英文【凱度消費(fèi)者指數(shù)-貝恩公司】2024年中國購物者報(bào)告,系列二：應(yīng)時(shí)而變：中國快速消費(fèi)品行業(yè)消費(fèi)新動(dòng)態(tài)

AdaptingtoChange:TheNewConsumerDynamicsinChina’sFMCGSector

ChinaShopperReport2024,vol.2

BAIN&COMPANY

Authorsandacknowledgments

BrunoLannesisaseniorpartnerwithBain&Company’sConsumerProductsandRetailpracticesandisbasedinShanghai.Youcancontacthimbyemailatbruno.lannes@.

DerekDengisaseniorpartnerwholeadsBain&Company’sConsumerProductspracticeinGreaterChinaandisbasedinShanghai.Youcancontacthimbyemailatderek.deng@.

RachelLeeisthemanagingdirectoratKantarWorldpanelChina.Youcancontactherbyemailatrachel.lee@.

ThisreportisajointeffortbetweenBain&CompanyandKantarWorldpanel.Theauthorsextendgratitudetoallwhocontributedtoit,especiallyEnqingWang,KateLiu,MatthewWu,JellyGuo,YongqiSi,BoruiWangfromBain;aswellasTinaQinandSallianHefromKantarWorldpanel.

Thisworkisbasedonsecondarymarketresearch,analysisoffinancialinformationavailableorprovidedtoBain&Companyandarangeof

interviewswithindustryparticipants.Bain&CompanyhasnotindependentlyverifiedanysuchinformationprovidedoravailabletoBain

andmakesnorepresentationorwarranty,expressorimplied,thatsuchinformationisaccurateorcomplete.Projectedmarketandfinancial

information,analysesandconclusionscontainedhereinarebasedontheinformationdescribedaboveandonBain&Company’sjudgment,

andshouldnotbeconstruedasdefinitiveforecastsorguaranteesoffutureperformanceorresults.Theinformationandanalysishereindoesnotconstituteadviceofanykindandisnotintendedtobeusedforinvestmentpurposes.NeitherBain&Companynoranyofitssubsidiariesortheirrespectiveofficers,directors,shareholders,employeesoragentsacceptanyresponsibilityorliabilitywithrespecttotheuseofor

relianceonanyinformationoranalysiscontainedinthisdocument.ThisworkiscopyrightedBain&CompanyandKantarWorldpanelandmaynotbepublished,transmitted,broadcast,copied,reproducedorreprintedinwholeorinpartwithouttheexplicitwrittenpermissionofBain&CompanyandKantarWorldpanel.

Copyright?2024Bain&Company,Inc.andKantarWorldpanel.Allrightsreserved.

KantarWorldpanel|Bain&Company,Inc.

1

AdaptingtoChange:TheNewConsumerDynamicsinChina’sFMCGSector

Contents

Reflectiononthefirstthreequartersof2024Whatmakesbrandsgrow

Implicationsforbrands

ExecutiveSummary

Thisisthe13thconsecutiveyearwehavetrackedtheshoppingbehaviorsofChineseconsumers.Ourongoingresearchprovidesavaluable,long-termperspectiveacross106fast-movingconsumergoods(FMCG)categoriespurchasedforhomeconsumptioninChina.Asintheprevious12years,weanalyzed26keycategoriesacrossthefourlargestconsumergoodssectors:PackagedFood,

Beverage,PersonalCare,andHomeCare.Thisyear,weupdatedourtrackingtoincludeNutritionSupplements,Coffee,andSanitaryPads,whileremovingToothbrushesandFabricSoftener,bring-ingourtotaltrackedcategoriesto27tobetterreflectevolvingmarketdynamics.

Inthisreport,wewillprovideupdatesonthefollowingtwotopics,andthenclosewiththeimpli-cationsforbrands:

?Topic1:OverallFMCGperformanceinChinaforQ32024year-to-date(YTD).

?Topic2:Thefundamentalsofbrandgrowth,andchangescomparedtopreviousyears.

