Sep 20, 2017 | By WGSN Insider
Experience the leading provider of consumer foresight.
Is the Chinese consumer that hard to understand? In a short word, yes. Having spent nearly a decade in Shanghai, the more time I look at the market the more questions I have.
Although China is home to the world’s largest homogenous population (well over 90% of the country is Han Chinese) that culturally identifies themselves by their collective identity, the biggest mistake you could possibly make is to assume that the market is one massive monolith. Nothing could be farther from the truth.
In many ways China is exactly like America, diverse, highly fragmented by class, education, values and regional differences but with an even more pronounced wealth gap creating a polarized two country in one effect. It makes it very difficult for locals to understand and for people to socialise across different groups. They simply don’t share a common language.
How could they though? Salaries range from as little as £300 to well over £3000 a month creating a sharp lifestyle divide. This is further exacerbated by aspirational social values that favour the story of one rich, entitled extreme in media that has very little to do with the average man or woman.
Netizens criticise luxury brands’ for using migrant plaids, 2013-2014
So with that in mind and at the risk of sounding like a Captain Obvious, here are five quick ways to approach understanding the Chinese consumer.
1. Don’t ignore the obvious, your concept isn’t their concept.
Concepts are not absolute, they tend to be subjective and to depend on your culture or social group. So to avoid your own bias establish what a concept looks like and means for China. Historic associations, cultural connotations and even the way a category is structured is often very different. For example funeral clothing in China is white, money is a lucky red, while green hats mean cuckold making it an incredibly unpopular fashion choice for men.
2. Understand the history and culture.
Before you can talk about Chinese consumer trends you need to develop an understanding of the country’s history and culture. Today, the country is defined by opposite but balancing forces, tradition and changing social values from exposure to capitalism and foreign markets. Current influences include Europe, the US, Japan and Korea so for Generation Z they will be a new Chinese cohort defined by a third culture world view. Expect older Chinese generations to have a difficult time understanding them.
3. Be weary of what you read and what you hear.
There is a lot of arguably terrible reporting around China that ranges from poorly written and researched stories that have colonial undertone to censorship approved non-news. Read everything with a grain of salt. Until or unless you are fully literate in Chinese, you are probably missing half the story. The same goes for what you hear from locals and expatriates, each group will often be only able to offer you a story specific to their social class which makes for a less than balanced view.
4. Look for the western equivalent.
Since concepts are often opposite from the west the easiest way to understand the Chinese consumer is to simply look for a western equivalent. But for some early market entries such American exports Starbucks and Nike, they might have already defined the Chinese standard.
5. Establish touch points
Similar to western equivalents, if you can establish local touch points it makes it a lot easier to understand the Chinese shopper. A few need to know names include WeChat (its kind of like Facebook, Whatsapp, LinkedIn had a baby that grew up and married a shopping app and mobile wallet), Dianping (similar to Yelp), Didi (similar to Uber), Taobao (Alibaba’s C2C shopping platform that is on par with Amazon), Alipay (similar to Paypal, but you can also shop and pay bills on it) and Weibo (China’s version of Twitter).
If you need some starting points McKinsey China has a great free English language podcast for economic knowledge, Jing Daily is invaluable for luxury insights while What’s On Weibo has social media insights written and researched by sinologists. This East meets West infographic by Yang Liu that has been published as a book is also amazing.
WANT TO READ MORE? Learn how retailer Ted Baker turned their business into a global retail success here.
NEED INSPIRATION? WGSN publishes 350 in-depth reports each month. That’s a seriously awe-inspiring amount of inspiration. Join WGSN.
Know what’s next. Become a WGSN member today to benefit from our daily trend intelligence, retail analytics, consumer insights and bespoke consultancy services.