Clear waters ahead
The appetite for high quality seafood among Chinese consumers is growing, leaving lots of room for Irish exports. Seafood Specialist, Amy Wang, discusses new channels of interest and activity in the year ahead
The demand for premium imported seafood in China has increased strongly during the past number of years and continued economic growth means this trend will continue and trickle down from higher to lower tier cities.
The majority of imported seafood is consumed in Tier 1 and Tier 2 cities. Tier 1 cities are nationally leading cities – Shanghai, Beijing, Guangzhou – and have the highest levels of economic development, enjoy the most disposable income, and are culturally influential. Those in Tier 1 cities are more open to imported foods, willing to try new and premium alternatives There is also an increased focus on health.
Tier 2 cities are leading provincial capitals and developed cities in key provinces such as Guangdong, Jiangsu (Chengdu, Hangzhou, Nanjing, etc.). This is a key growth market for premium goods, such as seafood, which are adopted at a much larger scale.
Seafood consumption in urban areas is roughly twice that of its rural counterparts, and it enjoys more variety. However, rurally, seafood consumption is growing at a faster rate.
We expect to see a rise in premium seafood consumption, particularly in urban areas, as it becomes available to more people. Consumers are also searching for healthy choices and seafood is seen as a better alternative to meat.
Seafood consumption is increasing across almost all channels, from foodservice to retail to quick-serve restaurants. Retail innovations have made premium seafood available for people to cook at home at a much larger scale, opening up significantly more opportunities for suppliers of raw ingredients (both alive and frozen). New Retail is taking market share from traditional supermarkets, such as Carrefour and Walmart. This trend is expected to continue over the next few years.
Blurring the lines between supermarket, restaurant, and e-commerce, New Retail is a new concept developed by Ali Baba. It is very innovative, creates an environment of trust and traceability, and has a reputation for premium, high-quality products, and consumers are willing to pay more for products sold here. New retail is available in approximately 20 cities across China, and it is increasing its presence.
Hema and other New Retail outlets offer many opportunities for Irish seafood exporters to promote and sell their products. Shoppers can scan QR codes of the products and are shown branded content (images, text, and videos), quality certification, customer reviews, and suggested recipes.
An increasing number of Chinese consumers are buying seafood online and Irish seafood producers should focus on ecommerce platforms Tmall, JD, and Taobao. Here, brands can publish product information, branded video and image content, and customers can leave reviews on their ecommerce stores. Thanks to the well-developed cold chain technologies, this is becoming a good alternative for consumers to order to eat it at home.
Online, Irish Pacific oysters are considerably more expensive than domestically produced oysters. Irish brown crab is relatively well marketed on Taobao and Tmall and is priced mid to high among other import competitors.
China has been pushing for more traceability features in the market and this has helped to drive the success of imported seafood and improve trust levels among consumers. It is very common now to see a QR code on packaging, giving consumers information on the product, the producer, and import dates. It can even tell you that the people who have handled the seafood have tested negative for Covid-19. This is an opportunity for Irish exporters to share information around Ireland’s clean waters, earn consumer trust and show that imported Irish seafood is safe.
The value of Irish seafood exported to China more than doubled (58%) between 2017 and 2019, with a 46% increase in volume. In the high value segments, lobster and crab have performed very well, with imports increasing at approximately 20-30% on a yearly basis, prior to the outbreak of Covid, and this is a trend we expect to continue.
2020 was a very challenging year for Irish seafood imports in China: Foodservice was damaged as a result of Covid, consumer confidence in imported goods was affected, and there were logistical and transportation challenges faced in supplying the market, especially for live shellfish. Consequently, Irish seafood export to China experienced a fall of 64%, from €44.7m in 2019 to €16.3m in 2020.
In 2020, we worked with importers to increase awareness of our seafood products to consumers through foodservice outlets. During the pandemic, Chinese consumer confidence was damaged by media reports, but we worked with the foodservice industry to restore this trust.
Marketing activity throughout the year included in-store promotions, the World Seafood Fishery exhibition and the Master Series, an event held in Shanghai where we asked a renowned foreign chef to design and cook a dish each for Irish langoustines and blue lobsters. We invited four food-related media to the cooking demonstration and used it to create two cooking videos for use in future PR.
We rolled out two seafood sampling campaigns in high-end western restaurants and five-star hotels in Shanghai and Guangzhou, to encourage consumers to try Irish seafood.
For the Shanghai Oyster and Whiskey event, we teamed up with a whiskey bar in Shanghai and hosted a ‘one weekend only,’ flash event combining Irish oyster with Irish whiskey and gin. This promotion was oversubscribed by 50%, indicating that the demand was still there.
Our online activity included posting on our social accounts, on Wechat and on Weibo. We also engaged with 22 consumer and trade Key Opinion Leaders (KOLs).
This year’s focus is on foodservice and we plan to attend five exhibitions to generate leads. We will also be exploring retail channels, especially for brown crab products. Our marketing strategy will focus on the premium positioning of our high-value shellfish, and increasing Ireland’s reputation for natural, nutritious, and safe seafood. Communicating Ireland’s range of premium seafood is a priority, and we will be highlighting blue lobsters and oysters as flagship products, with information on langoustine, whelk, brown crab and pelagic fish also part of the strategy. We will share the messaging around Origin Green, Ireland’s pioneering food and drink sustainability programme, which will further emphasise Ireland as a supplier of safe, sustainable, and premium seafood.
In targeting the trade, we are adding three more regional fishery shows, bringing to five the number of exhibitions where we will be showcasing. We will continue chef events to increase exposure to chefs and local distributors. To draw the attention of consumers, we will continue to share the premium nature of Irish oysters, and in August we are planning another oyster bar promotion. Our media events will include a partnership event with Jameson Whiskey. We are confident that as the Covid crisis abates, demand for Irish seafood return.