is part of the Informa Markets Division of Informa PLC
This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.
The sports nutrition market in China is rapidly growing. The US is currently the largest nutritional products market in the world, but China may soon occupy this position thanks to rising health awareness among the mainland population and the country's growing per capita GDP.
As trends of preventative healthcare and fitness grow, there are many opportunities for international brands to operate and thrive in China's sports nutrition market. However, there are obstacles with e-commerce regulations, and the health supplement industry is one of the most tightly regulated markets in the country.
Despite these challenges, the sports nutrition market in China is still in the initial stages of development and it shows great potential. This is a key time for international brands to explore and establish themselves in the market.
Chinese consumers are increasingly becoming more health and fitness conscious at a rapid rate. The cause of this increased awareness is multi-faceted with government strategy, western cultural influence and a growing affluent middle class all playing a part.
In June 2016 the State Council of the People's Republic of China issued a plan to implement a national strategy to improve fitness and health levels for the whole nation. The strategy aims to reach 1.5 trillion ($225 billion) investment on sports and fitness by 2020. This timeline coincides with the 2020 Olympic summer games which will be held in Tokyo. As the Beijing Olympics in 2008 proved, excitement and strategy around the Olympics creates a surge in sports participation and increases interest in fitness, which will likely stretch beyond Japan in 2020 to the Asia Pacific region. Alongside these aims and international markers, the Chinese government have set a target of half a billion people taking regular exercise by 2025.
Beyond initiatives at government level, younger consumers in tier one and two cities have been influenced by western-style fitness and health culture. This increasingly affluent middle class is spending their growing disposable income on health and leisure. According to Persistence Market Research increasing populations, rising incomes and living standards, and greater participation in sports represent huge opportunities for the sports nutrition market, making China a key target for health and nutrition brands.
Sports nutrition used to be a niche sector which catered for professional athletes and bodybuilders. While the sector still caters to these groups, the audience has expanded and the line between sports and wellness products has begun to blur.
The expanded audience for sports nutrition includes a more casual or mainstream customer. This audience is conscious about managing their weight and increasing their fitness levels. A section of this group is even further committed to fitness and sports and are often referred to as "fitness lifestyle users". As popularity for sporting events and classes increases, it has been forecast that the sports and fitness industry will increase more than three fold to $786 billion USD in 2025.
This landscape of increased interest and uptake in sport and fitness are ideal conditions for international sports nutrition brands to operate in mainland China, and to market to Chinese consumers.
While the emerging trends of fitness, health and wellbeing are positive, there are tighter e-commerce regulations in place which mean international nutritional brands need to consider expanding their offline channels.
Many international companies utilise e-commerce to distribute their sports nutrition products. However, the Chinese market changes rapidlyand regulation changes fast as well, therefore keeping an eye on the policies and regulations is always very important to any business entering or active in China.
Apart from e-commerce, there are other opportunities for organisations to reconsider their approach to operating in the sports nutrition
market in China. Another potential way to enter the market is through direct-sales licensing, then leveraging e-commerce sales channels
for rapid expansion.
A perhaps more effective strategy is to cooperate with local companies. By partnering with Chinese companies, international firms can
leverage the advantages of their Chinese partners when it comes to distribution channels and policy insight, bypassing the need to apply for their own licenses. Chinese companies are willing, and in certain cases eager, to work with international companies. Foreign brands have an established and respected reputation with Chinese consumers with 50% believing the international brands and products are better quality, which
means that a mutually beneficial relationship between both companies can develop.
Natural products and ingredients are of increasing importance to Chinese consumers. Similar to western markets there is a growing awareness and desire for less processed and artificial ingredients in nutritional products. As a result, natural ingredients and innovative flavours are key for products in the Chinese sports nutrition market.
In the sports and energy drink arena, there is a blurring between the two products. While sports drinks are usually non-carbonated beverages designed to replenish fluids, energy drinks tend to be carbonated and claim to make the consumer more alert. In both cases consumers are drawn to natural ingredients which has led to a growth in the use of botanicals including spices, herbs and other plant-based ingredients. Concerns over caffeine, sugar levels and artificial ingredients are also increasing which has encouraged brands to reduce these ingredients and put more emphasis on natural products and their benefits.
While it is a good time to enter the Chinese sports nutrition market, it is also a competitive industry. While consumers are craving natural ingredients, they are also seeking innovative, interesting flavours. A way for international brands to position themselves in the market is to lead with a unique ingredient which boasts both health benefits and a unique flavor.
With the various facets of health, wellbeing, sport and fitness all increasing in popularity across China, a joined up approach for penetrating the sports nutrition market is an important consideration.
Comparing and contrasting approaches to a healthy lifestyle in California and China, entrepreneur Frank Zhang felt that Chinese people were more concerned with appearance rather than both the internal and external benefits of fitness and health. To combat the underlying motivations for consuming more health-conscious products, Zhang established Well and Fit, an organisation which distributes health food products while educating their audience on the benefits of a healthy lifestyle.
Well and Fit's products are common in the western market including chia seeds from Mexico, nuts from Australia and coconut oil from Thailand. However, these products are not mainstream in China meaning consumers are willing to pay a premium for these imported all-natural products.
Interestingly, Zhang sees health food products as the secondary action of Well and Fit. His priority is to spread informative but accessible content on health and food via China's primary social media platform WeChat. Since launching this branch of Well and Fit in June 2017 the organisation has seen a 300% increase in expatriate followers, and once the content was introduced in Chinese the local Chinese following increased by 400%. Recently Zhang has gone further to integrate diet and exercise by partnering with fitness vendors who share the company's values.
Although an integrated approach such as that employed by Well and Fit will not be appropriate for all international brands entering the sports nutrition market in China, it is a key example of understanding the motivations of consumers and a reminder of the importance of digital platforms and content.