News

Premiumisation pushes Chinese juice brands ahead of foreign rivals - report

Most popular

Top US craft brewers in 2020 - data

Top US brewers in 2020 - data

How COVID has closed the digital gap - trends

Hard seltzers pave the way for 'soft seltzer'?

Top US craft brewers in 2019 - data

MORE

Foreign-owned juice brands in China are losing out as domestic rivals prove more adept at premiumising, a new report has said.

Chinese juice brands are moving up the value chain

Chinese juice brands are moving up the value chain

Market share for non-Chinese-owned juices between 2015 and 2016 fell 2.5%, according to Kantar World Panel data cited in a Bain & Co analysis this week. The drop is an example of "two-speed growth" in China, as local brands continue to outpace foreign ones, Bain said.

In juices, domestic brand growth has been driven by a move into not-from-concentrate (NFC). Bain said leading juice maker Nongfu "hit the sweet spot" with a new mid-range NFC juice, and enjoyed over 20% growth in 2015-16. In comparison, leading foreign juice maker PepsiCo sells concentrate juices in China through its Tropicana brand.

"To see premiumisation in action," Bain said, "look at the success of some juice brands commanding solid sales increases, despite declining sales and volume in the overall category."

The report also said that FMCG brands in China are struggling to maintain their growth rates as "the period of mass expansion is over".

"Brands need to reach their growth targets by focusing on penetration, by boosting brand repeat sales and through premiumisation," it said.

The report, the 13th China Shopper Report, was based on a survey of 40,000 households by Bain and Kantar Worldpanel.

The report identified a number of reasons for the two-speed growth in China for foreign and domestic FMCG companies, including that Chinese firms are more quickly coming to terms with e-commerce. PepsiCo, however, has moved to address the fast-growing channel by signing a partnership in May with online and mobile commerce giant Alibaba Group to use its data bank for customised products and marketing innovations.


Related Content

FREE TO READ - just-drinks' analyses of the year - The review of 2018

FREE TO READ - just-drinks' analyses of the year - The review of 2018...

Juice on the slide in North America as consumers shift towards healthy and functional hydration - comment

Juice on the slide in North America as consumers shift towards healthy and functional hydration - co...

Australia puts brakes on Kirin's Lion Dairy & Drinks sale to Mengniu Dairy - report

Australia puts brakes on Kirin's Lion Dairy & Drinks sale to Mengniu Dairy - report...

"Who knew we'd launch in the middle of a pandemic?" - just-drinks speaks to Jade Padua, co-founder o...

Oops! This article is copy protected.

Why can’t I copy the text on this page?

The ability to copy articles is specially reserved for people who are part of a group membership.

How do I become a group member?

To find out how you and your team can copy and share articles and save money as part of a group membership call Sean Clinton on
+44 (0)1527 573 736 or complete this form..



Forgot your password?