OverallFMCGgrowthinChinahasslowedduringthefirstthreequarters,becomingslightlynegativeinQ3andfurtherdeclininginSeptember(P10).Specifically,FMCGgrowthrateswere2.0%inQ1,1.6%inQ2,-1.1%inQ3,and-3.5%inP10.ForQ32024YTD,theaverageFMCGgrowthof0.8%wasinfluencedbya4.6%increaseinvolumealongsidea3.6%declineinaveragesellingprice(ASP).Thisdeclinerep-resentsthemostsignificantdragonFMCGperformanceinChinasincewebeganobservingthedefla-tionarytrendin2021.Throughoutthethreequarters,pricedeflationaccelerated,withASPdeclinesof-1.5%inQ1,-4.2%inQ2,-5.1%inQ3,and-5.2%inP10.Amongthemajorcategories,PersonalCareandBeverageexperiencedthelargestASPdeclinesandhavefaceddepressedpricesforthepastfiveyears.HomeCareandPackagedFoodalsoreversedtheirASPgrowthinQ32024YTD,enteringaperiodof

decline.Thisacceleratingdeflationarytrendhighlightstheincreasingpricesensitivityofconsumersandtheheightenedpromotionalfocusofplatformsandretailers.

KantarWorldpanel|Bain&Company,Inc.

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AdaptingtoChange:TheNewConsumerDynamicsinChina’sFMCGSector

InQ32024YTD,offlinechannelsoutperformedthemarket,gaining1%marketshareforthefirst

timesincetheinceptionofe-commerce.Thisgainwasdriven,inpart,bytheexpansionofdiscountchainsandclubwarehouseformats,aswellasbysmallerformatssuchasGrocery,CVS,andSuper/minimarkets.Theslightdownturninonlinechannelsstemmedfromrobustvolumegrowth,whichwasoffsetbyasimilar-sizedASPdeclineduetoheavypromotionsacrossnearlyallplatforms.Withinthee-commercelandscape,Douyincontinuedtoexperiencedouble-digitgrowth,surpassingJDtobecomethesecond-largeste-commercechannelbygrossmerchandisevalue.

Asoutdooractivitieshavesurgedfollowingthepost-Covidreopening,wehavenoticedaslightdeclineinfoodandbeveragespendingathome,nowaccountingfor55%inTier1andTier2cities.Inthiscon-text,cateringtoOn-The-Goconsumersinthefoodandbeveragesectorhasbecometheprimaryfocusforgrocerystoresandconveniencestores.

Atatimeofincreasedpromotionalactivationsbybrandandplatforms,itisimportanttorememberthefundamentalsofbrandgrowth.Thestartingpointistounderstandthatcategoriesbehavedif-

ferentlyalongthe“repertoire-loyalist”continuum.Wehavelookedatthisquestionthreetimesin

thepast(in2013,2016,and2019).Giventhesignificantchangessince2019,wehavedecidedtoprovideanupdatedanalysisofthisimportanttopic.Aspreviousreadersmayrecall,inrepertoirecategories,increasedshoppingfrequencytypicallyresultsinconsumerspurchasingagreatervarietyofbrands.Conversely,inloyalistcategories,higherpurchasefrequencydoesnotleadtoanincreaseinthe

numberofbrandsbought.Thisyear,wearrivedatseveralconclusions—someconsistentwithpreviousfindings,whileothersdiffer:

?Shoppersacrossmostrepertoirecategorieshavebecomemorerepertoire-orientedovertime,likelyduetointensifiedcompetitionandanincreaseinavailablebrands.

?Onlinepenetrationhasminimalimpactoneitherrepertoireorloyalistshopperbehavior.Thisholdstrueacrossbothcategorieswithhighonlinepenetration,suchasbabydiapersandmake-up,andthosewithlowonlinepenetration,likecandyandpackagedwater.

?Marketsremainhighlycompetitive,withasignificantshareofmarketpotentialstillupforgrabs.Amongthe27categoriesstudied,anaverageof18%ofthetop10brandsdroppedfromthelistin

2023comparedto2019.

?Consistentwithpreviousyears,themainfactordrivingperformanceforleadingbrandscomparedtoothersisbrandpenetration,whichsurpassesfrequencyandrepurchaserate.

?Onaverage,shoppershaveshownlowerengagementwithbrands(asmeasuredbyaveragepurchasefrequency),withasteadydeclineoverthepastdecade.

?Therevenuecontributionsfromlow-frequencyshoppershavebecomeincreasinglysignificantacrossmostcategoriesovertime.

?Thus,theshopperbaseforbrandsresemblesa“l(fā)eakybucket,”particularlyforsmallerand

non-leadingbrands.Consequently,brandteamsmustprioritizethecontinuousrecruitmentofnewconsumerstoexpandtheirshopperbase.

