Some of the brands Mars operates in China includes Dove, M&M’s, Snickers, and Maltesers, among which Dove accounts for a dominant 23.8% category share. However, most of these brands either show relatively flat growth or a slight decline over time, data indicated.
Dove, for example, owned 26.7% share of the entire Chinese chocolate confectionery category in 2014. It dropped from 25.3% in 2015 to 24.3% in 2016 before declining further to the current 23.8%. M&M’s held 7% of the category in 2014, falling slightly to 6.8% in 2017, according to Euromonitor.
Analysts at the market data provider pointed out Mars’ business faces challenges from “the shift of consumers to more premium products. Mars, whose brands are mainly positioned within the low/mid-priced range, lost half a percentage point of value share in 2017.”
“Despite this slight share loss, Mars’ retail value sales saw slow growth in 2017, primarily derived from the expansion of M&M’s and Snickers, and the gradual sales recovery of Dove in this year (2017),” added Euromonitor.
Chocolate with toys ‘most dynamic’ value growth
Ferrero, on the other hand, has seen its market share increase every year since 2013 mainly driven by the growth of Kinder Joy, according to Euromonitor.
Ferrero China currently operates four brands, including Ferrero Rocher, Raffaello, Kinder, and Nutella. The market researcher believes the company could even break into China’s sugar confectionery market if it brings Ferrara (acquired last year) to the country.
Despite the fact Ferrero’s share is only about half of Mars’ in China, it has increased from 10.5% in 2013 to 14% in 2017, Euromonitor data suggests. Kinder Joy, in particular, reached a share of 6.5% in 2017 from the previous 4% in 2014.
Mars and Ferrero make up around 50.7% of China's chocolate confectionery market currently, according to Euromonitor.
Euromonitor said chocolate featured with toys is increasingly managing to win over children and their parents in China because it offers “both a snack and a game to enjoy at the same time.”
“Chocolate with toys registered the most dynamic value growth of 18% in 2017, primarily thanks to the positioning of this product type for children, as well as the comparatively small sales base of this category,” Euromonitor said.
“Considering their relatively small pack size, chocolate with toys usually consist of a small amount of chocolate, which directly meets health demands for children,” it added.
Chocolate with toys is expected to reach nearly 2.95bn RMB ($452m) retail sales in China by 2022 from 1.91bn RMB ($292m) in 2017, Euromonitor predicted.