Tag Archives: China

Lotte Confectionary – Creation of Chocolate based holidays in East Asian Markets

 

Lotte is a huge conglomerate based in Japan/South Korea that has easily dominated the East Asian market for mass produced chocolate (Yonhap news). They are equivalent to Hershey’s in the states and recently solidified their global standing in the chocolate market by partnering with Hershey’s to dominate the chocolate market in China (Reuters). They are not only a company that produces chocolates, but many other chocolate related products in Asia along with being a conglomerate that has ventures in hospitality, technology and e-commerce.

Initially they began their marketing of chocolate in Japan, with what is called Ghana Chocolate.

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The name was derived from the source of their chocolate manufactures, they were marketed with “extra cacao for the extra rich taste” and with an “authentic” twist, as they were sourced directly from Africa. But much like their global competitor Hershey’s, they do not follow the recent model of “fair source” or “fair trade” chocolate. Unlike many of the local chocolatiers, they are anything but transparent in how their chocolate is sourced and conceived. Because they are a huge conglomerate, and because of lack of competition through artisanal and locally sourced chocolate in Asia, they feel no pressure to publicly release their sources and the treatment of the workers of their chocolate sources.

So why is this such a big deal? We’re familiar with the idea of bigger corporations buying out and hiding such information from us. When companies hide information from us in this day and age, more and more, we instead choose to make more educated choices when it comes to our purchasing of chocolate and spreading awareness. However, to understand why Lotte feels no pressure despite the spread of awareness and information to change, we have to go back a bit to understand the backstory of Lotte Corporation and a bit of Asian culture and history.

White Day, Black Day & Pepero Day

November 11 is just another day here in America. So is March 14 and April 14th. The only real “holiday” that America associates with chocolate is Valentine’s Day (February 14th). So why is it that the chocolate markets in Asia see such a huge increase in consumption and sales of chocolate during these seemingly random days?

In East Asia, particularly China, Japan and South Korea, being a “couple” is the trendy state to be. Rather than embrace your independence, many things in East Asia are catered towards couples and pairs. So, why is this important? This is because Lotte Confectionary has monopolized this mindset and effectively marketed various “holidays” and traditions that cater to this.

Aside from Valentines Day, East Asian cultures also celebrate what has been marketed to be “White Day” (March 14th) ,“Black Day” (April 14th) and Pepero Day (November 11th). In their culture, Valentines Day isn’t just a day for couples to exchange chocolate, but it is a day for women to gift different types of chocolate to various men in their life. There are 3 different types of chocolate that are sold and catered just for this day: Friendly Chocolate, Premium Chocolate and Hand-Made Chocolate. Friendly Chocolate is chocolate given to friends of the opposite sex that you are grateful to have in your life. Premium Chocolate are for the people in your life you are very grateful for but do not fit in a Friend or Lover category (ie. family members or best friends). The “Hand-Made” chocolate are the ones you carefully craft on your own after buying all the necessary ingredients and they are to be given to one person only – the person you love or would like to start a relationship with. This is important because on White Day, March 14, the men who have received these chocolates from women are expected to reciprocate and gift them with chocolate of their own. Of course, the same rules apply. And in April 14th, the lonely people who were unable to receive any Hand-Made Chocolate are expected to gather together and eat dark colored food (Smithsonian.com). Lotte has obviously used this to their advantage to market “bitter” dark chocolate and wallow in their sorrows until next year’s Valentines/White Day. Of course, Lotte has different types of chocolate at various price points to market and cater to all these buyers.

Pepero day (November 11) is yet another chocolate related holiday in where people give their significant others and people in their life Pepero. Pepero (or Pocky, as it is more commonly known here in the states) is a thin unsalted pretzel stick dipped in various flavored chocolate and different types of nuts for extra texture and flavor. Lotte Confectionary, a subsidiary of Lotte Corporation, is credited with the creation and marketing of this easy to chocolate dipped stick. Using clever marketing and visual cues, they have successfully branded this day as Pepero Day and the purchases of pepero on these days skyrocket. The day comes from looking like a Pepero Chocolate (11/11) and is also smart marketing on Lotte’s end.

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All of the chocolate that is produced my Lotte plays up on this cultural aspect of Asia where being single is considered “lonely” and “unsatisfying. As you can see in this Commercial for Ghana Chocolate, they prey on the couple aspect and the happiness that one would receive from being gifted these chocolates. Of course, it is no secret that they have their hands on non-chocolate related couple items as well.

Sex Sells – Celebrities

Now, this still doesn’t full explain why Lotte is one of the the biggest producer of chocolate related products in Asia. Yes, they’ve used their marketing tools to play up the couple oriented culture in Asia and used words like “Real Cacao” to get the unsuspecting consumer to believe that the product they are purchasing are of the highest quality.

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(It may also help that Asian Countries aren’t as stringent like the US FDA to release all their ingredient info)

But it is their usage of sexualization and celebrity endorsements when it comes to these Chocolate related products. As you have seen in the above commercial, almost all chocolate advertisements in Asia are like that. While this is also a common tactic in the US, the celebrities in Asia are idolized (they are actually called Idols) and children from the age of 8 to adults well over 25, follow and almost worship these celebrities. By using them and showing that this is their preferred brand of chocolate, the consumers do not ask questions of the source of these products, but instead buy them in bulk hoping to be more like them.

However, through clever marketing platforms and excessive usage of monetary funds (They are the 5th biggest conglomerate in Asia), they have made it that being the face of a Lotte Chocolate brand is the biggest achievement a celebrity can receive. This is why the previous faces of their brand have been celebrities like Mao Asada, Lee Hye-ri and Park Bo-gum. To understand the power of these celebrities, all three of them have been featured on Korea/Japan’s Top 100 power celebrity lists year after year.

Purchase of Guylian – Belgian Chocolatiers

Now, with all these pseudo-holidays that pop up consecutively over the months, along with the traditional holidays of Valentines Day, Christmas, Anniversaries and Birthdays, Lotte has created a market where they can offer anything from cheap go-to chocolate bars to high end European designer chocolate. Their chocolate markets continue to boom through the usage of celebrity endorsements, and ongoing advertisements for the necessity of their chocolate.

And now, with the purchase of Guylian, a high end designer chocolate maker based in Belgium, Lotte has been able to set a landmark and a path into Europe to even further their holding in the chocolate industry (Justfood.com, forbes.com). The most interesting part of this acquisition is that Guylian, on their website, claim that all their chocolate is humanely sourced from West Africa with their manufacturer guaranteeing the safety of the food (Guylian.com). Their website goes on to display their numerous awards and their guarantee of authentic and 100% cacao bean usage in all their chocolates.

Guylian is a company with origins in the art of haute-couture chocolate, with renowned chocolatiers within their starting ranks that have received certifications from famed confectionary and chocolatier schools. Through this purchase, Lotte has also been able to rebrand themselves into an even more sought after and cultured variation of chocolate. Rather than being just a consumer friendly chocolate company with “higher end” products, they have been able to include a Belgian based chocolatier that is famed and well known around Europe with their Guiness Record (Guiness) in chocolate making and patented praline chocolates.

Now, why is it that their parent company, Lotte Confectionary/Corporation, is not held to the same standard? Nowhere on Lotte’s website is there a link to the source or the location of their chocolate, nor how it is manufactured. The closest we can get to is that their chocolate is in majority sourced from West Africa (Ghana) and that they use “real cacao beans” to make their chocolates.

Why Should We Care?

Fair trade law, one that we are so familiar with in America and thanks to our class, is something that is still in its infancy in Asia (koreanherald.com). Despite Lotte being such a huge conglomerate that holds stake in almost everything you can think of (Technology, Hospitality, Food, Wine, etc.), because the Fair Trade Act isn’t a widespread knowledge and notion in Asia, ultimately the consumers do not care.

They do not check the sources of their products, they only care to purchase the “prettiest packaged products” to give to their significant others. The Fair Trade Certifications we discussed in class do not apply to the Asian Market, despite the chocolate being consumed in these areas have consistently risen (Financial Times). With Asia looking to be the next big market in chocolate that these conglomerates can get their hands on, shouldn’t Fair Trade be a priority?

However, through the usage of fancy terminology like “Real 100% Cacao” and “Chocolatiers”, Lotte manages to bypass all the Fair Trade knowledge that we have learned through class. The most important thing we should demand from this corporation is what we demand from every company these days – transparency.  Yet, because the economic and trade laws that encompass Asia are mostly focused towards fair trade within their borders, how their products are received in Asia do not really matter, it only matters how we treat our workers and crops within the continent of Asia itself.

As of right now, Lotte chocolates aren’t a major player in the United States. Other than a handful of Asian Markets that carry their brands, their reach to the United States is limited by global competitors like Hershey’s. However, with their recent joint-venture with Hershey’s in China and their merger with Guylian chocolates in Belgium, it is only a matter of time before they take over the global market, just like how they did in Asia. Because the idea of fair trade is still in its infancy in Asia, this can be a major issue to the chocolate markets and cacao farms across the world.

Because they are headquartered in South Korea and Japan, they do not feel the pressure that a lot of US companies do when it comes to Fair Trade in Chocolates. The labor laws directed at South Korean citizens state that the minimum wage to work a full time job (40 hours a week) in South Korea as of now is 15 and they may work a part time job (20 hours a week) at the age of 13 (DOL). If this is the law that they have on their own citizens, why should they really consider the dangers of child labor laws when it comes to foreign countries?

This isn’t to cast a bad light in Asian working culture, but to show the vast difference in culture and the importance of a global policy when it comes to these matters. When Lotte tries to break their way into the US market, we should be more aware of what they are offering and put the same amount of pressure on them as we are to Hershey’s and other global chocolate corporations. Because ultimately, fair trade chocolate is the best tasting chocolate we can have.

Works Cited:

“Chaebol Rankings Seesaw over 2 Decades.” Yonhap News Agency, english.yonhapnews.co.kr/news/2017/11/01/0200000000AEN20171101003000320.html.