KantarWorldpanel|Bain&Company,Inc.

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AdaptingtoChange:TheNewConsumerDynamicsinChina’sFMCGSector

Implicationsforthebrands

Toprepareforsuccessin2025,brandsshouldconcentrateonfivekeystrategies:

#1Re-examineandkeepinnovatingportfolio–Alignproductofferingsandvaluepropositionswithgenuineconsumerneedsandchannelspecificrequirements.Consumersarebecomingmorera-tionalandarelookingfor“truevalue”,notnecessarilylowerprice,soinnovationwillcontinuetoplayakeyrole.

#2Maximizephysicalavailability,bothonlineandoffline–Capitalizeonthefullpotentialofom-nichannelapproaches,connectingonlineandofflineeffortsthroughlargeconsumerdatasetstoestablishaconnectedcommercestrategy.

#3Embraceout-of-homeopportunitiesforfood&beveragecategorieswithspecificportfoliosand

route-to-market,asconsumershavereturnedtoout-of-homeeatinganddrinkingoccasions.

#4Capturementalavailability–Implementfocusedmarketingcampaignsaimedatrecruitingconsumers.Tonavigatethroughmediachanneldynamics,brandsmustfollowa1+N+Xap-proach(1standsforbrandcorevalueproposition,Nstandsforkeymarketingcampaigns,Xstandsfortailoredmarketingcontentpermediachannel)tofocusonbrandbuildingwhileadaptingtothediversifiedcontentexpressionondifferentmediachannels.

#5Continuetomanagecosts,giventhepersistentdeflationaryenvironment,includingtheinves-tigationofpartnershipopportunitiesandasset-liteoperatingmodels.

4

AdaptingtoChange:TheNewConsumerDynamicsinChina’sFMCGSector

Reflectiononthefirstthreequartersof2024

Inthefirstthreequartersof2024,China'sfast-movingconsumergoods(FMCG)industryexperiencedmodestgrowthof0.8%year-to-date.Thisgrowthincludedapromisingrecoveryinthefirsthalfof

theyear,withincreasesof2%inQ1and1.6%inQ2.However,thiswasfollowedbyadeclineof1.1%inQ3andamorepronounceddeclineof3.5%inSeptember(P10).(SeeFigure1)

Theperformancelaggedtotalretailsales,whichroseby2.8%excludingcatering,partlyduetothecountry'spro-consumptionpoliciesaimedatdurablegoods.Initiativessuchastheconsumer

equipmentupgradeandtrade-inprogramhavestimulateddomesticdemand,asevidencedbyasignificantincreaseof20.5%inhomeappliancesalesinSeptemberand39.2%inOctober.There

hasalsobeenacontinuousreallocationofconsumerexpendituretowardstheservicesectorssuchasdiningandtravel,withretailsalesintheseareasexperiencinga6.7%increaseduringthefirstthreequartersof2024.

Figure1:ChinaFMCGgrowthhasbeendeceleratingoverthefirstthreequartersandwasslightlynegativeinQ3andwideneddeclineinP10

Year-over-yearchangeinurbanshoppers'totalspendingonfast-movingconsumergoods

20%

10

0

-10

2019

5.6%

Year-over-yearvaluegrowth

Q1Q2Q3Q4Q1Q2Q3P10

Q1Q2Q3Q4

2021

2020

2022

2024YTD

0.1%

3.1%

1.5%

2.0%1.6%-1.1%-3.5%

Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4

2023

2.4%

TotalFMCGFoodandbeveragePersonalandhomecare

Notes:FMCG=fast-movingconsumergoods;Kantarupdatedtheconsumeruniversein2022and2023,leadingtosomeinconsistencieswithpreviousyears‘data;24Q3=June17–Sept.6,2024;P10=weekofSept.7–Oct.4,2024

Sources:KantarWorldpanel;Bainanalysis

5

AdaptingtoChange:TheNewConsumerDynamicsinChina’sFMCGSector

2024marksthesecondyearfollowingtheliftingofCOVID-19restrictionsinDecember2022.Althoughtheyear-to-dategrowthof0.8%wassimilartothe1%recordedinQ32023year-to-date,theunderlyingdynamicsweresignificantlydifferent.InQ32023,growthwasdrivenbya1.2%increaseinvolume,

coupledwitha0.2%decreaseinaveragesellingprices(ASP).Incontrast,Q32024recordedasolidvol-umeincreaseof4.6%(seeFigure2);however,theASPexperiencedasignificantdeclineof3.6%,the

highestdropsince2019,whiletheConsumerPriceIndexroseby0.3%duringthesameperiod.Defla-tionbecameincreasinglypronouncedoverthethreequarters,withratesof-1.5%inQ1,-4.2%inQ2,

-5.1%inQ3,and-5.2%inSeptember(seeFigure3).Ofthe27trackedcategories(seeFigure4),16expe-riencedpricedeflationinQ3YTD2024,drivenbyconsumersincreasinglyseekingvalueformoney,in-tensecompetition,andalackofinnovation.

