Retail in Asia


Post-COVID China is a green China

The pandemic has seen a marked uptick in individuals demonstrating kindness to others and the planet. This is noted in the increase in sustainability awareness and charitable behaviour among Chinese consumers. Sustainability and philanthropic initiatives are expected to be the trends in China in the post-COVID time.

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Studies illustrated Chinese consumers’ desire to live more sustainable lives and support sustainable brands. According to a survey last year by PWC, 72 percent of Chinese respondents buy from companies that are conscious and supportive of protecting the environment.

Another positive statistic shows that Chinese people donated 18 percent more money through online platforms last year than in 2020. More than 500 million Chinese consumers made philanthropic transactions through Tmall and Taobao platforms, supporting 2,450 charitable projects organised by 214 philanthropic institutions.

Brands looking to support these trends would be wise to understand their unique dynamics in China. A Stifel study in April echoed many studies in concluding that Chinese place higher importance on sustainability than their US and European counterparts. However, the importance of sustainability has not translated to consumers’ willingness to pay a premium for green credentials. Just 18 percent of Chinese consumers say they would pay over 10 percent more for green brands, compared to 26 percent of US consumers, 23 percent of Brits and 28 percent of Germans.

The brands that have been most effective in China in supporting sustainability are not those who have tried to justify a premium. The most successful brands have been focused on building brand preference and drawing consumers in with engaging and entertaining sustainability-related interactions.

KFC China provides a good example of how to educate consumers about sustainability, while making it effortless and fun to play their part. In a campaign last December, the fast food chain helped inform consumers about how to practice low-carbon behaviour when consuming KFC products. Part of this saw KFC introduce a green rewards programme, which encouraged and incentivized behaviour such as mobile ordering and in-store pickup, and opting out of using disposable cutlery. The company also used the campaign to launch an oat drink, their first carbon-zero product. More than 28 million members participated during the 3-week campaign, which benefited sales, was environmentally-conscious, and simultaneously lowered costs.

Similar to sustainability successes, a big driver of the growth in Chinese consumers’ philanthropy is the ease at which they can make donations with mobile payments. These are typically made on platforms such as Tmall and Taobao. This rising willingness to support charity also reflects the increasing appetite to engage with brands who also support good causes.

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The lessons on resonant sustainability and philanthropic initiatives also apply to many other areas of marketing in China. Brands should understand what elements are important to Chinese consumers and the relevant pain points to enable them to deliver initiatives that are simple, convenient, engaging and fun.

(Source : China Skinny)