Generation Z refers to a group of active, young consumers. Their sub-culture promotes consumption and their behaviour is driven by social media, individual personality, and self-pleasing lifestyle.

1. OTSIKKO
ALAOTSIKKO, KUUKAUSI VUOSISIGNAL: GENERATION Z IN CHINA

2. CHINA’S GENERATION Z
SUMMARY: CHINA’S GENERATION Z
• China’s one child policy has contributed to the evolution of the Generation Z.
• The most common definition for China’s Generation Z is the post 1995 generation, ranging
between the ages of 15 and 23.
• Generation Z in China differs from peers in Western Countries notably in the economic conditions
that has been favourable particularly for this generation of young people who have witnessed
constant economic growth.
• Prosperity characterises the lives of these young people as they make almost one-third of the total
consumption in China. The market is valued at 50 billion US dollars.
• Grandparents and parents (so called 4-2-1) practically enable the lifestyle of the Generation Z.
• Above 10% of average household spending in China originates from Generation Z.
• This generation is vitally important for the consumer brands: they have money to spend and on an
annual level, they buy luxury items using more than 7,000 US dollars.
• Generation Z is not too interested in saving; credit and debt are also options when it comes to
financing expenses.
• In addition to ‘living in social media’, Generation Z also spends their money there.
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3. GENERATION Z
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4. CHINA’S GENERATION Z
“ALONE BUT NOT LONELY”
4
Generation Z refers to a group of active, young consumers. Their sub-culture
promotes consumption and their behaviour is driven by social media, individual
personality, and self-pleasing lifestyle. Consumption has become a way to
construct one’s personality and to promote oneself. Investments into personality
construction ultimately aim at being accepted to join certain, desired social
circles.
Generation Z’s behaviour can be described as vertical integration, where
individuality is the core dominant theme. Communicating ones thoughts and
feelings as individuals, and to share actions with others, is instrumental.
Social media naturally has a significant role in Generation Z’s lives and these
young people generally have over 30 applications in their smart phones. Same
photos are shared throughout all relevant apps.
In China, social media platforms are usually commercial in their nature. Currently,
the most popular platform is TikTok with 75 million new users in December 2018
only. This media application allows creating and sharing short videos, and
appeals especially to the Generation Z as an alternative “goofy and irreverent”
version of online sharing.
AFFLUENCE
INFLUENCE
Picture Source: Future Consumer in
China and Hong Kong
China Skinny for Business Finland
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Celebrity wannabe

5. CHINA’S GENERATION Z
FROM TRADITIONAL E-COMMERCE TO SOCIAL E-COMMERCE AND NEW LUXURY
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Generation Z is not drawn to physical stores or e-commerce portals, and cannot be impressed by traditional
advertising campaigns or flamboyant brands. Gen Z has its own approach to shopping. Wanghong, social media
influences guide their shopping choices. These influences connect with Gen Z by short videos, livestreaming,
messaging and social media apps.
A perfect example of social media influencers’ platform is a Chinese shopping website Little Red Book
(Xiaohongshu). On this hybrid e-commerce portal and social media platform online beauty influencers teach their
followers make up tricks and the products can be bought in an instant.
Generation Z’s thirst for luxury differs from that of earlier generations. Luxury items allow Gen Z to appear affluent
and to express and delight themselves. In general, young people in China, also outside of Generation Z, will
strongly influence the luxury business in the country, particularly as most of them are new customers for luxury
brands.

6. CHINA’S GENERATION Z
TARGETING THE GENERATION Z
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“It’s not about
whether you
know about
this brand, it’s
about whether
the brand
knows me”
China’s Generation Z presents new type of challenges for the marketers.
First of all, Generation Z is not exactly a homogenous group throughout
China. Way of life differs in the Chinese first and second tier cities
compared to the third and fourth tier cities, for instance the work-life
balance ratio is different between these cities and the time available for
hobbies, even time spent online, and hence, the “construction” of one’s
personality does not follow an equal pattern.
This generation fancies their smart phones everywhere in the world but
not least in Mainland China. Smart phone is clearly the main marketing
channel to reach these young consumers.
Generation Z likes innovative advertising and channels. The influencers,
namely wanghongs and KOLs (Key Opinion Leaders), are of high
importance and recognising the leading ones is a challenge. Social media
in China also enables new ways of generating cash flows, thus
highlighting the importance of staying relevant in the eyes of the
Generation Z.