Figure2:ForYTDQ32024,theaverageFMCGgrowthof0.8%wasdrivenby4.6%increaseinvolumeandanASPdeclineof3.6%

Value

UrbanFMCGmarketvaluegrowth(percentage,2019–P102024)

10%

5

3.1

2.4

1.5

0

0.50.8

-3.5-5

19–2020–2121–2222–23YTD24

23Q3P10

–24Q3

Volume

AnnualgrowthofurbanFMCGmarketvolume(percentage,2019–P102024)

10%

4.6

4.1

4.1

5

2.4

1.7

1.5

0

-5

24P10

YTD23Q3–24Q3

19–2020–2121–2222–23

Averagesellingprice

AnnualgrowthofurbanFMCGmarketASP(percentage,2019–P102024)

10%

5

0

-0.1

-1.0-0.9

-2.5

-5

-3.6

-5.224P10

19–2020–2121–2222–23YTD23Q3–24Q3

CPI

Notes:ASP=averagesellingprice;CPI=ConsumerPriceIndex;FMCG=fast-movingconsumergoods;1)AllAveragesellingpricesarecalculatedbasedonRMBperkg/LexceptSkinCareandMakeupisperpack,andFacialTissueisper100sheets/rolls;2)CPIdataisasofOct2024fromNationalBureauofStatis-ticsandincludeallconsumergoods;Allchangesmayleadtosomeinconsistencieswithpreviousyears’data;P10=weekofSept7–Oct4,2024;3)Market

valuegrowth=(1+volumegrowth)/(1+ASPgrowth)–1,e.g.YTD23Q3–24Q3=0.83%=(1+4.59%)*(1-3.6%)-1

Sources:KantarWorldpanel;NationalBureauofStatistics;Bainanalysis

6

KantarWorldpanel|Bain&Company,Inc.

AdaptingtoChange:TheNewConsumerDynamicsinChina’sFMCGSector

Figure3:Afteraslightimprovementin2023,thedeflationarytrendthatstartedin2021acceleratedin2024

UrbanFMCGASPgrowthbyquarter

4%

2

0

-2

-4

-6

2021

2022

2023

2024YTD

(percentage,Q12021–P102024)

3.4

Deflationarytrend

emergedsincemid2021

-0.04%

1.2

0.0

0.5

-1.3

-2.1

-2.5%

-2.8

-3.0

-0.8

-1.0

-1.5

-0.8%

-3.2

-3.6

-3.8%

-4.2

Q1Q2Q3Q4

Q1Q2Q3Q4

Q1

Q2Q3

Q4

Q1

-5.1-5.2

Q2Q3P10

---Annualgrowthrate(percentage)

Notes:ASP=averagesellingprice;FMCG=fast-movingconsumergoods;P10=weekofSept.7–Oct.4,2024Sources:KantarWorldpanel;Bainanalysis

Figure4:Onlyafewcategoriespremiumizethroughoutthefirstthreequartersof2024

ASPyear-over-yeargrowth(percentage,YTDQ32024vs.YTDQ32023)

15%

10

5

Q32024

0

CPI:0.4%

-5

-10

-15

Q32024YTDCPI:0.3%

Biscuit

ewinggum

.

Milk

P

Sanitarypads

●●

`、Facialtissue

ackagedKitchencleaner

ater\Fabricdetergent

ToiletTissue

Hairconditioner

●

●

ASPdeclinereversed

Instantcoffee

Continuouspremiumization

Cluster1:

Continuous

premiumization

RTDtea

CSDO\O

Ch

Instantnoodles

Toothpaste

OBeerCandy

Juice

Nutritionsupplement

Infantformula

Personalwash

Shampoo

w

Skincare

Yogurt

Chocolate

Cluster3:

Premiumizationreversed

todeflation

Cluster2:

Continuousdeflation

BabydiaperMakeup

ContinuousASPdecline

ASPgrowthreversed

-15-10-5051015%

ASPyear-over-yeargrowth(percentage,2023vs.2022)

PackagedfoodBeveragePersonalcareHomecare

Notes:ASP=averagesellingprice;CSD=carbonatedsoftdrink;RTD=ready-to-drinkSources:KantarWorldpanel;Bainanalysis

KantarWorldpanel|Bain&Company,Inc.

