Main+characteristics+of+Generation+Z+in+China

• China-chic describes the trend of China-centric design and the rise of Chinese brands
• Generation Z is composed of young consumers born between the mid-1990s and the early 2010s, who have been raised on the internet and social media
• They are gradually becoming the main force that drives China’s consumer market
• Most young people earn their own incomes and have strong purchasing power, even if they don’t, their parents and family members will support them financially
• Global brands such as KFC, McDonald’s, L’Oreal, and Nike are just everyday consumer goods to them, and they do not look up to them with admiration
• Members of Generation Z pay more attention to their personalized needs and stress on personality and expression while buying products
• They long for exclusive products specially targeting them during their shopping sprees
• Domestic companies have been proactively catering to the uniqueness of Generation Z’s demands. Chinese sportswear brand Li-Ning debuted its fall/winter 2018 collection at New York Fashion Week and successfully integrated chinoiserie with the sports trend
• Other Chinese brands, including Anta and Feiyue, also launched products to satisfy the demands of the new generation of consumers
• The comparative advantage of global brands is weakening as Generation Z transitions into the main consumer group
• Global brands’ operating models cannot meet individual requirements of the younger generation, as they rarely launch products or services based on the market demands of China
• Global brands like Zara and L’Oreal have less horizontal differentiation, which does not meet the young people’s personal preference, based on motives of self-expression and having a good time
• Domestic brands rose quickly by targeting customer emotions
• The advantage of domestic brands over global brands lies in customer emotions
• Vertical differentiation involves finding a quality/price mix that will differentiate the brand from its competitors, and that appeals to enough consumers and can be profitably implemented
• Horizontal differentiation refers to any differentiation that is not associated with the product’s quality or price point
• Starbucks released a limited-edition “cat paw cup” in China in 2019, which highlights the success of horizontal differentiation by revealing an emotional nerve with consumers
• The new generation of consumers is precisely a group that pays high attention to emotional needs. They seek distinct personalities, fashion, fun, and stories in products, from which domestic products get a leg up on their global competitors
• Domestic companies leverage social media and livestreaming e-commerce to sell their products and influence their target consumers

• Gen Z in China are defined as those born between 1996-2010 and make up about 15% of China’s population.
• They are China’s first generation of digital natives and are familiar with technology as a form of communication and commerce.
• McKinsey conducted a survey of nearly 3,000 consumers in China aged 18-54 to identify six key trends that define China’s Gen Z as a unique cohort of consumers.
• The key trends are:
  • China’s Gen Z are optimistic, impulsive, tend to outspend their budget, and are confident in their future earnings.
  • Desire for ‘unique’ products and services; they prefer brands that offer customized products, while 53% opt for brands that provide tailored services.
  • China’s Gen Z are relatively more loyal to brands; 47% agreed that they stick with brands they like, while 43% said they will always choose a brand they know over a new one.
  • Omnichannel shopping is on the rise; almost 40% of Gen Z consumers in China stated they would browse in-store but shop online while only about 15-30% of Gen Z in other countries stated they would do so.
  • Gen Z gravitates more towards individual merchants on ecommerce platforms due to greater transparency and more quality assurance.
  • Word-of-mouth, the online version, is most influential when it comes to purchase decisions; online reviews and the opinions of friends and family on social media are powerful sources of influence across generations.
  • However, Gen Z in China look to other sources for product recommendations; 51% say that official social media accounts of consumer brands are one of their top three sources of influence, while 44% count bloggers and online influencers among their top three sources of influence.
• Gen X shoppers in China indicate they are more spontaneous than Gen Z consumers elsewhere; even younger Chinese consumers are more impulsive than their peers in other countries.
• China’s Gen Z are the most spontaneous of all, with 47% telling McKinsey that they buy products on the go, five percentage points higher than for Chinese millennials (aged 24-38) and more than 10 percentage points higher than for China’s Gen X.
• This behavior is driven in part by robust confidence in future earnings; 78% of Chinese Gen Z respondents said they believe they will earn more or much more in the future.
• 36% of the survey sample overspend their budget, and China’s Gen Z refer to themselves

