SHANGHAI — MEC (www.mecglobal.com) and CIC (www.ciccorporate.com) released today their “Consumption Trends China 2013” Report.
New consumption trends, both on a macro and micro level, are appearing, colliding, converging, and even disappearing, in real time and at lightning speed. Marketers are working from scripts that are constantly being re-written. Some of these trends are comprehensive in scope, affecting and altering many aspects of consumption. For some marketers, these trends will unlock new opportunities and/or significant competitive advantages. For others, dealing with their impact will be a major challenge.
Christian Guinot, President of MEC China, said, “As change accelerates across the country, the odds of missing a beat rise significantly. It’s therefore important to have your finger on the market’s pulse and understand consumers and behavior. The aim of our annual Consumption Trends China report is to provide direction on what’s next and to be a springboard, inspiring marketers to discover new business models, products, services and experiences to meet the needs of their ever-evolving consumers.”
This is the third year for the report. This year, the methodology has been enhanced by working with CIC, China’s leading social business intelligence provider, in order to provide a more comprehensive view of the year ahead. CIC brings IWOM (Internet Word of Mouth) monitoring and social media research, adding depth and texture, to the trends.
Sam Flemming, Founder and President of CIC, said, “The emergence of social media is fast transforming methods of understanding consumer attitudes and conducting market research, and IWOM (Internet Word of Mouth) monitoring and social media research are essential parts of this change. The online world, with is liveliness, frankness and outspokenness, offers an additional route to a true understanding of consumer opinion and market pulse. At the same time, it provides an opportunity to understand how the very same media in turn influences consumers. Via Social Media Research, CIC punctuated each trend with examples to illustrate the needs of consumers and the exemplifications of those needs in a more vivid and true-to-life form. ”
Theresa Loo, National Director of Strategic Planning, Analytics and Insight, MEC China said, “Trends are broad points of view, and when you get a feel for them, many market observations and insights begin to make more sense. The ability to grasp the implications of consumption trends will give marketers an edge in tackling their markets.”
The Top 10 consumption trends for 2013 are:
1. Pay for safety
2. Go Micro
3. Culture Consumption
4. Spending on the Young
5. Spectacular Singles
6. Charity is the New Fashion
7. Emotion Consumption
8. Gray Hair Craze
9. Super 3rd Party
10. Crossover Economy
Here is a preview of some of these trends and their implications:
Pay For Safety
Safety is a big concern for Chinese consumers. After repeated food safety issues, shoddy workmanship and fake products, consumers are willing to pay a premium for a sense of safety in their consumption. For example, more people are buying insurance or organic food. Tweets on microblogs about road safety and food safety have soared. One weibo tweet satirically said that “if a Chinese is laid flat on the ground, he is a chemistry periodic table,” demonstrating the seriousness of the problem.
The prefix ‘micro’ is a consumption buzzword that goes with a lot of things. For marketers, it means more precise targeting of consumers in their advertising and promotional efforts. For consumers, it means short versions of movies, books, narratives etc. It also means having access to convenient and trouble-free purchases, at a lesser expense, at any time or place. These fine-tuned, “micro” approaches are becoming a craze. They add convenience to consumers’ lives and create new sales opportunities for marketers.
As the proportion of single men and women in society increases, consumption opportunities customized for this audience have emerged. Singles are not burdened with family responsibilities, and they want to enjoy life. They know how to live in the present, and they are willing to open their wallets for immediate gratification.
Gray Hair Craze
According to the results of the 6th National census, 13.26% of Chinese are 60 years old and above, and 8.87% are 65 and above. These represent respective increases of 2.93% and 1.91% since the last census. And seniors in China today no longer save every penny like the older generations of the past. They have plans and new ideas for the golden years of their lives, and are willing to spend more money on a pleasant and high-quality retirement.
Super 3rd Party
Do you have wishes that you have difficulties achieving alone? Look for a solution from a Super 3rd Party. This emerging “go-between” economy is where an intermediary steps in and bridges the gap of what needs to be done, but cannot be accomplished by the consumer concerned. The existence of a 3rd party as go-between makes it possible for consumers to achieve things efficiently which were out of their reach before. Examples are carpooling website (www.pinker365.com) that provides a platform for consumers with carpooling needs to match up and purchasing agents that assist consumers to buy products from overseas.
Implications for Marketers
Integration of online and offline
Consumers tailor their usage of online and offline media and platforms based on their information or entertainment needs, accessibility and convenience in terms of time and location etc. Online and offline media should be seamlessly integrated as a single communication model. The key is to drive traffic from online to offline and vice versa as consumers move along the purchase pathway.
In many of the trends, there are numerous cases of integration between online and offline. “Go Micro” uses online media and channels to facilitate offline consumption; WeChat and MOMO in “spectacular singles” uses digital technology to allow people to better communicate with each other. The challenge is to integrate them by playing up the strengths of each online/offline media or platform. For example, brick and mortar stores can be used to create memorable brand experiences, while social media can be deployed to facilitate information finding, discussion amongst friends, and “shai” (show and tell).
