Nielsen's Latest '2016 China FMCG Forecast Report' Analysis

Nielsen's latest "2016 China FMCG Forecast Report" shows that in 2016, China's consumer packaged goods (CPG) market will see slightly faster sales growth than in 2015, with the trend of consumption upgrading continuing, and consumers preferring to buy high-quality, especially health-beneficial products. In addition, as consumers increasingly demand convenience, small retail stores and convenience stores will further drive FMCG sales growth.

Similarly, in the skincare products market, high-end products such as moisturizing and sun protection are becoming the main sales drivers. Although sales volume grew less than 3% compared to the same period last year, total sales value increased impressively by 13%. Nielsen predicts that in 2016, as consumers continue to demand high-end, high-quality products, sales value growth in these categories will again outpace volume.

Fan Yijin, General Manager of Nielsen China, commented: "The proliferation of mobile internet allows consumers to instantly access product reviews and engage in social discussions, enabling them to quickly understand product quality and value. Therefore, the pursuit of high-end, high-quality daily necessities has become the 'new normal', which will drive growth in the FMCG market."

When Chinese consumers purchase food and beverages for their families, they also seek high-end and high-quality products—health and safety are their primary considerations, so in 2015, consumer demand for healthy functional drinks and all-natural foods continued to grow.

Nielsen research indicates that in 2015, China's beverage market showed stable, modest growth, with an increase of nearly 1% compared to 2014. However, consumers are increasingly demanding higher-quality beverages, providing opportunities for innovative manufacturers producing functional drinks. Juice also has similar appeal as a healthy, natural choice. Nielsen's 2015 data shows that compared to the same period last year, functional drinks grew by 7.6% and juice by 4.7%.

"Products focusing on natural and healthy attributes are highly aligned with current consumer needs," Fan said. "Consumers want a healthy lifestyle and pay close attention to food safety. Meanwhile, the emerging middle class is more willing to choose high-end products for health and safety reasons. This trend is very evident in the 2016 forecast data."

Convenience is another important factor influencing China's rapidly changing FMCG retail landscape. Nielsen's retail research data shows that consumers are currently spending more in small retail stores and chain convenience stores, while reducing visits to hypermarkets and supermarkets. In 2015, the chain convenience store channel contributed about 9% to the growth of FMCG sales.

This trend is evident across most FMCG categories. In the convenience store channel, household cleaning products grew by as much as 11%, but in the hypermarket channel they declined by 4%; food and instant noodles grew by more than 6% in convenience stores, but fell by nearly 12% in hypermarkets. Nielsen expects small channels to become more important, and the 2016 sales forecast aligns with this trend.

According to Nielsen's forecast for 2016 market size and sales data, the overall FMCG market will continue its stable growth; however, with consumption upgrading and consumers' pursuit of high-end new products, sales value will grow faster than volume in many categories. In 2016, in the convenience store channel alone, facial cleanser sales value will grow by 14%, while volume growth will be only 7%. Since consumers will buy more expensive, higher-quality daily necessities in non-food categories, growth will be strongest in non-food categories. The forecast data highlights the growing trend of Chinese consumers' spending power and demand for innovative products. For food categories, this means safer, more natural, and healthier products will further drive sales growth. Yogurt, due to its alignment with the health and natural trend, is expected to see double-digit growth in 2016.

In terms of retail channels, Nielsen's "2016 China FMCG Forecast Report" indicates that consumers' high demand for convenience will continue, with their spending further shifting from large stores such as hypermarkets to relatively smaller retail channels. This trend is particularly prominent even in household daily necessities, with an expected growth of 9.8 percentage points in the convenience store channel in 2016. For manufacturers aiming to win the 2016 market and achieve leapfrog development, accurately understanding China's retail landscape to respond more effectively to consumer needs will be of paramount importance.

Source: sdcxkxp518

Speed 8 Taurine Vitamin Functional Drink National Recruitment

Company: Shandong TuBage Group Co., Ltd. Reasons for recommendation: 1. Superb taste and quality. 2. International superstar Donnie Yen as brand ambassador, precise and effective. 3. Patented packaging design. 4. Strong corporate strength. 5. High profits, professional operation team and after-sales service. Recruitment area: Nationwide, for blank markets.

WeChat: lp780611.

For more information, follow the WeChat official account: TuBage Food.

-END-

China's best FMCG distributor learning platform

Dedicated to providing professional, practical, and actionable tutorials for enterprises and distributors

Committed to helping Chinese FMCG distributors grow rapidly

The most professional and practical knowledge base in the FMCG industry

Reply with the red number below to get corresponding content

Reply with number 1 to view the complete knowledge base

[Long press QR code to follow]

To join QQ/WeChat groups, please click: Read the original text