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Many Chinese consumers are returning to their roots after two decades of intense western influence in the nation’s food and drink culture, while others are looking to modern solutions for modern health issues. What trends are emerging in China’s health and natural ingredients market?
Due to growing disposable incomes and increased urbanisation, many Chinese consumers have become increasingly health conscious, and are looking for healthier packaged foods and beverages. There is a strong cultural element to wellness in China, with a greater focus on illness prevention and wellness maintenance than in the West, founded on the principles of traditional Chinese medicine. The health of the Chinese people is overseen by the National Health and Family Planning Commission, and public health policy has emphasised a preventative approach since the early 1950s.
However, there is much more to the Chinese health and wellness market than traditional Chinese medicine. Some consumers have become more sceptical about Chinese medicine in recent years and are looking for more modern products and ingredients. The government is actively encouraging such foods; the Chinese State Council has put forward a plan called Healthy China 2030, which specifically makes the development of health food and nutrient-fortified food one of its priorities.
Thibaud André is a senior consultant at Daxue Consulting, a market research firm offering services for companies looking to enter the Chinese market. He says the desire for natural and organic foods and drinks underpins much of the market for health and wellness ingredients in China.
“The first large trend is healthiness and safety, avoiding the worst and staying healthy,” he said.
Health scares have damaged consumer trust in their food supply, and many food and drink providers aim to emphasise their natural and organic origins as a result. Chinese consumers are looking for purity above all, a promise that their foods are free of any kind of contaminant. Despite ongoing efforts to improve standards and consumer trust in domestic food manufacturing, often foreign foods benefit from the perception that they are cleaner and healthier.
However, Daxue has documented a movement back toward traditional Chinese foods and ingredients, particularly when it comes to health foods.
“After years of the Chinese consumer – and especially the youth consumer – opening to the world and a new way of consuming and going into more modern lifestyles and so on, there is a trend of going back to their roots recently,” André said. “They are associating with the traditional family structure and sharing between generations, reintegrating traditional medicine and ingredients.”
Food and drink brands have been incorporating well-known healthy ingredients, such as green tea or ginseng, for the past couple of decades – and ingredients that have traditional connotations of wellness continue to spark consumer interest, particularly on e-commerce platforms.
“There is a whole cultural discussion about how Chinese medicine is integrated in daily life,” André said. “Some ingredients have been part of the processed F&B market for a long time…Getting back to traditional medicine and adding healthy ingredients is something that is getting traction. It’s not just Chinese brands, but international brands try to incorporate traditional ingredients in processed foods.”
He cautioned that such an approach to launching a brand in China would be most suited to those already working with these ingredients. What is more, common strategies used by many western companies may be losing their lustre among young Chinese consumers, such as using traditional ingredients in sodas and other packaged drinks.
“Green tea has been added to drinks since the early 2000s,” he said, explaining that while green tea has become a mainstay in packaged beverages, the trend has started to evolve.
“This green tea integration was also about the integration of more soda and more alcohol. More and more consumers that we interact with as health conscious consumers have switched from these beverages to more traditional beverages that might incorporate these ingredients. They might not be much healthier because they still contain a lot of sugar, but they incorporate some of these traditional ingredients.”
Meanwhile, other natural, traditional ingredients are coming to the fore, and André highlights red dates, also known as jujube, as an example. In online food stores, he says some categories using the ingredient have seen 100% sales growth in just a few months, particularly drinks and soups, with products like red date and ginger tea.
The Chinese population also has a rising proportion of elderly consumers, and products are emerging to help maintain the health and wellness of this growing demographic. The focus might be on natural energy or immunity, but André says consumers are more open to the idea of prevention than outright health claims.
“The Chinese consumer is a bit more sceptical than the European one, so usually the promise is about avoiding the worst rather than getting to the best,” he said.
With the right message, however, 73% of Chinese consumers are willing to pay more for healthier foods, making them some of the world’s most health conscious, according to research from Boston Consulting Group. Along with rising incomes among the nation’s growing middle class, attention to personal wellbeing means China’s health and wellness market is expected to see strong growth in the years ahead.