China’s Two-Children Policy Promises Potential for Korean Baby Food Manufacturers | Be Korea-savvy

China’s Two-Children Policy Promises Potential for Korean Baby Food Manufacturers


Korean firms have yet to make progress in the Chinese market, however, mainly from high market entry barriers, local regulations, and poor brand awareness, despite the fact that 52 percent of the market share for powdered formula is claimed by overseas manufactures. (image: KobizMedia/ Korea Bizwire)

Korean firms have yet to make progress in the Chinese market, however, mainly from high market entry barriers, local regulations, and poor brand awareness, despite the fact that 52 percent of the market share for powdered formula is claimed by overseas manufactures. (image: KobizMedia/ Korea Bizwire)

SEOUL, Oct. 21 (Korea Bizwire) – China is experiencing another baby boom generation after repealing its infamous one-child policy, and the change is proving to be a boon for Korean firms hoping to make inroads in the Chinese market for baby food products. 

The Korea Agro-Fisheries & Food Trade Corporation (aT) recently launched an online shopping mall specifically for K-food linked with China’s instant messaging service WeChat. 

From October 19 to 21, aT also hosted a baby products expo, during which it signed business agreements with local wholesale centers and baby food product outlets, allowing it to establish pop-up stores and display stands at 14 wholesale baby product outlets and baby shops in 85 Chinese cities and provinces.

Products that prove successful after aT’s initial operations will be expanded to some 2,800 baby shops across the country, a company official said. 

According to local sources, China should welcome roughly 3 million newborns starting this year, rapidly growing its market for baby products. With younger parents’ changing consumption patterns and improving livelihoods, the market for baby food is growing by an annual average of 15 percent, and was sized at $19.8 billion in 2015. 

Korean firms have yet to make progress in the Chinese market, however, mainly from high market entry barriers, local regulations, and poor brand awareness, despite the fact that 52 percent of the market share for powdered formula is claimed by overseas manufactures. 

Similar circumstances apply for other baby food, drinks, snacks, and supplement makers, with Korean companies still struggling to establish themselves in the Chinese market. 

Given the current situation, aT’s latest ventures mark a significant breakthrough. 

A new platform on WeChat created by aT, Hansik Wang (韓食王), takes advantage of the fact that WeChat is one of the largest messaging services in China, in addition to WeChat’s power bloggers, who serve as its main commercial agents. 

These agents, called Wei Sang, have a strong consumer management system, providing frequent content to their followers, and serving as a powerful word-of-mouth promotion platform. 

Wei Sang target mainly the young and women consumers, selling food, household supplies, and beauty products, which accounted for 14.2 billion won in market size in Q1 2015. 

“Chinese consumers have a higher level of anxiety towards their domestic products, from frequent food safety scandals,” said aT President Yeo In-hong. “And because they’re more sensitive towards food products for babies, we believe there’s plenty of room for safer Korean products.”

By Kevin Lee (kevinlee@koreabizwire.com

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