Nestle, the ice cream giant, is to expand its product range to try to reach consumers of all ages in the Chinese market, in which it already is highly-positioned.

The intention was revealed by Ken Donaldson, head of Nestle's ice cream business unit for the China Region, when launching 29 new products yesterday in Beijing.

"Our strategy is to continuously improve our product quality, and offer value to the consumers, expanding availability on every front," said Donaldson. "We will attract new consumers with our low-priced products as well as take-home items, which are specially designed for kids, teens and adults."

Nestle's new ice cream products range from 1 yuan (12 US cents) to 19 yuan (US$2.30).

"We are not dropping the price of our products, though, but expanding our product chain, to make the products available for every consumer, and sharpen the competitiveness in the Chinese market," said Donaldson.

Nestle's market expansion move is set to trigger a fierce ice cream war in the mainland market, said industry insiders.

In March, many big players in the ice cream industry both local and international will release their annual expansion plans.

Yili, Walls, Mengniu, Nestle and Meadow Gold are the major brand names battling for sales, according to an earlier report by Sinomonitor International, an independent Sino-Japanese market monitoring company.

The report, released in the middle of last year, was based on the China Marketing and Media Study's database, which for the last seven years followed more than 70,000 Chinese consumers in 30 major cities.

According to the report, foreign giants Walls, Nestle and Meadow Gold boast 30 per cent, while the two domestic brands Yili and Mengniu hold 27 per cent of the market.

The ice cream market should encounter yet more fierce competition this year, insiders say.

In order to continue its ravishing market performance and fend off competition, Nestle plans to further penetrate the huge market by fortifying its distribution network, said Zhang Rong, regional manager of the company's north region ice cream division in China.

"We will prove ourselves in the second and third-tier cities, which also foresee great potential," said Zhang in an interview with China Daily after the press conference.

Nestle's current mainland strength lies mainly in the big cities, according to Donaldson.

Source: China Daily