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AdaptingtoChange:TheNewConsumerDynamicsinChina’sFMCGSector

Trade-up:Amongthe27categoriestracked,9didnotexperienceadropinaveragesellingprice(ASP).MostofthesecategoriesmaintainedaflatASP,withchangesbetween0-1%.Onlyjuice,instantcoffee,andtoothpastesawincreasesexceeding1%inASP.Thisgrowthcanbeattributedtorisingdemandforhealthandwellnessproducts,alongwithinnovationswithinthecategories.Forexample,thejuice

categoryexperiencedheighteneddemandforhigherqualityandricherflavors,withcoconutwateremergingasarapidlygrowingsub-category.Instantcoffeealsobenefitedfrominnovationssuchasfreeze-driedinstantcoffeepods.

K-Shape:CertaincategoriesdisplayedaK-shapedpattern,whereinnovationsmetconsumerneedsbutfacedfiercepricecompetition.Thehomecaresegmentexemplifiedthistrendmostclearly.Infacialtissue,themasssegmentgrewby18%,drivenprimarilybyvolume,whilethepremiumsegmentexperiencedsignificantvaluegrowthduetoinnovationssuchasfour-layer(36%),five-layer(93%),andlotionfacialtissues(26%),althoughthesefiguresoriginatedfromsmallerbases.

Continuousdeflation:Amongthe16categoriesexperiencingadecreaseinASP,4sawdeclines

exceeding5%,allwithinthePersonalandHomeCaresegments.Thesecategoriesincludedhair

conditioner(-10%),skincare(-6%),makeup(-10%),andbabydiapers(-8%).Thenotablepricede-flationwascausedbyseveralfactors:increasingcost-consciousnessamongconsumers,competitivepressurefromduty-freechannels,aggressivecompetitionamongplatformsfortraffic,domestic

brandsofferingvalue-for-moneyproducts,andalackofbreakthroughinnovationsinthesecategories.

GeographicPattern:Growthpatternsalignedgeographicallywithtotalretailmarkettrends,asTier3andTier4citiesoutperformedTier1andTier2cities(seeFigure5).ForQ3year-to-date,

Tier3andTier4citiesgrewby2.9%and5.5%,respectively,whileTier1andTier2citiesfaceddeclinesof4.4%and0.9%.Volumeledgrowthacrossallcitytiers,whileASPdeclinedacrossallcitytiers.

China'seconomygrewatitsslowestpacesinceearly2023inthethirdquarter,at4.6%,fallingshortofthefull-yearGDPgrowthtargetofaround5%.Authoritieshavecommittedtoimplementingaddi-tionalstimulusmeasuresandprovidingguidancetosupporthouseholdconsumptionsincelate

September.Whileitwillrequirepatienceandtimeforthestimulustotakefulleffect,itislikelytoprogressivelybuildconsumerconfidencewhichwilllatertranslateintohigherconsumption.

Categoryupdatethroughoutthefirst9monthsof2024:HomecarecontinuedtoleadgrowthintheFMCGsector,closelyfollowedbybeverages

Amongthefourmajorsectors(seeFigure6),homecareexperiencedthehighestgrowthwithavalueincreaseof3.5%,justaheadofbeveragesat3.3%.Packagedfoodsawmoremoderategrowthat1.4%,whilepersonalcarefacedanincreaseddeclinecomparedto2023,returningtoalevelsimilartothatof2022withadecreaseof4.4%.Thismarksadeclinefrom-2.0%in2023and-4.8%in2022.

8

KantarWorldpanel|Bain&Company,Inc.

