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P&G leads FMCG penetration in China

News, 02 December 2016

BEIJING: A total of 22 FMCG companies reach more than 100m urban Chinese households according to Kantar Worldpanel data, with Procter & Gamble heading the list.

Figures covering the 52 weeks to October 7 showed that P&G achieved 93.4% penetration during the year, well ahead of rival Unilever, in sixth place on 81.3%. And it was adding new buying households at a faster rate (1.2% vs 0.8%).

Both of these were among the six non-food companies in the table, the others being Heng An (75.5% penetration), Nice Group (75.3%), Liby (7.5%) and Colgate (69.8%). All but Colgate (-0.9%) had added buyers.

"Gaining new buyers is key to growth in the FMCG market," said Jason Yu, General Manager/China at Kantar Worldpanel. "In the last 12 months some of the country's biggest companies have added to their already considerable buyer base.''

This was especially true of Chinese companies: Nongfu Spring added an extra 8.1m households (thanks in part to the successful launch of a premium ready-to-drink tea), Haday 5.7m, Heng An 4.6m, Yili 4.3m and Mengniu 3.4m.

The picture for international businesses was mixed, however, with Coca-Cola (-0.9%), Mars (-2.5%) and Mondelez (-1.2%) all losing buyers while PepsiCo made gains (+1.6%) and Nestlé saw no change.

"The general trend, for all key players who have experienced significant growth in their penetration in the last 12 months, is that they tend to capture growth opportunities and make headroom across all city tiers," noted Kantar Worldpanel.

Another trend it observed was FMCG companies looking to increase their buyers through online stores – although e-commerce makes only a small contribution to driving incremental FMCG buyers – with a total of 39m urban families having bought products from the top ranked 22 companies via e-commerce channels.

P&G was chosen by the most households, it reported, attracting 15m urban families online, but Mengniu (+123%), Yili (+117%) and Orion (+101%) had seen the fastest growth in online buyers. Colgate, it added, had the greatest number of online-only buyers at 1.1m households.

Data sourced from Kantar Worldpanel; additional content by Warc staff