• Basic statistics show the age and population distribution of China from 2012 to 2022 and 2021, respectively.
• Resident population and resident population distribution in China in 2020 are presented with a breakdown by generation, including Generation Z.
• Statistics on the financial and employment background of Gen Z in China for 2021 and 2018 are provided, including monthly surveyed urban youth unemployment rate, monthly disposable income, sources of disposable income, average monthly salary, and share of consumers saving money.
• Different statistics on Gen Z online shoppers in China include their activity from 2018 to 2022, their share in total active online population from 2016 to 2020, their top channels to buy products from in 2021, the breakdown of traditional e-commerce and live commerce users by generation, newly added online shoppers in China from 2017 to 2021 per generation, e-commerce penetration rate among active Gen Z users in 2020 by platform, their online spending power in 2022, and their willingness for online shopping in 2022.
• Various statistics on selected consumer goods indicate their share among Gen Z consumers in China or the distribution of spending on them, such as beverages and snacks, monthly apparel spending, cosmetics, luxury goods, consumer electronics, and garage kits.
• The shopping preferences and behaviors of Gen Z in China are detailed with the distribution of spending of Gen Z students and non-students in 2021, the breakdown of monthly expenditure by segment in 2021, the influence of advertising on Gen Y and Z consumers in 2021, the share of planned and impulsive purchase among Gen Y and Gen Z in 2022, the attitude towards BNPL among Gen Y and Gen Z in 2022, and the preferences of domestic brands among consumers in 2021 by generation.
• Compound IDs and the US Environmental Protection Agency are mentioned for reference.
• A few methodology notes are provided, such as the use of monthly surveys for unemployment rate and disposable income and the interview method for luxury goods purchasing reasons.
• All statistics and data sources are given, along with their publication dates, from January 2020 to May 2022.

• Generation Z in China is known for their open expression of themselves and their views. (source: Agility)
• These individuals are more independent than previous generations. (source: Agility)
• Chinese Gen Z has deep pockets, even those in their teens. (source: Agility)
• This generation factors in individuality and self-expression as important aspects in choosing luxury brands. (source: Agility)
• According to a report from consumer research firm Mintel, Chinese Gen Z is more likely to care about brand and product quality than previous generations. (source: Mintel)
• Male members of the Gen Z population are willing to spend significantly more than females on nonessential items. (source: Agility)
• International brands have been affected by the increased interest from young Chinese consumers, while local brands have struggled. (source: Agility)
• Report from McKinsey & Company: Chinese Gen Z is willing to pay for high-quality products and show a preference for Western brands. (source: McKinsey & Company)
• Other key findings from the McKinsey & Company report include:
  • Luxury goods account for a lower percentage of Gen Z’s overall spending but make up more considerable proportions of purchases by younger Gen Z members.
  • Mobile transactions are preferred by Gen Z, with more than 80% of spending on luxury items occurring online.
  • Gen Z members are more interested in collecting and ownership than millennials.
  • Gen Z members travel more than previous generations, and brand experiences while traveling are essential in their decision-making.
• The report from EB Urban Lifestyles, a trendy online store in China, revealed that young Chinese shoppers display more creativity and individuality. (source: EB Urban Lifestyles)
• This trend is backed up by a consumer survey conducted by Euromonitor, revealing that Chinese millennials and Gen Z customers see themselves as more creative and individualistic than their predecessors. (source: Euromonitor)

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• The economic power of younger generations in China is a force to be reckoned with.
• Zak Dychtwald, the founder of market-insights company Young China Group, offers a framework for analyzing the younger generations of China and other countries using four “orbits of inquiry.”
• These orbits are generational power, generational distance, generational continuity, and intergenerational financial fluidity.
• Generational power refers to how much impact a youth cohort has in their own financial ecosystem. In most Western economies, the wealth is still concentrated in the older age brackets, but in China, young people both make trends and move markets. Seventy-nine percent of the spending on luxury goods and services in China is done by people under 40.
• Generational distance refers to the difference between generations. China has lived through so much change that it can be impossible to capture a 20-year swath of population utilizing a single designation such as Millennial or Boomer.
• Generational continuity examines how being their parents’ children affects their worldview. In China, the older generation grew up in the Maoist era, and China’s Millennials and Gen Z have internalized a sense that the pursuit of luxury is a worthwhile enterprise. Unlike American Boomers, they are living out their parents’ dreams.
• Intergenerational financial fluidity is how money moves between generations. Young people in China are market movers due to the fact that money moves far more freely between generations in China than it does in the US. One-child policy and upside-down pyramid demographic structure explains how young people with a fraction of the income of their American counterparts are making such a market splash.
• Chinese under-40 population disproportionately accounts for spending on luxury goods and services. At least half of all global luxury spending will be accounted for by China by 2025.
• The demographic picture in China looks like an inverted pyramid, with four grandparents for every two parents for every one child.
• A comparison between the number of people under 40 in China and the total population reveals that the number is proportionately small due to a massive baby boom in the 1950s and 1960s, followed by the baby bust caused by the one-child policy.
• Details include numbers such as 79% of spending on luxury goods and services in China is done by people under 40. One-third of all study abroad students in the US hail from China. Also, China was the largest outbound travel spender in the world pre-Covid.
• Young

