The report jointly published by Tmall and CBN Data, looks at online consumer data collected between 2016 and 2018.
1. Small packaging
More snacks, white wine and tea bags are appearing in smaller or individual packs. In 2017 and 2018, small packs were most popular in new first-tier cities such as Chengdu, Hangzhou, Wuhan and Dongguan, followed by second- and third-tier cities.
For example, more “one day pack” nuts have appeared in the market since 2016, and accounted for 25% of the market size in 2018.
New first tier and second tier cities made up nearly 45% of the entire “one day pack” nuts consumer market last year, and consumers born between 1990 and 1995 formed the bulk of the consumers.
Another example is the rise of small pack white wine, which is becoming the beverage choice for small group gatherings.
Jiang Xiao Bai, a white wine brand by Chongqing Jiangji Distillery is one example. The glass bottle is covered by a layer of paper packaging with chic designs, including cartoons, life-style photos, and quotes by consumers.
Traditional tea makers are also making tea bags in small packs to pander to consumers’ preference for style and personalised packs.
2. Diet replacement meals
According to the report, 85% of the consumers who purchase diet replacement meals are gym-goers.
Between 2017 and last year, the sales of diet replacement meals jumped more than 50%, with females and consumers born after 1995 forming the majority of buyers.
The top five diet replacement powder meals brands are Laojin Mofang, Quaker, Wugu Mofang, Youchan, and Ming An Xu. As for non-powder products, the brands topping the chart are Three Squirrels, Bestore, Jian Yuan Tang, AJI, and Jiashili.
3. Low sugar
The rate of growth of the sales of low sugar products have nearly doubled for the first time in China, according to the report.
“As the pace of life has quicken and work-related stress has increased, the concept of ‘sub-health’ is increasingly common amongst the white-collar workers. Healthy eating has become a consumer demand, and low sugar has become a subject of focus,” the report said.
“Sub-health”, more commonly known as suboptimal health status, is a term coined by the China media. It refers to a state where there are uncomfortable symptoms which cannot be diagnosed by medical procedures. In China, it is usually used in the promotion of health foods.
Low sugar products are especially popular in Guangdong, Jiangsu, and Zhejiang, and consumers born after 1990. The demand for low sugar products are also on the rise on regions that are famous for strong taste buds, including Sichuan and Hunan.
4. International brands
International brands are winning more Chinese, although domestic brands are retaining hegemony.
Last year, the international food and beverage brands that are available in Chinese e-commerce platform came from 93 countries. Most of these foreign brands came from European countries (36), followed by Asia (26).
5. Internet sensation
Food and beverage popular online are becoming a new fashion for Chinese consumers. Females from the new first tier and second tier cities are the main supporters.
Age wise, consumers born after 1990 formed more than half of the total number of consumers, increasing from 50% to 56% from year 2017 to last year.
Some examples of popular food selling available include ice-cream brand Chicecream, which shot to fame for its tile-shaped ice-cream.
6. Inter-industry cooperation
Brands from different industries are coming together to launch food and beverage products.
Examples include Rio and Six God cocktail jointly developed by Rio, a China cocktail brand, and Six God, a perfume brand based in Shanghai.
Five thousand bottles of the cocktail were sold out within 17 seconds and the number of related Weibo posts amounted to 60 million.
“If you want to win over the Chinese, other than being delicious, the food must also be healthy, it is even more important to have a good packaging and brand narrative,” said the report.
Similar to products popular online, the consumer base is made up of females, those born after 1995, and the new first and second tier cities.
7. Revival of cultural elements
As traditional brands embrace new sales models, such as unmanned automated stores and fast speed delivery service, more consumers are paying to these brands again.
For example, Dao Xiang Cun, a traditional snacks brand, is offering a “one hour delivery” service. Hangzhou-based Zhi Wei Guan had also partnered with Tmall new retail, operating its first smart retail store in Xihu.
Out of all traditional Chinese brands, about 60% have adopted new sales models, said the report.
The number of searches related to traditional brands on Tmall hit 1 billion between August 2017 and August 2018.
In the same period, the number of consumers who bought food and beverages from these brands was 86 million. Those who are born after 1990s numbered at 3.2 million.
The sales of products which had a traditional culture element to it shot up 263.6%.