For Luke Nicholas and Peter Cullinane, whose products occupy the value-added, niche end of the market, the challenge will be to reach the 340 million newly affluent Chinese. Just getting a product on the shelf - itself enough to drain the resources of many medium-sized New Zealand companies – won't necessarily get it sold.
“As in the West you have to educate the consumer about the product, the brand story, and the health and safety components of the product," says Damon Paling, Customs and Trade partner for PwC. “In such a competitive market, connecting with your customer is extremely difficult."
He also points to social media. “WeChat, Weibo (Chinese social media platforms) are fantastic ways to connect with the consumer. Consumers like to share their experiences after they've purchased, they want to learn from others before they purchase, so aside from traditional channels of distribution and e-commerce, social media is an area that has to be explored if you're looking to connect with the Chinese consumer."
This rings true with Cullinane, whose $6.49-a-bottle chocolate milk was a runaway success in New Zealand aided by a viral social media campaign.
Cullinane believes he can replicate some of that success in China. “Consumers are happy to pay a premium if they know they're getting a premium. I believe people are pretty much the same everywhere. There is a bit of hope here …"