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CHINA'S DIETARY SUPPLEMENTS INDUSTRY RAPID GROWTH
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Recently, the Health Research Institute released the "2021 health trend new Insight", insight shows that the contemporary workplace people are generally faced with hair loss, insomnia and other sub-health problems, "health" has gradually become a new generation of young people's consumption needs. According to the "Post-90s Health Report" by Fast Way Research Institute, 32.7 percent of post-90s respondents spend between 100 and 200 yuan per month on dietary nutritional supplements, and 21.9 percent said they "have the habit of using dietary nutritional supplements for a long time."
As a leader in the health products industry, Bykin said to the growing dietary supplements market of the post-90s generation, "The gradual awakening of health awareness and the growing need for health care will continue to influence the segmentation of the dietary supplements market to light function of food, fast digestion, high-frequency direction close.As a generation that is more receptive to new things, the consumer demand of the post-90s generation will encourage all dietary supplement companies in the industry to develop younger and more diversified ideas in product development and packaging theme design."
China's dietary nutrition supplement industry is growing rapidly
According to statistics from Ping An Securities, from 2015 to 2020, the global health care market grew slowly with a 5-year compound growth rate of only 3.4%, while the Chinese health care market grew rapidly with a compound growth rate of 9.4% during the same period. By May 2021, the total size of China's dietary nutritional supplement market reached 231.7 billion yuan, making it the second-largest dietary nutritional supplement market in the world.
According to the investment planning analysis report of the dietary supplements industry of Foresight Industry Research Institute, dietary supplements attract a large number of pharmaceutical and food enterprises to participate due to their strong consumability and high premium, which leads to the low concentration of dietary supplements industry in China. In recent years, the number of enterprises in the dietary supplement industry has been decreasing with the further tightening of the regulation of the industry. By May 2021, the CR10 of the dietary supplement industry in China was 28.9%, which increased by 3.4% compared with that in 2015.
"In essence, dietary supplements, both the food and drug is a heavily regulated FMCG, from the perspective of consumer psychology, consumer generally willing to pay a premium to buy its known brand of dietary supplements, in the long run, dietary supplements industry vulnerable to the strong stronger pattern, It will be more and more difficult for small brands to survive in the market." Shenzhen University food science and processing research Center Liu Wen told reporters.
"After graduation from graduate school, I entered the investment bank, and the daily workload is very heavy. Overtime is a common thing. Therefore, I have no time to compare brands one by one. Post-90 financial practitioners told reporters.
Regarding the trend of consolidation in the dietary supplements industry, Bykin said: "With the gradual introduction and implementation of relevant national policies, industry regulations and standards, the regulation of the dietary nutritional supplement industry has become increasingly strict, and the degree of industry standardization and entry threshold has been further improved, which has a significant impact on the long-term development and competition pattern of the industry, and provides policy guarantee for the sound development of the industry."During 2010-2020, the company's operating revenue increased from 340 million yuan to 6.09 billion yuan with a compound growth rate of 33.2%, and its net profit increased from 90 million yuan to 1.52 billion yuan with a compound growth rate of 32.4%.
Product quality is the root of brand power. In order to meet consumers' increasing demand for dietary supplements, ByHealth has invested a total of 370 million yuan in RESEARCH and development from 2018 to 2020.
"The dietary supplement industry has moved from the first half of marketing to the second half of development. As consumers become more aware of health and nutrition, the emphasis on marketing over products has begun to fail. Consumers of different age groups and different physical conditions will have different demands for health care products, and a way to win the market is bound to be eliminated by the market," Bykin said.
Consumers born in the 1990s are driving e-commerce branding
With the entry of post-90s consumers, the e-commerce channel has gradually become one of the main consumption channels for dietary supplements. According to the data of the Qianzhan Industry Research Institute, the revenue of the e-commerce channels in China's dietary supplements industry increased from 0.2% to 30.6% from 2008 to 2020.
"The rapid development of dietary supplements online channel is related to the three characteristics of dietary supplements themselves. First, dietary supplements have a high unit price but are lightweight, which is very similar to 3C products. At present, the rate of e-commerce of 3C products in China is very high. Second, the immediacy of dietary supplement consumption is weak. Instead of buying today and having to eat tomorrow, consumers can have a waiting time. Third, early consumers rely on online cross-border e-commerce to buy overseas brands of dietary supplements, which to some extent also promotes the trend of online dietary supplements in China." Western securities researcher Xue Yuanxue said in the research report.
According to the report of Ping An Securities, by health's early expansion mainly relied on offline channels, and the number of drugstore terminals of the company increased greatly from 3400 in 2007 to nearly 20,000 in 2012, before 2013. Drugstore terminals have always accounted for more than 90% of the company's total revenue.
However, offline drugstores are not the first choice of post-90s health care consumers. According to the latest data from Miji, more than 50% of drugstore consumers are over 60 years old, and consumers under 40 years old account for less than 30%.
According to a report released by Analysys, nearly 80% of the 3,215 people born in the 1990s said they bought dietary supplements online in the past year. 31.26% said they only bought dietary supplements online, while only 5.6% said they only bought them online. I have a regular habit of buying dietary supplements from pharmacies.
The report also pointed out that at present only 13.5% of the 90 after preferring foreign brand dietary supplement, "represented by 90 after a new generation of young consumers become savvier, we are no longer willing to so-called foreign goods pay higher premium brands, and value is more cost-effective, at the time of online shopping, also can shop around, choose the products to match his needs." A post-90s dietary nutritional supplement consumer told reporters.
In the face of changing times, By health has been implementing an e-commerce branding strategy since 2017."The so-called e-commerce branding strategy refers to the development of an independent e-commerce brand system and the implementation of a differentiated brand strategy, so as to promote the brand younger and provide value to young dietary supplement consumers." Our e-commerce products emphasize lightness, fashion and taste, and focus on the needs of young people, forming a clear difference from conventional dietary supplement products." The company said.
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