We attended a very interesting briefing yesterday on “The Chinese Middle Class” which was sponsored by the China-Britian Business Council. Paul French, of Mintel, Shanghai spoke about what we can expect from the growing Chinese consumer class.

67% of the Chinese middle class intend to buy luxury clothing this year.

67% of the Chinese middle class intend to buy luxury clothing this year.

VERY enlightening presentation, that turned more into a group conversation. Some highlights to share:

  • The middle class is getting squeezed- Though there is large income growth in many areas, costs of living are on the rise as well. Beijing property has become not only unaffordable but near impossible to attain.
  • Credit cards are a new (and fast growing) trend in China- While it has traditionally been a saver economy, consumers are now amping up the percentage of income they spend. Still, 32% of the middle class save over 50% of their salary.
  • The buzzword of the moment is “Lifestyle”-  Either through brands, technology or education, everything is about acquiring the lifestyle you want… and that others will admire.
  • Still defensive consumers– they  live in a world of bird flu, food scares and fake products. Brands need to sell their products but also safety and security, consumers do not trust brands and so all efforts must be made to prove they are genuine.
  • It is all online– ecommerce is the future. 88% of the middle class have bought clothes online in the past year. In Shanghai, the post office delivers 5 times a day, bringing online purchases straight to consumers, often paying with cash or card on delivery.
  • China’s getting grey hairs– the ageing population is quickly growing, and the middle class will be sure to buy services and products to help them cope. Currently, only 35% of middle class households are multi-generational.
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