Brands in & out of

China Observation & insight from personal and professional life in China

Café in Beijing - young middle class Chinese consumers fall in love with life’s potential

Consumerism is a powerful force in China

Walk around any of China’s major cities and you experience a sophisticated marketing culture.

When I first worked in China, it was ‘blink’ is this communism?And the answer – welcome to capitalism with Chinese

characteristics.

Consumer advertising is all pervasive and highly visible, international magazine titles celebrate their first decade in

China, netizens are always on, engaged with vibrant digital and social media and compelling celebrity culture.

And all in just over 3o years

Pervasive as it is, consumerism and brand culture is relatively recent in China compared to the west.

In 1978 Deng Xaiopeng opened China up to the west promoting economic development, unleashing an unstoppable

entrepreneurial spirit and desire for material success.

Dramatically, just 37 years later, by 2015, it is estimated that more than one-third of the money spent around the world on

high-end goods and luxury brands will come from Chinese consumers.

But here’s the gap…

Scratch the surface and you find that in many categories consumers lack the depth of knowledge that comes from

growing up with brands, and ease of access to information on all kinds of subjects – from fundamentals such as healthcare

and nutrition to more specialized products like laundry softeners and consumer protection.

Even luxury brands recognize the need to tell their story, explaining brand heritage and unique craftsmanship to

educate consumers and build loyalty.

Beyond the obviousConsider categories we take for granted – coffee,

mouthwash, diapers, cosmetics or motor oil. When coffee started 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 plans to triple the number of its stores by 2015 – but the famous Third Space has taken on uniquely Chinese characteristics.

Starbucks is the destination for career enhancing meetings, sweet milky drinks and never mind the strangers taking a

random nap.

The new westernized consumer

Driving growth in consumption, China’s new middle class, divides into different generations. The most westernized and

influential are Generation 2 (G2)* typically teenagers and people in their early 20s, born after the mid-1980s and raised

in a period of relative abundance.

They are confident, independent minded, and determined to display 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 continues

to transform at an unprecedented speed.

The interpretation of ‘taste’ is also shifting, while older affluent consumers aspire to a romanticized vision of traditional European & Chinese culture, the younger

generation of influential consumers seeking emotional satisfaction through better taste or higher status prefer niche

over mass brands.And they are loyal to the brands they trust.

Desire + knowledgeBrand aspiration and desire must be balanced with rational

understanding of product functionality and the benefits.

But once that understanding takes hold – watch out! Chinese consumers are fast adopters.

Brands that involve, inspire and empower China’s eager consumers will win their hearts…and those brands may be

changed in the process.

Adrienne Bateup-CarlsonIdeas & insights that shape brands.

Adriennebateupcarlson@cxaspac.comTwitter @CarlsonAdrienne