With its population, economic growth, fast-paced innovation and shopping-obsessed consumers, China is the market that producers globally aspire to get a piece of. Yet for a market that offers so much opportunity, it’s curious that when it comes to macadamia innovation, there are surprisingly few examples to draw on.
Australian macadamia producer Stahmann Farms is set to change that, with the recent launch of Riverside All Australian flavoured macadamias in Lime & Pepper and Chilli variants, as part of an exclusive collaboration with major Chinese snack retailer Bestore.
With more than 2,000 bricks and mortar stores, a rapidly growing online presence and a 20 million strong social media fan base, Bestore is ideally placed to help Stahmann grow the underdeveloped kernel market in a country where consumers have predominantly experienced macadamias in-shell.
Stahmann Farms Sales Manager, Andrew Waddell, says spearheading macadamia product innovation in the world’s largest market is a truly exciting prospect for the business, and represents many years of intensive research, relationship-building, and product development.
A perfect strategic fit
Stahmann Farms has a 25-year history in the bulk supply and export of macadamias and pecans. The business tested the retail waters in China in 2015 with the launch of an Alibaba online store which saw Stahmann selling its Toowoomba-grown and processed macadamias from Australia directly to Chinese consumers for the very first time.
According to Andrew Waddell, it’s been a steep and valuable learning curve. “It’s a real challenge starting a retail business in China where nobody knows your brand, country or nut. All the selling points that we have in Australia don’t necessarily apply in the Chinese market, so attracting shoppers was initially very difficult.”
Waddell first met Bestore’s procurement team on-site in China and immediately sensed a potential partnership. “Bestore was very open about the fact they were looking for good quality Australian kernel,” says Waddell. “They had seen what we were doing online in China, and it felt like a really good fit straight away.”
Waddell says Bestore’s understanding and treatment of its customers is second-to-none. “The way they treat their shopper is better than anything I had seen before,” he says.
“Consumers in China shop differently to what we’re accustomed to in Australia. The retail experience in China is so fast, the competition is fierce, and retailers have to tread a fine line between luring the customer into store, but not pushing them so hard to buy something that they walk away. Bestore has got that balance just right,” explains Waddell.
Director of Bestore Overseas Business Center, Paul Li, says collaborating with Stahmann will help them cater to the demands of today’s Chinese consumer. “Although the macadamia market is still dominated by in-shell nuts, demands for something different and better quality from Chinese consumers has been observed,” he says.
“For example, daily nuts and flavoured almond kernel have already obtained broad recognition here. By cooperating with Stahmann Farms, we aim to combine Chinese taste with high-quality foreign raw materials, to create high-end nuts snacks in line with the demands of Chinese consumers.”
Breaking new ground
Chinese consumers know macadamias almost exclusively as an in-shell product, saw cut for easy shelling, with a slightly sweet, creamy flavouring added.
For Stahmann Farms, the lack of diversity in macadamia products, and particularly the absence of kernel products, represented an opportunity that could not be ignored.
“We really felt that China was ready for our product because their nut category had only seen macadamias done one way. Yet we were seeing other flavours and formats coming through the Chinese nut category, such as cheese flavoured cashews, and peppery pistachios. So we felt it was fair to think they might be open to savoury macadamia kernel products,” explains Waddell.
The launch of Riverside All Australian, which also includes two pecan products, was preceded by extensive trial and experimentation.
“We developed a portfolio of different flavoured kernel product samples that we were confident could populate the market gap we had identified in the Chinese market,” says Waddell.
“We ended up presenting eight macadamia flavours to the Bestore team. They loved our Lime & Black Pepper and Chilli flavours instantly, not only for the way they tasted, but because they had never seen those flavours in any kind of nut product. So they were the two flavoured macadamia variants we launched in Bestore’s stores in September.”
Branding and pack format also played an important role in the product development process.
The Riverside All Australian packs are 30 gram packs that scan individually at the Bestore checkout, providing a point of difference in a store that sells most of its packaged products by weight.
While Riverside All Australian is the umbrella brand, ‘The Australian Nut Tycoon’ features as a sub-brand. “In China the word ‘tycoon’ is associated with being a successful and respected expert in your field,” explains Waddell. “We introduced that sub-brand to build some trust around the farmer and the product’s origin.”
And it seems to be catching on fast. “In the Chinse language, we are known as ‘The Australian Nut Tycoon’ more so than Riverside All Australian,” he says.
Capturing the professional female snack spend
Stahmann Farms has a clear target market in mind for its Riverside products, after considerable time spent immersed in the Chinese market, observing first-hand who shops where and how.
“We’re envisaging our products will appeal to younger professional women, usually when stopping in to make a quick purchase at Bestore on the way to work,” explains Waddell.
“She wants healthier snack options that fit easily into a handbag for fuss-free consumption on the run. Our slimline 30 gram scannable pack and small kernel pieces speak to convenience, our flavours provide the taste satisfaction she’s seeking, it’s an affordable product, and lightly flavoured nuts are considered healthier than other snacks like potato chips.”
Bestore attracts lots of shoppers in this demographic, however Stahmann feels its product has broad enough appeal to tap into other consumer segments as well, such as older male consumers, and mothers buying for their children.
Riding the Chinese innovation wave
Andrew Waddell believes consumer desire for new and interesting flavours is a big driver of food innovation in China right now. “The turnover of new flavours is very high in this market. As a manufacturer, you have to hit the mark straight away or your product won’t survive.”
Bestore’s Paul Li says in addition to this, Chinese consumers are seeking imported food products that offer superior quality and health credentials. “Stahmann’s macadamia products align well with this desire,” he says.
“We are excited by the product because in addition to its high nutritional value, macadamia kernel has a beautiful appearance, and a unique taste and smell. Compared to other nuts, macadamias deliver a new sensory experience.”
While macadamia kernel consumption is in itself a new and exciting concept, Li says he sees this as just the start. “We think macadamia consumption holds great potential for the future,” he says. “Macadamias are well suited to developing new products such as flavoured snacks or as an ingredient for baked products.”
Just the beginning
While its early days for the Stahmann and Bestore collaboration, Andrew Waddell is confident it signals the start of bigger things to come in China.
“We have a number of other macadamia flavours in the pipeline,” he says. “It’s fantastic to have our first two flavours in store finally, and we are really excited at the prospect of where this launch could take us. We think Chinese consumers are going to love discovering new ways of enjoying macadamias and to have our product at the forefront of that is very gratifying.”