Global Shrimp Market Analysis for Thai Union Group (Year 2021)

Client Background

Thai Union Group is one of the largest and most renowned seafood producers globally, with a strong focus on shrimp products. Thai Union's portfolio includes both domestic and international brands like Chicken of the Sea, Sea Pak, and Petit Navire. The company has a global presence in retail, foodservice, and export markets and is deeply committed to sustainable aquaculture and corporate social responsibility (CSR).

The company faced challenges in understanding how to better position their shrimp offerings amidst growing competition and changing consumer preferences toward sustainability. They sought FMI's expertise to strategically navigate market trends, understand pricing models, enhance their sustainability positioning, and explore growth opportunities in both existing and emerging shrimp markets.

Research Objectives

Thai Union approached FMI with specific research objectives:

1. Comprehensive Market Segmentation: To understand the global shrimp market, segmented by product formats, sales channels (retail, foodservice, B2B), regions, and consumer preferences.
2. Pricing Strategy & Market Trends: To assess current pricing structures at manufacturer, distributor, and retail levels, along with the competitive pricing strategies of other leading shrimp producers.
3. Competitive Landscape: A thorough analysis of key competitors in the shrimp market, including pricing models, product offerings, and market share dynamics.
4. Sustainability Trends: To identify growing consumer demand for sustainably farmed shrimp and evaluate the impact of certifications like ASC and MSC in driving retail sales.
5. Supply Chain Optimization: To explore best practices for streamlining the supply chain, reducing costs, and improving logistics across Thai Union’s global shrimp operations.
6. Strategic Recommendations: To provide actionable insights on how Thai Union can differentiate itself in the competitive shrimp market and strengthen its brand positioning.

Challenges Faced

Thai Union encountered several key challenges, including:

1. Market Fragmentation: Understanding the highly diverse market segments, especially with differing preferences in regions like Europe, North America, and Asia for fresh vs frozen shrimp, packaged vs bulk, and value-added shrimp products.
2. Sustainability as a Key Differentiator: The shrimp market was becoming increasingly competitive with major players emphasizing sustainability. Thai Union needed to understand how to better leverage its sustainable shrimp farming practices to appeal to increasingly eco-conscious consumers and buyers.
3. Pricing Pressure: With increasing price sensitivity, especially in foodservice and retail markets, Thai Union needed insights into effective pricing strategies that could ensure competitiveness without sacrificing margins.
4. Supply Chain Efficiency: Optimizing the cold-chain logistics and managing demand fluctuations for shrimp products, especially across different markets, remained a significant logistical challenge.

FMI’s Approach

FMI adopted a multi-faceted research approach, leveraging both primary and secondary research to deliver actionable insights across Thai Union’s core areas of focus:

1. Global Market Segmentation & Trends: FMI conducted an in-depth analysis of the global shrimp market, segmented by product formats (whole, peeled, deveined, IQF, value-added products), sales channels (retail, foodservice, export, B2B), and regions (North America, Europe, South East Asia, Middle East, and emerging markets). We also:

• Conducted consumer preference studies, revealing a growing demand for sustainably farmed shrimp in both retail and foodservice.
• Provided regional insights, highlighting key trends such as premium shrimp demand in Europe and Middle East, and price-sensitive bulk shrimp sales in Asia.

2. Competitive Pricing Analysis: FMI provided pricing models across different sales channels, including:

• Retail pricing: Comparative analysis of fresh vs frozen shrimp across leading supermarkets (Walmart, Carrefour), and price elasticity in consumer-driven markets.
• Foodservice pricing: Insights into pricing for bulk shrimp for restaurants, hotels, and QSRs (Quick Service Restaurants), with a special focus on the premium price segments.
• B2B and Export pricing: Focus on bulk shrimp pricing, including FOB and CIF pricing models, along with a competitive pricing analysis for key export markets (USA, EU, Japan).

We evaluated price sensitivity among traders, wholesalers, and foodservice operators, providing insights into seasonal price changes and tariffs affecting shrimp trade.

3. Competitor Landscape & Market Share Analysis: FMI conducted a thorough competitive analysis of major shrimp producers and distributors globally, including:

• Market share analysis for major companies like Thai Union, CP Foods, Maruha Nichiro, and Royal Greenland.
• Analyzed pricing structures, product offerings, and sustainability initiatives of competitors, with a SWOT analysis of each competitor to highlight opportunities and threats in the market.

4. Sustainability Insights: FMI identified the growing demand for sustainable shrimp across key markets and regions. We examined:

• The impact of sustainability certifications (ASC, MSC) in driving consumer preference and willingness to pay a price premium.
• Insights into consumer attitudes towards eco-friendly sourcing and the role of sustainability in brand positioning within retail and foodservice markets.

5. Supply Chain & Distribution Optimization: FMI reviewed Thai Union’s global supply chain for shrimp products, providing the following insights:

• Cold chain management best practices, including transportation methods and cost-effective logistics for frozen shrimp shipments.
• Recommendations for demand forecasting and inventory management to ensure a steady supply during peak periods.
• Optimizing distribution channels, especially focusing on strengthening export partnerships in emerging markets (Middle East, Southeast Asia).

6. Strategic Recommendations: FMI provided the following actionable recommendations for Thai Union:

• Geographic Expansion: Expand into emerging markets like India, Vietnam, and the Middle East, which have high shrimp consumption potential.
• Sustainability as a Differentiator: Leverage Thai Union’s sustainability practices as a key differentiator in marketing campaigns to capture the growing segment of eco-conscious consumers.
• Product Development: Introduce value-added shrimp products (shrimp snacks, pre-cooked shrimp) in response to changing consumer preferences in retail and foodservice markets.
• Pricing Strategy: Introduce flexible pricing strategies across different market segments (premium pricing for sustainably farmed shrimp in retail vs. competitive bulk pricing in foodservice).

Solution Delivered

FMI delivered a comprehensive market report for Thai Union, including:

• Detailed market segmentation, identifying key growth areas and emerging market opportunities.
• A competitive analysis with pricing strategies and positioning recommendations for Thai Union’s shrimp products.
• Sustainability insights that helped Thai Union leverage eco-friendly messaging in their marketing campaigns.
• Strategic supply chain and distribution recommendations to streamline their global shrimp operations and improve logistics efficiency.

Results

• Thai Union successfully repositioned its brand in international markets by highlighting sustainability in its shrimp products, gaining a competitive advantage.
• The company expanded its footprint in new export markets, including India and UAE, by targeting B2B and foodservice buyers with competitive pricing.
• Thai Union enhanced its product offering by introducing value-added shrimp products, which resulted in increased retail sales and greater market penetration.
• The pricing analysis helped Thai Union align its shrimp prices with market demands, ensuring profitability and maintaining competitiveness in all key regions.