24 Dec Chinese love for health & wellness continues
With Chinese household incomes and health awareness increasing, Chinese consumer demand for health and wellness products is steadily growing. The understanding that health and wellness products can promote a healthier lifestyle has expanded from first-tier cities to lower-tier cities where people are becoming more affluent, making them more willing to trade up to health and wellness products. Healthy, convenient consumer products targeting a growing middle class will be the winners in China’s new economy, but long-term success relies on adapting to rapidly changing consumers.
To succeed in China, Australian health & wellness brands can no longer rely solely on Australia’s clean and green image with mass market strategies. The Chinese consumer is becoming more discerning. They want high quality and safe products that help them achieve a more balanced, healthy and family-focused life. For Australian health and wellness brands they need to ensure that their brand promise and positioning clearly meets this consumer desire.
Ongoing issues with food safety and quality, rising incomes, effects of urbanization and an ageing and stressed population is expected to see China’s growing health and wellness market hit almost $70 billion by 2020. Chinese consumers are some of the world’s most health conscious with 73 per cent prepared to pay a premium for products deemed healthier – 12 points higher than the global average, according to Boston Consulting Group (BCG).
A study shows that Chinese mainlanders are spending, on average, about a quarter of the family’s monthly budget on health management, which includes everything from health care products to exercise and regular medical check-ups.
Families owning assets of more than 10 million yuan (US$1.28 million) are spending an average of 14,000 yuan per month on their health and well-being, out of total household expenditure of 57,000 yuan, according to the survey by the Hurun Report and the Shenzhen Catic Wellness Group.
The health & wellness needs of the Chinese expands beyond healthy eating habits and medication however. There has been an observed trend of the younger population in particular turning more and more to energy products. The economic growth observed throughout China has demanded a lot out of the working class. As a result, more people look for energy drinks and other supplements as fuel to get them through the day.
The amount of Chinese citizens adopting work-out regimes has increased tremendously in the past few years. According to IBISworld, the gym and fitness industry has experienced an annual growth rate of roughly 11.8% since 2011 and is expected to generate up to $6 billion this year. The shift in fitness trends can be largely attributed to millennials and women in particular who are trying to keep up with evolving health and beauty trends.
For Australian health & wellness brands a word of caution. China is not a single market and you need to look at unique preferences and regional differences. For instance, in Tier 1 centers there is increasing demand for protein powers and energy drinks whereas the regional cities have yet to see a major shift towards this as yet.
More and more Chinese people are looking for newer solutions to their health issues and this opens the door for savvy Australian companies.