Asiafruit Congress 2014 Highlights

Asiafruit Congress 2014 showed the way to capitalize on the opportunities in Asia’s dynamic consumer markets, from branding to m-commerce.
 
Asiafruit Congress gave delegates a unique insight into the world of opportunities in Asia’s hugely dynamic fresh fruit and vegetable markets on 2 September in Hong Kong.

Kicking off Asia’s premier conference and networking event, which attracted more than 400 decision makers from 38 different countries, James Sinclair of InterChina, explained how the ‘premiumisation trend’ in China, fuelled by rising incomes, is creating unprecedented opportunities for fresh produce brands.
 
“The middle-class in China is interested in trading up, but they are discerning. They are not interested in trading up in everything,” said Sinclair. “Consumers are worried about chemical and biological hazards when it comes to food, so when trading up, one of the key priorities are fresh produce, along with cars, leisure expenditure and travel.”
 
Sinclair said branding provided a mark of trust to safety-conscious consumers, particularly younger generations, who represent an increasing share of the market. “Many younger consumers are not confident in selecting produce,” said Sinclair. “They don’t know what they’re looking for and don’t have relationships with vendors. Brands help consumers build confidence in a product by offering consistency and trust.”
 
Trading up is not just about buying a more expensive product, he pointed out, but about addressing consumer sensitivities, be it peace of mind over food safety, desire for ‘indulgence’ or concern with the aesthetic appearance of the fruit. “Start by deciding what your brand should stand for in China, and then wrap it up in a story,” he told delegates.
 
The digital revolution has offered new ‘clever and disruptive’ ways to tell that story and develop brands, Sinclair added, a theme explored in the ensuing panel discussion. Zespri’s China corporate relations manager Matt Crawford, highlighted how Zespri was attracting and retaining consumers by positioning its brand as more than just a produce label through events like its recent Juicy Water Fight in Shanghai.

“The challenge is to build connection to brand,” Crawford said. “The aim of events like the Juicy Water Fight is to highlight the importance of vitality, getting outdoors and having fun with your family, which consumers will associate with the Zespri brand.”

Crawford also explained how guests at the Juicy Water Fight were encouraged to share their experience through social media. “There is nothing more important than peer to peer marketing in China at the moment,” Sinclair added. “It’s not uncommon for consumers to go through 200 comments (from fellow consumers) before buying a product.”
 
While acknowledging the huge opportunities for producer brands in Asia, fellow panellist David DeLorenzo, CEO and president of Dole Asia, said branding remained very important to the fresh produce business globally.
 
“I think every piece of fresh produce should have a brand on it, because a brand to the consumer means that somebody cares, that someone is responsible,” said DeLorenzo.
 
“In the fresh produce industry, I don’t see it as one company’s brand against another, I think we’re all partners together in building consumption. Our goal should always be to increase consumption for everyone.”
 
DeLorenzo also stressed that the best way to secure consumer endorsement was through the quality of the offering. “What sells produce is good quality and size of display. When you have large displays of good quality produce, consumption goes up dramatically. Brands that stand behind that quality will always benefit.”
 
Latin America looks to extend reach
Latin American exporting countries such as Chile and Peru have been leading the charge for imported fruits in Asia. With their export volumes set to grow strongly in the future, the second session focused on the need for them to boost their market penetration in China in particular.
 
In the session, which was opened by Peru’s deputy agriculture minister Jorge Luis Montenegro, Juan Carlos Rios of Peru’s Intercorp Group said further market penetration was unlikely to come from the creation of direct distribution networks, but through collaboration with regional distributors who had knowledge of the market.
 
That view was echoed by Christian Carvajal of Chilean exporter association Asoex, who pointed out that suppliers should capitalize on the fact that many regional distributors in China were looking to make the leap into direct importing.
 
Breakout sessions spotlight opportunities
A series of breakout sessions kicked off the afternoon agenda at Asiafruit Congress, and while China had dominated the morning’s proceedings, a session dedicated to Indonesia packed out the room. Kafi Kurnia, managing director of Peka Consult, encouraged exporters considering entering the Indonesian market to look beyond the volume of customers they can service and focus on the value they can derive from supplying high-end products to the market.
 
“The average annual growth for fruit imports to Indonesia is between 13 and 15 per cent, but it’s not only the size or rate of growth of this market that is important; quality is also essential,” said Kurnia. “There is a new trend forming in Indonesia towards self-indulgence, so consumers are interested in buying top-quality fruits.”
 
In other breakout sessions, Patrick Vizzone of National Australia Bank analysed Asia’s surging demand for safe food, Winstone Chee of Dairy Farm Group and Wayne Prowse of Fresh Intelligence Consulting mapped out the market trends in Asia’s vegetable trade, while Louis Ng, Pear Bureau Northwest’s China representative, and Brett Ennis of Prevar, looked at the bright future for pear marketing in the region.