China is the world’s largest consumer market for food and beverage products. As Chinese consumer behavior shift, the rising middle class is more and more embracing the western lifestyle and fuelling demand for items like dairy products, western-style breakfast cereals and fruit-based products such as fruit jam. The main drivers have been the increasing health consciousness of Chinese people and per capita income growth. There are clear market openings for foreign brands who want to sell their products into the Chinese breakfast market. According to EU SME Center Report, by 2018, the Association of Food Industries predicts that China will be the world’s largest consumer of imported food. However, these imported products are not necessarily adapted to the local taste and might require some adjustments to match the local preferences regarding sweetness, flavor, taste, texture, pricing and packaging.
Case Description: F&B industry in China
Daxue Consulting’s client is a major international confectionery, jam, and fruit-based products manufacturer looking for new routes for further development into the Chinese market. Already exporting its products to China, our client was searching for secondary and primary research on the Chinese market as well as actionable recommendations for the launch of new products and expansion into the Chinese market. The company asked the Daxue team to organize a research project including sensory testing in China to gather local perceptions and acceptance to the products it sought to start distributing in the Mainland.
Daxue Consulting’s Expertise:
Daxue Consulting created a three-step process for an analysis of the confectionery and jam market in China as well as to identify the sensory key attributes of their product. This process began with an Observational Analysis of the market followed by a Sensory Research and ended with Recommended Routes for Development.
Phase 1: Observational Analysis
As a first step, our team attempted to get a better understanding of the confectionery and jam market in China which contained a Desk Research market overview, including research on:
- Competition benchmark: market trends, market size, as well as market players and their marketing strategies and promotions online and offline.
- Distribution channels: a full understanding of distribution channels and networks in addition to the challenges and obstacles that our client will face in seeking to expand further into the Chinese market.
- Packaging: packaging, flavors, and ingredients of top products analysis.
- Customers’ needs and tastes: consumers’ preferences and geographic presence of each product.
Phase 2: Sensory Research in China
The end goal of this sensory analysis project was to eventually make adjustments on the product’s recipe to match the local tastes (sweetness, flavor, taste, smell, sight, pricing, and packaging). According to Clément Mougenot, head of research at Daxue Consulting, the biggest challenge with this method is the scientific aspect and the requirement of special formulas & software.
Sensory research applies the principles of experimental design and statistical analysis to human senses to assess the perception, liking or disliking of products’ attributes. The evaluation comprises a broad range of different methodologies. The sensory analysis includes four sub-sections in China: effective testing, affective testing, perception and central location testing (CLT).
However, in this case, our experienced research team decided for the so-called ‘affective testing’ (sometimes also called consumer testing) which helps to investigate subjective feedback of a product’s profile (such as taste, smell, sight, and texture).
Our research team used both methodologies of effective testing to identify the “drivers of liking” (sensory attributes that drive products acceptance). Daxue applied hedonic tests using the 9-point-scale to evaluate the acceptance of the product as well as its liking and disliking of particular product attributes, and preference tests to find which product compared to key competitors’ the consumers favor. Therefore, Daxue Consulting organized a series of sensory research sessions taking place in tailored sensory testing rooms in Shanghai, where participants were asked to taste the client’s new recipes as well as key competing products. Respondents rated each product regarding each and every attribute and additionally rated the overall likability.
Additionally, Daxue’s team complemented the research with qualitative data through several focus groups and interviews. Therefore, participants were asked to give feedback on the packaging, pricing, and marketing tools as well as why they like or not like specific attributes, what’s behind it. This made it possible for the client to understand which products were likely to appeal in China and what product characteristics to put forward in its China communication campaigns.
Phase 3: Analysis & Recommended Routes for Development
This step contained our Final Analysis and Recommendations including:
- Analyze and cross-analyze data collected during the Desk Research and Sensory Research phases
- Display the results (spider charts) and interpret the findings
- Identify and assess the opportunities, challenges, and obstacles that our client might face during their market development in China
- Propose possible development routes for our client in China
- Synthesize the data and create a final list of actionable recommendations
After analyzing all the obtained data, our team gave suggestions for how to adapt the recipe, the flavor of the product and how to change the package to better suit both Chinese adults and children. Daxue Consulting’s project managers compared the client’s product taste and packaging to key competitors’, giving recommendations for what aspects of each competitor to adopt and which ingredients to avoid. The Daxue team also provided a full strategic plan including suggested price range, place of sale, and promotional strategy.
Daxue Consulting has accomplished various sensory research projects in the F&B industry including clients, such as a well-known yogurt brand, but also in other industries such as cosmetics or textile as well as various sensory projects concerning packaging.
Click here to get more information about how Daxue’s team is conducting sensory analysis in China.