Department of Labor. “Laws Governing Exploitative Child Labor.” http://www.dol.gov/sites/default/files/research/southkorea_CL.pdf.

“History.” Guylian Belgian Chocolates, http://www.guylian.com/us/history/#history.

Just-food.com. “SOUTH KOREA: Lotte to Buy Chocolate Firm Guylian.(Reprint).” Just-
Food.com, 2008, pp. just-food.com, June 25, 2008.

Kim, So-Hyun. “Fair Trade Finds Feet in Korea.” Korean Herald, 10 May 2013, http://www.koreaherald.com/view.php?ud=20130510000757.

Kwok, Vivian Wai-yin. “Korean Confectioner Takes A Bite Of Europe.” Forbes, Forbes Magazine, 19 June 2013, http://www.forbes.com/2008/06/23/guylian-lotte-confectionery-markets-equity-cx_vk_0623markets03.html#47c47be64320.

Martin, Carla.“Alternative trade and virtuous localization/globalization”, Harvard University, (2018).

Martin, Carla.“Haute patisserie, artisan chocolate, and food justice: the future?”, Harvard University, (2018).

Smith, K. Annabelle. “Korea’s Black Day: When Sad, Single People Get Together And Eat Black Food.” Smithsonian.com, Smithsonian Institution, 13 Feb. 2013, http://www.smithsonianmag.com/arts-culture/koreas-black-day-when-sad-single-people-get-together-and-eat-black-food-16537918/?no-ist.

Soyoung, Kim. “Lotte, Hershey Launch China Candy Venture.” Reuters, Thomson Reuters, 29 Jan. 2007, http://www.reuters.com/article/us-lotte-hershey-china-idUSSEO22724620070129.

Terazono, Emiko. “Asian Chocolate Demand Set to Outstrip Global Growth.” Financial Times, Financial Times, 4 Oct. 2017, http://www.ft.com/content/3cb2e488-a8f8-11e7-ab55-27219df83c97.

“Valentine’s Day.(Chocolate Purchases)(Brief Article).” Journal of Property Management, vol. 71, no. 1, 2006, p. 9.

 

*thank you again for the extension on my paper regarding personal matters. I really really appreciated the extra time. Thank you!

 

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Porcelain and Posh: Juxtaposing Global Chinese Export Ware Influences and a Fraught Modern Chinese Chocolate Market

During the 17th to 19th centuries, there was a flourishing trade of export porcelain wares and material goods from China to Europe and the Americas centered around chocolate consumption.  Beautiful and ornate chocolate pots and cups with Chinese patterns and motifs became commonplace in many households and chinoiserie permeated Western decorative arts.  But for all this flow of material culture and ideas in the past, the introduction of chocolate, or the food products and culture of these objects, has been particularly difficult and fraught in Modern China.  The confusion over the Chinese chocolate market is evident in current news and popular articles declaring the rise of a generation of “young chocoholics” with predictions of a promising and expanding chocolate market[i] juxtaposed against downward trends of chocolate confectionary consumption due to greater awareness of healthier diets that contain less sugar.[ii]  This contrast in reception of items we think of as, for example, so quintessentially Chinese or absolutely American, illuminates the complex social interchanges and connectivity between different cultures and ideas.

By the time that Europeans were just discovering chocolate, the Chinese had already developed a thriving ceramics industry due to various major advancements in the sixth to ninth century, such as the “discovery of porcelain” and “the development of high-fired stoneware.”[iii]  In addition, kilns were producing goods to make and serve China’s own stimulant beverage.  Tea, with its own long social history, had taken hold and tea drinking habits expanded across socioeconomic boundaries thanks in part to easier and less expensive transportation channels after the Grand Canal was completed.[iv]  By the 14th century, Jingdezhen in southeast China emerged as the main kiln complex and single center of production due to a popular new technique, the now recognizable “porcelain painted with cobalt blue under a transparent glaze.”[v]

The kilns at Jingdezhen were making millions of products for trade and domestic use in the 15th century and by the 17th century, Chinese “blue-and-white porcelains” were “the most desired and technically advanced ceramics in the world.”[vi]  As trade routes developed, Chinese potters were commissioned to produce specific objects for the Western market, often receiving models and images to copy for some guidance.[vii]

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A curious example of early East-West trade, this Portuguese ewer made in China around 1520-40, based on an Islamic form, actually has the Portuguese coat of arms upside down most likely because the Chinese painters misunderstood how they were supposed to appear.  From the Metropolitan Museum of Art.

But it was the imagery that came from “this wondrous, faraway place” that caused “la maladie de porcelaine”, or a craze and madness for porcelain.[viii]  The number of items exported was extensive; documents show that close to 10,000 chocolate cups and saucers out of a total of 150,000 porcelain items were brought over from Canton to Amsterdam for the Dutch East India Company in 1752 on one ship (Gordon 598).[ix]  When Europe developed their own porcelain factories in the early 18th century, they adopted Chinese “shapes and motifs” that became “part of Western ceramic traditions”; even today, common “shapes, sizes, techniques, and decoration” in ceramics are of Chinese origin.[x]

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This chocolate pot was made in Germany where the first European porcelain was produced. It is still inspired, however, by Chinese and Japanese designs and “rich visual languages” which is evident in the flowers and plants painted on the pot (Evolution of Chinese Ceramics, The Met). From The National Museum of American History – Chocolate pot with wooden handle, porcelain, Meissen. 1987.0896.02ab. Syz Collection (1569).

The demand for porcelain from Europe declined, but a new market emerged in America in the late 1700’s.[xi]

Chinese porcelain ware trade not only brought about a vast exchange and sharing of ideas “that remains unparalleled in world history”[xii], but also extended the global influence of Chinese motifs and decorative themes that deeply permeated Western culture and social realms.  E. Fleming writes that art objects can bear a “double commentary on the society” in both a “passive and an active voice” in that they are an expression of the culture and give “direction, form, energy, and self-consciousness” to the culture (277).[xiii]  The “Chinese taste” filled homes and the intimate social lives of 18th century colonial Americans, influencing a wide spectrum of decorative arts and material goods from landscape gardening to textiles.[xiv]  These objects and their patterns and motifs filled the American aesthetic imagination (we can still see examples of Chinese motif decorative ironwork on the exterior of Beacon Hill homes in Boston to this day) and played a part in the flow of ideas at the time.

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A closer look at an example of Chinese fret motif on a decorative ironwork balcony in Beacon Hill, Boston. In the background, the architectural style of the building appears to be Greek Revival, but the Chinese-inspired pattern showcases the strong influence of Asian aesthetic ideals. From Wikimedia Commons.

In the 19th century, for example, Eastern art was seen as “uncorrupted” by industrialism and the artistry of skilled handiwork and “good design” [xv] may have been juxtaposed against increasingly uniform factory products.  Moreover, Eastern art provided a new vocabulary and an alternative to revivalist styles based on historical associations[xvi], which would have been important in a time when differentiation in identity and from the tastes of antiquity were being discussed.  Much like Marcy Norton’s argument that Europeans did not change chocolate to suit their own tastes, instead they adopted a taste for indigenous chocolate and sought to recreate the experience[xvii], Europeans and Americans also either brought Chinese decorative art objects into social spheres or sought to emulate Chinese designs and craftwork.  The heart of the matter is that importing Chinese porcelain and goods, and their proliferation throughout society, fundamentally changed European “ideas about itself, its material culture, and its relation to the world” that permeated all levels of society (Cavanaugh and Yonan, 6-7).[xviii]

In contrast, the entry of chocolate confectioneries, as produced by western brands and companies, into Modern China has been particularly challenging and complex.  Chocolate has been present in China since the 17th century, but it has only existed marginally with very limited penetration into local cuisine (though much is still unknown about China’s chocolate history)[xix], unlike in Europe and America.  In modern times, China was isolated from the Western world from 1949 to 1979 during a chaotic period of great social experiments and revolutions, but an Open Door policy was implemented in 1978 to encourage and increase foreign trade and investment.[xx]  Soon after, the “Big Five” global chocolate companies – Cadbury, Hershey, Nestle, Ferrero and Mars – all sought to establish their brand in this perceived massive market with a population of 1.3 billion people, fighting for ways to achieve commercial success and enter the social lives of the Chinese people in the 1980’s and 1990’s.[xxi]  They set up joint-ventures and factories, Mars in the late 1980’s and finally Cadbury, the last to move into China, in 1995, and sold their products mainly as luxury goods.[xxii]  By 2004, the first “international exposition of fine chocolate” or “Salon du Chocolat” was held in Beijing.[xxiii]

Soon thereafter, speculations spread about the potential of the emerging chocolate market in China, but these statistics and predictions have carried over to today with relatively little progress.  In 2005, the average consumption of chocolate in China was about a kilo per person annually and only about 2% of inhabitants could afford luxury goods.[xxiv]  Projections were quite optimistic, however, with a strong value forecast for chocolate and a compound annual growth rate of 11% from 2005-2010[xxv]; China could potentially become the “largest confectionery market in the future.”[xxvi]  By 2010, chocolate sales had increased steadily in China to a little over $1.25 billion USD, however, the per capita sales remained relatively low at a miniscule approximate 1¥ or about 15 cents USD increase per year between 2006-2010.[xxvii]  China remains a small market in comparison, only accounting for about 2% of total chocolate sales in the world.[xxviii]  The spread of chocolate has “met significant resistance” outside of the larger cities and still is hardly present Chinese cuisine today.[xxix]

