Who moved my cheese? Chinese consumers did

Through that yellow, holey chunk for which Tom and Jerry had a long battle, to that motivational bestseller Who Moved My Cheese?, to four-cheese pizzas offered by Pizza Hut China, to cheesecakes sold in western-style dessert cafes in top-tier cities, consumers of the post-80s and -90s generation in China have come to be acquainted with this smelly dairy product.

Knowledge on the mass level is still limited to pre-shredded Mozzarella or sliced Cheddar, and it could be overwhelming to peer into a specialty cheese shop with Roquefort, Camembert, Feta, Emmental, Gouda, Taleggio, Saint Nectaire, or Monterey Jack and all their different size and mould labels.

The main sales channels for cheese are still in the food-service sector like bakeries and restaurants, leaving a lot of room for China’s retail market. A 2016 Mintel category report suggested that the cheese retail penetration rate was merely 24% in China, compared with Vietnam (73%) and Japan (41%) then. In 2017, China's cheese consumption per capita remained around 0.1 kg each year, far lower than the global average of 2.6 kg, according to the Dairy Association of China.

Cheese brands are still attempting to help the product find its way to dinner tables of the Chinese people, whose traditional food culture, sans cheese, extends to thousands of years ago. Europeans use a knife to cut a block of cheese, but the Chinese brandish a pair of chopsticks for almost everything they eat.

"Say we have cooked a bowl of noodles, and if there’s cheese nearby, it is a big mismatch of culinary elements," said Dechun Wang (王德纯), senior application specialist of the culture and specialties innovation team at DuPont Nutrition & Health China, speaking last week at the Food and Beverage Innovation Forum 2018 (FBIF) held in Shanghai.

Culinary habits aside, most Han Chinese consumers are not disgusted by cheese; they are just curious about its funky whiff. After all, in ancient history, cheese (more along the lines of fried squares of goat or yak milk cheese) was on the menus of mainly nomadic tribes living north of the Chinese hinterland. Cows were traditionally more useful as tools of agriculture rather than sources of dairy. Cheese, processed or natural, hard or soft, never made it into the mainstream food vocabulary.

Worries of any image or habitual hurdles may be unfounded, Wang added. The trend of 'snackification' with cheese as an ingredient and preference for sweetness in China will help budding cheesemakers. Blueberry cheesecake, for example, is more appealing than fermented beancurd, he said. 

Among the nutritional perceptions of the four main dairy products in China, cheese is almost a blank slate. Milk and yoghurt enjoy healthier product images (helping improve immunity and bone health, for one) than butter that is more likely to be associated with being high in calories, fat and cholesterol. Cheese, according to this Mintel analysis, is somewhere in between.

This blank slate offers growth potential for cheese in unconventional areas, since tastes (whether aged, brothy, buttery, butyric, creamy, fatty, lipolytic, meaty, proteolytic, salty, sharp, sour or yeasty) for fresh cheese are still very undeveloped in China, much like a novice wine drinker describing red wine as 'really sour grape juice'.

So, introducing cheese as a flavour adaptation of more familiar foods, while promoting cheese, is also enabling other food brands to get noticed. David Li (李锡安), general manager of Panda Dairy, a newcomer competing against China's bigger cheese retail manufacturers like Mengniu and Bright Dairy, is thinking of working with hotpot, ramen and spicy malatang producers to add cheese into those dishes. Fonterra's cheese imported from New Zealand is also making its way into sausages mashed with fish and cheese, a kid's snack (see left).

Modern teahouse brands are already doing such flavour adaptations, with drinks that blend Chinese tea with whipped cream cheese on top—voila, cheese tea (芝士茶, pictured top of article). It originated in the southern cities of Shenzhen and Guangzhou, with the most popular chain being HeyTea (喜茶). The tea shop still has no marketing department after six years since launch in 2012, because marketing is a "bonus item" compared to brewing consumer insights, shared Vivian Xiao (肖淑琴), CMO of HeyTea, now expanding nationwide. "The tea product itself must have its own vitality. At the beginning of launch, as little marketing as possible should be done to test if the product has any ability to survive".

Heytea was the first tea brand to add cheese into the beverage, she claimed, after research and development with local experimental tasters. Speaking at the same forum, Xiao said, "if you drink pure black tea, you will find that the aftertaste is rather boring. We thought of adding mangoes to the tea initially. Mangoes tasted good on its own but conflicted with the tea due to its heavy profile. We found that cream cheese is perfect with the bitterness of black tea."

 

Food purists may deem this as chaos, but as the Who Moved My Cheese fable goes, responding  proactively to chaos can be a market advantage. Category-blurring innovations, whether within and outside the dairy industry, are "encouraged", wrote Summer Chen (陈扬之), a Mintel food and drink senior analyst in a March 2018 report, as "they serve more as reinforcement than substitution".