It’s the most intimate of screens as it is carried along by consumers on a 24/7 basis. It is a convenient communication tool for “Spectacular Singles” to lead a fulfilling life. “Go Micro,” relies heavily on a strong mobile strategy to capture the immediacy of each and every micro-purchase. Mobile strategy can be integrated into the e-commerce and/or communication plan via the use of gamification, augmented reality, social couponing and mapping/geospatial technologies etc.
Trust is the foundation of social and business life. Trust in a brand gives consumers the ability to try products or services with greater confidence. It is the ‘gut feel’ for the right decision that consumers are looking for. As can be seen from the “Pay for Safety” trend, there is a trust deficit in China. Consumers are taking a skeptical view of brands.
It is therefore vital that brands gain and retain consumers’ trust in order to succeed. Brands can promote their reputation for trustworthiness through social media platforms and word of mouth channels. They should also constantly monitor what is being said about them on the internet so that they can move in quickly to amplify a relevant discussion or to come up with countermeasures when negative publicity arises.
For brands with e-commerce, online trust is even more important. Good reviews and recommendations from friends and fan communities serve to alleviate some of the distrust. However, there are multiple facets of consumer trust online, such as product quality, internet safety, efficiency, return policy, warranty etc. Success for any e-commerce player in China involves tackling the various components affecting trust along every step of the purchase pathway.
Gamification (game-based learning and simulation) is a wildcard which lends fun and excitement to anything that it is associated with. Deploying games in brand communication, or building game mechanics into the purchasing process to move consumers along the purchase pathway, are great ways for brands to engage with consumers. “Go Micro” works on the basis of “many feathers make a bed.” It has to find a way to scale its efforts. Building in a gamification system is a good way to keep consumers coming back and participating more.
With the “Gray Hair Craze” trend, elderly consumers are extending their consumption into a myriad of products and services. There is more for them to learn about what is available and how best to utilize it. Deploying gamification in the learning process is a good way to improve the learning experience and help brands gain affinity and relevance with consumers.
Social commerce refers to the use of social media strategies to anticipate, personalize and energize the shopping experience. Chinese consumers are very social along the purchase pathway. They want confidence in what they buy from their friends, and insight from their community. They are prolific reviewers and readers of online product reviews. Brands need to create or leverage platforms for their customers to share and tell, thus enhancing brand relevance and brand preference in the process. “Super 3rd Party” needs a social platform for consumers to “shai” (show and tell) about the experience brought to them by intermediaries. Brands could provide these platforms via their official website, mobile-site or leverage other social platforms, so that they can “stick” around to experience the brand.
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CIC is China’s leading social business intelligence provider, enabling enterprise to fully leverage the power of social media and Internet Word of Mouth (IWOM) intelligence across the organization. Since 2004, CIC has pioneered IWOMized technology, research and consulting. Firstly, by coining the term IWOM and then being the first to raise the concept of “social business” in China. As the industry thought leader, we have always been at the forefront of China’s internet and social business revolution. CIC is China’s largest integrated 3rd party provider of technical IWOM solutions, social media studies and social business intelligence. In order to help companies effectively leverage this social business intelligence, CIC provides customized research, consulting services, syndicated reports, and industry trend watches, rich in actionable insight. In addition to helping brands accomplish their social business aims, CIC is also monetizing the social business industry in China, creating an integrated social business support system (IWOMmaster), powered by our proprietary technical solutions and platforms.
In early 2012, as China’s leading social business intelligence provider, CIC agreed to be acquired by WPP’s Kantar Media, the media research and insight division of Kantar, as a move to strengthen its position and with aim to expand its social offering across Asia Pacific.
CIC will continue to provide social business intelligence from an objective, third-party perspective, to the world’s leading brands and agencies.
To find out more, please visit us at www.ciccorporate.com
MEC has 50+ trend scouts from different parts of China. They monitor what is happening in their cities on a regular basis and feedback the information to MEC on a timely fashion. MEC then took the 20 most cited trends and asked 1200 consumers from 12 tier 1 to tier 3 cities (Beijing, Shanghai, Guangzhou, Shenzhen, Chengdu, Shenyang, Nanjing, Jinan, Jingzhou, Mianyang, Foshan, Xianyang) to rank them in an online survey, so as to ascertain the importance of these trends to consumers’ lives. MEC then went to a number of syndicated tracking studies on Chinese consumption and media habits to do data mining to validate the trends.
Simultaneously, CIC conducted IWOM monitoring and social media research to provide granularity and texture to the trends. CIC validated the trend topics based on netizens’ online discussion and media discussion by monitoring the buzz volume about key trend topics on main social media platforms, including Sina Microblog, Tencent Microblog and News sites. CIC then also validated the consumer phenomenon of key trend topics by exploring CIC social media IWOM watch database and related Microblog tweets from netizens from tier1 to tier 3 cities.
Information Source: WEBWIRE