There are many practical explanations for the difficulties the Big Five faced in penetrating the Chinese market.  Lawrence Allen describes them in great detail: the limited infrastructure and underdeveloped retail channels that prevented widespread distribution (particularly when it came to air conditioning), especially outside of first-tier cities; lack of business information; difficulties working with local ingredients; and potential viable competition from local brands, especially if they reach and succeed in lower-tier cities first.[xxx]  Other challenging factors included the lack of dairy in Chinese cuisine, which, according to Bertram Gordon, “may have been the single most important reason” that there was no “‘takeoff’ of chocolate” in China in the late 19th and early 20th centuries.[xxxi]  Even more important, perhaps, was the role of sugar – Sucheta Mazumdar argues that Mintz’ theories of sugar consumption’s complex connections to production and realms of power cannot fully explain why it was so limited in China; instead, it was the contrast to Britain’s major population shift from agrarian to urban.[xxxii]  In China, peasant households, which still made up 90% of the population well into the 19th century, simply did not buy many products on the market, and, combined with relatively higher prices and no increases in real wages, sugar did not enter the everyday lives of Chinese people as it did in Britain.[xxxiii]  To this day, there is no dessert course during Chinese meals.  Finally, the familiar concept of cradle to grave product loyalty simply could not be applied to China’s emerging and new consumerism, people spent much more time reading and perusing products before they made a purchase decision.[xxxiv]

The incredible permeation of Chinese porcelain throughout Europe and America can act as a lens to view the remarkable lack of success of Western chocolate companies in the constantly cited great potential of the Chinese chocolate market.  Allen uses the example of the Big Five chocolate companies’ entrance into China to show the global interconnectedness of “China’s destiny”[xxxv], but as the history of Chinese export ware shows, China had tight connections with global interchanges where its own products had been hugely influential and deeply intertwined with other cultures in the past.  The difference is that the Europeans were fascinated by and in wonder of the “Other” they viewed through the images and decorations on porcelain from the Far East, but the “Other” in Modern China from foreign products is often associated with excess.  Some Chinese condemn the “Eurocentrism” of the Chinese chocolate market where the Big Five try to outcompete each other in upselling their “luxurious” products, and they are not fooled by this façade – many are keenly aware that the Big Five produce chocolate for mass consumption and that these manufacturers are not giving them a reason to incorporate chocolate “into their daily consumption habits.”[xxxvi]  In the past, Europeans imitated Chinese porcelain because of the exquisite designs and extraordinary craftsmanship, now in turn, American and European companies are holding up a product to for the Chinese to emulate that has false connotations and is an extension of a lifestyle that is culturally and socially foreign.

Current chocolate ads in China still portray the pinnacle of Western luxury, placing Chinese actors in very “exotic” locales, for example, with tastes and cultural references that can be lost on or too foreign for most Chinese people.

This Dove ad has many elements that would appear distinctly foreign to a Chinese audience from the Parisian location, the dress of the actors, to the pet dogs. Though on the rise, keeping animals as pets is still (relatively) not always a common practice in China, especially outside of major cities. 

When Snickers partnered with a mainstream Chinese boy band, TF Boys, to create an ad campaign with stories of studying and dealing with the pressures of school, with a video game format mixed in, that seems more universally appealing to Chinese children and general audiences, sales skyrocketed within two days.[xxxvii]

Allen continues to offer business advice that centers on a company’s “foreign heritage” that somehow lends them “product quality”, “management depth” and “credibility”.[xxxviii]   But Zhou argues that it is precisely this kind of emulation of “the high-end status of imported chocolate” that will not lead to success or interest mass consumers in China.[xxxix]  Consumerism has a complicated history in China and can still be an ambivalent, problematic topic today.  The Chinese Communist Party was quite “anti-consumerist” in the 1950’s when “revolutionary asceticism” was promoted, but at the same time allowed advertising and some forms of consumerism to persist (Gerth, 2010).[xl]  This dichotomous tension continues in the present day and, even if high-end products are commonplace in some areas and foreign brands can be associated with “credibility”, many Chinese people may still be hesitant and lukewarm towards extensive messages about luxury.  Zhou writes that chocolate manufacturers will need to “go against market norms” and “promote their products on a cultural level”; more importantly, chocolate companies will have to think outside the box, perhaps collaborating with a Chinese culinary institute or engaging in a “cross-cultural dialogue” about chocolate’s different historical roles in Chinese and European societies.[xli]

In conclusion, the challenges of chocolate confectionery companies in China and the stagnating pace of growth of the Chinese chocolate market may be due to many misunderstandings and disconnected cultural interpretations.  While only some aspects of chocolate were touched upon here in a long history of global exchanges, the particular significance of Chinese export ware for chocolate and their remarkable influence in so many aspects of European and American society may be helpful as a foil in thinking about how little the products of the Big Five chocolate companies have permeated Chinese society.

Special thanks to Nancy Hearst, Librarian in the Fairbank Collection of the H.C. Fung Library for finding or suggesting many of the sources on Modern China.

[i] Ren, Daniel. “New Generation of Chocoholics may Turn China into a Major Chocolate Market.”  South China Morning Post, 10 Sept. 2017.  Web.  7 May 2018.

[ii] “Chocolate Confectionery in China Executive Summary.”  Euromonitor International.  Euromonitor International, Aug. 2017.  Web.  8 May 2018.

[iii] “Evolution of Chinese Ceramics and Their Global Influence are Theme of Entirely New Installation on Metropolitan Museum’s Great Hall Balcony.”  The Met.  The Metropolitan Museum of Art, 14 Sept. 2012.  Web.  8 May 2018.

[iv] Sigley, Gary.  “Tea and China’s Rise: Tea, Nationalism and Culture in the 21st Century.”  International Communication of Chinese Culture, vol. 2, issue 3, 2017, pp. 319-341.

[v] “Evolution of Chinese Ceramics,” The Met.

[vi] “Evolution of Chinese Ceramics,” The Met.

[vii] Munger, Jeffrey, and Alice Cooney Frelinghuysen.  “East and West: Chinese Export Porcelain.”  Heilbrunn Timeline of Art History.  The Metropolitan Museum of Art, Oct. 2008.  Web.  8 May 2018.

[viii] High, Rachel.  “Porcelain Obsession: Denise Patry Leidy on Her New Book, How to Read Chinese Ceramics.”  Blogs / Now at The Met.  The Metropolitan Museum of Art, 11 Sept. 2015.  Web.  8 May 2018.

[ix] Gordon, Bertram M.  “Chinese Chocolate: Ambergris, Emperors, and Export Ware.”  Chocolate: History, Culture, and Heritage.  Eds. Louis Evan Grivetti and Howard-Yana Shapiro.  Hoboken: John Wiley & Sons, 2009, pp. 595-601.

[x] High, Rachel.

[xi] Munger, J. and A. Frelinghuysen.

[xii] “Evolution of Chinese Ceramics,” The Met.

[xiii] Fleming, E. McClung.  “Early American Decorative Arts as Social Documents.”  The Mississippi Valley Historical Review, vol. 25, no. 2, Sept. 1958, pp. 276-284.

[xiv] Fleming, E. McClung, 218.

[xv] Oshinsky, Sara J.  “Exoticism in the Decorative Arts.”  Heilbrunn Timeline of Art History.  The Metropolitan Museum of Art, Oct. 2004.  Web.  8 May 2018.

[xvi] Oshinsky, Sara J.

[xvii] Norton, Marcy.  “Tasting Empire: Chocolate and the European Internalization of Mesoamerican Aesthetics.”  American Historical Review, June 2006, pp. 660-691.

[xviii] Cavanaugh, Alden and Michael E. Yonan.  “Introduction.”  The Cultural Aesthetics of Eighteenth-Century Porcelain.  Burlington, VT: Ashgate Publishing Company, 2010.

[xix] Gordon, Bertram, 601.

[xx] Wood, L.J. and S. Grosvenor.  “Chocolate in China: the Cadbury Experience.”  Australian Geographer, vol. 28, no. 2, 1997, pp. 173-184.

[xxi] Allen, Lawrence L.  Chocolate Fortunes; The Battle for the Hearts, Minds, and Wallets of China’s Consumers.  New York: American Management Association, 2010.

[xxii] Wood, L.J. and S. Grosvenor.

[xxiii] Gordon, Bertram, 600.

[xxiv] Pacyniak, Bernie.  “Chocolates ‘n China.”  Candy Industry.  Stagnito Publishing Co., June 2005.

[xxv] “China’s Chocolate Binge.”  Food Magazine.  Reed Business Information Australia, Ltd., April 2007, pp. 30-31.

[xxvi] Pacyniak, Bernie.

[xxvii] “China Acquires a Taste for Chocolate and Wine.”  China Business Review, July-September 2011, pp. 32-33.

[xxviii] Allen, Lawrence, Battle for China’s Consumers, 203.

[xxix] Gordon, Bertram, 600-601.

[xxx] Allen, Lawrence, Battle for China’s Consumers.

[xxxi] Gordon, Bertram, 600.

[xxxii] Mazumdar, Sucheta.  Sugar and Society in China: Peasants, Technology, and the World Market.  Cambridge, MA: Harvard University Asia Center Press, 1998.

[xxxiii] Mazumdar, Sucheta.

[xxxiv] Allen, Lawrence, Battle for China’s Consumers, 38.

[xxxv] Allen, Lawrence, Battle for China’s Consumers.

[xxxvi] Zhou, Hongcheng.  “Why the  Chinese Are Still Not Sweet on Chocolate.”  Sixth Tone, 2016-2018.  Web.  9 May 2018.

[xxxvii] Yu, Douglas.  “M&M’s, Dove and Snickers Maintain Chocolate Market Lead in China.  Confectionerynews.com.  William Reed, 3 Sept. 2017.  Web.  9 May 2018.

[xxxviii] Allen, Lawrence L.  “Chocolate Fortunes; Lessons Learned by Leading Chocolate Companies Can Help Firms Succeed in the China Market.”  China Business Review, July-September 2011, pp. 28-31.

[xxxix] Zhou, Hongcheng.

[xl] Gerth, Karl.  “Compromising with Consumerism in Socialist China: Transnational Flows and Internal Tensions in ‘Socialist Advertising’.”  Past and Present (2013), supplement 8, pp. 204-232.

