BEIJING: The fast-moving consumer goods market continued to grow in China last year, with Coca-Cola and Procter & Gamble being two of the main beneficiaries of this trend.
According to Kantar Worldpanel, the research firm, the Chinese FMCG sector expanded by 5% in 2009, although this constituted a slowdown from the uptick of 15% that was registered in 2008.
Contributors to this development included on-going public caution following the high-profile scandal linked to the sale of tainted baby milk in 2008, which had an impact on the food category in particular.
Previous analysis from the China Market Research Group revealed product safety would be the top priority among Chinese shoppers this year.
In seeming evidence of this, Kantar said that brands promising specific health benefits and premium food lines, which are both associated with better levels of quality, saw demand rise in 2009.
Elsewhere, the soup segment posted an improvement of 25.9% year-on-year, with fruit juice up by 19%, tea by 15%, confectionary up by 13% and biscuits by 11.9%.
Fabric softener also recorded an increase of 20.1%, a figure that reached 14% for household cleaning goods and 10.4% for oral care.
By contrast, carbonated drinks experienced a slight slowdown, and while milk sales started to stabilise, products contaminated with melamine were again found on store shelves in January this year.
More broadly, Kantar's study identified some of the most successful consumer goods companies that are active in China.
It reported that Coca-Cola, the soft drinks giant, Mengniu, the dairy specialist, and Master Kong, the food and beverage manufacturer, all had a penetration rate of 90% in urban households.
The last of these three organisations delivered growth of 13% in 2009, boosted by its strength in the tea category and a range of new launches.
Procter & Gamble, Unilever and Colgate, rivals in the consumer goods sector, also had a presence in 80% of homes in major Chinese cities.
At present, P&G enjoys the strongest position of this group, while sales of Unilever's Kao and Amway ranges also climbed by more than 10% last year.
Overall, consumers in China bought more FMCG products in 2009, but there was also a slight decline in the cost of each purchase.
Shoppers are now making more trips to hypermarkets, due to the increasing prevalence of this kind of outlet and the lifestyle changes that have accompanied the economic liberalisation process.
Many are similarly making more use of the internet as a retail channel, with some 87.9 million members of the online population estimated to have adopted this approach over the last 12 months.
Data sourced from Kantar Worldpanel; additional content by Warc staff