Brandsin & out ofChinaObservation & insight from personal and professional life in China
Café in Beijing - young middle class Chinese consumers fall in love withlife’s potential
Consumerism is a powerful force inChinaWalk around any of China’s major cities and you experience asophisticated marketing culture.When I first worked in China, it was ‘blink’ is this communism?And the answer – welcome to capitalism with Chinesecharacteristics.Consumer advertising is all pervasive and highly visible,international magazine titles celebrate their first decade inChina, netizens are always on, engaged with vibrant digital andsocial media and compelling celebrity culture.
And all in just over 3o yearsPervasive as it is, consumerism and brand culture is relativelyrecent in China compared to the west.In 1978 Deng Xaiopeng opened China up to the west promotingeconomic development, unleashing an unstoppableentrepreneurial spirit and desire for material success.Dramatically, just 37 years later, by 2015, it is estimated thatmore than one-third of the money spent around the world onhigh-end goods and luxury brands will come from Chineseconsumers.
But here’s the gap…Scratch the surface and you find that in many categoriesconsumers lack the depth of knowledge that comes fromgrowing up with brands, and ease of access to information onall kinds of subjects – from fundamentals such as healthcareand nutrition to more specialized products like laundrysofteners and consumer protection.Even luxury brands recognize the need to tell their story,explaining brand heritage and unique craftsmanship toeducate consumers and build loyalty.
Beyond the obviousConsider categories we take for granted – coffee,mouthwash, diapers, cosmetics or motor oil. When coffeestarted to become popular in China, on-line ‘coffee-lover’groups appeared, created by consumers seeking knowledge.Now Starbucks is on every street corner in China, and plansto triple the number of its stores by 2015 – but the famousThird Space has taken on uniquely Chinese characteristics.Starbucks is the destination for career enhancing meetings,sweet milky drinks and never mind the strangers taking arandom nap.
The new westernized consumerDriving growth in consumption, China’s new middle class,divides into different generations. The most westernized andinfluential are Generation 2 (G2)* typically teenagers andpeople in their early 20s, born after the mid-1980s and raisedin a period of relative abundance.They are confident, independent minded, and determined todisplay that independence through their consumption.*McKinsey & Company. Mapping China’s Middle Class.
Good taste & cultured living‘Good taste and cultured living’ are the byword for success.Aspiration is a powerful motivator in a society that continuesto transform at an unprecedented speed.The interpretation of ‘taste’ is also shifting, while olderaffluent consumers aspire to a romanticized vision oftraditional European & Chinese culture, the youngergeneration of influential consumers seeking emotionalsatisfaction through better taste or higher status prefer nicheover mass brands.And they are loyal to the brands they trust.
Desire + knowledgeBrand aspiration and desire must be balanced with rationalunderstanding of product functionality and the benefits.But once that understanding takes hold – watch out! Chineseconsumers are fast adopters.Brands that involve, inspire and empower China’s eagerconsumers will win their hearts…and those brands may bechanged in the process.
Adrienne Bateup-CarlsonIdeas & insights that shape brands.Adriennebateupcarlson@cxaspac.comTwitter @CarlsonAdrienne