'Westernisation' of Chinese retail market presents packaging challenges

China has seen significant changes in eating habits, shopping behaviours and lifestyle habits as consumer behaviour responds to Western influences. A Canadean report, ‘Latest Trends and Key Issues in the Chinese Retail Packaging Market’, predicts that consumer packaged-goods providers will capitalise on the trend of ‘Westernisation’ and integrate more Western groceries onto their shelves.

Canadean suggests that, as the ‘Westernisation’ of the retail market is fairly new, products that are considered to be mid-range in Western countries are more likely to be offered as premium products in China. Western commodities also serve as symbols of modernisation and provide a sense of elevated status for consumers. As a result, Western brands of products such as fragrances, chocolates, coffee, cheese, ice cream and carbonated soft drinks are becoming prevalent in Chinese retail markets.

A typical Chinese supermarket in a developed urban area will stock more varied products in comparison to an equivalent US or Japanese store, thus increasing the choice available and offering more opportunities to choose Western products. This is an important trend for packaging companies and also suggests that domestic companies will need to match the standards of Western packaging to stand out against their counterparts.

According to Catherine O’Connor, a senior analyst at Canadean, “Despite China’s growing interest in Western brands, foreign offerings do not always find it easy to integrate into the Chinese retail market. Earlier this year, Revlon and L’Oréal both pulled back from China, misunderstanding the needs of this lucrative market.”

O’Connor believes that providers of consumer packaged goods will attract more customers by localising products to Chinese tastes. She cites the examples of KFC, which has introduced a range of breakfast soups, and Oreos, which have been altered in China to have flavours such as green tea as consumers found the originals too sweet.

As well as reformulating products for the Chinese market, companies also need to modify packaging to influence them at the shelf edge. O’Connor explains, “In particular, the use of colours is of paramount importance for the Chinese. Yellow is seen as a royal colour and red is chosen for good luck and happiness. However, these bright colours are mostly preferred for food products, while pastel or white shades are preferred for household items and personal care products.”