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By Debasish Roy Chowdhury (China Daily)
Updated: 2007-07-17 16:15

According to a Euromonitor International study on the mainland soup industry, the market leader is Unilever China, with a 33.3 percent share of the 221 million yuan market, followed by Shanghai McCormick with 12.8 percent and Nestle China with 7.2 percent.

Apart from their smart brand positioning and marketing strategies, these highly localized foreign food companies have also been feeding on the growing income of the Chinese, which spawns a need for convenience on the one hand and quality consciousness on the other.

Campbell, for example, will position its broths as a healthy option, made from natural ingredients, 97 percent fat-free and with no added MSG. It has already started a low-sodium drive for its existing brands.

These, exactly, are the concerns of a new China, and will mark the new marketing battle lines in the food industry as in almost everything else, rather than mere price competitions.

Campbell's entry thus carries two vital lessons: one, there is still enough room to grow in the market as the market itself is constantly growing, which is why it keeps drawing new players; two, moving up the value chain to create product differentiation is key to making room in this dynamic market.

Any Chinese company planning to wrest the market in traditional products from multinationals will easily soup up its sales if it takes these lessons to heart.

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