I was very honored to share the stage with Tom Doctorroff, Asia-Pacific CEO of JWT Advertising, at iTV-Asia’s China Consumer Insight event in Shanghai.
As the Chinese middle class grows, China’s consumption market is expected to reach $16 trillion by 2020, according to a Credit Suisse report. Who are these new consumers? What are their characteristics? How can multinationals reach them? These were the subject of our panel discussion.
Below are the highlights:
- Chinese consumers are fundamentally Chinese. Certain characteristics stay true despite recent dramatic changes. For example, Chinese culture is collective-oriented. People tend to measure their worth according what society expects of them, rather than what they want for themselves. Chinese consumers are more willing to buy products that enhance their social status. Western companies can charge premier prices for such products.
- Young people are becoming more individualistic, and they want to express themselves. However, once they get married, they are more likely to follow the conventional collectivist mindset. Marketers need to understand this and craft their messages to reach different age groups.
- Although there is a lot of optimism, many people are living under extreme anxiety. Part of the reason for anxiety is peer pressure. They see some people become very rich while others remain poor. They are worried they will be left behind, which would be humiliating.
To give some context, I define the Chinese middle class as those who earn an annual income from $10,000 to $60,000. They are mostly urban professionals and entrepreneurs. A rule of thumb is that a middle-class household has one-third of its income for discretionary spending.
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