Daily Nuts, a Promising 20 Billion Yuan Market in China

In recent years, the "Daily Nuts” snack category, marketed using the concept of “one package a day, as part of a healthy lifestyle," has performed extremely well. It is a new snack food concept that combines mixed nuts with preserved fruits into one small package (trail mix). In 2015, the Chinese food company Wolong took the lead in launching this new category. The brand experienced explosive growth, with an annual increase of 500% ^[1]. The popularity of “Daily Nuts" has attracted many enterprises. At present, more than 100 manufacturers now market "Daily Nuts" products ^[2].

The birth of "Daily Nuts" has boosted the growth of the entire nut industry. The growth rate of domestic nut consumption has been above 15% for five consecutive years, and the market size of daily nuts exceeded 10 billion yuan in 2019 and is expected to exceed 20 billion yuan in 2022 ^[3], becoming the fastest-growing category of snack foods. In less than five years, "Daily Nuts" has transformed itself from a fledgling category into the most promising and competitive category in the snack industry.

How was it born

Nuts is an established category, while “Daily Nuts” is a new category. The concept came in the wake of sluggish sales growth of canned, gift boxes, and other large packaged nuts in China in 2015. To help Chinese consumers comply with “Dietary Guidelines for Chinese Residents" that "all people should consume 25 to 35 grams of soy and nuts every day," Wolong introduced mixed nuts in small packages (25g/package) and advocated one package a day, laying a foundation for the popularization and premiumization of this category in the next five years.

Reasons behind its popularity

Healthier snack. Driven by China’s consumption upgrade, people demand high-quality products that are labeled as healthy, natural, and additive-free. The appearance of “Daily Nuts” coincides with this trend. Nuts and dried fruits are a great source of vitamins, minerals, and fiber and contain lower levels of processed sugars and salts when compared to other categories of snacks.

More portable snack. Nuts were usually sold in large bags or cans in large amounts. However, “Daily Nuts” reshaped people’s consumption habits by putting them into 25g small packages. This small change drastically expanded the scope of nut consumption scenarios such as morning breakfast, outdoor activities, traveling, exercising, meal replacement, and working.

Fortifying your foods. Many young people like to add nuts to their yogurt, oatmeal, and salads, which makes this product not only a snack but also a meal supplement.

Major players

As the pioneer of “Daily Nuts," Wolong experienced a rapid development with sales revenue reaching 1 billion yuan in 2017 and 550 million yuan in the first half of 2018 ^[4]. Many snack food enterprises attempted to emulate this success, including traditional nut-based food enterprises Chacha and Orchard Farmer, China’s top 3 snack giants Three Squirrels, Bestore and Be & Cheery, retailers Fresh Hema and Bianlifeng, and even foreign food brands Oreo and HERSHEY'S.

In 2018, Wolong occupied the highest market share of about 30.77%, and Chacha was the next with a market share of about 15.38%. 

Data source: Qianzhan Industry Research Institute

However, Wolong failed to cement its position at the top of the leaderboard and was surpassed by Chacha. In January 2019, Chacha Little Yellow Bag Daily Nuts achieved the goal of monthly sales exceeding 100 million yuan and became the leader in the “Daily Nuts” segment ^[5].

Mainstream “Daily Nuts” Brands on the Market

Product innovation

As the competition intensifies, the pace of product innovation is rapidly moving towards more segmented products. Many brands are following the “one pack a day” model and sell in 30-day supplies. Now companies are selling 7-day, 14-day, and 21-day kits to meet different demands. In terms of ingredients, most packages contain 6-9 different kinds of ingredients, with walnut, almond, and cranberries as the most popular raw materials. To differentiate products, many brands start to introduce more ingredients such as dried cherries and dried red dates. The targeted consumer group also becomes more segmented such as nuts for office workers, for children, and for women.

Innovation in Product Development Driving Segmentation

Chacha’s Little Yellow Package Daily Nuts focuses on the quality and fresh taste of nuts and develops “key preservation technology," including self-developed nitrogen-filled preservation technology and nut storage and processing technology.

Oreo and HERSHEY'S choose to integrate nuts with their own star products. HERSHEY'S rolled out mixed chocolate and nuts in June of 2018, as “healthy snacks for children." Oreo launched a “Daily Nuts” product in September of 2019, which contains mini Oreos, nuts, and dried fruits.

LYFEN launched a “daily nuts” fortified with probiotics in March, which is positioned as a product that can bolster natural immunity and improve intestinal health.