Chinese FMCG spending down 8% in first two months: Kantar

Ding Yining
Hand wash, disinfectant and wet tissues enjoyed surpassing growth during the epidemic period, which also saw new demand for home cooking ingredients.
Ding Yining

Overall spending on fast-moving consumer goods (FMCG) in China was restrained in the first two months despite strong sales of home hygiene products amid the coronavirus outbreak, according to recent industry data.

Total FMCG spending (excluding fresh food) among domestic households declined 8 percent, while home cleaning items picked up 7 percent, according to the latest figure from Kantar Worldpanel.

Only one-fourth of categories tracked by Kantar showed growth or experienced limited losses during the epidemic. 

Pet food, toilet tissue, infant milk powder, packaged water and sanitary items, which sees one-fourth of purchase through online channels, had limited impact.

Hand wash, disinfectant and wet tissues enjoyed surpassing growth, while new demands emerged for home cooking ingredients such as herbs and spices.

Cooking material and pre-cooked meal makers should grab this chance to hook consumers  into the new habits they may have developed during the epidemic.

Categories like skincare, make-up, shampoo, Chinese spirits, wine, beer, chocolate and candy experienced the biggest impact, but are expected to see gradual recoveries in sales.

Beverage brands are advised to capture these moments of happiness and time together that can benefit both snacking and alcohol.

Dr Yu, a skincare brand which specializes in skin barrier recovery developed by Shanghai Jahwa United Co, was among the few personal care brands to cater to skin restoration and repair function amid the epidemic.

After seeing the demand to repair allergic skin, its new skin repair facial mask was launched in February and sold out 1.56 million units on one of the livestreaming shows on Tmall last month.

Beauty spending showed resilience in online channels, with a 7 percent increase in the first two months against an overall drop of 13 percent after physical retailers were ordered to shut down.

Cooking oil, UHT milk, yogurt, biscuits, nutrient supplements and laundry detergent saw growth returned to normal levels before the epidemic. 

Total FMCG spending increased 5.2 percent last year, up from 4.7 percent in 2017 and 5 percent in 2018, but this was mainly driven by price increases, according to Kantar.

Average spending per household dipped 0.9 percent last year and average price per unit added 3.8 percent.

Personal care and beauty growth doubled the industry average last year with 10.4 and 10.1 percent annual gains.

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