Chinese Consumer Behaviour

Team Fire - China 2010


In 2010 I had the privileged to visit China as a part of the UniSA MBA program. During the series of lectures I attended a presentation by Professor Ting-Jui (Peter) Chou on Chinese Consumer Behaviour. I share these notes as I believe that anyone considering entering the Chinese market should understand this behaviour deeply.

Product safety is the main concern of consumers – is the product safe & secure. As an example China is the #1 in cancer per population due to the environment & food quality. Once you understand and can deliver on this point you need to understand the market.

Chinese Me Generation:

This group want to be connected, but connect online, so are removed from the physical world – similar to Japan. Due to 1 child policy this group is the loneliest in the world. They may appear to be counter-conformity in appearance, but in psychological way they want to be the same. There is a sense of being connected and safe.

The way to reach them is through social network marketing.

Chinese people prefer a grey area. They are more humanised, not machines. Therefore, they remain efficient in the grey area, unlike in Western societies.

Chinese Social Classes:

There are real gaps in China between urban and country, rich and poor. So you need to determine your market prior to entry. Peter recommends focussing on the rural population; especially in Western China with a good enough product as this is where the population is. Peter showed that Rural has strong buying power

Industry is shifting inland; there are incentives for business from the government. People also want to return to home countries and the Government is building the infrastructure to support this return. People who are unable to leave their homeland aim to get a higher education that releases them to live anywhere. These top students are focussing on entering a prestigious uni – in either Shanghai or Beijing.

Peter believes that the difference in income is good as it allows for opportunity. Therefore people have hope which dovetails into the mentality of the Chinese – have carried a heavy weight & are searching for luck. They have suffered so want to get ahead at any cost.

Advertising:

The #1 for of advertising in China is TV; the second is word month, especially friends. To target certain segments then focussing on social media is another avenue to market.

In recent times there has been a change in advertising from submissive woman in house to outside and challenging women in ads. So, as with any country, ads need to be adapted to local culture, otherwise you won’t get buy in. In China you need to adjust your ad for the local market which is also very conservative.

There are still high feelings between China and Japan/Korea, so you need to say not from Japan or Korea & that your country is good friends with China which dovetails into the Chinese sense of nationalism.

Interestingly, Chinese only have a negative perception of price, so you never advertise price, just features and benefits. Another interesting fact is that consumers have no concerns about their privacy hence RFID tracking is OK!

Due to the focus on product safety you need to reduce non-personal risk and to give the consumer hope.

Government:

For Chinese there is a high focus and importance given to politics. You will see that State Owned Enterprises (SOEs) therefore will at times promote Governmental policy over their own products and services! This being said the Chinese are the most capitalistic nation on earth due to the loss of Confucianism and religion in the nation. Therefore in essence they are true capitalists who must use their own morals rather than the moral given by a belief system. The Government has noticed this in the current term (2004) so have bought back Confucianism again to assist in developing morals, even to the extent of opening a Uni course in Beijing.

China is surviving the GFC due to having a strong government. The Government behaves in China like a parent, not a facilitator. Regardless people will talk about government but will support it as it is their parent.

There is also a conflict between real world & psychological world. The Chinese population actually want to be looked after by the government. This is interesting because in 2010 Avatar was the #1 film in China as it freed their minds to be free mentally during the film...but not in reality.

Summary:

The Chinese consumer is influences by the one child policy, the conservatism in the culture, the various social classes and the reliance upon Government. If you can understand this deeply enough you entry into the Chinese marketing will be more sustainable.

What are your experiences of entering the Chinese market?


Summer Palace 2010

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StarCreate profile image

StarCreate 5 years ago from Spain

interesting analysis, very insightful, thanks!


charmike4 profile image

charmike4 5 years ago from Adelaide, South Australia Author

Thanks StarCreate. I see you write a bit about food. Do you have any experiences in the Chinese market either importing or exporting?

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