Gen Z is the first generation to grow up in China in a digital landscape. Born between 1995 and 2009, their relationship with retail brands and their consumer behaviours and experiences differ from Millennials and Gen X. For businesses looking to capture the potential of brand success within this fast-moving, multi-faceted landscape, it takes creativity and true insights.
How does Gen Z react to brands? What are their shopping habits? What brand values do they resonate with? How do they interact with the retail space and what expectations do they have? The lightning speed of tech advances has inspired innovation and contributed to dynamics evolving within these young consumers.
In a 2020 census, Gen Z made up just 16.5% of China’s population.
However, they are a mighty force within the country’s globally powerful consumer market.
Gen Z consumers don’t fit neatly into a single category. The biggest sector is those who are brand-conscious and follow trends. Another substantial Chinese consumer group for Gen Z who enjoy comparing brands and doing their research, and they enjoy shopping. Here are six insights about Chinese Gen Z consumers that retail brands need to know:
1. Gen Z wants to spend and shop spontaneously
Compared to previous generations, and the national income average, Chinese Gen Zers have more disposable cash than their parents and grandparents did at their age. Not only that, but as noted in the South China Morning Post, they are set to be the recipients of “US$3 trillion in intergenerational wealth transfer in the coming decade.” This comes with a willingness to spend and a belief that retail therapy will continue.
Perhaps because of socio-economic changes, both positive and negative, Gen Z likes to spend as soon as payday hits, and often before. They are more impulsive when they make purchases than previous generations. They are also influenced to make spontaneous buys during their retail experience.
The Orangeblowfish Tip: Meet this consumer confidence with feel-good branding and campaigns that feed into retail urges.
2. Gen Z likes popular brands but is open to new ones
Chinese consumers gravitate toward brands they know, and Gen Z is no exception. However, what this consumer group is more likely to do, is try different brands and also ditch ones that aren’t giving them what they want. The loyalty is there to some extent, but it’s not steadfast. Brand followers in China are the least committed and more likely to switch. What this means is that brands need to continue to connect with consumers in innovative ways and can’t simply rely on their legacy.
Chinese beauty brand, Harmay leverages this idea with small sizes of its products so that Gen Zers can try out different ones for less. This is coupled with a self-serve approach that enhances this sense of these consumers being free to browse without the presence of a pressurising expert or salesperson.
The Orangeblowfish Tip: Develop ideas about brand heritage to move it forward by modernising storytelling so that the identity doesn’t become stale.
3. Gen Z traverses all retail channels
Given the explosion of retail platforms across the globe, including China’s Taobao, Xianyu, and Tmall, it’s no big surprise that online shopping is a Gen Z pursuit. This doesn’t give describe the full picture, though. Those who love spending may make a purchase online, but they’ll often visit a physical store first. The same is true of those Gen Z consumers who are looking for good deals and those interested in eco-conscious products.
Offline presence can be just as important for brands that primarily focus on e-commerce. Gen Z wants engaging, creative brand experiences that they can interact with before purchasing online. It’s not enough for brands to simply put products on shelves. Gen Z needs a reason to visit a store, the opportunity for offline brand engagement, and a user-friendly e-commerce experience.
The Orangeblowfish Tip: Think offline, even when pursuing online consumers to create an omnichannel approach that links up seamlessly.
4. Gen Z is influenced by social media
Brands are often clamouring to make an impact on socials, and rightly so, but the message has to be relevant to connect. Gen Zers in China spend far more time in digital spaces than their predecessors, enabling brands to make an impact on these platforms. Chinese consumers who love shopping are also drawn to brands that others seek out and they’ll pay extra to get the brands they want. These consumers want to be noticed online and attract approval for posts. Even those favouring greener brands are swayed by the social status side of being an eco-purchaser.
Video content on socials is a growing area and the onus is on brands to make this content connect with Gen Z who lap up digital content. The top influences for Gen Zers come from social media, including official brand accounts. KOLs are rising in importance in relation to brand allegiance and Gen Z retail behaviour and wield a lot of power in helping a brand connect with this market. Online forums and peer reviews, as opposed to offline word-of-mouth also feature heavily as Gen Z influences.
The Orangeblowfish Tip: Brands need to harness the power of social media and KOLs as creative branding tools to leverage authentic engagement with Chinese Gen Zers.
5. Gen Z looks for brands that celebrate individuality
Gen Zers are experienced consumers who know what they want. They follow brands and are influenced by popularity in the main. Some independently determine what they regard as quality buys, too. And others are looking for the best deals without compromising quality. High ratings alone are not necessarily enough to pull in Chinese Gen Z consumers. They want brands that are differentiated and stand out. They want brands that offer personalisation in a way that reflects a consumer’s own experience. Brands need to resonate with a consumer’s personality and personal aesthetic much more closely.
This links in with a growing openness to local brands. This is motivated by consumers questioning whether they need to need to buy international products and whether they are any better than Chinese ones. After all, plenty of the products from elsewhere are made in China anyway. There has been a growth in innovation within Chinese production and manufacturing. This has led to certain products, such as mobile devices and other tech products catching up locally. Gen Z consumers in China who believe that a local brand is good quality will question paying more for an international brand, unless they are really love it
The Orangeblowfish Tip: Brands need to focus on visibility and presence while creating branding narratives that inspire a sense of individuality.
6. Gen Z love brands that align with their own values
In China, there’s a blossoming market for brands that connect on a value level with Gen Zers. The connection is about creating a relationship whereby a brand reflects the attitudes of individual consumers in a way that they can express their beliefs. In this way, brands become a representation of who they are. A good example of this is the way that Gen Zers are embracing environmental responsibility products.
It’s not necessarily a desire to save the world that’s driving this consumer behaviour as perhaps an expectation that sustainability is built-into brands. Businesses have become more conscious of a global shift toward more ethical brands which has undoubtedly had a knock-on effect in China. Eco-brands are something of a trend for Chinese Gen Zers and this translates as them wanting the kudos without necessarily being open to paying more or compromising on quality.
The Orangeblowfish Tip: Branding in a more localised, authentic way so that Chinese Gen Z consumers can relate to them culturally inspires sustainability.
In Summary: The rise of digital platforms, disposable incomes, and the symbiotic connection between influencers and brands all combine to create a unique Gen Z retail profile. It’s not enough for brands to think they know what Gen Zers are interested in. They have to look at how they are interacting with brands, and why. Gen Z consumers are bold and brands need to be brave enough to try a different approach.
Sources:
Premium Beauty News: https://www.premiumbeautynews.com/en/harmay-the-chinese-company-that,20056
South China Morning Post: https://www.scmp.com/business/china-business/article/3263191/chinas-gen-zers-sway-marketing-retail-trends-they-become-major-force-driving-domestic-consumption?campaign=3263191&module=perpetual_scroll_0&pgtype=article
Xinhua News Agency: https://sponsorcontent.cnn.com/int/xinhua/how-gen-z-consumers-are-shaping-the-future-of-chinas-retail-sector/
Statista: https://www.statista.com/topics/9889/gen-z-consumers-in-china/#topicOverview