Friday, February 14, 2014

Why Oreo cookies lose in China – Ben Cavender

Ben Cavender CMR 3
Ben Cavender
Once upon a time Oreo was the most popular cookie in China, but its producer Mondelez International Inc is facing major challenges, as China´s consumers change preferences very fast, explains retail analyst Ben Cavender in the Wall Street Journal. 

The Wall Street Journal:
Oreo has been one of the country’s most popular cookie brands since it launched in China in 1996, with Mondelez holding the largest market share in China’s biscuit segment at 16%, according to market-research firm Euromonitor International. Cookie sales in China have more than tripled from 2003 to 50.4 billion yuan, or roughly $8.3 billion, last year. 
But industry watchers say China is one tough cookie, and Mondelez is facing bigger obstacles to growth here. Consumers in the world’s most populous country are curious and willing to try out new things, but that means as more brands enter the market, there are more snacks to distract them from Oreos, said Ben Cavender, a senior analyst at consultancy China Market Research in Shanghai. 
Mr. Cavender said most companies are finding that Chinese consumers bore easily, so it’s key for food makers to innovate and introduce new brands. ”You have to keep the market constantly hooked,” he said, noting that changing the packaging often isn’t enough.
More in the Wall Street Journal.

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