30 Sept 2009
Mainland Middle-Class Spending Habits Little Changed by Financial Crisis
Attraction to Hong Kong Trends and Products Offers Opportunity, HKTDC Survey Finds
30 September 2009 – Middle-class consumers on the Chinese mainland are spending more cautiously in the wake of the global financial crisis, but have not made significant changes in basic consumption habits and attitudes, according to a survey conducted by the Hong Kong Trade Development Council (HKTDC). Survey results reflect the fact that mainland consumer spending has maintained its rapid pace despite the international financial turmoil. The HKTDC surveyed 1,050 mainland middle-class consumers in Beijing, Shanghai, Guangzhou, Chengdu, Dalian and Wuhan in June this year – the third survey of its kind since 2003.
High Disposable Income
“Middle-class families in the mainland have a high disposable income and strong purchasing power, so it is important for Hong Kong companies looking at market opportunities there to learn more about mainland aspirations and spending characteristics,” HKTDC Deputy Chief Economist Pansy Yau said today at a media conference. “The survey results can help companies position their products and devise appropriate marketing strategies.”
The average household income of respondents was about Rmb10,000 (US$1,460) per month, with 63 per cent having paid off their home mortgages. Many were affluent, reporting that they own a car, buy international brand-name mobile phones, handbags and watches and holiday overseas. Respondents also said they hoped to provide their families with a comfortable and affluent lifestyle as a means of enhancing success and to reward themselves for hard work.
The study found a relaxed attitude towards spending and little concern about price. The rate of saving was also low among younger respondents with no family obligations: 34 per cent aged 20-24 and 32 per cent of those 25-44 said they were not in the habit of saving.
Although 72 per cent of the respondents said they have become more cautious about buying in the wake of the financial crisis, their attitudes about consumption have not changed much. The only notable shift was in realising the need to make long-term financial plans. Respondents said they would proactively seek investment opportunities and work hard to build a career.
Most respondents also said they were willing to pay a premium for what they like or consider worthwhile. Some 85 per cent said they would spend on clothes, cosmetics, fitness training or even plastic surgery to improve their appearance. Following trends was common across different age groups, with nearly two thirds admitting they like to try out new things and acquire innovative products. But despite the perception that mainland consumers indulge in major brands, 77 per cent said personal taste was more important, and a majority viewed themselves as trendsetters.
In Touch with Hong Kong
“The findings showed these trend-chasing consumers like getting in touch with Hong Kong’s popular culture so they can keep up with international trends,” said Ms Yau. “Their favourable impression of Hong Kong and Hong Kong people affects their perception of Hong Kong products and services, and that can be translated into market opportunities for Hong Kong companies.”
Mainland middle-class consumers viewed Hong Kong companies as flexible about adapting international fashion to satisfy tastes in Asia. Some 64 per cent considered Hong Kong products made on the mainland to be relatively better. “Hong Kong companies should leverage the good impression of Hong Kong brands to expedite their entry into this market,” Ms Yau recommended. “To break into the market, Hong Kong companies can target the specific interests and habits of the mainland middle class.”
Noting that the Internet is an increasingly valuable platform for expanding business on the mainland, Ms Yau said 29 per cent of the respondents frequently visit Hong Kong websites, and 28 per cent shop online often. Ms Yau also said word-of-mouth advertising is key, with 63 per cent of respondents admitting they like to share new trends and life experiences with friends. “To foster good word-of-mouth, products and services must have their own unique characteristics, be of good quality and make an impression on consumers in the sale process.”
A full report of the survey is available at the HKTDC Bookshop for HK$200 per copy.
Supporting video of these events is available, free of charge, on www.thenewsmarket.com/hktdc
Please contact the HKTDC's Corporate Communication Department:
Tel: (852) 2584 4216
About the HKTDC
Established in 1966, the Hong Kong Trade Development Council (HKTDC) is the international marketing arm for Hong Kong-based traders, manufacturers and service providers. With more than 40 offices worldwide, including 11 in the Chinese mainland, the HKTDC promotes Hong Kong as a platform for doing business with China and Asia. The HKTDC also organises trade fairs and business missions to connect companies with opportunities in Hong Kong and the mainland, while providing information via trade publications, research reports and online. For more information, www.hktdc.com