Chinese consumers: wealthy, confident, sophisticated
According to a report by global information data measurement company Nielsen, Chinese consumers are more optimistic about their work and finances than they have been for the last four years.
The report, released last Thursday and surveying respondents through the fourth quarter of 2016, also highlights how Chinese shoppers spend: embracing ecommerce and partying at live concerts. These behaviours are the latest evolution of an urban middle class that is becoming richer, more sophisticated, and more technologically adept.
Despite a general trend towards ecommerce damaging some brick-and-mortar retail sectors, local convenience stores were outperformers, returning a 9% rise in sales for the fourth quarter, year-on-year. Online grocery shopping, however, was even stronger: ecommerce sales of fresh foods – particularly fruit and vegetables – jumped up by 10% year-on-year in the same period.
It is no secret that the Chinese are avid travellers, having a larger cruise market than the rest of the world combined. But the fourth quarter of 2016 saw it swell even more. 37% of respondents said they were planning a vacation against 34% in 2015. The reasons behind travel are evolving too:
In years past, Chinese travellers have often been led by shopping opportunities (a reflection of the often much-higher prices Chinese consumers pay for a number of goods). Yet this year, 91% of those travellers going to Hong Kong were there not for the cheaper prices, but for the culture and food.
In a similarly sophisticated manner, Neilsen reported that 57% of Chinese in ‘first tier’ cities were attending Live Concerts – a figure higher than that in North America!
Chinese consumers are getting richer, and more confident. But 4Q2016 shows that they’re also getting more sophisticated – and that more of their money is going not on conspicuous consumption, but on discerning luxury purchases.
Dominion holds a number of companies in its Global Trends Luxury Fund – across multiple sectors – that stand to benefit from the trends discussed in this article.
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