China mainland’s millennials and Gen Z luxury consumers are reported to contribute to 46% of China’s luxury purchases in 2021 (TMI&BCG, Oct 2021).
Two key facts to address the characteristics of new luxury comers’ luxury purchase behaviours:
#1 Post-90s become the backbone of China’s luxury consumers
Post-90s generations represent around 50% of the total luxury consumers, expecting to grow luxury spending by 25%-30% by 2022;
Around 11% of the luxury consumers (annual luxury spending > RMB 300K, equal to euro 4.2K) contribute 40% of the sales. They are driven mainly by the BRAND SERVICE and RESALE VALUE.
#2 Post-90s have a shifting luxury demand
They stress more the importance of SELF-REWARDING and SELF-EXPRESSING. They purchase luxury items more to reward or express themselves other than gifting;
They have a higher demand for BRAND SERVICE, such as one-stop, customized services that offer them a unique brand experience.
They appeal to the ‘ARTISTIC VALUE’ of luxury brands, reflecting a shift in the aesthetic standard.
Therefore, luxury brands must build a compelling brand presence to stress the brand value and create the right customer experiences to cater to the shifting demand.
Source: 2021 Tencent x BCG China Digital Luxury Report
