Want Want aims to tap women's alcohol market
The children who grew up with Tsai Eng-meng's rice crackers have finally reached the legal age for alcohol, which translates into a new business opportunity.
The Taiwanese snack food tycoon's empire, Want Want China Holdings, will be diversifying its food business and tapping into the lucrative market for alcohol next year. It will launch a sweet-tasting summer alcoholic drink - complete with a lady's best friend, collagen - called Sawow, targeting the young woman's market.
The drink, containing 4 to 6 per cent alcohol, will be packaged in either a curvy plastic bottle or a small aluminium pack, according to the company. It will come in three flavours - milk, peach milk and pineapple milk. Want Want says the drink will also contain added collagen, an ingredient believed to be good for the skin.
Want Want, listed in Hong Kong and Singapore, has been producing a small amount of alcoholic drinks - some sold to Japan and others just for gifts to friends, Tsai said.
He said that unlike Japan, where sake could be drunk either hot or cold, the mainland did not have cold alcoholic drinks made especially for summer, and young women on the mainland only drank beer.
'Lots of girls drink in China, and we want to make an alcoholic drink that all girls drink,' he told the Hong Kong media at Want Want's headquarters in Shanghai. A plaque featuring the company's iconic Hot Kid logo made of pure gold hung at the building's entrance.
Tsai said the profit margin on alcoholic drinks was high, but the duty was also heavy. Initially, the group planned to launch Sawow at a retail price of five yuan (HK$5.70) this year. But since the group's other drink products were selling very well, he decided to postpone the launch to next year.
'We have too many products and it's difficult to focus on the promotion [of one particular product],' he said. He said initially the drinks would be sold in the coastal area of the mainland and Hong Kong.
However, Tsai did not want to use Want Want as a brand for the group's first alcoholic drink to be marketed in China. 'The Want Want brand was created for children,' Tsai said.
'If I name the alcohol drink with the Want Want brand, parents would yell at me.' Tsai said he had no intention of selling this alcoholic drink, which he said was best to drink on ice, to overseas markets such as Europe and North America just yet. 'We can't even handle all of the Chinese market at this point.'
In 2008, the group had revenue of more than US$1.5 billion, with an after-tax profit of more than US$262 million.
The snack empire has been adjusting its product lines, Tsai said, by adding new items such as instant cup rice noodles and baby food.
He said the company had spent little on research and development of new products. '[Research and development] will only tell you what you cannot produce. The idea is more important. You think of what you want to make.'
Tsai said the group had not spent much on advertising either, just about 100 million yuan. 'We only place advertisements targeting children. That's because the memories of the brand, which they learned from watching these commercials, will stay with them when they grow up.
'But when they grow up, they don't watch TV anymore, so it's useless to spend advertising dollars on older age groups.'