China is en route to become the world's second largest consumer market by 2015 following unprecedented growth several times faster than in developed countries during the last four decades, according to a report released by Boston Consulting Group.
The report based on a survey of 4,258 consumers in 13 Chinese cities between February and March 2007 reveals that most Chinese consumers, even when currently they are among the most saving-minded people, have plans to spend more in the near future to fulfill their family dreams. "The past decade of rapid economic growth has brought prosperity but also uncertainty, resulting in a highly complex consumer market with diverse consumer attitudes," said Hubert Hsu, senior partner and managing director of BCG, at a press conference in Beijing. "Capturing the next wave of consumer growth in China will involve developing deep consumer insights and creating marketing differentiation," said Hsu. The report said there are significant generation differences in terms of spending attitude among Chinese consumers. Younger generations target expensive products with brand names, better quality and rising concern over safety and quality of cheap products. Chinese consumers have more faith in brand names compared with US consumers, since they believe a good brand represents quality, safety, effectiveness and durability, said Hsu. However despite strong spending inclinations, Chinese consumers continue to "treasure hunt" –search for deliberate trade-offs to maximize "value" of their budgets. They use similar strategies for money-value shopping as their counterparts in other countries, except for several unusual tactics such as group purchase for volume discount, said the report. The report suggested global suppliers in China should establish strong, branded relationships with China's money-value conscious consumers, provide the kinds of products that appeal to practical concerns and emotional needs, and be willing to customize their offerings to meet the needs of a geographically diverse population. Promoting consumption is one of the policy priorities of Beijing authorities which would like to see the economy less dependent on exports and more linked to the domestic market. But making China into a western-style consumption society could entail serious sustainability problems for the whole world, admit Chinese experts. Academic Pan Jiahua and a member of the Chinese government's panel on climate change admits that if every Chinese family makes true its dream of having an automobile, "world' resources won't stand it".