Asia 5 Bringing you a flavour of business trends in Asia...in just 5 minutes A Futures Coaching initiative www.futurescoaching.com
stock marketThe Shanghai composite is down 25% from its 2011high. If the Chinese stock market is taken as the mostresponsive measure of social mood, we would expectChinese middle classes to be very negative right now
consumer confidence This is confirmed by national statistics on consumer confidence which indicate a downward trend since 2007
on the groundI was in Shanghai for the Expo in 2010 and things werereally buzzing – as I blogged about in Changing ChinaAnecdotally, people were: - smiling - walking with purpose - dynamic - asking whats new?But in December 2012, I founda slower pace and more tired,stressed faces
cautiousIn a City of 23.5 million, people keep themselves tothemselves: - there seems little spontaneous social interaction - people stay in their shells and venture out only after the other person takes the initiative - prudence prevails – people keep close hold on their possessions - and their children
fight backChinese social researcher Priscilla Sze confirmed thebleaker mood to me – people are more concerned aboutthe future and are reigning back on spendingDespite this, people are being encouraged to retain theiroptimism. The key phrase to be heard throughout 2012was: “POSITIVE ENERGY”
pick me up Advertising plays a key role in this: the whole dynamic is so much more upbeat than in the West The happy faces and zingy colours would be seen as false in the sceptical, downbeat West. In China, they inspire people to reach for the stars.....
statusStatus remains a huge driver of consumer spendingfuelling the luxury marketLinked to the reputation and honour of ones face andthe need to stand out in a population of 1.3bn, McKinseypredict the Chinese luxury market to top $27bn by 2015 –or some 20% of the global luxury market
knocked offIn signs of a maturing marketplace, the Chineseincreasingly reject poor qualityIn many cases, this means favouring western brandsover localBut it also increasingly meansrejecting fake and false: consumerswilling to buy fake jewellery fell from31% in 2008 to a mere 12% in 2011
experientialAs in the West, luxury is becoming more experientialBSG reported in 2012 that sales for luxury goods wereincreasing at 22% annually but this was bested by luxuryexperiences up 28%Private New Years Eve partieson the Bund seem as good away as any to spend money
design & functionApples rise and rise suggest that the Chineseconsumer is willing to look beyond status andintroduce design and functional criteriaApple has positioned itself to represent more than just luxury– but the cult of western individuality through its designdifferentiation....and its working!iphone sales were up by 500% Q2 2011-Q2 2012; on themetro everyone seemed to be using one!
AcknowledgementsData were drawn from Whartons Jan 2013 article: “Apples foray into China”
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