Spain contributes more than half of the world’s total olive oil production. It shipped more than 18,700 metric tons of the oil to China in 2013, up 13 percent from the same period a year earlier, according to the Beijing-based China Chamber of Commerce of Foodstuffs and Native Produce. Italian olive oil exports to China increased by €40 million in 2017, according to the National Institute of Italian Statistics. Spain has traditionally been the largest exporter to China, followed by Italy, France, Greece and Turkey but the tides may be changing, according to industry analysts. Let’s take a look at the industry and how your brand can penetrate the market.
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Status quo of the olive oil market in China
All well known brands of olive oil in China are exported. Surveys show that brands from Spain and Italy are highly recognized by Chinese consumers and preferred over local ones. In 2016, China lowered tariffs on Italian olive oil that were long considered prohibitive for entry to the market. The decreasing cost of importing also coincided with cuts to production costs in Italy.
Despite the fact that olive oil accounted for only 1% of China’s total edible oil consumption in 2013, the country’s olive oil imports remained strong and hit 43,400 metric tons in 2013, an increase of 5.8% from the previous year. The growing trade figure had also pushed Chinese companies to seek takeover targets overseas that could help meet the demand for olive oil back home. Considering a long-term perspective, rising per capita income, an increase in the number of middle-class people and the growing demand for more sophisticated food, this trend will continue to increase in China.
Why are Chinese Consumers (and Distributors) buying olive oil?
As an imported food product, why is olive oil becoming more popular now?
1. Olive oil is a lifestyl Product
‘Di Gou You’ (gutter oil) is illicit cooking oil which has been recycled from waste oil collected from sources such as restaurant fryers, drains, grease traps and slaughterhouse waste. The rise of scandals, exposed by local media, regarding gutter oil has led chinese consumers to seek alternatives to local cooking oil, an important ingredient necessary for almost every dish.
The most important reason for the increasing interest in olive by the Chinese, is its well-documented health benefits. In China, olive oil is widely regarded as a healthy oil that can help prevent cardiovascular disease; decrease cholesterol; delay senility and prevent cancer. Only 0.19% consumers don’t know why olive oil is helpful to health. （Source: SJTU）The concept of healthy food products is a traditional advantage of imported food product in China.
2. Olive oil as a gift
Imported food products are considered a good gift in China, including olive oil. Quality is especially important in a country where ‘Mianzi‘ takes precedence over everything. ‘Mianzi’ literally translated as ‘Face’, idiomatically means dignity/prestige or ‘to save face’. It’s a subculture in China that is strongly rooted in peoples minds and deeply influences daily life of the Chinese. A quality gift is a must, a show of respect to the receiver. (see more about China face consumption)
Health imported oil like olive oil is usually better packed with a relatively high price which makes it a perfect choice of a gift. During festivals, olive oil sells much better than usual.
3. Price of olive oil is acceptable
Price was a big obstacle for imported olive oil before, but it is no longer important.
The increasing concern for food safety changes many Chinese consumers’ insistence on cheap deals. Now they would rather pay more if their health and safety can be guaranteed.
4. Reliable olive oil brands
A well-known reliable brand is the key to win China olive oil market. Gradually, the competition in this market revolves around branding. Good branding instills consumer confidence. Needless to say, without proper branding, your product risks being one of just many olive oil products.
Among the 12.25 million tons of imported olive oil in the first two months of 2012, 5.16 million tons of it was a product called Olive Pomace Oil. This brand amounted to 42.1% of the total imports of olive oil. However, “Olive Pomace Oil” was none existant in the market place, as it had been repackaged and rebranded before being sold.
This scandal undrmined consumers’ confidence, as real oil was being sold along with fake oil, indistinguishable because they were all under different packaging. Scandals like this is why good branding and promotion are undispensable.
How can we help you promote your brand?
Branding in China is important. Chinese consumers buy the name of a brand. They want to buy premium, reputable brands. Chinese people are also the most connected people all over the world. They spend an average of 3 hours to surf on their smartphones. To attract them you need to use digital solutions to gain visibility and make relevant sales.
A CHINESE WEBSITE TO BE ACCESSIBLE TO CHINESE CONSUMERS
To be visible by your target, you need to have a website in Mandarin, hosted in China, for SEO (search engine optimisation) reasons. Baidu, the leading search engine in China, will not rank websites hosted in other countries or websites that are not in Chinese.
Your website must follow Chinese standards and Chinese trends.
SOCIAL MEDIA TO CREATE A COMMUNITY
Social media in China is not so difficult; the secret is to generate “traffic”. In China, we know how to start, how to facilitate and develop these conversations among Chinese citizens, on Chinese platforms such as:
• Wechat • Weibo • Tieba • Tianya • Douban
KOL TO PROMOTE YOUR BRAND
To gain visibility and e-reputation, it is crucial to encourage positive word-of-mouth. KOL can help you.
The Key Opinion Leaders (KOL) are social media users who succeeded to make a lot of traffic on their accounts and became famous. Chinese consumers idolize KOLs, trust them more than brands. Some KOLs have some millions of fans. They are really good to influence the massive population. You can influence olive oil lovers and health enthusiasts by using KOLs as intermediaries. Through them, you are able to reach your target group. In other words, intermediaries can be a great asset in selling your imported spirits to Chinese consumers.
LEAD GENERATION PROFESSIONALS
We are professionals of the lead generation. To be effective in your lead generation, you need first to develop a good e-reputation. Invest in online advertising and create quality content will help you develop your e-reputation. Finally, measure results to improve your performances.
We are lead generation experienced and we apply it to our agency. We get an average of 350 leads per month (March 2018) by applying the method we offer to companies that use our services.
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We understand the Chinese consumers: their needs and habits
We also understand the foreign brands’ difficulties when they tried to enter the Chinese market.
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