China’s yoghurt market has seen exceptional growth. Increasing dairy consumption and yoghurt’s popularity as a snack have meant double-digit growth over the last five years, and created a market worth USD $20 billion. Let’s unpack the size of the opportunity and what it means for imported brands.
Image: Getty Images; szefei
Super-Sized Growth
China’s yoghurt market is already worth an eye-watering USD $20 billion. That’s expected to grow in double-digits into the immediate future. Our friends at ChemLinked estimate the yoghurt market may add an additional USD $10 billion in value by 2022.
Three state-owned enterprises have a strong hold of the yoghurt market. Inner Mongolia Yili Group, China Mengniu Dairy, and Bright Dairy & Food accounted for around 60% of category sales. That sounds like a strong grip on the category, but the truth is that their combined market share has decreased from 75% a few years before. This means Yili, Mengniu and Bright Dairy may be struggling to meet consumers’ increasingly varied need states and preferences. This is the opportunity space imported players can take advantage of.
Opportunity Spaces in China’s Growing Yoghurt Market
Before we get into the opportunity spaces, a quick word on China’s yoghurt market. China’s yoghurt market has a roughly even split between ambient drinking yoghurt (also known as shelf-stable or room-temperature yoghurt) and chilled yoghurt. Over the past few years, ambient drinking yoghurt has seen a faster growth rate because of consumer hesitations over drinking chilled products and improved distribution to cities that have incomplete cold chain distribution. Speak to one of our analysts for a detailed market breakdown.
So, now to the opportunity spaces. Currently, our expert analysts have used online and offline retail sales data to identify these opportunities:
- Clean-label ambient drinking yoghurt
- Ambient drinking yoghurt calibrated to ideal body shapes (e.x.: “jacked”, “cut”, and “slim”)
- Ambient drinking yoghurt to aid post-meal digestion
- Non-dairy yoghurt for lactose intolerant family members
- Chilled yoghurt with added protein
- Chilled yoghurt with probiotics
Contact us for an introductory call to explain each opportunity in detail.
Image: Getty Images; dairyreporter.com
Things To Remember
For brands that don’t have a strong track record in China, you may need to build up a sales track record via e-commerce in order to establish your credentials with Chinese retailers and distributors. Fortunately, Alibaba’s cross-border e-commerce marketplace, Tmall Global, has announced plans to bring 1,000 new overseas brands onto its e-commerce platform over the next 12 months. This plan falls under Alibaba’s $200 billion, five-year-import program. To get on Alibaba’s radar, you’ll need the commitment to modify your current yoghurt format, texture and packaging for the China market. We offer research and e-commerce services that can help you understand what modifications are needed. And, under our Restart 2020 program, these research and e-commerce services are offered to promising brands at preferential rates.
If you’re looking for a capable partner that’s up to the challenge of making your brand go places in China, let’s get in touch!