[xli] Zhou, Hongcheng.

The Great Wall of Chocolate: Barriers Against Chocolate in China

As the gates of the Chinese market began to open in 1978 through Deng Xiaoping’s Four Modernization Policy, western industries began scrambling to access the 1 billion prospective customers within China’s borders. The chocolate industry in particular made a noticeable effort in trying to alter the Chinese diet so that it could include the massive quantities of the sweet treat that western societies have grown so fond of. However, despite their efforts throughout these years, the average person in modern day China only consumes about “1.8 ounces of chocolate annually”. In comparison, Switzerland consumes “22 pounds per person” and the U.S. consumes “11.7 pounds per person” annually (Allen, 28). But what factors in China have contributed to this stark difference? This blog will address how cultural barriers and distrust in dairy products have deterred the spread of chocolate within China’s rapidly growing populace.

The disparate cultural layout of China’s provinces has proven to be difficult for chocolate companies to maneuver. For starters, although the Chinese ethnic diversity is mainly homogenous with “92 percent” of the population being Han Chinese, the culinary traditions are not. For example, the north prefers “salty” foods, while the south favors “sweet and fresh”; “spicy” is the ideal flavor in the east, as opposed to the west, which adheres to “sour” flavors (Allen, 23). This amalgamation of preferences has made it difficult for chocolate companies to create products that would satisfy the majority of the population and make lasting impressions on anyone that is willing to go out of their comfort zone to purchase the exotic confectionaries.

Furthermore, older generations of Chinese were accustomed to a “limited range of foods” due to the tough economic times of the 40’s and 50’s. This caused monotony in the citizens’ diets, as their palates became accustomed to eating the same salty foods well beyond the moment China’s borders opened to foreign lands. As a result, the introduction of chocolate into the Chinese diet in the ‘80’s was not well received because “the sweetness of chocolate [was] too foreign and too extreme” (Allen, 27). This deterred people from consuming it in their daily lives due to how abnormal it was when compared to the average Chinese foods at the time; thus, it was considered a luxury to eat chocolate, which could be equated to how westerners view fine wine. This also proved that traditional marketing methods that worked on average westerners would not function with the Chinese populace. To account for this, the exotic and sweet treat was introduced as something one would give as a gift during a special occasion rather than for self-consumption. The following Chinese Dove Commercial is a perfect example of this practice. During the ‘80’s and ‘90’s, chocolate as a gift accounted for “over half” of the sales in China, but so long as chocolate continued to be viewed as a gift, it would never reach the heights that we see in the west. Younger generations of Chinese citizens, who have grown up eating the popular dessert, have been known to be more likely to purchase it for self-consumption. According to a study by the New York Times, modern Chinese chocolate consumers mostly consist of young people ages fifteen to twenty-four, which shows that there is still hope for chocolate as a commodity in China’s future.

 

ferrero-rocher-chinese
Gifts like the one in this picture would often be given along with chocolates and red envelopes, traditional Chinese gifts that usually contain money. This exemplifies the combination of western consumerism with Chinese traditionalism.

 

One other reason why Chinese people have avoided chocolate and other dairy-based products has been because of a general distrust in the quality of Chinese milk. One incident, in particular, caused Chinese trust in milk products to dwindle. According to a Harvard Business School case study, in 2008, Sanlu, a milk provider, started adding increased amounts of melamine in their products in order to maintain protein content standards. These increased chemical levels killed six infants and made 300,000 other people sick. This article by Forbes gives more details on how this incident has effected the Chinese dairy industry. After this incident, many other milk brands were found to have this exact same problem with their products, thus, causing widespread skepticism towards Chinese dairy. Chocolate in China, which contains at least 15% milk powder, took a major hit within this scene. One article from Reuters recalls how on September 29, 2008 Cadbury had to shutdown eleven of its Chinese chocolate products due to the suspicion that they were contaminated by melamine. Eventually, the company was forced to close three of its chocolate factories within China. Below, you can find a chart to visualize how much of the Chinese chocolate market the top companies had during the year of 2008. As expected, Cadbury was not doing so well after the milk scandal.

chocolate charts

As a result of this scandal, the confectionary industry has since slowed down, but the Chinese government has imposed tighter regulations on the milk industry in order to regain customer loyalty and trust. For instance, in 2009, the government passed a series of legislation that mandated dairy product producers to raise industry standards, bolster the barriers of entry, and promote the development of large-scale dairy farms, which tended to have higher quality products than their smaller counterparts. These tight regulations allowed for our favorite confectionary treat to make a comeback in the country years later. In 2012, CNN declared that chocolate sales in China grew about 19%, which accounted for $1.9 billion in sales, so we can see that chocolate is here to stay in the long run and is slowly making its way into the Chinese hearts and stomachs.

 

Works Cited

Allen, Lawrence L. Chocolate Fortunes. American Management Association, 2010.

Burke, Samuel. “Who Consumes the Most Chocolate?” CNN, Cable News Network, 17 Jan. 2012, thecnnfreedomproject.blogs.cnn.com/2012/01/17/who-consumes-the-most-chocolate/.

Jones, David, and Tan Ee Lyn. “Cadbury Withdraws China Chocolate on Melamine Concern.” Reuters, Thomson Reuters, 29 Sept. 2008, uk.reuters.com/article/uk-cadbury/cadbury-withdraws-china-chocolate-on-melamine-concern-idUKTRE48S2B520080929.

Kirby, William and Dai, Nancy Hua. (2016) Yili Group: Building a Global Dairy Company. 9-317-003. Cambridge, MA: Harvard Business School.

Shen, Samuel. “Chocolate Makers Try to Satisfy a Picky Chinese Palate.” The New York Times, The New York Times, 3 July 2008, www.nytimes.com/2008/07/03/business/worldbusiness/03iht-choco.1.14202940.html.

 

 

 

The Introduction of Chocolate to China: A Complex Interplay of Trade, Exchange and Ideas

From a Western-centric voice and orientalist perspective[i], Lawrence Allen describes the challenges and complexities of the chocolate market in China beginning in the 1980’s.[ii]  The infrastructure was not developed for the logistics of storing chocolate, it was expensive and viewed as a foreign luxury product, and there was growing viable local competition.[ii]  As the 2015 graph shows, the consumption of chocolate in China is still relatively minute at only 200 grams per capita.

statistic_id263779_per-capita-consumption-of-chocolate-confectionery-worldwide-2015-by-key-market
Source: Mintel. “Per Capita Consumption of Chocolate Confectionery Worldwide in 2015, by Key Markets (in Kilograms).” Statista – The Statistics Portal, Statista, http://www.statista.com/statistics/263779/per-capita-consumption-of-chocolate-in-selected-countries-in-2007/, Accessed 9 Mar 2018

But the story of chocolate in China began much earlier, with some of the same East versus West duality themes, and its unsuccessful introduction dates back to the Kangxi Emperor who ruled from 1661 to 1722 during the Qing dynasty.  Quickly glossed over in the history of chocolate – Coe and Coe, for example, simply state that chocolate never took on in the Far East (173)[iii] – the actual story is much more nuanced.  At times mysterious, the tale of chocolate’s entry into China reveals the complexities and politics of trade and knowledge exchange during the last imperial dynasty.

An instance captured on a tapestry, part of a series known as “The Story of the Emperor of China” commissioned by the Duc du Maine, son of Louis XIV, sheds light on the intricacies of the moments when chocolate was first introduced.  La Collation shows the Kangxi Emperor “proudly holding a chalice full of chocolate”[iv], perhaps identified by what appears to be a chocolate pot on a side table at the edge of the tapestry.  The Emperor sits across the table from his wife who is being served tea[iv], a juxtaposition that shows the already established tea drinking culture in China, which, in addition to the possibly difficult or overly exotic flavor of chocolate, may be a reason that it was never adopted – chocolate simply could not compete with or supplant an already beloved stimulant drink.[v]  The tapestry is a fanciful depiction as the Emperor did not like the chocolate drink according to Qing records[iv], but, on the other hand, it also illustrates how chocolate became the “cultural bond” and “material link” for the exchange of religious, cultural and scientific ideas.[vi]

00666401
After cartoons by Guy-Louis Vernansal (French, 1648 – 1729), and Jean-Baptiste Monnoyer (French, 1636 – 1699), and Jean-Baptiste Belin de Fontenay (French, 1653 – 1715), et al
Tapestry: La Collation, from L’Histoire de l’empereur de la Chine Series, about 1697–1705, Wool and silk
309.9 × 422.9 cm (122 × 166 1/2 in.)
The J. Paul Getty Museum, Los Angeles

The Jesuit missions to China between the 16th and 17th centuries were important pre-modern exchanges of knowledge and culture between China and the Western world.[vii]  The Kangxi Emperor, as he was interested in a diversity of medicinal knowledge, provided patronage for the Jesuit missionaries who had personal access to the imperial court, thus allowing for the transmission of medicinal knowledge between China and Europe.[viii]  The story goes that the group of Jesuit missionaries who arrived in 1639 at the Kangxi court claimed to have cured malaria, which greatly interested the Emperor in Western medicine; some of the missionaries also proclaimed their love of drinking chocolate.[ix]  The Emperor was interested in trying some, so they prepared a chocolate drink in the European style, adding additional ingredients such as cinnamon, chilis and sugar which could be found in China, as well as other foreign ingredients, into boiling water in a silver or copper pot, then mixing it with a wooden tool.[ix]  The Jesuits tried to convince him that in America, chocolate is consumed like tea and it works well as an anti-diarrheal, but it was not to the Emperor’s liking as in Chinese conceptions of medicine, chocolate would be classified as “hot” or excessive “yang” energy, which can cause diarrhea![ix]

