2023year2month13Royal Dutch Philsips Elite Club2023The first city tour kicked off in Shenzhen, with this elite event specially inviting many industry leaders to engage in an in-depth discussion on market trends, quality breakthroughs, innovative ideas, and other issues.
Chief Executive Officer of Royal Philips NVMr. Hein SchumacherSenior Vice President, Professional DairyMr. Roger LooChief Business Officer of Professional DairyMr. Mark StolzenbachMs. Du Jing, General Manager of Professional Dairy Products China, attended the event. Frost & SullivanFrost & SullivanMs. Zhang Xiaojing, Executive Director of Frost & Sullivan Greater China, was invited to attend and delivered a speech on the future development trends of the Chinese baking and tea beverage markets.
Ms. Zhang Xiaojing first shared the development trends of the baking industry. She pointed out, From the product perspective, baked products are developing towards snack-like, healthy, and wellness-oriented offerings. In recent years, whether it's cakes, bread or desserts, they have become increasingly compact and exquisite. The trend towards snack foods better meets consumers' needs for 'enjoyment' and 'social sharing', broadening the consumption scenarios; at the same time, consumers also pay more attention to health and wellness. Therefore, baked products made from natural ingredients, such as dairy fats, fresh fruits, nuts, probiotics, etc., as well as freshly baked and short-term shelf-life products at stores, will be more popular.
"ZAs the main consumer group of baking products, generations are keen on purchasing new products. "Ms. Zhang Xiaojing said. Baking products are trending towards diversified development, with brands creating new product matrices by combining different flavors, textures, and aromas to meetZThe generational pursuit of novelty.
at the same time,IP addressBrand collaborations are also diverse, helping products break through boundaries, increase brand exposure, and endow baked goods with an 'interesting soul' while being delicious and attractive, thereby enhancing consumers' willingness to purchase. Ms. Zhang Xiaojing stated that while keeping up with trends and accelerating product launches, baking products also need to focus on strengthening their internal brand capabilities, dedicated to researching differentiated products to establish a brand image.
In recent years, baking and beverages have merged and borrowed elements from each other's hits to incubate derivative creative new products. For example, the original coconut latte created by Luckin Coffee has become a hit in the coffee industry, balancing the bitterness of coffee with the sweetness of coconut milk cleverly, bringing new inspiration to baking products. Similar examples include soy milk tea drinks and matcha, which have been successfully incorporated into new baking products, becoming new memory points for brands.
In addition, with the upgrade of consumption, baked products are developing towards higher-end directions. The full-platform layout of digital marketing and the popularization of takeout have expanded the reachable consumer group, further promoting the development of the baked market.
The high-end positioning of products is mainly reflected in raw materials and design. For example, dairy products have been upgraded from plant-based to animal-based fats, and imported European brands are chosen to enhance the taste of the products; a high-value appearance and design can stimulate consumers' desire to share on social platforms. This kind of social dissemination can continuously bring topics and buzz to the brand, thereby increasing its popularity.
In addition to product upgrades, digital marketing across the platform and food delivery will continue to penetrate. Before the pandemic, many brands had already launched online ordering features on third-party food delivery platforms, which accelerated the brand's digital marketing across all platforms over the past three years, including WeChat official accounts, mini-programs, Rednote, Douyin, etc. The increase in the penetration rate of catering and food delivery has also brought about an increase in online ordering volume and average order value for brands.
According to Ms. Zhang Xiaojing, the consumption scenarios for baked products are no longer limited to home or bakery stores. They have extended to various settings such as tea shops, cafes, restaurants, and the current popular camping scene. The consumption scenarios and times are closely related. According to Frost & Sullivan research, afternoon tea is the most frequent consumption time, followed by breakfast, which aligns with the consumer's needs for 'enjoyment' and 'fullness' of baked products. A more diverse range of baked product scenarios can meet consumers' needs for consumption across multiple scenarios and times.
Subsequently, Ms. Zhang Xiaojing analyzed the future trends of the tea beverage industry. She stated, Similar to the baking market, new tea beverages are also showing a trend of category expansion. The retro trend is sweeping through, like the collaboration between Black & White Milk and Leluo Tea. They inject the soul of classic Hong Kong-style milk tea—plain milk—to new beverages, recreating the classics and leading a nostalgic trend. In line with the trend of 'coffee drinks becoming tea drinks,' tea brands have also created series of products such as coconut, cheese, and thick milk, breaking down barriers between different dimensions and opening up a 'multiverse,' greatly increasing sales.
In terms of raw material upgrading, 'dairy products+Tea base ” Dual-wheel drive for upgraded tea drinks. On one hand, new tea brands actively cater to the trend of healthy consumption, widely using fresh milk to replace traditional milk powder and creamers in milk tea. On this basis, they develop tea formulas for high-end dairy products such as light cream and cheese, customizing rich and creamy tastes through different brewing methods and ratios. On the other hand, the upgrade in tea base is reflected in differentiated competition in the tea base market. From tea powder to black and green tea, and then to high-quality original leaf tea from the same region, they even incorporate refined tea-making methods such as extraction to fully satisfy consumers' enjoyment of drinking tea.
In addition, the offerings are also constantly evolving. Frost & Sullivan has tallied the number of new products launched by leading tea brands each year over the past three years.2020New launches in aggregate annually575model2021Year-on-year surge60%reached930amount, as of2022The number of new releases in the first three quarters of the year reached a new high. "The surge in new product numbers is behind even more intense competition," Ms. Zhang Xiaojing further explained. Although tea infusions are a supporting role, they bring richer layers, flavors, and tastes to tea drinks, making them a battleground for brand competition. In addition to Chinese ingredients such as sweet potato and taro puree, there are also new ingredients like 'horse hoof popcorn'.+The interesting features of new technologies have brought new vitality to the tea beverage market.
It is worth noting that since2022Since the beginning of the year, Xicha has led the new tea beverage market to bid farewell30The era of yuan prices. Brands continue to enrich their offerings.20For product categories below the RMB 100 level, while average order value has declined, consumption frequency has increased. At the same time, direct-operated brands such as Xicha have started franchising in some areas under certain conditions, aiming to capture the lower-tier market and accelerate penetration.
Ms. Zhang Xiaojing stated that tea is addictive, with consumption habits having been largely formed and a high repurchase rate achieved. Consumers have a high loyalty to brands and pay more attention to products with better cost performance. At the consumer end, Frost & Sullivan has observed three trends:1The frequency of tea consumption has increased, and consumption habits have been formed.9Consumers make at least one purchase per week;2The tea beverage brand has a high loyalty rate, with consumers preferring new products over old ones;3) The mainstream consumption of tea falls on20Within the original price range, cost-effectiveness has become a battleground for businesses.
Ms. Zhang Xiaojing believes that in the future, the export and differentiation of tea culture will be the core competitiveness that resonates with the younger consumer group.
For tea brands, in addition to producing good products, they also need to tell compelling stories. For example, teaIP addressJoint efforts have expanded to popular historical dramas, from 'Dream of the Red Chamber' to 'Empresses in the Palace'.IP addressThe fit between culture and product enablesIP addressCustomized drinks have become a hit; the freshly made handmade tea brand —— Grandma's Handmade, which conveys an ancient culture, craftsmanship, and the taste of home. Through genuine ingredients and handcrafted production, even with higher pricing, consumers are willing to pay; there is also the popular winter pastime of roasting tea around the stove, which has brought new Chinese-style teahouses onto hot search lists through leisure scenarios.+Tea culture+The sense of atmosphere helps to explore the infinite possibilities of new tea beverages.
