A Burberry cap, oversized Chanel sun glassed and Balenciagas, carrying six great big Louis Vuitton bags, flagging down an Uber outside Harrods… You have a pretty sharp image in your head, don’t you? They have become a regular sight not just in London, but any other European city, any major airport:
The Chinese Super-Rich.
With more millionaires than the US, China has become a hot target for Western luxury brands. In fact, by 2025 40% of the world’s luxury market will be in China, so many brands have come to bank on Chinese custom. But who are the main demographics they should target and what do they care about?
The Demographic of Chinese Millionaires
The main difference between Chinese and Western millionaires is their age. Many Chinese millionaires were born in the 80s and 90s, and with China’s upper middle class expanding, their numbers are rising rapidly. The same goes for the “She-conomy”. Women are investing more and more in themselves, a cultural shift and rise in female spending power that is not to be ignored.
And it’s all happening online! Not just in terms of online shopping but also every other aspect in life. Contrary to most beliefs, Chinese millionaires DO have time for social media, a lot of time.
Chinese Millionaires on Social Media
Whether they are watching short videos on Douyin (TikTok), chatting on WeChat, or looking up handbags on Little Red Book (Xiaohongshu), they are open to receiving messages online and interact with influencers. Also, a staggering 90% of Chinese millennials buy “big ticket items” online – yes, those include Mini Coopers. But is it just the brand label that they’re after?
The Real Driver Behind Purchasing Decisions
Some of the most forward thinking, rich Chinese millennials have begun to mature and care less about showing off big labels such as their parents may have done. This has pushed more niche luxury brands into focus and the idea that rich Chinese shoppers now care more about the craftsmanship of products and how luxury items define their personality rather than how others may perceive them. They are going from peer approval to self-gratification, so to speak.
So will they stop buying ‘conventional’ luxury brands?
More so, will Chinese millionaires turn their attention to domestic brands?
Tune In For More
For more on this topic, on values and consumer behaviour, as well as attitudes towards sustainability, tune in to episode 7 of ‘China, WTF?’ (What’s the Future). You can listen to the whole podcast below or download it on your usual podcast provider (iTunes, Spotify, Desktop/Buzzsprout, …).
00:58 Sara’s story and her affiliation with Marc Zuckerberg
03:00 2012, the year Chinese people began upgrading their lives to become citizens of the world
04:19 How Sara, in line with the Chinese government’s vision, re-defined the meaning of ‘etiquette’ in China
08:54 Can social disposition change fast enough to catch up with economic growth?
11:20 What drives the purchasing decisions of high net- individuals (Brand heritage or quality)
12:08 Demographics of Chinese millionaires and why they are different to those in the rest of the world
15:00 What rich Chinese people spend their money on (Home design, brands, cosmetics or self-care)
16:28 Will Chinese people stop buying flashy luxury brands and pay more attention to quality and craftsmanship? From peer approval to self-gratification
18:00 Why short video platform Douyin (TikTok) and review/lifestyle app Little Red Book (Xiaohongshu) have become essential marketing tools to capture the attention of high net individuals
22:00 The best foreign brands in China and why they are successful
24:31 Where Sustainability stands on Chinese consumer’s priority lists
26:10 The rise of affordable luxury
28:24 Why Chinese people are starting to look domestically for luxury products (Bosideng example)
30:21 What Chinese brands can learn from Western brands
32:44 What’s The Future?! Is the Chinese growth is slowing down and do brands need to stop relying on Chinese consumers?