The Future of Made in Italy Points East

GDP growth will be double that of the USA by 2028, 41.2 million households will become part of the highest income class by 2025, and there will be a strong focus on quality. These are just some of the drivers that will fuel the take-off of consumption of Made in Italy products in the coming years – particularly by the Chinese Gen Z. 

"To respond to and conquer this market, deep immersion in the country's culture and effective application of innovative strategies are crucial," according to Giulio Busoni, Partner at Porsche Consulting. The Chinese market imposes completely different requirements and structures that the Italian market. First of all, there is the integration of digital, which is a crucial element for the average consumer: 46% of all retail transactions take place on e-commerce platforms.

Jiawei Zhao, Managing Director Porsche Consulting China, adds: "The key to success in food supply chains lies not only in the origin of the products, but also in a solid management of the supply chain, the ability to guarantee consumers a high rate of experience, and the ability to adapt quickly to market demands." The expansion in the East is as complex as it is promising, and the numbers confirm it: Italian agri-food exports to China in 2023 recorded an increase of +4.1% compared with 2022.

This is also confirmed by several success stories of symbolic players of Italian excellence who have been cultivating their presence in Asia for years. Lavazza, for example, managed to penetrate the market through a joint venture with a local chain, which was followed by the opening of more than a hundred coffee shops. The business model works, and the entire coffee sector boasts annual growth rates of around 30%. Italian brands have all the credentials to win large market shares and focus on expansion in Asia, but there are some points that require attention. 

Focusing on expansion with a "capital-driven" approach is effective in high-growth sectors, as long as you remain dynamic and ready to adapt quickly to market changes. In fact, being "smart" in deciding the degree of control to be maintained and "agile" in the timing of entry are key elements of success. Complying with technological standards is not only mandatory to connect with the consumer but is necessary to intercept market trends. Finally, to gain and maintain leadership, building a strong and recognizable brand is key.