7. CHINA’S GENERATION Z
TARGETING THE GENERATION Z
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To reach the Generation Z, it is fundamentally important to have a
common language, find a suitable platform and to establish an
emotional connection. For brands, it is more important to know
these Generation Z individuals than the other way around. In
China, the intelligent use of digital marketing and establishing
emotional connection enable brands to differentiate themselves
from competitors.
Successful future market entries could use new approaches such
as connecting to local communities, using artists, chefs, local
fashion designers, and other cultural influencers. Less successful
strategies include copying Western sales channel strategies to
China and launching products without localising them.
Picture Source: Future Consumer in
China and Hong Kong
China Skinny for Business Finland
ASTUTE PREMIUMIZER

8. FUTURE CONSIDERATIONS
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9. CHINA’S GENERATION Z
FUTURE CONSIDERATIONS
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“Chinese
consumers are
hyper sensitive to
anything that
looks to be putting
their country and
people in a bad
light.
- Mark Tanner, Managing Director at
China Skinny
• China’s Generation Z will remain as an influential consumer group. Their lives will
change in the coming years as they acquire different roles. As a consequence, their
interests, way of life, income levels, and the way they use money might change too.
• Some social media platforms have already witnessed popular virtual influences who
are not real humans but AI-generated robots or digital creations. Gucci has used a
young Japanese robot girl Erica in its WeChat marketing campaign. The future success
of such online avatars will depend on their ability to create value for their audiences.
• Rising Chinese nationalism is increasingly fed by the trade war and Huawei’s turmoil in
foreign markets, and some foreign brands are already feeling the impact. Growing
number of Chinese consumers prefer home-grown brands. According to JD.com the
sales value of Chinese brands grew 8% faster than foreign brands while the volume
grew 14% faster in 2018. Conclusion is that politics start to matter and the
competition will increasingly tighten.
• Many foreign brands are still doing well: imported fruit sales grew 36% last year while
Nike’s sales grew 24%. But foreign brands need to work harder to compete against
local products and services, that are growing better in quality in a familiar, home
market.
• Sales strategies need to be evaluated against: a) influence of e-commerce on margins
b) online-offline channels that neither is cannibalised by the other c) Singles-Day is
witnessing stand-alone strategies d) rapid development in digital space (young people
have no physical wallets anymore).

10. CHINA’S GENERATION Z
SOURCES
• MarketingPulse –conference, 20 March 2019, Hong Kong
• The Economist Corporate Network events, Hong Kong
• https://www.bloomberg.com/news/articles/2019-01-23/china-s-gen-z-teenagers-spend-more-and-worry-less-than-you-do?srnd=gen-z
• https://www.bloomberg.com/news/articles/2019-04-24/china-s-gen-z-skips-the-stores-and-shops-on-social-media
• https://jingdaily.com/virtual-influencers/
• https://jingdaily.com/gen-z-chinese-characteristics/
• https://jingdaily.com/china-affluent-gen-z-agility
• https://www.marketopportunities.fi/home/2019/future-consumer-in-china-and-hong-kong/
• https://www.mckinsey.com/featured-insights/china/how-young-chinese-consumers-are-reshaping-global-luxury
• https://popularchips.com/dailies/top-5-virtual-influencers-also-known-as-cgi-influencers-on-instagram/
• Sarah Perez, Techcrunch.com, 29.1.2019 https://techcrunch.com/2019/01/29/its-time-to-pay-serious-attention-to-tiktok/
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