AdaptingtoChange:TheNewConsumerDynamicsinChina’sFMCGSector

Figure5:Tier3and4citiesledthegrowthat2.9%and5.5%respectively,whileASPwasdepressedacrossallcitytiers

Value

UrbanFMCGmarketvaluegrowthbycitytier(percentage,2024Q3YTDvs.2023Q3YTD)

9%

7

5.5

5

2.9

3

0.8%

1

-1

-0.9

-0.5

-3

-4.4

-5

Tier1Tier2Tier3Tier4Tier5

Volume

UrbanFMCGmarketvolumegrowthbycitytier(percentage,2024Q3YTDvs.2023Q3YTD)

8.7

9%

6.9

7

4.6%

4.0

5

2.4

3

1

-1

-0.9

-3

-5

Tier5

Tier1Tier2Tier3Tier4

Averagesellingprice

UrbanFMCGASPgrowthbycitytier

(percentage,2024Q3YTDvs.2023Q3YTD)

9%

7

5

3

1

-3.6%

-1

-3.0

-3

-3.3

-3.6-3.7

-5

-4.4

Tier1Tier2Tier3Tier4Tier5

Notes:ASP=averagesellingprice;FMCG=fast-movingconsumergoods;Tier1cities:Beijing,Shanghai,Guangzhou;Tier2cities:provincecapitalexcludingBeijing,Shanghai,Guangzhou,addingTianjin,Chongqing,Shenzhen,Dalian,Qingdao;Tier3cities:prefecture-levelcity,excludingDalianandQingdao;Tier4

cities:county-levelcity;Tier5cities:theresidenceofthecountygovernment

Sources:KantarWorldpanel;Bainanalysis

Figure6:Homecaregrewthroughout2024YTD,whilefood&beveragedeclinedinQ3andinP10,andpersonalcareremaineddepressed

TotalFMCGFoodandbeveragePersonalandhomecare

UrbanFMCGmarketvaluegrowth(Percentage,2024Q1–Q3/P10vs.2023Q1–Q3/P10)

15%

10

5

2.01.6

0.8%

0

-1.1

-3.5

-5

24Q124Q224Q324P10

UrbanFMCGmarketvaluegrowth(Percentage,2024Q1–Q3/P10vs.2023Q1–Q3/P10)

15%

10

5.9

5

4.3

3.2

2.7

3.3%

1.4%

0

-0.6

-1.1-1.3

-5

-6.7

PackagedfoodBeverage

UrbanFMCGmarketvaluegrowth(Percentage,2024Q1–Q3/P10vs.2023Q1–Q3/P10)

15%

10

4.3

4.1

3.8

5

3.5%

2.2

0

-2.8

-4.4%

-5

-4.1

-4.9

-6.1

PersonalcareHomecare

24Q124Q224Q324P10Growthrate(YTD24Q3vs.LY)

Notes:FMCG=fast-movingconsumergoods;LY=Lastyear;P10=weekofSept.7–Oct.4,2024Sources:KantarWorldpanel;Bainanalysis

KantarWorldpanel|Bain&Company,Inc.

9

AdaptingtoChange:TheNewConsumerDynamicsinChina’sFMCGSector

Homecaredelivereda+3.5%growth(SeeFigure7),drivenbyrobustvolumegrowthof+8.7%,sur-passingthe+7.1%volumegrowthrecordedduringthesameperiodin2023.Thissegmentexperiencedtheleastaveragesellingprice(ASP)deflationamongallsectors,withitsvolumegrowthbeingthestrongest.Theoverallvolumeincreasewassupportedbybothgreaterproductpenetrationand

frequencyofuse,reflectingheightenedhealthandhygieneconcerns,alongsideagrowingdesireforself-indulgenceandanimprovedqualityoflifeathome.Consumersareincreasinglyseekingproductsthathavealowerimpactonhealthandtheenvironment,enhancedfragranceandaes-

thetics,aswellasprofessional-gradeefficiencyandeffectiveness.Fabricdetergentandkitchen

cleanersbothrecordedsignificantgrowthat+6%,drivenbyhighvolumeincreasesof+8%,despiteaslightdeclineinASP.Inthekitchencleanercategory,fruitandvegetablewashachievedare-

markable+26%valuegrowthwithpremiumpricing,whilevaluepacksof2-3Land3Lsawstrong

increasesat+14%and+25%,respectively.Cleaningoccasionsinkitchensandbathroomscontinuedtorise,becomingmorespecializedwithproductstargetingdraincleaning,waterstainremoval,

