Trends Shaping The Confectionery Market
Monday, October 21st, 2019
Trend report: the APAC market for confectionery products is forecast to grow at a compound annual growth rate (CAGR) of 5.8 percent from US$41.6 billion in 2018 to US$55.1 billion in 2023, says GlobalData.
The confectionery sector in the Asia-Pacific (APAC) region has undergone a significant transformation over the past decade, in-line with changing consumer preferences. A large base of the young population who are increasingly seeking innovative products, and time-scarce consumers looking for ‘in-between snacks’ that can be consumed on-the-go, are driving the market for confectionery products in the APAC region.
The APAC market trend for confectionery products is forecast to grow at a compound annual growth rate (CAGR) of 5.8 percent from US$41.6 billion in 2018 to US$55.1 billion in 2023, says GlobalData, a leading data and analytics company.
As the confectionery sector evolves to better target consumer’s impulse buying behaviour, GlobalData identifies the below as the key trends that are currently driving the market in the region:
Flavour Novelty And Diversity Is Highly Important In The Confectionery Category
A substantial proportion of consumers in the APAC region are seeking confectionery products with unique tastes & flavours. This is particularly true among young consumers who enjoy highly adventurous palates and like to try new varieties. By highlighting the “unique” ingredients in the formulation of new launches and associating them with “fine” flavours, companies such as Mars Foods (China) have tasted success by launching candies in spicy peanut flavour.
Increasing Sugar Consciousness Among Consumers
With rising obesity and lifestyle-related diseases in APAC countries, especially in Australia (67.4 percent adults were obese in 2017, as per WHO), consumers have become more health-conscious and are adopting wellness-oriented lifestyles. This is leading to an increased interest in confectionery products that are low in sugar. Confectionery manufacturers are therefore introducing products with ‘sugar-free’, ‘low-fat’ claims, which contain natural sweeteners such as ‘stevia’ that resonate well with these consumers
Premium Range Products Appeal To Connoisseurs
As consumers in APAC region continue to move up the economic ladder, they are taking greater interest in premium confectionery products and are turning to luxurious offerings as a ‘treat’ after a long day or week. These consumers prefer handmade and small-batch products which are ‘high priced’ with ‘premium packaging’. In line with this trend, manufacturers such Parle Products have launched a premium chocolate bar under the Friberg banner, containing imported Swiss chocolate.
Rising Desire For “Natural” Products
Growing awareness among consumers of the negative impact of artificial flavours on their health means they are increasingly seeking confectionery products with ‘natural’ ingredients. These “natural” food formulations . In response to this growing desire for guilt-free indulgence, confectionery manufacturers are introducing products with natural claims and real fruits. For instance, Morarka Organic Foods Limited launched a Kiva branded candy, which the company claims to be made with 100 percent organic jaggery.
Although confectioners are adapting to meet consumer needs, they continue to face multiple challenges. Counterfeiting of products is increasingly prevalent, especially in major markets such as China, which is hampering growth of the industry. A shrinking supply of Cocoa production—especially from countries such as Ghana and Indonesia—is also threatening the growth of the industry.
Furthermore, introduction of sugar-tax by countries such as Malaysia can discourage consumers from purchasing confectionery products, thereby impacting the volume sales. Despite these challenges, Asia-Pacific region offers a huge potential for growth of the industry as the per capita is still one of the lowest among regions.
A shrinking supply of Cocoa production—especially from countries such as Ghana and Indonesia—is also threatening the growth of the confectionery industry.
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