Westernisation to reform packaging in Chinese retail market, Canadean

Posted by AFN Staff Writers on 29th September 2014
Westernisation to reform packaging in Chinese retail market, Canadean
Westernisation to reform packaging in Chinese retail market, Canadean

In recent years, China has seen significant changes in eating habits, shopping behaviours, and lifestyle habits, as consumer behaviour responds to Western influences. Consumer packaged goods providers will capitalise on the trend of Westernisation for new experiences and integrate more Western groceries onto their shelves, market research organisation Canadean has predicted.

Western commodities ‘status symbols’ for Chinese consumers

As the Westernisation of the retail market is fairly new, Canadean said products that are considered to be mid-range are more likely to be offered as premium products in China.

Western commodities also serve as symbols of modernisation and provide a sense of elevated status for consumers. Canadean said that as a result, Western brands of products such as fragrances, chocolates, coffee, cheese, ice cream, and carbonated soft drinks were becoming prevalent in Chinese retail markets.

Packaging manufacturers need to stand out in varied market

Canadean said a typical Chinese supermarket in a developed urban area will stock more varied products in comparison to an equivalent US or Japanese store, thus increasing the choice available and offering more opportunities to choose Western products.

This is an important trend for packaging companies, according to Canadean. It said that domestic companies also needed to match the standards of Western packaging so they could stand out against their counterparts.

‘Localising’ products likely to increase success

Catherine O’Connor, Senior Analyst at Canadean, said that despite China’s growing interest in Western brands, foreign offerings did not always find it easy to integrate into the Chinese retail market.

“Earlier this year, Revlon and L’Oréal both pulled back from China, misunderstanding the needs of this lucrative market,” Ms O’Connor said.

Consumer Packaged Goods’ (CPG) providers will attract more custom by localising products to Chinese tastes, for example, KFC has introduced a ranged of breakfast soups, and Oreos are altered in China to have flavours such as green tea, as consumers found the originals too sweet.

Packaging needs to reformulate too

As well as reformulating products for the Chinese market, companies need to modify packaging to influence them at the shelf edge.

“In particular, the use of colours is of paramount importance for the Chinese,” Ms O’Connor said. “Yellow is seen as royal colour and red is chosen for good luck and happiness. However, these bright colours are mostly preferred for food products, while pastel or white shades are preferred for household items and personal care products,” she said.