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• China’s new generation born between the 1980s and 1990s is a social cohort that has grown up in the era of reform and opening-up. This generation is deeply influenced by the significant social changes that took place such as fast economic growth, the one-child policy, education expansion, the rise of the Internet, marketization, industrialization, urbanization, and globalization.
• The life course of this generation is intertwined with these changes which greatly affect their living circumstances and opportunities, shaping their generational characteristics while widening the intergenerational gap between them and the previous generations.
• The post-1990 generation is replacing the post-1980 generation to become the main force of China’s new generation. The majority of post-2000ers are still attending school and following the steps of the post-1990 generation.
• The one-child policy is shaping the generational characteristics of the youth. The policy combined with the country’s rapid economic growth has had a massive impact on the life course of the new generation. This has altered family structures, intrafamily relationships, and parenting styles. The rapid economic growth and the one-child policy led many prosperous Chinese families to invest more in child education. As a result, the China’s young generation enjoys higher living standards and better nutrition compared to the previous generation.
• The one-child policy and the decline in the fertility rates in China have substantially altered family structures, intrafamily relationships, and parenting styles. Today’s families are characterized by a more equal and intimate parent-children relationship and pay more respect to children’s needs and individuality. This transformation of intrafamily relationship has reshaped the intergenerational relationship in wider society since the young generation carries their self-confidence, independence, and open-mindedness into society. Young people are no longer passively indoctrinated, whereas the older generation can no longer indoctrinate the youth with their absolute authority.
• The post-1980 generation enjoyed higher education since they received secondary education when the “universalization of 9-year compulsory education” was promoted. The gross college admission rate in China was only 6% previously. As a result of the higher education expansion policy implemented in 1999, the gross college admission rate in 2016 increased to 48.4%, which means almost half of the young people of the college entrance age could get access to higher education. The post-1980 generation had a higher chance of receiving higher education (28.3%) than the older generations, almost doubling that of the post-197

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• Gen Z is born between 1998 and 2014.
• The vast majority of Gen Z are from one-child families.
• The internet has radically changed the way information is shared among Gen Z.
• Tangping and neijuan are the latest buzzwords in China’s Gen Z to describe their way of thinking and living.
• Tangping (lying flat) describes young people who, instead of striving for higher pay and social status, choose to be content with attainable achievements and let time unwind.
• Neijuan (involution), on the other hand, describes a process where people are trapped inside a cycle of over-competition that stops them from moving on or benefiting in a zero-sum game.
• Gen Z distinguishes themselves from older generations in that material betterment is no longer the single most important source of meaning in life.
• They view life differently and care more for their status as human beings.
• Many young people - especially those born after 1995 or 2000 - are well aware of the overarching social structure and want to imagine alternative ways of living.
• They are more idealistic, simplistic, and nationalistic than earlier generations.
• They are more open, straightforward, and spontaneous in expressing themselves, caring more about humanistic values and protecting the environment.
• On China’s popular video-streaming website Bilibili, a video called “The Next Wave” praised the new generation’s limitless potential, saying “All humankind’s knowledge and insight are gifts specially prepared for you,” but the younger audience did not feel it accurately represented them.
• To the Gen Z, the material betterment is no longer the single most important source of meaning in life. Citing the buzzwords lying flat and involution in an interview, one Gen Z described her lying flat as a positive way of living and involution as unnecessary.
• Gen Z is more open to the notion that they may be the first generation not to do better than their parents.
• The Gen Z population in China is about 280 million. A third of them are now in adulthood and starting to enter the job market. They will be the backbone of China’s workforce in ten years.
• Among the one million international students in the US, a third of them are from China and two percent of this elite group pursuing studies overseas are among the university students in China.
• Gen Z in China is developing during China’s fastest economic growth fueled by globalization.
• The majority of Gen Z in China were born into one-child families, born in an era

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The impact of China's one-child policy on Generation Z

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Top 5 characteristics of Generation Z in China