Gifting ones way to business potential ^简体

   

      
      
   

Yanzhifang Food Co Ltd, a nutritious grains producer based in Anhui province, is growing at a rate of 50 percent annually from a new business category — gifts.

The company, which has been relying on retail and e-commerce to reach more health-conscious consumers, expects its gift products business to reach one quarter of total revenue, or 500 million yuan ($69.1 million), by the end of this year.

"Branded health grain products for families, friends, or as welfare for employees, have been in great demand since 2020," said Kong Qingfang, director of corporate affairs at Yanzhifang. "We've developed gift products customized for every client's budget and request."

A rising number of domestic companies that target individual consumers at the retail level are banking on the surging growth potential of China's gifts industry.

The Chinese gifts market, which primarily comprises marketing or promotional items, giveaways and employee welfare products, is thriving as such products help enhance consumer relations, boost purchases, and foster employee-employer ties.

China is the world's largest producer and exporter of promotional giveaways. The market size of China's gifts industry is forecast to reach 1.38 trillion yuan in 2024, according to the "2024 China Gift Industry White Paper" by RX Huabo and Kantar.

In 2022, the overall scale of China's gifts industry reached 1.23 trillion yuan, with the annual growth rate exceeding 9 percent from 2018 to 2022. Projections anticipate an average growth rate of 4 percent between 2023 and 2027, according to the report.

The gifts sector in China harbors significant growth potential. By comparison, the mature gifts industry market in the United States, particularly gift cards, reached $275 billion in 2022.

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Emotional appeal

The giftware industry in China encompasses a wide array of consumer products, spanning everyday items like home decor, drink-ware, and stationery to more luxurious offerings such as timepieces, jewelry, silverware and artworks.

"Everything can be a gift, as long as it is imbued with emotional significance," said Helen Shen, vice-president of RX Huabo. The Shenzhen, Guangdong province-based company holds 13 gift exhibitions in China annually, covering more than 3 million buyers and 10,000 suppliers.

"With the continual improvement of living standards in China, there's seemingly no shortage of options. However, selecting the right gift requires insight and a deep understanding of people's lives," Shen said.

During the three major traditional Chinese festivals — the Spring Festival, the Mid-Autumn Festival and the Dragon Boat Festival — large enterprises or organizations also provide food, groceries or home appliances to strengthen their relationships with employees, Shen said.

Compared to conventional retail channels, the gifts sector, with its emphasis on added value and personalized services, often yields higher profits for producers, she said.

For instance, leading food and snack companies have identified new growth opportunities within the gifts sector.

The white paper by RX Huabo and Kantar indicates thriving new categories, including pet-related products and innovations inspired by traditional Chinese culture, small home appliances and digital electronic devices.

During the China (Shenzhen) International Gifts and Home Products Fair in April, a dedicated hall showcases "Created in China" gift products, highlighting innovations from Chinese designers.

Among the exhibitors at the China Beijing International Gifts, Premium & Houseware Exhibition in March, a set of eye-catching colorful dragon-shaped fridge magnets designed by a Beijing-based industrial design studio became a hit.

These magnets, featuring transparent materials and components that could be reversed and twisted to look like a dragon floating on the surface, captured the attention of many buyers.

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"We used to design and create customized toy products for the capital's iconic tourist sites. We were bestsellers but in small quantities. Now, the gifts sector presents a larger and newer market," said Liu Yang, a professor of industrial design at Beijing University of Technology and founder of Beijing Huaxin Yichuang Industrial Design Co Ltd.

"Chinese consumers have always had a fondness for traditional Chinese culture. It's the modern design, craftsmanship, and new material that make traditional Chinese intellectual property and cultural products more appealing to today's youth," said Liu.

Shen of RX Huabo said that gifts are no longer about just adding a company logo or commemorating traditional festivals.

The innovation and added-value infused into the gift receive the most recognition, she said.

An increasing number of giftware companies have expanded their business by incorporating more design elements and offering customized designs for customers.

"When it comes to gifts, it's about delving into the corporate core values and cultural systems and fusing them with designs and productions," said Liu, who has called for setting up a platform during gift industry exhibitions for designers to gather and exchange innovations and stimulate the applications of these IPs.

Another new trend this year is more visibility among companies promoting pet-related products.

Shen said that, due to the increasing trend of viewing pets as life companions, potential customers are often pleasantly surprised when they receive pet accessories as gifts rather than gifts for themselves.

Additionally, a surge in the population of singles has resulted in less procurement of food ingredients such as oil, rice, or flour, and an increase in purchases of dairy and ready-to-cook products, she said.

The gifts industry in China is mainly operated by small and-medium sized companies, with relatively small-sized orders in both value and quantity.

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According to the white paper jointly released by RX Huabo and Kantar, there were only 50,407 registered and existing companies in the gifts industry as of 2022.

Statistics from the white paper showed that there are currently over 100,000 small and medium-sized gift companies, along with over 4,000 large gift companies.

According to the report, more than half of the total orders for a single supplier consisted of less than 10,000 pieces. Over 60 percent of orders were valued at less than 3 million yuan each in 2023. In terms of volume, about 75 percent of single orders comprised fewer than 300 pieces.

However, the industry is growing, and powered by emerging retail enterprises and those venturing overseas.

"This year, all of our fairs are likely to experience growth, with a projected 7 percent increase in average exhibition coverage and revenue," said Shen.

RX Huabo's gift exhibitions have grown from having just over 100 exhibitors initially to nearly 10,000 exhibitors presently.

She said that promotional and marketing products are expected to maintain robust momentum, driven by rising consumption among product companies such as liquor producers and electric vehicle manufacturers.

In the past, growth engines stemmed from formula milk producers who acquired more promotional presents, or insurance companies in the finance industry.

The gifts sector in China is extending its reach overseas, with RX Huabo set to launch its inaugural overseas exhibition this September in Indonesia.

The show is set to feature around 500 suppliers from China, with preparatory workshops in advance to facilitate overseas market expansion, Shen said.

"A growing number of Chinese companies, including electric vehicle and mobile phone producers, are venturing abroad to explore market opportunities," she said. "As they eye more overseas consumers, we're going along with them."

Plans for gift exhibitions in the Middle East and Vietnam are also afoot. "In these markets, middle-income families are rapidly expanding, with a demand for higher-quality gifts," she added.

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[來源: ChinaDaily]