Chinese consumers are dominating the luxury market. But rather than just purchasing physical luxury items, Chinese consumers are embracing and redefining luxury in a whole new wealth of ways. A report from Reuter Communications has uncovered the trends in luxury Chinese market in the new decade.
The first trend noted for the new decade is the rise of digitally interconnected products and services that allow pre-testing by potential shoppers and providing plenty of data for businesses to dig through.
As heavy mobile users, Chinese consumers have embraced WeChat as an integrated app that is almost intractable from people's lives. This trend is expected to continue in the future with further synergies between communication, entertainment, and commerce, where users can watch a live-streamed event, buy items featured on the show, while also sharing the experience with friends.
Mobile technology is also becoming more seamless in terms of registrations and passwords with recognition tools able to read and recognise faces, fingerprints, and voices. An evolution of greater integration between consumers with physical spaces is being powered by the implementation of these tools .
But as the luxury landscape becomes even more innovative and competitive, China is set to lead. In 2030, it's predicted that Chinese travellers will account for a quarter of all global outbound travellers. The report also states that China has continued to be the world’s leading gold consumer for the sixth year running, and is about to become the global leader in both fashion and beauty markets.
To tap into this exploding Chinese market, businesses are being urged to become more "China-specific", meaning products and services have to be created for Chinese consumers rather than being localised. Ideally, products and services could involve Chinese experts, agencies, creatives, and influencers.
Another trend on the horizon is a new definition of luxury itself. The report explains:
"Instead, there will soon be no set definition of luxury – the western concept of luxury no longer applies in China. Luxury does not have to mean fine dining, ultra-expensive fashion, or a private jet. It can mean affordable or accessible, it can mean streetwear, wellness, or family life."
Complementing this new definition of luxury is a rising national pride among Chinese nationals based on the nation's economic growth, and the highly publicised upgrades in the quality of life and prosperity for many. This nationalist ideology has also reshaped the relationship between brands and consumers, with the report stating that it's clear who now holds the power.
"Crossing all demographics and segments, the entire population has a key element in common. Self-awareness of their sheer spending power means they understand their value to international brands and expect appropriate respect," said Tracy Zhang, director of Reuter Communications.
Lastly, in an interesting development when one considers China's environmental issues, the report said that affluent Chinese consumers are expressing an interest in sustainable products. Previously, luxury brands were savvy on public relations and few customers chased them up on claims. However, Chinese consumers are now looking closer at the impact on China’s environment from foreign corporations.
So when it comes to luxury the future is clear, it's China's world, you're just selling in it.