andtoiletodorelimination.Facialtissuesgrewby6%,aslowdownfromthe18%growthobservedduringthesameperiodin2023,yetstilldemonstratingrelativestrength,propelledbyan8%vol-umeincreasedespitea-2%ASPdecline.ThissegmentshowsdivergenceinASP,withhigher-endoptions,includingmulti-layerandlotion-infusedvarieties,commandingapremiumandgrowingatover+25%.Innovationshavealsoemergedinthemasssegment,withhangingtissuesexperi-

encinggrowthexceeding+800%fromasmallbase.Conversely,toilettissuedeclinedby-8.5%

(withrolledtissuescomprising90%ofitstotalvalue),whichincludeda-4.4%volumedeclineanda-4.2%ASPdecline.Thisdecreaseisattributedtoashifttowardsalternativeformats(suchashang-ingtissue,cottontissue,andwettissue)andconsumersoptingformorevalue-for-moneyproducts.

Personalcaredeclinewidenedto-4.4%(seeFigure7),comparedto-2.0%in2023.However,makeup,alongwithscalpserumandleave-inhairtreatments,contributedtoastrongrecoveryinvolumedemand,whichroseby+5.8%,upfrom+1.4%inthepreviousyear.Shampooexperiencedavalueincreaseof2%alongsideavolumegrowthof7%.Incontrast,hairconditionersawavaluedeclineof1%butenjoyedavolumeincreaseof9%.Makeupalsorecordedavaluedecreaseof2%whileachievingavolume

growthof9%.Thesefiguresindicatethatthepersonalcaresectorfacedacceleratedaveragesellingprice(ASP)deflationof-9.6%,comparedto-3.3%duringthesameperiodin2023.Thistrendpersistedthroughouttheyear,withQ1at-7.5%,Q2at-10.6%,andQ3at-10.5%.Thedeclinewasdrivenbycon-sumers'heightenedcost-consciousness,competitivepressurefromduty-freechannels,aggressive

promotionsfromonlineplatforms,anddomesticinsurgentbrandsofferingvalue-for-moneyalternatives.BothhairconditionerandmakeupexperiencedsteepASPdeclinesof-10%.Skincarerecordeda

valuedropof-4%withmodestvolumegrowthof2%,whilepersonalwashachievedavalueincreaseof3%alongsideavolumeriseof4%.Thisgrowthwasfueledbyatrendtosimplifyskincareroutines,despitetheexpansionofsub-occasionslikekneecream.Consumersareincreasinglyfocusedon

functionalityandingredients,optingforvalue-for-moneyproductswhentheydonotperceivetangiblebenefitsfromhigher-pricedoptions.Toothpastewastheonlycategorywithinthesectorthatexperi-encedpremiumization,showingavalueincreaseof7%,volumegrowthof5%,andanASPriseof2%.Thistrendcanbeattributedtoitslow-ticket-pricenatureandfunctional-need-drivenpremiumization.SanitarypadsremainedflatinbothvolumeandASPduetoalackofbreakthroughinnovationsthisyear.Babydiapersdeclinedby-12%invalueand-5%involume,reflectingsimilarresultstothe

sameperiodin2023,whichsawa-11%decline.Thisdownturnwasdrivenbybroaderdemographictrends,andlikesanitarypads,thiscategoryhasnotseensignificantnewdevelopmentsthatcouldpositivelyimpactASP.

KantarWorldpanel|Bain&Company,Inc.

10

AdaptingtoChange:TheNewConsumerDynamicsinChina’sFMCGSector

Beveragegrowthincreasedby+3.3%invalue(seeFigure8),surpassingthesameperiodin2023,whichrecordedonly+0.1%growth.Thisrisewasfueledbyrobustvolumegrowthof+4.5%,com-paredto+3.4%in2023,althoughtherewasaslightdeclineinaveragesellingprice(ASP)of-1.2%,higherthanlastyear's-0.1%.Thetrendtowardsnear-waterdrinkscontinuesasconsumersshift

fromhigh-sugaroptionstoloworno-sugaralternatives,particularlythosewithChineseingredients,especiallyinready-to-drinktea.Asaresult,Juicerecordedimpressivegrowthof+20%,followinga+24%increasein2023.Ready-to-drinkteagrewby+11%,downfrom+14%lastyear,whilepack-agedwaterincreasedby+6%,adecreasefrom+9%in2023.Notably,coconutwater,asegment

withinjuice,surgedby+129%afterremarkablegrowthof+203%inthesameperiodof2023,sig-

nificantlyboostingoveralljuiceperformanc