In the 1980s, China took some very big, bold decisions. The one-child policy slowed the country’s dangerous overpopulation, but changed the country’s culture forever. And the economic liberalization that started with the rise of Deng Xiaoping created unprecedented levels of wealth in a country that was largely unaccustomed to it. This combination of circumstances produced a uniquely affluent and individualistic generation.
According to a report by Fung Business Intelligence, most people in this so-called ‘privileged generation’ are only children in an often relatively wealthy family. For many this means, in stark contrast to their European and American contemporaries, no student debt and no crippling accommodation costs.
A recent study commissioned by the Singapore Tourism Board showed young Chinese holidaymakers spend more than twice what their average Asian peers will spend. They are helping China to grow its e-commerce market by a projected 13%, between 2016 and 2020, with fashion items and consumer electronics dominating their shopping lists.
So how can the rest of the world reach them? According to eMarketer there are five things we should know about this growing, affluent and influential group.
A China Internet Network Information Center (CNNIC) survey found that millennials (ages 20 to 39 for the purposes of this poll) comprise more than half of Chinese internet users in 2016. In a survey conducted by Sinomonitor, mobile internet penetration among China’s urban millennials was above 90% in the 12 months ending March 2016, the highest rate of any age group studied. So if you’re an e-marketer looking to reach millennials, you’re fishing in the right pond.
In a recent survey, Chinese millennials were nearly twice as likely as their US counterparts to agree with the statement: “I share everything that I do online.” 76.6% of Chinese millennials create original content for their own online channel at least once a week, compared with 41.8% in the US. So, when they are enthusiastic about something, it spreads fast.
A recent HSBC survey found that 70% of millennials aged 19 to 36 in China are homeowners – the highest rate among the nine countries surveyed, including the US (35%) and UK (31%). Homeowners are more likely to buy for the home than renters, so if you’re marketing homeware and decorative items, this is a very good place to look for customers.
Millennials in China are discerning and demanding, valuing authenticity and uniqueness. Their curiosity has led to booming cross-border retail e-commerce sales. The top three product categories are personal care and beauty, food and apparel and accessories. Their adventurous tastes have also increased demand for product categories such as Japanese animation and wine.
Although Chinese business people have long been interested in wine, knowing that sought-after Bordeaux varieties make excellent gifts, the indigenous Chinese wine industry is gathering pace and more wine is being consumed for flavor than status. In fact, China is set to pass France and the UK to become, by 2020, the second largest wine consumer after the US.
According to INS young Chinese wine consumers are likely to conduct thorough research on winery websites before purchasing online. Of the 38 million urban drinkers of imported wine, 88% actively use the internet, with 69% searching for wine information online and 49% purchasing wine online. That’s a far higher proportion than elsewhere – one in three US wine drinkers research on the internet and only 11% buy online.
According to an October 2016 study for Airbnb, 93% of millennials in China consider traveling an important part of their identity. In fact, they rank travel at number one; above paying off debt, investing, saving, or buying a home or car. Further research by Kantar TNS shows that, as well as travel, Chinese millennials also value individuality, immediate gratification, novel experiences and self-expression. This is the definition of open-mindedness, so if you’re selling global culture, China is buying.
The goods they are buying more of, according to smallbiztrends, are ladies’ fashion items, such as clothing, shoes, jewelry, makeup and beauty products, such as skincare.
This has led to accusations of superficiality. In fact Millward Brown argue that to be successful with this group, it’s all about attaching the right celebrity to your product or service. However, they are more socially conscious than this suggests. Just like millennials all across the planet, corporate social responsibility is required of every brand they are likely to approve.
Lastly, it’s worth asking ‘is this sustainable’? Although the Chinese economy has experienced uncertainty in recent years, the country’s leadership is motivated to keep the economy growing. Although they don’t have to face re-election in a democratic system, they can be removed if they don’t get it right. So if you’re wondering whether to reach out to Chinese millennials, the answer is a resounding ‘yes’.