Millennial Market Research in China

China offers a vast market for businesses looking to tap into its ever-growing consumer base. Comprising a significant proportion of the population, these young, tech-savvy, and highly educated consumers are redefining consumption patterns and influencing the growth trajectory of various industries. 

Thus, understanding the millennial market research in China is crucial for businesses looking to capitalize on this lucrative segment.

The importance of millennial market research in China

Millennial market research in China plays a vital role in helping businesses understand Chinese millennials, and their unique characteristics, preferences, and values. The most important reasons why millennial market research in China is essential for businesses are the following:

• Millennials represent a significant portion of China’s population and have considerable spending power. As a result, they play a vital role in shaping various industries and driving economic growth.

• Chinese millennials have different consumption patterns than previous generations, often prioritizing experiences, self-improvement, and premium products. Market research enables businesses to identify these shifts and adapt their offerings accordingly, ensuring they remain relevant and appealing to this demographic.

• Millennials in China are digital natives and rely heavily on technology for various aspects of their lives. They have a significant influence on the development and adoption of digital technologies, e-commerce platforms, and social media trends. Market research helps businesses understand how to leverage these digital platforms effectively to reach and engage with millennial consumers.

• Millennials in China are increasingly concerned about environmental and social issues, driving demand for sustainable and ethically produced goods. Market research allows businesses to evaluate the importance of these factors for their target audience and align their practices accordingly, fostering brand loyalty and a positive reputation.

• Chinese millennials are the consumers of the future, and their preferences and habits will continue to shape the market in the coming years. Investing in market research focused on this demographic can provide businesses with the insights needed to adapt their strategies, ensuring long-term success in the rapidly evolving Chinese market.

Key market trends shaping millennial consumption

Millennial market research in China has identified several trends that are influencing the consumption patterns of this demographic. These trends include digital technology and social media, health and wellness, and sustainability and social responsibility.

• Internet and smartphone usage: Chinese millennials are digital natives, having grown up with widespread access to the internet and smartphones. As a result, they are comfortable using technology in all aspects of their lives.

• E-commerce and online shopping habits: The proliferation of e-commerce platforms have made online shopping a preferred method of purchasing for many Chinese millennials. They value the convenience, variety, and competitive pricing offered by these platforms.

• Influence of social media on purchasing decisions: Social media platforms play a significant role in shaping the opinions and preferences of Chinese millennials. They often turn to influencers and online reviews for recommendations and inspiration.

• Fitness and personal care trends: Chinese millennials are increasingly conscious of their health and well-being, driving demand for fitness facilities, personal care products, and wellness services.

• Brand values and ethical practices: This generation is also drawn to companies that demonstrate corporate social responsibility and ethical practices. Brands that promote sustainability, ethical sourcing, and fair labor practices are more likely to resonate with Chinese millennials, who are increasingly discerning about the companies they choose to support.

Understanding what’s new and trendy with Millennials in China

An industry sector to watch is “Smart Home” and “Connected Home.”  Innovations in Smart Home are impacting how young people live. Home assistants, smart tech, and other innovations are becoming increasingly common for young people.  Particularly with demographic changes and the shortage of affordable skilled labor in Chinese urban areas, “smart” products are ways to adapt to demographic changes. Opportunities exist, and already Chinese companies are trying to develop their own Chinese-speaking versions of smart speaker smartphone and home assistants like the Google Mini and Amazon Echo.  

Milk Powder is an important product to track in China.  Years ago there was a milk powder scandal that raised the issue of quality products for babies. Concerns about drinking water and the quality of products remain high.  Baby milk products from Hong Kong and Australia are popular and relevant to the discussion about demographics in China. Some Chinese Consumers travel from the Mainland to Hong Kong to buy baby products and health and nutrition supplements.  

China has leapfrogged into “e-tail.”  Around the year 2000, some people thought that retail would remain important given Chinese consumers’ concerns about price/quality concerns.  Culturally, face-to-face interaction was important, and so the idea of e-tail becoming very popular was uncertain. Concerns over infrastructure and delivery were thought to be barriers to e-tail.  Increasingly, ecommerce and e-tail websites like Tmall, Tao Bao, and Alibaba have helped China leapfrog in tech development and become global leaders in eCommerce. Now people from all generations are buying online.  Products sold on sites like Tmall are ones to watch.

