China’s impact on the global economy has so far been mainly export-driven, but it is now entering a new phase of growth, shifting emphasis to its increasingly lucrative internal wealth. This change has triggered a whole new set of business opportunities, and means an understanding of the Chinese consumer is more crucial than ever.
In this article, we share some key insights on this topic including satisfying demand from sophisticated consumers and offering products and services that consumers can trust.
Capturing China’s domestic market
China’s impact on the global economy has so far been mainly export-driven, but it is now entering a new phase of growth, shifting emphasis to its increasingly lucrative internal wealth. This change has triggered a whole new set of business opportunities, and means an understanding of the Chinese consumer is more crucial than ever.
Satisfying demand from sophisticated consumers
The rise of domestic wealth in China offers opportunities to both foreign and local firms. Personal values in China are tremendously different as compared with the Western World and it is the brands that succeed in mirroring these values that will be do extremely well. GfK Roper Reports
Worldwide research reveals that 41% of consumers in China are ‘Achievers’ (vs. 25% globally) and this number has grown strongly over the last two years.
Achievers tend to buy things that express their feelings of accomplishment. This explains why Chinese consumers have a real taste for sophisticated products. For example, affluent consumers in China tend to see having 'nice things’ such as high-end brands or imported Western brands (such as Starbucks for instance) as a statement of success. For that reason, brand quality is also very important to these consumers. 49%
of Chinese consumers say that they prefer to own fewer but higher quality items (vs. 39% globally).
Marketing tips:
With the opportunities of growth for China moving inland, Marketers should expect increasing competition from local brands which are quickly learning how to satisfy the needs of their sophisticated consumers. Understanding deep rooted personal values of consumers in China and other developing economies enables marketers to gain competitive advantage by tailoring brand positioning and messages to the aspects of life most meaningful to emerging market buyers.
Offering products & services that consumers can trust
Building trust will be a key ingredient to successful business with consumers in China. 47% of Chinese consumers claim that they only buy products and services from a trusted brand (vs. global average of 32%). Trust has been an important issue for brands in China, especially in the food industry. 63% of Chinese consumers worry about getting sick from contaminated food or drink products (vs. global average of only 39%) given high-profile stories concerning contamination of food and drink products.
Marketing tip: Foreign brands are still highly trusted by consumers in China, but national brands are gaining momentum in addressing the need to feel safe. Emphasizing the quality and reliability of your brands conveys desirable advantage to Chinese consumers as their purchasing power and product options expand.
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