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Whereas insights into the “me” and curious consumers can be used to better understand what urban Chinese people buy and the thinking behind their purchasing decisions, our analysis also sheds light on how urban consumers engage with consumer packaged goods companies and retailers. Not surprisingly, digitization has taken hold in a pivotal way. Digital channels are pervasive and digital consumption continues to grow in popularity.
What does the emergence of digital as a way of life mean for consumer packaged goods companies and retailers? It means that growth is no longer simply a matter of moving consumers and customers through linear purchasing processes. Creating smarter, seamless and secure experiences at every point of interaction is what defines expectations in the digital world. Experiences today must be non-stop, customized and cross-channel.
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Our research showed that 86 percent of urban Chinese consumers are internet users. One segment of consumers – which we refer to as “internet civilians” – conducts nearly all of its transactions online. Only two of the eight segments we identified have little digital exposure. Of China’s digitally connected urbanites, 73 percent go online and nearly 50 percent visit social media sites every day. This has significant implications for advertising and brand building.
Digital channels are pervasive in China and digital consumption continues to grow in popularity. Creating smarter, seamless and secure experiences at every point of interaction is what defines expectations in the digital world.
Chinese urban consumers spend, on average, 9.4 hours per week watching TV. Yet, they spend more than 28 hours per week consuming content via their PCs, tablets or smartphones (12.6, 8.3 and 7.2, respectively). In this fragmented environment, it is quite difficult to maintain a consumer’s attention through a single channel.
Digital media is particularly relevant to younger consumers in Tier 1 and Tier 2 cities. As the 18- to 35-year olds age, their affinity for digital media will certainly continue and also be embraced by the generations that follow them. This suggests that internet advertising will become a mainstream approach to connecting with urban consumers in the years ahead.
Social media deserves special consideration. Urban consumers in China use social media for a variety of purposes, but most use it to stay connected and communicate information. A sizeable number also turn to social media to source product information. Given that 73 percent of respondents often recommend products they’ve purchased to their friends, one can assume that many of these recommendations and critiques occur in the social media space.
July 22, 2014
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