The Chinese consumer is a western marketer’s dream—young, wealthy, tech-savvy and fantastically brand loyal.
Chinese Internet conglomerate Tencent hosted a three-hour presentation at Advertising Week today on how to reach them, giving interested attendees a battery of information about the average Chinese traveler. Here are the highlights:
- China will have 200 million upper-middle class and affluent households by 2030.
- Consumer spending has grown—and will continue to grow—by 10 percent annually, reaching $6.2 trillion by 2021.
- Among the 18-35 age group, discretionary spending will grow from $700 billion in 2011 to $2.6 trillion in 2021.
- A total of 7.6 million households bought luxury goods last year, spending $75 billion overall and an average of $11,000 per household.
When advertising to the Chinese market, the presenters urged localizing content and acknowledging Chinese culture, but warned against overdoing it. Chinese consumers’ main reason for purchasing luxury products is their attachment to globally well-known brands.
To reach this rapidly growing, luxury-hungry market, Tencent recommended focusing on mobile, citing much higher saturation rates for mobile than Internet. As Tencent has a monopoly over Internet and mobile in the country, the conglomerate offered itself as the best partner to send messages to the Chinese luxury consumer.
Luxury products isn’t the only market where China is taking the lead. Just this year, the country accounted for 57 percent of esports consumption as well.
In the United States
- Three million million Chinese travelers come to the US annually, and will spend $34.7 billion per year.
- Vacationers spend an average of $12,000 per trip, of which they spend $6,000 on shopping alone.
- The average income for the Chinese vacationer is $75,000 per year.
- Independent tourism is the new mode: 65 percent of Chinese vacationers travel outside of tour groups, and the number is expected to grow to 76 percent by 2021.
- Among travelers to the US, 61 percent stated that shopping was the most important criterion for selecting a destination.
Beyond individual figures, Benny Ho, senior director at Tencent, gave a few key insights on how to drive sales among Chinese shoppers.
Ho urged the assembled audience to rethink the purchase funnel in this case, explaining that Chinese consumers plan out their shopping itineraries long before they reach America. “They’re here to buy, not to shop,” he said.
Citing these statistics, Ho emphasized the need to send brand messaging to Chinese vacationers before they depart to the United States in order to make it into their limited consideration sets at all—again pointing to Tencent as the means to this end.
The conglomerate has recently unveiled plans to expand into the US market.