Mark Tanner examines the many generational divides and subdivides of the Chinese consumer market.
In any market in the world nowadays, it is rarely enough to have a generic proposition and marketing strategy. Trying to appeal to everyone will generally end up in appealing to no one. Fortunately, most brands have realised that you have little chance of success by transplanting marketing strategies from other markets and expecting them to work in China.
But many brands still don’t recognise that localising for China requires more layers of localisation to resonate with disparate target audiences within China itself.
There are few markets where the differences between target audiences are more pronounced than in China. Consumer preferences and behaviour can be drastically different by city tier, region and within cities themselves.
Overlay location with generational differences, and you have a matrix of colourful consumer groups each with their own specific needs, cultural cues and historical drivers.
Within those younger groups are a series of subtribes – whether it be gamers, cyclists, campers, pet lovers, bakers, effeminate men or something else – all which provide another level to connect and be meaningful to consumers who are bombarded by countless messages every day.
Whilst China Skinny does numerous research and strategic development projects on how best to identify and connect with appropriate target audiences, we’re not going to pretend to intimately understand every evolving target group in China. We don’t think anyone could.
Because of this, we’re happy to share analysis from other agencies which we believe provide great insights to help you better understand your target audiences.
Over the past few months, BCG has released findings from a couple of studies which we thought were worth sharing.
The first drills down into the generational divides and subdivides in the Chinese consumer market. The report highlights the four generations who are dominating the surge of 80 million consumers who are forecast to join the middle-class-to-affluent group within the next seven years in China. They include the Baby Boomers, a generation of hard work and dedication who drive ‘granfluence’ and eat for health; Gen-X, a generation of wealth accumulation who socialise for status and seek quality; Gen-Y, a generation of accelerated self-development who pursue professionalism and value productivity; and Gen-Z, a generation of rich spiritual life who create subcultures and crave comfort.
Although many brands seem obsessed with Gen-Z consumers in China, the study highlights that it is the Gen-X and Gen-Y cohorts who are the main drivers of consumption in China, and will be for a considerable time.
As we’ve noted in the past, the Chinese consumers most likely to buy foreign products are also part of this group. These consumers also have the strongest willingness to trade up in various categories and are more willing to pay a premium for a higher quality of life.
One of the interesting outtakes from the study was the need to identify which aspects of each profile remain constant across age and life stages, and which are fluid. The study also highlighted that 70 percent of the growth in well-heeled consumers will come from tier 3 cities or lower.
BCG’s other study looks into stark differences in consumers’ life philosophy, consumption patterns and values across different city-types. They grouped cities into two types which shared common traits: emerging and traditional.
In emerging cities like Shenzhen, technological change and fast-paced lifestyles has seen consumers prioritise efficiency and seek immersive experiences. While the slower pace in traditionally industrial cities like Qingdao and Kunming has led to a preference for rituals and familiarity.
Defining your target groups to a more granular level may seem more work up front, but it will provide a solid basis to build the rest of your marketing plan, while ensuring that plan is more likely to resonate in a meaningful way.
Mark Tanner is managing director of Shanghai-based marketing and research company China Skinny. Email [email protected] or visit www.chinaskinny.com
