China's economic slowdown is forcing FMCG brands to rethink their growth strategies, but according to Jason Yu, General Manager – China for Kantar Worldpanel, a more challenging consumer climate doesn't mean that opportunities have dried up entirely.
China is experiencing a cycle of slower growth, the effects of which are also affecting many other markets across Asia. GDP hit record lows over the last 18 months, with disposable income also stagnating among Chinese consumers. From growth of 7.9% in 2012, GDP has progressively slowed to 6.7% in 2016, while urban disposable income has declined from 12.6% to 7.8% in the same period.
For FMCG brands, the numbers are even more grim.
"Last year the total packaged goods grocery category only grew by 3%, and for food and beverage the growth was only 1%," said Yu at the Food & Beverage Innovation Forum in Shanghai.
"This is a very weak sales performance compared with what the market has enjoyed over the past one decade," he added.