Chocolate continued to appear in China but many of the details and how it was used by Chinese people are not well understood.  In 1719, Pope Clement XI sent many gifts to the Kangxi Emperor and the imperial court that he knew would be well received, including “two hundred pounds of chocolate” (69)![x]  It is unclear what happened to the chocolate since the Emperor did not care for it, but my own speculation is that maybe other elite officials, some of whom had been baptized and converted to Christianity, developed a taste for the drink.  Here chocolate was embroiled in a long-lasting controversy over whether Chinese ancestor rites and Confucian rituals were contrary to Christian morals that eventually caused the expulsion of the Catholic missions from China. [x]  Meant to sway the Emperor to accept papal decree that Chinese rites could not be accommodated, the gifts eventually had no effect on the Emperor’s disfavor.[x]

The Franciscan missionaries who came after the Jesuits, did often partake of chocolate and treated it as a pharmaceutical; Bertram Gordon mentions many documentations of requests for chocolate from Franciscans missions in southern China or thanks for chocolate sent from 1678 to 1730.[xi]  In one example, Fr. Buenaventura Ibañez wrote on March 5, 1678 from Macao to his Minister Provincial that “he had requested a cargo of cacao to be sent from New Spain with all the accoutrement necessary to make chocolate as a present for the ‘king of Canton’” (595).[xi]  The consistent chocolate deliveries during this time delineate the extended trade routes from the Spanish colonies in Latin America to Europe, where chocolate was becoming more accessible and not only for the most elite,[v] to the ports of southern China.  The Franciscans would distribute the chocolate amongst themselves, and there is little information or research currently about whether it was given to local Chinese (besides the court)[xi] and their reactions to this new drink, though one can imagine that some Chinese who were brought into the Catholic Church and perhaps worked with the Franciscans may have tried it.

An important development from the introduction of chocolate, and a strong indication that there was awareness of chocolate throughout China, is the ceramic ware made for export to New Spain[xi] and to Europe where there was an “obsession” with Chinese porcelain.[v]  Some of the earliest mentions of chocolate pots from China are from export ware inventories in the late 1600’s, including one belonging to Captain Nicholas Dumaresq “who had been active in the Spanish trade network” (597).[xi]  The most exquisite of these wares would have been made at Jingdezhen, which to this day is still famous for and produces lustrous, fine porcelain.  The kilns at Jingdezhen were newly revived in the 1690’s and, coming full circle, a chocolate cup dating to the Kangxi period, around 1710, was found at an excavation.[xi]

D2015-JBC-0707-0001Yonge Beaker, view 1
A reconstruction of a beaker made at Jingdezhen which was most likely used for drinking chocolate in the early 18th century. Yonge Beakers. Jingdezhen, China, ca. 1720, hard-paste porcelain with underglaze blue. Drayton Hall, National Trust for Historic Preservation. https://draytonhall.files.wordpress.com/2015/09/03_beakers.jpg, Accessed 9 March 2018

Thus, even though drinking or eating chocolate never became an integral part of Chinese culture like in Europe, it still played an important role in the exchange of ideas, burgeoning global trade routes, and the development of industries that connected China to Europe and the Americas in pre-modern times.

[i] Martin, Carla.  “The Rise of Big Chocolate and Race for the Global Market.”  Harvard University, 7 March 2018, Cambridge, MA.  Lecture.

[ii] Allen, Lawrence L. Chocolate Fortunes: The Battle for the Hearts, Minds, and Wallets of China’s Consumers.  AMACOM, 2010.

[iii] Coe, Sophie D., and Michael D. Coe.  The True History of Chocolate.  3rd ed., Thames & Hudson, 2013.

[iv] Puente-Ballesteros, Beatriz.  “Tasting Chocolate at the Kangxi Court: Medicine, Politics, and Global Trade Flows in the 17th Century” talk summary.  Harvard University, https://asiaevents.harvard.edu/event/beatriz-puente-ballesteros-tasting-chocolate-kangxi-court-medicine-politics.  Accessed 9 March 2018.

[v] Martin, Carla.  “Chocolate Expansion.”  Harvard University, 7 February 2018, Cambridge, MA.  Lecture.

[vi] Grejda, Jennifer.  “Interwoven Histories: Chocolate and Jesuits in The Collation Tapestry from the Court of Louis XIV” abstract.  University of Maryland, http://arthistory.umd.edu/sites/arthistory.umd.edu/files/Abstract_George_Washington_University_Jennifer_Grejda.pdf.  Accessed 9 March 2018.

[vii] “Jesuit China missions.”  New World Encyclopedia, http://www.newworldencyclopedia.org/p/index.php?title=Jesuit_China_missions&oldid=981333.  Last revised 8 May 2014.  Accessed 9 Mar 2018.

[viii] Puente-Ballesteros, Beatriz.  “Jesuit Medicine in the Kangxi Court (1662-1722): Imperial Networks and Patronage.”  East Asian Science, Technology, and Medicine, no. 34, special issue, 2011, pp. 86-162.

[ix] 黄昉苨(Huang Fangni).  “巧克力入宫 (The Entry of Chocolate).” 课外阅读 (Teenagers), no. 20, 2016, pp. 34-35.

[x] Johns, Christopher M. S.  China and the Church: Chinoiserie in Global Context.  University of California Press, 2016.

[xi] Gordon, Bertram M.  “Chinese Chocolate: Ambergris, Emperors, and Export Ware.”  Chocolate: History, Culture, and Heritage.  Eds. Louis Evan Grivetti and Howard-Yana Shapiro.  Hoboken: John Wiley & Sons, 2009.  595-601.  Print.

Why Hasn’t Chocolate Taken Off in China?

This video is a Chinese advertisement of Dove chocolates, focusing on the smooth and sweet taste of chocolate.  Among the Big Five, Dove has been one of the leading chocolate products in China. Since the 1980s, the Big Five have invested massive resources into trying to sell chocolate, with hopes of a lucrative return as China’s consumer class grows. Although some companies such as Ferrero and Mars have had some success, the dream of reaching all Chinese consumers has yet to be fully realized. Why these companies have struggled to successfully penetrate the Chinese market is a question worthy of exploration. Although some literature sources address this puzzle, none of them offer fully convincing arguments for why this might be. Building on Mintz’s consideration of how “sweetness” fits into the cuisine of different cultures, I argue that we must understand how people understand flavors and food in China to fully understand why chocolate may not be as popular.

The Big Five have made concerted efforts to market chocolate to Chinese people, using different concepts to attract the attention of consumers. For example, some have focused on the cultural practice of “gift-giving”–finding that more people may choose to give chocolate rather than buy it for the sake of self-indulgence. To some extent, these efforts seem to be working. This next video is a news report that reports how chocolate in China is becoming more popular. However, as the video points out, the consumption of chocolate in China remains extremely low, and a person in China only eats about 100 grams of chocolate annually.

Interestingly, one of the points made in this video and other news reports also comment on the short history of chocolate in China. Many point to China’s recent industrialization as the start of the country’s interaction with chocolate. As Allen writes in the opening paragraph of his book “Chocolate Fortunes : The Battle for the Hearts, Minds, and Wallets of China’s Consumers,”

Until twenty-five years ago, almost none of them had ever eaten a piece of chocolate. They were, to coin a phrase, ‘‘chocolate virgins,’’ their taste for chocolate ready to be shaped by whichever chocolate company came roaring into the country with a winning combination of quality, marketing savvy, and manufacturing and distribution acumen.

Here, Allen’s analyzes China through a highly orientalist and capitalist lens, describing Chinese people as “chocolate virgins” to be “conquered in a war” between chocolate corporations. Allen’s description is highly problematic in the way that it views Chinese people as simply “consumers” who can fulfill the wild dreams of one of the big five chocolate companies. By saying that before 25 years ago, “none of them had ever eaten a piece of chocolate” is a gross exaggeration, and would suggest that chocolate has had a very recent entry into China.  On the contrary, there is evidence that shows chocolate has long been in China, and some sources say its presence dates as far back as the 1600s (Grivetti and Shapiro 2011; Gordon, 2011).  These scholars point to several opportunities in which chocolate could have been introduced into China, including its close proximity to European countries (like Turkey) where chocolate and coffee were extremely popular; England’s colonization of Hong Kong in the mid 1800s, and the outsourcing of Chinese laborers to the Philippines where both cane sugar and chocolate were popular (Clarence-Smith 2003; Grivetti and Shapiro 2011). In searching through a database of Chinese trade and business documents, I also found a journal entry from 1883 where missionaries documented their consumption of chocolate, suggesting that it was not a foreign substance or food to the Chinese (See Picture 1 & 2).

Given that the data suggests chocolate has had a much longer history in China, this makes the puzzle of why chocolate has not been fully taken off even more interesting. Allen posits that many of the challenges that explain why chocolate has not taken off in China are logistical barriers that have gotten in the way. For example, he cites the difficulty in finding places that can keep chocolate at an appropriate temperature to avoid melting. Additionally, Allen even talks about how China is not as developed as the west, therefore their stores simply do not fully expose consumers to chocolate. Although Allen talks briefly about the importance of understanding how food is understood in China (citing the yin and yang concept), he ultimately criticizes China for being too close-minded to chocolate. He writes,

Ironically, in spite of such a wide variety of tastes and textures, chocolate was so foreign to the Chinese palate that the only culinary gateway into the diets of Chinese consumers was as a foreign and exotic curiosity. Therefore, to make their chocolates appealing to Chinese consumers, the Big Five’s marketing approaches and products had to be consistent with this prevailing view.

Despite acknowledging China’s diverse and rich culinary culture, Allen still believes that through thoughtful marketing, the Big Five can make chocolate popular in China. I argue that this is a problematic and limiting understanding of chocolate in the Chinese context. Even if companies face no logistical supply-chain barriers or have perfect marketing campaigns, there are cultural factors to account for that explain why chocolate has not, in its history, been fully accepted into Chinese culture.  In order to understand this, I believe we need to take a more nuanced look at the food system in China. Although there are certain regions, such as eastern China, that may prefer sweet foods, most of the country is not accustomed to eating solely sweets; there is a cultural system in China that dictates what what foods are better than others dependent on the season, weather, or condition of one’s body. To indulge in a sweet confectionary, or many pounds of it, is fundamentally oppositional to the balance of foods that one should consume.