Chinese Millennials and Luxury Products

Luxury products are also products to watch.  European premium chocolates, wines, trips, and luxury apparel are popular.  Foreign wines have only in the past decade gained major popularity versus traditional beer and alcohol.  SIS has conducted research about conspicuous consumption and the importance of foreign brands as means to communicate status and identity, and to build relationships (guanxi).  

Innovative smart tech and apps are important to watch. Ridesharing, social apps, mobility innovations, and smartphones like Xiaomi address important customer pain points.  Our company recently attended the Consumer Electronics Show in Las Vegas. Some of the products seem “space age” but some of the new technologies were developed in China. 

How might these consumption patterns change?

Under the One Child policy, inheritance, attention, and resources are focused on one child.  With 4 grandparents, two parents, and one child, China’s single children received significantly more prosperity and opportunity than children in other generations.  Some referred to single children as “Little Emperors”.  There has been some ambiguity about the TwoChild Policy.  An additional child would change the social and economic dynamics. Expectations such as filial piety and parental expectations of getting university degrees may be impacted.

Millennial market research in China: Potential growth opportunities for businesses

Businesses that can successfully fulfill the unique preferences and values of the Chinese millennial market will benefit from numerous growth opportunities. By focusing on the following areas, companies can capitalize on this segment’s potential:

• Customization: Chinese millennials appreciate products and services that can be tailored to their specific needs and tastes. Businesses that offer customization and personalization options can better engage this demographic and foster brand loyalty.

• Unique experiences: Millennials in China are driven by the desire for unique and memorable experiences. Companies that can offer innovative products, immersive brand experiences, and exclusive events may find success in capturing the attention of this market segment.

• Mobile and digital platforms: As digital natives, Chinese millennials expect seamless integration of mobile and digital platforms into their shopping and consumption habits. Businesses should invest in developing user-friendly mobile apps, responsive websites, and engaging social media content to reach and retain these consumers.

• Collaborations and partnerships: Partnering with influencers, popular local brands, or celebrities can help businesses tap into the Chinese millennial market. These collaborations can create buzz, increase brand visibility, and enhance credibility in the eyes of the target audience.

• Localized marketing strategies: Understanding regional differences and cultural nuances within China is essential for businesses to create effective marketing campaigns. Adopting localized strategies can help companies resonate with millennials across various regions of China, expanding their reach and market share.

• Continuous innovation: Chinese millennials value novelty and innovation. Businesses that continuously update their offerings, embrace new technologies and anticipate emerging trends will be better positioned to meet the ever-evolving demands of this market segment.

Challenges of millennial market research in China

• Complex consumer behavior: It is difficult to generalize or predict the preferences of millennial consumers in China due to their diverse and complex behaviors. A wide range of values, attitudes, and aspirations have arisen due to the rapid economic growth, technological advancements, and cultural shifts experienced by this generation.

• Rapidly evolving trends: Constant monitoring and adaptation are necessary due to the rapidly changing Millennial market trends in China. Staying up-to-date with the latest trends and consumer preferences is crucial for researchers, as these can change rapidly due to the impact of social media, influencers, and other cultural factors.

• Regional differences: China, being a vast and heterogeneous nation, exhibits notable regional disparities in culture, language, and economic progress. To provide accurate and actionable insights, millennial market research in China must take into account these variations.

• Trust and authenticity: Chinese millennials are seeking genuine connections with brands and authentic experiences, as they become more skeptical of traditional marketing and advertising tactics based on trust and authenticity. When conducting market research and crafting marketing messages, researchers should consider this.

How can companies best respond to today’s consumer dynamics in China?

Keep smart technology, apps, and social marketing in mind.  Focus on the importance of social dynamics and “word of mouth.”  Also, it is helpful to keep in mind social “memes” and social-cultural opportunities such as “China’s Single’s Day”.

Learn more about Market Research in China

About SIS International

SIS International offers Quantitative, Qualitative, and Strategy Research. We provide data, tools, strategies, reports and insights for decision-making. We conduct interviews, surveys, focus groups and many other Market Research methods and approaches. Contact us for your next Market Research project.

Contact us to see how we can help your company thrive in China.