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Hurun Report publishes ‘China HNWI Gifting White Paper’ in association with MEC

The Hurun Research Institute and MEC has released “China HNWI Gifting White Paper 2017”, a report on the gifting behavior and demand of high net worth individuals (HNWIs) in China.

Chinese people celebrate all kinds of festivals throughout the year. As a result, many brands constantly launch topical marketing campaigns and package their products and services with gifting concepts. Brands need to consider various giftees’ roles, gifting occasions, emotional needs and gifting motivations. Brands need to grasp various marketing opportunities throughout the year.

The white paper reveals that “family” are the most common “giftees”, with 98% of HNWIs sending them gifts. Interestingly, 67% HNWIs have given themselves gifts last year. This is more common among females (74%, index 110). “Self-gifting” fits in with the popular concepts in the Chinese community like “xiao que xing” (“little but certain happiness”), “a sense of ceremony”, and “love and pamper myself”.

When choosing a gift, HNWIs always consider the product itself, its brand and price. In terms of product, “good quality and craftsmanship” (87%), “practicality” (85%), “uniqueness” (77%) and “attractive packaging” (74%) are considered to be the most important factors. When it comes to brand, important factors include “high-end, to gain face” (90%), “well-known brand” (83%) and “whether the brand fits with giftee’s self-image” (80%); and with regards to the price, whether the “price meets giftee’s expectations” (61%) is the main consideration for “gifters”.

Compared to Tier 1 cities, Tier 2 cities in China show more positive attitudes. Chinese New Year, birthdays, Mid-Autumn Festivals and anniversaries show the highest gifting rate. Different gender and age groups of HNWIs show different gift preferences: males tend to gift more jewelry, flowers and handbags; females tend to gift more watches, personal care devices and mobile tablets; young people under 35 years old gift more diverse fashionable products such as accessories, skin care, perfume, cosmetics, SPA beauty, sports cards, etc.

With HNWIs paying more attention to managing their health, almost 90% of the respondents pointed out that “healthcare products” are the most popular gifts for them. Appetite for luxury products is increasing, 60% of respondents sent luxury items as gifts more frequently compared with the last three years, with 18% doing so considerably more than before.

27% of HNWIs encounter difficulties when gifting. The top 3 most troublesome aspects are “unclear about giftees’ needs or preferences” (57%), “time and effort spent on selecting gifts” (50%) and “giftees are hard to impress” (49%). Results show that the female respondents “enjoy the process”, while the males “take shortcuts” in gift selection. Brands need to engage females more during gift selection, to deliver a more satisfying experience along the way, and guide male customers to make efficient purchases.

In addition, brands need to understand the roles of different purchase channels, to leverage their influence in marketing, and to create efficient and pleasant shopping experiences across all channels. With regards to domestic purchasing channels, 97% of HNWIs have brought gifts in brick-and-mortar shops. Among them, “domestic brand stores, counters” (76%), “domestic department stores, shopping centers” (68%) and “through friends” (58%) are the most common purchasing channels. 74% of HNWIs have purchased gifts overseas. 69% of HNWIs have shopped for gifts online.

The research was conducted over six months from December 2016 to May 2017, encompassing 14 cities in mainland China, with 507 HNWIs filling in surveys of their gifting behaviour. Their age averaged 41 years, their wealth amounted to 22 million RMB per capita, and they have 4.17 million RMB of disposable income annually. A further 16 wealthy individuals were interviewed by our teams based in Shanghai, Beijing, Guangzhou and Xi’an.

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