In discussing the minimal role of sugar in French cuisine, Mintz’ cultural explanation provides a compelling framework that can help us understand why something sweet like chocolate may not be as popular in places like China. He writes,  

Sweetness does not seem to ever have been enshrined as a taste to be contrasted with all others in the French taste spectrum–bitter, sour, salt, hot–as it has in England and America.  Though dessert has a firm place in french meals, the position of cheese is even sturdier, often as if it were a spice. This is rather like the Chinese usage, where sweetness occurs somewhat unexpectedly, and also not always as the climax to the meal.

As Mintz points out, both French and Chinese cuisine are different from American and English cuisines in that they do not necessarily treat sweetness as a main or core component of dishes.  Given sweetness’ smaller role in the cuisine of China, confections such as chocolates may therefore not be as attractive to consumers. Acknowledging the way that food is understood culturally is essential to understanding why chocolate companies may find resistance in China; if the Big Five truly want to take a stab at China, then they need to understand that the cuisine and cultural food systems are more important than consumers’ purchasing power or logistical barriers.

Works Cited

Allen, Lawrence. 2010. Chocolate Fortunes: the Battle for the Hearts, Minds, and

Wallets of China’s Consumers. pp. 1-39, 201-224

Clarence-Smith, William Gervase. 2003. Cocoa and Chocolate.

Gordon, Bertram M. 2011. Chapter 44: Chinese Chocolate in the book Chocolate: history, culture, and heritage edited by Grivetti and Shapiro.

Mintz, Sidney. 1986[1985]. Sweetness and Power: The Place of Sugar in Modern

History. New York: Penguin Books

Multimedia Sources:

Picture 1&2:

The Chinese Recorder: Missionary Journal. 1883. Volume 14, Issue 1. China: Trade, Politics & Culture.

Video 1: Dove Chocolate Advertisement. Extracted from Youtube.  https://www.youtube.com/watch?v=EhwYbH5n15c

Video 2: Chinese news report on chocolate. Extracted from Youtube.

https://www.youtube.com/watch?v=s9qRl9Lj818

Chocolate’s Missing History

The literature on chocolate is rich with history on the growth of chocolate prevalence in Mesoamerica and Europe. Cacao was discovered thousands of years ago, and was often combined with other ingredients to be prepared as a chocolate drink. Chocolate made the trek from Mesoamerica to Europe, where initially Spain took the reigns on making chocolate a popular and exotic beverage for European royalty. Over time, the drink became not as limited to just the upper-class, as chocolate became more commonplace in European chocolate houses (Allen 20). However, chocolate seems to have been stopped in its course to the East. Why is it that chocolate traveled from Mesoamerica to Europe, but not from Europe to Asia? While the chocolate industry exists in the East today, the introduction of chocolate in the East was severely delayed due to cultural conservatism and culinary disparities.

Maya-lord-chocolateChocolate Beginnings

Cultural Conservatism

Until very recently, chocolate never made its way into Asian culture in the same way that it significantly permeated European culture. One argument as to why chocolate was never really recognized and accepted in the East is cultural conservatism (Coe, 316). Charles Perry, an expert on cuisines of East and Central Asia, was always puzzled as to why chocolate was unable to penetrate Asian food culture, but he suggests that cultural conservatism might be the main reason (316). Cultural conservatism for Asia is likely a suggestion that Asia has strong roots in strict rules, uniform ideologies among large regions, and a reluctance for indulgence. As chocolate was often enjoyed as a delicacy among Europeans, a conservative Asian response to chocolate in the 16th century and beyond was likely to reject it. Dr. Henry Stubbes, a widely quoted and respected authority on chocolate, believed chocolate to be an aphrodisiac (312). If this perception of chocolate was carried to Asia, then it likely only made the introduction to the conservative East more difficult. Sophie Coe, author of The True History of Chocolate, agrees with Perry’s suggestion of cultural conservatism as a roadblock for the acceptance of chocolate in Asia, but believes the subject to still be somewhat of a mystery (316). While the rejection of chocolate might have been more indirect for many Asian consumers, one account of rejection almost caused disaster for one Italian Merchant (Coe, 315). Giovanni Francesco Gemelli Carreri was traveling through the city of Smyrna, on the coast of Turkey, and writes the following about his encounter:

“Thursday the Aga of Seyde came to see me. I gave him some chocolate, but this savage had never tasted it, or perhaps he was drunk, or the tobacco smoke produced the effect; he became very angry with me, saying I had made him drink a liquid to disturb him and take away his judgement. In short, had his anger lasted it would assuredly have gone badly with me, and it would have served me right, to have regaled such a coarse person with chocolate.” (Coe, 315).

Culinary Disparities

Cuisine also likely played a large role in Asia’s rejection of chocolate. Perhaps this was a reason chocolate was not ever able to permeate areas like India, Southeast Asia, or the Far East (316). For example, Jesuit missionaries and Portuguese merchants brought chocolate with them on their journeys east, but the natives had “little interest in the substance” (316). Charles Perry speculated that the bitter-sweetness of chocolate might appeal to a region of the world where nut-filled pastries are often consumed (Coe, 315). On the contrary, it seems there is nearly no correlation to be made on this front. Perry also suggested that possibly the coffee-crazed culture of the East and the way of life found around coffee houses contributed to the obstacle of establishing chocolate as a popular taste for Asian consumers (315). It appears that there was not necessarily a void that chocolate would have filled for Asian food culture, so it was easy for them to reject it.

In China, even up until the 1980s, only the most determined chocolate addict would go through the trouble of buying a chocolate bar (Allen, 33). The chocolate market was nearly nonexistent for Chinese consumers at this time, so the reward of chocolate did not usual meet the hassle of obtaining it. One news article in the early 1990s found that the Chinese eat only one bar of chocolate for every 1,000 consumed by the British (Coe, 316). Ultimately, chocolate was so foreign that the only way it was able to become a part of the average consumer’s diet was curiosity (Allen, 23). In hope of exploiting this curiosity, the Big Five chocolate companies began the difficult task of developing a presence in the East in the late 20th century. Today, the chocolate industry in many parts of Asia is growing rapidly. Advertisements in countries like Japan and India attempt to capture chocolate’s irresistible nature in order to appeal to consumers (Martin, 41). Moreover, China has recently built a Chocolate Wonderland (below) that appeals to young children in hopes of introducing the goodness of chocolate at a young age (Martin, 39). One final avenue for which chocolate is permeating Asian culture is through using it as a ritual for gift-giving (Allen, 25). Through studying the history of chocolate in Asia, it is becoming clear that the story is really just beginning.

article-2068735-0F04677C00000578-322_634x413Wonderland

 

Works Cited

Allen, Lawrence L.  Chocolate Fortunes: The Battle for the Hearts, Minds, and Wallets of China’s Consumers. New York, NY, 2010.  Print.

Coe, Sophie D. and Michael D. Coe.  The True History of Chocolate.  Third Edition.  London: Thames & Hudson, 2013. E-book.

Martin, Carla. The Rise of Big Chocolate and Race for the Global Market. Cambridge, MA. 2017. Lecture.

Unwrapping Chocolate Potential in the East: How Foreign Companies Wooed Chinese Consumers

Chocolate was introduced to Europe in the 16th century but it was not until the end of the 20th century that the godly good made its way to China. By the end of the 20th century, China had undergone dramatic social and economic expansion, and the world’s largest chocolate companies (the “Big Five”: Ferrero SpA, Cadbury, Hershey Co., Nestlé SA, and Mars Inc.) recognized the potential of introducing chocolate to the Chinese market (Allen 202). At the time however, chocolate had no history or tradition in China, thus highlighting the importance of finding a meaningful way of introducing the good. The “Big Five” companies needed to have a profound understanding of cultural differences in order to do so (Nelson). Moreover, these companies faced numerous challenges in regards to supply chain management and distribution. Depicting how global chocolate companies attempted to gain commercial success in China highlights the intricate nature of developing into an emerging market. This also enhances our understanding of the strategies these companies will embrace as they expand further.

chocolate-heart
Gift Giving – A Cultural Gateway

Culinary traditions were very different in China and chocolate companies were challenged to find a meaningful way of introducing chocolate to the Chinese market (Allen 23). The big five chocolate companies recognized that gift giving was universal throughout China and could serve as the cultural gateway for introducing chocolate. With this is mind, chocolate companies targeted their marketing efforts toward affluent Chinese consumers and developed elaborate packaging designs to appeal to this consumer base (Allen 25).

Although many affluent Chinese consumers were willing to justify the expense of chocolate for gift giving, chocolate companies recognized that self-consumption could generate even greater profits across a variety of social classes. In established markets in other countries, self-consumption accounts for approximately 90 percent of total sales (Allen 26). In China in the 90s however, gift giving accounted for more than 50 percent of total sales, thus highlighting enormous potential for expansion into the self-consumption market! China’s economy grew substantially in the 1990s and consumers subsequently started having more pocket money. In addition, young Chinese started familiarizing themselves with Western culture and food. These social and economic changes conveniently facilitated the introduction of chocolate to the mass market in China (Allen 27).

Mars’s Master Strategy

Today, the American company Mars is the leading chocolate business in China and a number of factors allowed Mars to get ahead of its competitors. First, Mars introduced the Dove chocolate bar, the earliest chocolate product aimed for self-consumption (Allen 200). This bar allowed Mars to establish legitimacy and build loyalty among young Chinese people (Allen 21). Moreover, Mars has embraced an aggressive expansion strategy of manufacturing in China along with aggressive media and marketing initiatives primarily to build up its Dove and Snickers brand (Lannes and Blasberg)

Screen Shot 2016-03-11 at 6.59.42 PM
Mars was the official sponsor and exclusive supplier of chocolate bars during the 2008 Olympics in Beijing, representing one of many successful recent marketing initiatives.

