Market research: Chewing gum in China

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The chewing gum segment, the fastest growing segment of confectionery industry is growing at a CAGR of approximately 7% for past few years. Companies are marketing its multiple health benefits to take advantage of the recent health craze among Chinese consumers. It is said to relieve stress, helps with weight management, and also increases alertness and focus. All these factors result in the increasing demand of chewing gum in people of every age group.

Drivers of chewing gum industry

With increasing health concerns, consumers are shifting toward low calorie products which in turn will drive the growth of the artificial and natural sweetener market. This will increase the demand for sugar free gum and in turn, the overall chewing gum industry will grow. The confectionery manufacturers are trying to tap this opportunity by providing the consumers sugar free gum in many different flavors and colors.

Two sub-sectors of gum, in particular, are expected to experience fairly poor performance in the near future. Bubble-gum has a CAGR of -0.4% between 2011 and 2016 whereas sugarised gum has a CAGR of 1% over that time period. As health becomes more of a concern in China, consumers are looking to gum as sweet, yet healthy substitute for other confectionery goods. As a result, they are stepping away from unhealthy gum options and are looking towards healthier alternatives such as sugar-free or functional gum.

Innovation in chewing gum is another important driver of this industry. Different flavors, flexibility and variety in gum attract consumers. Due to the increasing frequency of food scandals related to food additives, the current trends suggest consumers prefer gum with natural colors made without the use of synthetic and azo dyes.

International Chewing gum giant brand: Wrigley (箭牌)of Mars

The Wrigley Jr. Company is an American company headquartered in Chicago, Illinois. Founded in 1891, the company currently sells its products in more than 180 countries and operates 14 factories in various countries, including the United States, Mexico, Australia, the United Kingdom, Canada, Spain, New Zealand, the Philippines, France, Kenya, Taiwan, China, India, Poland and Russia. On April 28, 2008, it was announced that Mars, Inc would acquire Wrigley for approximately $23 billion. The corporate headquarters, the Wrigley Building, is one of the more well-known landmarks on the Magnificent Mile in Chicago.

Extra (益达) is the second sugar-free gum launched by the Wrigley Jr. Company in the United States. It was introduced in 1984 and became one of the most popular brands of gum in the United States within a few years due to its long-lasting flavor. Its other products include lollipops and the “Liquid Blast” gum. Due to its economies of scale and its established brand image, Wrigley is dominating the Chinese chewing gum market.

Daxue Consulting China Market Research

Sources:

Picture Source: Wrigley China

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