Public perceptions of sugar have changed radically since the Taikoo Sugar Refinery was established in the late 19th century, but the business is successfully transforming itself to take advantage of the expectations of modern, health-conscious consumers.
Taikoo Sugar is one of Hong Kong's best-known brands and can trace its roots to 1881, when Swire established a sugar refinery there. But since those formative years, both the business and the market have changed dramatically. What was in its day one of the largest industrial plants in the world producing sugar – at that time universally regarded as a healthy and nutritious essential foodstuff – is now a modern business that engages in product development, packaging, and distribution.
"The Taikoo Sugar brand is certainly both a blessing and a challenge," says recently appointed Director & General Manager of Swire Foods Holdings Limited, Allen Li. "As an iconic and trusted brand, it gives you almost instant acceptance from consumers when you launch a new product, but it also restricts and confines consumers mostly in the sugar domain." A highly experienced food industry executive, with stints at both Taikoo Sugar and Swire Coca-Cola under his belt, Allen Li is embracing the challenge of finding ways to overcome these restrictions – by developing new products to satisfy evolving market demands.
"I believe there are two major trends in the sugar business at the moment", says Li. "One is the macro health trend and the other is the 'consumption occasion' trend." While the demand for healthier food products containing lower levels of refined sugar requires no elaboration, Li explains that what he calls the "consumption occasion" market trend has seen consumers increasingly seek out speciality sugars for specific purposes: such as coffee sugar for coffee-drinking, or sugars designed explicitly for baking and dessert-making.
A healthy future
Taikoo has responded to the millennial trend towards healthier lifestyles with an impressive extension of its product range, far beyond the commodity sugar products that are still a familiar feature on supermarket shelves. The Taikoo Sugar brand now encompasses unrefined options, as well as "Better For You" and "Wellness" ranges.
The business is also looking to extend its functional red sugar range. Red sugar is a traditional product that retains the nutrients, as well as the natural colour and flavour of the sugarcane. It is ideal for traditional Chinese dishes and desserts and in northern China is widely believed to offer health benefits and to nourish the blood and warm the body in colder weather.
"The key is to provide consumers with more healthy choices," says Li. "We have also launched zero- and low-calorie products to further enhance our reputation as an all-round expert in the sugar category." These include Taikoo Monk Fruit Extract Blend Sugar, a low-calorie, natural sweetener, and Taikoo Stevia Blend Sweetener, a plant-based, calorie-free product that has no impact on blood glucose levels. The company is currently in product development of a new zero-calorie range incorporating Stevia, Monk Fruit Extract and Xylitol. Scientific studies suggest that Xylitol, a natural plant-based sugar alcohol, provides health benefits because it doesn't spike blood sugar, and even enhances dental and digestive health. "So we're not just adapting or responding to this health trend, but we also see it as an opportunity to further expand our business, going forward," says Li.The key is to provide consumers with more healthy choices, to enhance our reputation as an all-round expert in the sugar category.
Though these innovations reflect the company's current direction and offer access to new market segments, the wellness options are intended to complement and supplement – not replace – the more traditional sugar offerings. "I would say these new products are an integral part of what makes Taikoo Sugar a unique sugar brand," says Li. He points out that Taikoo is meeting the expectations of the "consumption occasion" trend by extending its range of speciality sugars – coffee sugars, baking sugars, traditional Chinese slab, monocrystal and rock sugars – which are all designed for specific usages. One recent innovation that has crossover with its healthy lifestyle offerings is Monk Fruit Sweetener for Baking – usually, low-sugar sweeteners are unsuitable for baking because they cannot assist the fermentation process; but the Taikoo Sugar team added various ingredients into this new product so as to improve its baking and bulking performance. The objective is that Taikoo Sugar is recognised as an all-round sugar expert, able to provide the most comprehensive range of products to satisfy consumer needs and expectations.
Market leader
Greater China has traditionally been the core market for Taikoo Sugar, which operates three wholly owned sugar packaging plants in Guangzhou, Shanghai, and Chengdu, and is the leading sugar supplier to China's retail and catering sectors. China is the world's third biggest consumer of sugar, after India and the EU, and consumption is forecast to keep on growing – reaching 16.44 million tons by 2030, according to Xinhuanet. This is the market where the brand enjoys greatest recognition. In 2019, a comprehensive consumer research focus group on the Chinese Mainland confirmed that consumers perceive Taikoo Sugar as a national leader, citing attributes that include "best-quality", "premium", "trustworthy", "safe" and "reliable".
"We are currently distributing in more than 120 cities on the Chinese Mainland and are truly the most prominent national sugar brand," says Li. Greater China remains the focus for the future, though he also sees some significant opportunities for expansion into other parts of Southeast Asia.
Diversifying the customer base and penetrating further into the younger and high-end markets are also key to future plans. Brand graphics and more innovative packaging designs will be developed to tap into a younger demographic and Li notes that the branding for Taikoo's new sugar variants is designed to appeal to millennials.
Agility in adapting to a rapidly evolving market is also essential. In the Chinese Mainland market, e-commerce B2C platforms are particularly important for the launch of new products series. Historically, Taikoo Sugar enjoys a very strong presence in the traditional physical retail space, but Li says that the future focus will be on developing greater digital capabilities. Digital platforms will act as both a brandbuilding and a direct selling interface with end consumers. "We at Taikoo Sugar need to keep developing to achieve breakthrough; nevertheless, the principles when developing the business and products still leverage on our brand's strengths, value and identity," he says.
Sweet success
The future looks healthy for Taikoo Sugar – a brand that is successfully trading on its household name status to grasp exciting new opportunities offered by the latest consumer trends. The company's willingness and ability to adapt in imaginative ways to satisfy modern tastes and priorities mean the possibilities offered by a potentially huge – and increasingly health-conscious – Chinese market are literally limitless.
Allen Li believes the secret to Taikoo Sugar's success will lie in positioning the brand as part of a balanced healthy lifestyle and he says that concept should extend beyond the food we choose to consume, embracing all aspects of life – including not just the physical, but also the mental aspects of wellness. "We shouldn't be focusing only on what we consume without a holistic view of how we live our lives – everything should be in moderation, be it enjoyment or work," he says. It's the philosophy of "a little of what you fancy does you good" and Taikoo Sugar is intent on giving its customers the sweet treat that is an essential ingredient to complete their healthy lifestyle. 