In addition to recognizing the value of branding, Mars has also undergone some organizational changes that lowered distribution costs. The recent acquisition of the gum company Wrigley’s, resulted in the formation of the leading retail confectionary company and gave Mars extensive distribution and sales operations networks (Allen 211-212). This recent merger ultimately allowed Mars to strengthen the company’s position as the leading chocolate company in China.

This campaign, which encourages consumers to create a love art piece by using Dove’s boxes, went viral on social media, exemplifying the success of Mars’s marketing efforts.

Looking Ahead

Today, the Chinese chocolate market represents a relatively small share of global chocolate consumption. However, the country’s sales potential is huge, given that a larger proportion of the country’s population is becoming potential chocolate consumers (Allen 202; Cohen). During the last three decades, the “Big Five” companies have built brand awareness and it seems unlikely that other global chocolate companies will be able to break into the market (Allen 22). Although local Chinese competitors have lower operating costs and can thus set lower prices, it seems unlikely that these companies are an immense threat to the “Big Five” (Allen 213).

China’s market has enormous growth potential and there are two major strategies that chocolate companies can adopt to strengthen their position. First, chocolate companies should sustain business in first-tier cities and fine-tune sales and marketing efforts (Allen 202; Nelson). Secondly, chocolate companies should consider expanding to second-tier cities (Allen 202; Nelson). Supermarkets represent a new exciting distribution channel, but it will be imperative to address challenges in regards to infrastructure and product innovation to respond to the preferences and price-point of the new consumer base.

To wrap up, there is seemingly no simple recipe for success but companies that are sensitive to the varied demands of the Chinese consumers are more likely to unleash the full potential of the market.

HD16365-1.jpg

 

Works Cited

Allen, Lawrence L. Chocolate Fortunes: The Battle for the Hearts, Minds, and Wallets of China’s Consumers. New York: American Management Association, 2010. Print.

Cohen, Luc. “China Chocolate Market Seen Growing to $4.3bln by 2019-Hershey.” Reuters. 18 February 2015. Web. 11 March 2016.

Lannes, Bruno, and John Blasberg. “Gold Medal Brands.” Bain & Company Insights. July 1 2008. Web. 11 March. 2016.

Nelson, Christina. “Chocolate Fortunes.” China Business Review. July 1 2008. Web. 11 March 2016.

Media Sources

Chocolate candy hearts. Digital Image. http://torange.biz/16365.html. Web. 11 March. 2016

Chocolate Heart. Digital Image. http://www.publicdomainpictures.net/view-image.php?image=20869&picture=chocolate-heart. Web. 11 March. 2016.

Kestrel Lee. “Dove Chocolate’s Valentine’s Day Campaign”. Online video clip. YouTube. YouTube, 9 January 2012. Web. March 11. 2016.

Snickers hospitality Team. Digital Image. http://www.sportsworld.co.uk/clients/snickers-beijing-olympics-2008. Web. 11 March. 2016

 

A Growing Taste for Chocolate: An Analysis of Chocolate Displays in CVS and FamilyMart

Globalization has created incredible challenges for modern marketing, as companies must win over new markets that feature the unique tastes and desires of a different society. When we take a look at how chocolate is marketed and sold in both American and Chinese drugstores, we can analyze how the stores display the chocolate products. Through this analysis, we can also realize how those reflect the social perception of chocolate in each country, in turn directing how those changing perceptions turn around and drive the marketing, thus creating one large feedback loop. In this analysis, we will examine the displays that sell chocolate in one Harvard Square branch of CVS and compare that with chocolate displays in a parallel store in Shanghai, China called FamilyMart.

Mass-produced chocolate in CVS "Premium Chocolate" display in CVS

To set the scene for our argument, we will begin with a basic overview of the two stores and their respective displays. CVS is the second largest pharmacy chain the USA, after Walgreens; in Harvard Square alone, there are two branches opened. Taking a look at the display of chocolate in newly opened branch on JFK Street, we can see that chocolate is sold throughout the store, with one primary area for most of the chocolate being sold. The standard bulk chocolate is sold clumped together in one aisle, with various other candies and sweets, while the “Premium Chocolate” display is placed at the end of that aisle.

Bulk chocolate bins in FamilyMart FamilyMart logo Chocolate on shelves in FamilyMart

Most readers will be familiar with CVS, but not so much FamilyMart. FamilyMart is in fact a Japanese convenience store that has flourished in China, where there are currently 1,235 stores in operation, and it can be considered a Chinese equivalent to CVS. In this Shanghai franchise of FamilyMart, we can see that chocolate is also being sold in two sections, but with significant differences in strategy. Instead of choosing bags of prepackaged chocolates, customers can instead choose their desired amount of snack-sized mass-produced chocolates (like Snickers, M&Ms, or Chinese brands) and buy that amount for a price based on the weight of chocolate. These bins stretch down the entire aisle; the shelves on either side hold the prepackaged gift-type chocolates, bars, and even displays devoted to entire brands.


With the scene set for the two drugstores in the United States and in China, we can begin to examine the specific strategies used to create those displays and how they reflect each country’s habits and perceptions of chocolate. There are two important aspects of these displays that we can focus on: the chocolate and its packaging, as well as the context of the displays themselves.

The assortment available in the regular chocolate aisle of CVS is what one would expect of any American retailer, with all the “big chocolate” players trying to assert their presence. Often, there will be yellow stickers to indicate special deals resulting in astoundingly low prices associated with a huge variety of products. This can only speak to the power of multinational corporations, which is reflected in their ability to produce and distribute millions of pounds of chocolate worldwide. This ability, as detailed by anthropologist Jack Goody in Industrial Food, is mainly due to improvements in mechanization and transportation in the Industrial Revolution of the 1800s. Coupled with this technical revolution of mass production was the increased volume of trade, and as a result, retailers are able to provide many of the same products worldwide. As a result, in the Chinese counterpart to CVS, we can see many of the same goods: M&Ms, Hershey Kisses, Ferrero Rocher. In that sense, the variety of goods that companies are trying to market do not vary much, and so they do not have to create entirely new marketing strategies for a completely different set of products.

However, in the clash of cultures that is “East Meets West”, companies must tackle the task that comes with marketing to Chinese consumers. China is one of the most famous cases of growing globalization and capitalism: reforms in the 1980s shifted the Chinese economic structure from communalism to a market-based economy, and according to the World Bank, over 500 million people have been pulled above the poverty line with GDP growth rate averaging around 10% yearly. With this quickly growing economy and a population of 1.3 billion, China became the popular target for the big chocolate companies. Access to this market has not been easy for many of the companies, and these companies have had to come up with new strategies from those used in the United States to break into the Chinese market.

Thus, when we take a look at the packaging, we can see obvious differences that show that these companies are reacting towards the different perceptions that Chinese people hold about chocolate. The first main difference is that in CVS, the bulk chocolate is already packaged in bags of about ten to twelve ounces for consumers to buy. As mass production become increasingly easier for companies to use, the West saw that “choices to be made about eating…are made…by what are perceived as time constraints” (Mintz 202). Americans began prioritizing the convenience of food and snacks, and so these packs are ready-made with a variety of products for customers to grab and go.

Hersheys Spring Assortment Mars Halloween Assortment

In American society, the “experience of time…is often one of an insoluble shortage, and this perception may be essential to…the principle of ever-expanded consumption”(Mintz 202). As people in America feel increasingly pressed for time due to the pressure to do more and be more successful, these conveniently packages have unconsciously driven the mass consumption of chocolates, which in turns fuels the support for selling chocolate in such method. In other words, the packaging in CVS showcases the American impulse of buying chocolate on a whim, often to self-indulge themselves with large quantities of chocolate, which only reinforces that particular marketing strategy.

Contrast this to the packaging in FamilyMart, which reflects the more careful and thoughtful selection of Chinese consumers. Customers instead get to scoop their own bags and combinations of chocolates. This Chinese strategy of selling snack-sized chocolates has a much more practical air, in that customers can pick exactly how much of what they want to eat without the trouble of having to buy at least ten or so ounces of it. This process of selecting their chocolate and having it weighed, similar to how one would buy chocolate or candy from a specialty store in the United States, requires more upfront investment in the purchase, perhaps due to an underlying purpose of gift giving.

Gift giving itself is an act that requires much more thought and preparation, and the importance of gifts is a Chinese cultural code that successful companies have recognized while marketing in China. While the bulk chocolate can be catered towards someone’s particular tastes for chocolate, other products on the FamilyMart shelves can be seen packaged very ornately to leave a positive impression upon receipt. The M&Ms are packaged in the fun shape of the M&M mascot and even with a gift inside, while the Dove chocolate has been placed in a respectable tin. In fact, Mars has adopted this tactic of appropriate packaging rather well, and the commercial below is just one example that reflects Mars’ overall strategy of emphasizing the appropriateness of Dove chocolate for a gift.

[Chinese Kinder ad]

This commercial is the second of a two-part series of ads that focuses on the same actor and actress. The smitten man brings chocolate to the door of the woman he pursued in the first installment, and gives it as a gift of his season’s greetings. She shares the chocolate with her friends and then coyly asks him to bring another box just for her, and so the commercial ends on a promising note. We could also examine this ad for the way it plays into stereotypical gender roles and associations with chocolate, but will instead keep the focus on the action of gift giving. This ad targets the gift giving aspect of Chinese culture incredibly well, giving the audience positive images of love and associating that with Dove chocolate. As Professor Martin discussed in lecture, Mars has been able to win over the hearts of Chinese consumers more successfully than the other companies, simply by showing a distinguished knowledge of and dedication to Chinese consumers.

