After growth held up quite well during the first two years of the pandemic, only a modest sales increase was recorded in 2022, given all three of the biggest markets in the Asia Pacific region were in decline in this year. While the Chinese market was being impacted by ongoing strict lockdowns, negatively affecting retail sales as well as production and logistics, consumers in India and Japan were becoming more price sensitive in the face of rising prices due to global inflationary pressures.
This report comes in PPT.
An inflationary environment globally is pushing up prices for consumers in the Asia Pacific region, a good number of whom were already struggling with their budgets due to the economic impact of the various COVID-19 restrictions in recent years. In the face of growing price sensitivity, consumers could trade down to cheaper options or buy smaller pack sizes in non-essential product areas like snacks. While this will see the Indian and Japanese markets struggling in 2022, continued strict lockdowns are also impacting the Chinese market.
While consumers in the Asia Pacific region will continue to look for indulgence in their snacks, they will also increasingly place an emphasis on health in these products. COVID-19 has only served to increase the number of health-conscious consumers. In India, Euromonitor’s Lifestyles Survey found that more than two thirds of respondents were looking for healthy ingredients in food and beverages and half of them closely read the product labels.
While the percentage of retail value sales accounted for by e-commerce remains below 10% in the region, e-commerce continues to take share from other forms of retail distribution, albeit at slowing rates compared to the mini-surge seen in 2020, when the pandemic first arrived in Asia Pacific. China has the biggest e-commerce share (17%), and, with an ever growing pool of online shoppers and intermittent lockdowns still taking place in this country, e-commerce continues to become an increasingly important distribution channel for people to buy snacks.
Sweet biscuits, snack bars and fruit snacks are expected to see positive growth in Asia Pacific over the forecast period, with India the most dynamic of the “big three” markets, and the Philippines, Vietnam and Pakistan expected to see some of the most dynamic growth. Sweet biscuits will continue to dominate sales, and therefore also add the most new actual value in 2022-2027, but snack bars will register a slightly stronger CAGR over this period.
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