Digitally-empowered Chinese shoppers are increasingly using purchases to express themselves, according to Alibaba Group’s online marketplace Tmall and consultancy Bain & Co.
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In a report published in March, the pair highlighted key trends to help brands navigate China’s USD 6 trillion consumer market.
“Symbolic consumerism with social significance has emerged in China,” noted Jifeng Luo, Associate Professor, Department of Management Information System, Shanghai Jiao Tong University, in the report.
In the last two years, shoppers have become more selective – but also willing to pay more – for high-end apparel, cosmetics and pet-care supplies, as these purchases as a form of self-expression and to help them craft their identities.
To keep up, brands’ understanding of consumers needs to be more nuanced. Brands can also stay ahead of the curve by creating products that resonate emotionally and aesthetically with consumers.
At the same time, people are leaning towards cheaper, multi-use substitutes in basic lifestyle categories such as personal care, kitchen supplies and computers.
These findings echo a recent whitepaper co-authored by Tmall and consulting firm Ernst & Young that found shoppers in China are looking for tailored and experiential experience from consumer electronic goods as they invest more in their homes and lifestyles.
The consumer electronics industry in China was valued at RMB1.86 trillion ($270.94 billion) in 2022, up 2.96% from the previous year, according to the whitepaper.
It is on track to hit nearly RMB2 trillion this year, the authors estimate, and Chinese electric appliance manufacturer Midea sees even more investment on the horizon.
“In the coming few years, we anticipate 76 percent of Chinese homes to undergo renovations, which will impact 40 million households. That is the market we are maneuvering in,” said Charley Dong, the brand’s head of digital and media, during a talk following the publication of the whitepaper.
Retailers’ capability to foresee new consumer needs in consumers’ constantly evolving lifestyles is crucial for them to make the most of this opportunity, according to Peng, especially when targeting younger shoppers.
“Chinese consumers born after 1990s are very different from previous generations,” said Zong Yanping, managing director of coffeemaker brand De’Longhi Greater China.
They like to relax at home, and many are buying consumer goods to create a café experience without leaving the house, with annual growth in coffee maker sales volume on Taobao and Tmall topping 53% in 2022.
De’Longhi’s products have become particularly popular among professional restaurateurs and coffee aficionados alike, propelling the brand to outperform the average growth margin on Tmall last year.
“Our coffee makers are designed to do more than just brew a cup of joe. They also bring out the feeling that one’s home is a secure and comfortable place where one can unwind and enjoy life,” said Zong.