After analyzing the product availability and packaging in each of the stores, we can also look at the particular placement of the displays themselves within the store. As described earlier, CVS has most of its chocolate in one main aisle with the “Premium Chocolate” display labeled as such, and at the end of that aisle. This has several effects, the first of which is the mere placement of more chocolate at the end of one aisle. Because customers only pick an aisle if they know the product is in that aisle, they are more likely to walk past all the ends of the aisles. Having chocolate on the end of the aisle thus promotes its visibility in the store and entices people to pick up some “premium” chocolate, in this case various bars and packages of Ghiradelli, Lindt, and Ferrero Rocher. In the case where they prefer other kinds of chocolate, they have still been distracted by the mere image of chocolate and are then pulled into the aisle in search of the chocolate they want instead. In this particular CVS, and most American stores in general, there chocolate and candy even at the counter, which has the same effect of distracting the customer and relies again on the impulse and self-indulgence snacking tendencies that Americans tend to display.

Counter of CVS selling chocolate snacks

This snacking tendency actually has been seen as a historical trend away from full and separate meals, to smaller snacks in between main mealtimes. The French anthropologist Fischler, “appalled by the way “snacking” has supplanted meal taking…raises questions about the trend toward desocialized, aperiodic eating” (Mintz 212). This tendency is so common and has become so ingrained in our diets that it aligned perfectly with Western packaging of chocolate in convenient grab-and-go sizes. Mintz further goes on to say that today one might sense the “quickening of such diffusion, a speeding up, even in large, ancient societies that were apparently once resistant to such processes, such as China and Japan”.

In FamilyMart too, there were small packets of chocolate at the register for people to glance at and perhaps buy to snack on. However, the mass of the chocolate in FamilyMart was deep within the aisles of the store. The pictures have shown the large self-scoops of mass-produced chocolate, as well as the shelf displays of more nicely packaged chocolate. These displays were on either side of the bulk chocolate, and although it makes sense at first to group all the chocolate together, seems to have other effects. In order to look at those chocolates, customers must literally turn their backs on the bins in order to look at the shelves. This causes a literal separation between the two types of packaged chocolate, which directly contrasts with the placement in the American display. The chocolate in CVS at the end of the aisle drew the customer in, whereas the bins are what will catch the Chinese consumer’s eyes and potentially keep them there and cause them to be completely distracted from the contents of the shelves.

How then, can chocolate companies be so successful with the ornate packaging in FamilyMart that is actually rarely seen in generic drugstores like CVS? This apparent contradiction can be explained through the perception of chocolate in China and the nature of the consumers’ purchases. We have also explained the impulse buys that mark American purchases, and contrasted that with the gift-oriented purchases of the Chinese. The separation of the shelves and the bins push this explanation even further, in that Chinese consumers must truly have given genuine thought to the idea of purchasing chocolate as a gift rather than whimsically deciding to buy it for someone after seeing it. After all, the likelihood that they look at the shelves is very low when the large bins of chocolate capture their eyes first. Even when consumers buy chocolate as gifts in CVS, it still may be marked by impulsive tendencies merely because their thoughts have been primed by the image of chocolate. The placement of certain chocolate on the shelves was further emphasized by flashy displays. Of particular mention were the following two displays for Ferrero Rocher and Kinder.

Ferrero Rocher display in FamilyMart Kinder display in FamilyMart

These displays were of particular interest due to the fact that Mars has been so successful relative to the other chocolate companies in China. Ferrero, another of the big five companies, owns these two brands. As a matter of fact, Ferrero has carved out its own “niche in China by taking the path of least resistance” and successfully employing tactics aimed at the Chinese culture of gift giving. In Chocolate Fortunes, Lawrence Allen tells of how Ferrero “successfully sold the Chinese people on its delicate, foil-wrapped hazelnut treats”, using its foreign and exclusive image to promote the value of its chocolate as a luxury gift (Wharton article). Thus, placed in this historical context, the display in FamilyMart of Ferrero with its predominantly gift-oriented goods and personalized spotlights makes complete sense.

With this explanation, the other display of Kinder chocolate then seems somewhat of an anomaly, since the packaging looks too simple to mark the goods as gifts. We often do not see Kinder chocolate in the United States; the CVS in this comparison certainly did not sell Kinder products. The reason for its presence and marketing is in fact driven by another aspect of Chinese culture – that of the value placed in children. The marketing of this product was likely developed through the social valuation of children in Chinese culture, and the parental desire to raise successful children. In the following ad, the mother has prepared Kinder chocolate for the children when they say that they want to eat something tasty. The chocolate is further described as having the nutritional value of a large glass of milk within the bar, and the children are shown playing outside happy and healthy. These images really draw on the parents’ desires to have similarly happy and healthy children, and so Ferrero demonstrates truly effective marketing that plays on aspects of Chinese culture that Mars does not.

Following the examination of chocolate displays in an American CVS and a Chinese FamilyMart, we can see that both the variety of goods, their packaging, as well as the environment of their displays all reflect the societal perceptions of chocolate. These in turn show how each culture has particular values that are played upon by chocolate companies in order for them to successfully sell their product; and in doing so, these chocolate companies further reinforce the same habits that then continue to draw sales of chocolate. Yet in the Chinese market, we can see two divisive approaches that sell chocolate: one approach sells chocolate in customized bulk purchases of snack-sized chocolate, while the other approach leads to elaborate packaging the name of gift giving. These approaches, although both effective thus far, are signs that Mars has perhaps a slippery hold on the Chinese market for chocolate. There remains still an enormous amount of potential in a market of this size, and through the continued, careful analysis of Chinese culture, any company can emerge successful in the years to come.

Works Cited

The Paradoxical Selflessness of China’s Chocolate Market

The experience of eating and purchasing chocolate in our western society can often be defined by our individual love for its taste and its self-indulgent nature. It would make sense that in trying to extend this experience to the Chinese marketplace, the “Big Five” producers (Ferrero, Cadbury, Hershey, Nestle, and Mars) should try to replicate many of these same factors. Interestingly, China’s adoption of chocolate as something not primarily for oneself was rather backwards when compared with our traditional western practices, so much so that some may even consider it paradoxical. Yet it is this paradox that reveals that power of a specific culture to shape the experience of chocolate into one that is suitable for its audience.

In the taste arena, chocolate was very foreign to the Chinese palate. As described by Lawrence Allen in his work China and Chocolate: East Meets West, China had gone through a period of austerity from the 1950’s to the 1970’s. During this time, “people became accustomed to a limited range foods that were predominantly indigenous…variety was not only limited, it was also highly seasonal” (Allen 27). As such, existing populations found “the taste, texture, and particularly the sweetness of chocolate too foreign and extreme” (27). Frank McCafferty, a senior manager for chocolate product development in Asia, describes the dichotomy between westerners’ and China’s tastes well: “In the U.S. it has to be sweet, sweet, sweet, more sugar is better — not in China” (Doland). Thus, rather than embracing the rational attraction of its sweet taste, the Big Five had to take a much different strategy and promote chocolate as a “foreign and exotic curiosity” (Allen 23). The means to do this would be through the Chinese culture of gift giving.

Trends revealed that Chinese consumers were not largely buying chocolate for themselves. Not only does this support the idea that the fundamental chocolate taste was not playing a major factor in consumption, but also that chocolate for self-consumption was a rather underdeveloped market, again defying much of our traditional views on the self-indulgent nature of chocolate. For other established chocolate markets, the gift-giving purpose of chocolate only accounted for less than 10 percent of total sales (Allen 27). This was not the case in China. With over half of chocolate sales attributed to gifting, Allen puts it well when he writes, “Chocolate gift sales do not require the purchaser to have a taste for chocolate – only that he or she be willing to pay the price” (26). In this way, it almost appears that the inherent food qualities of chocolate were secondary to its role as a good gift, a symbol of “prosperity and fashionable good taste” (Allen 26). As seen in this media post by Shanghai Jungle, the author writes about how much of the success seen by Ferrero in China can be linked to its good gifting qualities, such as a the company’s premium gold packaging as seen in the image below from a Hong Kong shop.

Chocolate: A Gift That Conveys Love
http://www.shanghaijungle.com/news/Chocolate-A-Gift-That-Conveys-Love

Come 2008, despite economic challenges in China, Ferrero was doing well with the sales of their gift boxes outperforming the overall growth of the chocolate market. However, the development of their self-consumption products remains “elusive” (Allen 204).

It’s helpful to keep in mind that China’s chocolate market is still very young. Chocolate has only been around for a little over 20 years, as pointed out by the reporter in the following news video.

Yet so much of the market has been shaped by chocolate’s introductory role as a high end gift. The Godiva store shown in the video is just one example of the Chinese desire for chocolate as a luxury item for social interaction, rather than an everyday candy for personal enjoyment. Possible reasons for this are the geographic, demographic, and logistical barriers of reaching the masses in China. While high-end “first tier” cities have been tapped into, “consumers who lived beyond third-tier city standards were physically, culturally, and financially inaccessible for chocolate” (Allen 35). Indeed, this is just a start. Starting with China’s major cities, it will be fascinating to see how demand for chocolate will evolve over these next few decades and spread out to the masses. In many ways, the development of a selfless gift giving chocolate market not revolving around its good taste and personal satisfaction is highly paradoxical. But it does show a side of China’s gift-giving culture that chocolate has helped to illuminate.

Multimedia Sources:

[http://upload.wikimedia.org/wikipedia/commons/a/a4/HK_Kennedy_Town_%E5%AF%B6%E7%BF%A0%E5%9C%92_Belcher%27s_Westwood_mall_shop_7-eleven_Ferrero_Rocher_Jan-2011.JPG]

[http://www.shanghaijungle.com/news/Chocolate-A-Gift-That-Conveys-Love]

[https://www.youtube.com/watch?v=m4AzK3ecKwI]

References:

Allen, Lawrence L. Chocolate Fortunes: The Battle for the Hearts, Minds, and Wallets of China’s Consumers. New York: American Management Association, 2010. Print.

Doland, Angela. “Who’s Winning China’s Chocolate War?” Advertising Age. N.p., 8 Dec. 2014. Web. 13 Mar. 2015.