1. How big is the Chinese cheese market?
In recent years, the Chinese cheese industry has seen a rapid expansion of its dividends. According to data, by the end of 2021, the retail market of cheese in China reached 12.3 billion yuan in sales, with a compound annual growth rate of 23.85% over the past five years. It is also expected by the China Dairy Association that both the changing perception of and demand for dairy consumption in China are expanding: the size of the Chinese cheese market will reach 15 billion yuan in 2022.
2. What are the consumer groups for cheese products in the Chinese market?
The Chinese people are becoming more and more concerned about the health of their food, and with the Chinese government implementing a three-child policy, the children’s market is huge. In addition, many young people who have studied abroad, teenagers in high tier cities, the post-90s who like western food and the western dessert bakery industry also make up an increasingly large cheese consumer group.
According to Kantar research data, by 2021, the cheese penetration rate in Beijing, Guangzhou and Shanghai has increased to 38.0%, significantly higher than in other regions.
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3. How to position cheese products in China?
Selling cheese in China requires an in-depth understanding of Chinese consumers’ eating habits and consumer psychology.
To be successful in China, cheese as an imported product must cut into a usage mindset and make it a high frequency repurchase FMCG product, such as yogurt as an aid to digestion, which is the driving force behind Chinese purchases.
Cheese, on the other hand, still lacks a hardcore label for Chinese consumers beyond concentrated dairy products. So it is important for cheese brands to continue to innovate on the cheese products entering China, refining and reinforcing marketing points at the level of health, taste, age, temperature, shape and texture to provide Chinese consumers with more choice.
4. What are the marketing methods for cheese products in the Chinese market?
For a special food product like cheese, it is difficult to spread the sales in China without effective marketing. Some cheese brands have not thought clearly about marketing and have taken a wrong turn, ending up with marketing that is not even as effective as the cheese-flavored snacks made in China (fake cheese).
In a highly digitalised China, digital marketing has definitely become the first choice for companies to carry out cost-effective marketing methods. At the beginning of a brand’s entry into the Chinese market, the most important thing is to reach potential consumers efficiently through fragmented information formats, in order to expand the brand’s awareness and establish its authority.
We will now take a look at the choice of online marketing channels in China, both in terms of awareness and authority.
4.1. Visibility: Xiaohongshu(RED/ Little Red Book), Douyin(Tik Tok)
As the hottest social platform for young people in China today, Little Red Book / Xiaohongshu and Douyin (Chinese TikTok) are very suitable for new food brands starting out in China. Because it can use a precise push mechanism to present graphic or video content to potential consumers (based on age, interests, etc.), and because there are a large number of food and life sharing KOLs and KOCs on these two platforms, this is very advantageous for brands to expand their initial awareness.
Xiaohongshu, as a social platform for sharing exquisite life with mainly female users, has a more pronounced user group with a tendency to consume and a higher purchase intention and conversion rate.
Douyin, as a large traffic entertainment platform, is more suitable as a channel for brand image and slogan promotion, showing an advanced, clean and healthy image for the company. For example, the origin of cheese, the production process, food safety science, explanation of cheese types and even when the brand is matured and starts live-streaming to sell cheese, this can be extremely high to increase consumer trust, word-of-mouth spread and corporate reputation.
Overall, Douyin is better suited to traffic marketing for cheese brands, while Xiaohongshu is better suited to content marketing.
4.2. Authority: WeChat, Baidu, Zhihu
Consumer exposure to a new brand is usually accompanied by a number of search verification actions, which means that cheese brands must build up their information system in advance on the relevant platforms to present consumers with a reliable and authentic image of the imported brand.
Unlike in Europe, the Chinese do not attach much importance to brand independent sites (but it does score points if they have them). For Chinese consumers, Baidu encyclopedia, the information presented during a Baidu search, WeChat Official Account and formal sales channels are more important.
WeChat is very powerful and brands are able to use the account to post product information, live streaming, content marketing, customer service, sales and after sales and everything else online. Establishing a WeChat Official Account is the first step for all brands to enter Chinese marketing and is an important process for foreign brands to adapt and localize to the Chinese market.
Zhihu
Zhihu is the largest Q&A platform in China. It has the highest credibility of any platform and is highly advantageous in terms of content marketing.
There is a huge gap in Chinese consumers’ knowledge of exotic foods such as cheese, so reviews from “cheese lovers” and “cheese industry insiders” on Zhihu are seen as a key part of the decision making chain. Many brands have shown us that if word of mouth on Zhihu is negative, the product will not sell as well as it should.
5. What are the distribution channels for cheese products in the Chinese market?
In China, brands can win the trust of consumers as long as they are sold through proper channels and have relevant import information backed up by a good after-sales service. Many e-commerce platforms facilitating market entry are flourishing in China. Below we introduce three reliable sales channels.
5.1. Distributors
Distributors are a lazy option for food brands that are new to China. This is because established agents have their own more established sales channels. Excellent agents can use their original sales network to quickly spread the goods to the end market and buy time for the brand to occupy more market share.
But the brands must shine a bright light on the selection of excellent, responsible dealers.
5.2. Tmall
Tmall International is an online import retail platform owned by Alibaba, offering overseas original imported goods directly to Chinese consumers. Brands have two models to choose from.
Tmall Self-support: Tmall acts like a supermarket to buy goods from brands and then sell them. The brand only needs to provide the goods to Tmall.
Tmall flagship shop: The brand pays a fee to the Tmall platform and then opens its own official flagship shop on the platform, which the brand side builds, markets, sells and provides customer service for a range of activities.
5.3. Jingdong
Jingdong International is a brand belonging to the Jingdong Group, which focuses on cross-border imports and has earned a high reputation among Chinese consumers for its efficient logistics. Jingdong has also created a professional shopping platform for international brands for imported goods.
Jingdong Self-support：Jingdong Self-supporting buys from cheese brands in a unified way and sells them on the shelves. The brands are able to enjoy the logistics and after-sales service of Jingdong Self-supporting.
Brand flagship shops：Brands pay a fee and use the Jingdong platform to open a shop. Jingdong is not involved in the specific operations except for managing merchants and customer services (refunds, complaints, etc.).
All in all, in just a few years, the race has been on in the Chinese cheese market. It is certain that a combination of good products and the right marketing will lead to a gradual entry into the first rung of the Chinese cheese market in the future.
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