MEC, www.megclobal.com, a leading media agency, today released their annual forecast of Chinese consumption trends in 2012.
China is changing at a dizzying pace. For some marketers, these changes will unlock significant competitive advantages. For others, dealing with their impact will be a major challenge. As change accelerates across the country, the odds of missing a beat rise significantly. It’s important therefore to have your finger on the pulse – via the consumer.
This is the second consumption trends forecast published by MEC China. Some of the trends discussed in last year’s report have become very prominent this year. Others, such as Cluster-Oriented Consumption and Sensory Experience Consumption, have evolved into other trends in this new report.
Improvements have been made to the methodology. Similar to last year, MEC gathered input from over 50 trend scouts from different parts of China. The improvement came when MEC then took the most frequently mentioned trends and asked 565 consumers from 7 cities to rank them in an online survey. MEC then data-mined a number of syndicated tracking studies on Chinese consumption and media habits to find quantitative evidence to validate the top 12 trends.
Ranking of top 12 trends for 2012
T1：Me Consumption T7：Lazy Consumption T2：Eco-Friendly T8：Grass Roots Decision Makers T3：Hybrid Economy T9：Alternative Sensory Experience T4：Tech 360 T10：“Com”plex Consumption T5：Virtual & Physical Worlds Seeping into Each Other T11：World of Gamification T6：Free?? Free!! T12：Zhai (cocooning)
The Chinese used to see ‘individualism’ as a word with bad connotations, applicable to people who only cared about themselves but not others. However, the Chinese of today have come to see individualism as something to be pursued and developed. They no longer live by the principle of “the bird that shows its head gets shot.” Instead their unspoken slogan is “I have my own perspective”. They are more eager to share themselves with other people and put themselves in the limelight. The rise of personal media, including blogs, microblogs, and personal pages, are good examples of this trend. Those who are into writing blogs have increased by 12% within the last 4 years, while the use of weibo (the Twitter of China) has doubled since the last quarter. An ordinary individual can now have his or her own broadcasting platform. Each person is a source of information, becoming the hub of his or her sphere of influence.
T3：The Hybrid Economy
As the economy develops and the internet spreads, focusing exclusively on one’s own development is no longer a safe policy for marketers. More and more brands and categories are breaking out of their own protective cocoons and experimenting with new forms of joint ventures: cars team up with luggage, pension schemes with daily consumption. There is also the development of social TV, combining TV with mobile devices and social networking sites. It’s not just a question of one brand partnering with other brands, but the different approaches of wholly unrelated categories are now being coupled to meet consumers’ various needs.
Changes in lifestyles today make people more dependent on science and technology. Individuals have around them a battery of hi-tech products, each performing a different function. Yet there are all kinds of indications that technology integration is becoming a major trend. The various technologies are becoming invisibly linked, so that mobile phones can control TVs, or electric lights can modulate audio effects. In future, consumers will not be dealing with stand-alone high-tech devices, but will find science and technology penetrating every facet of their lives. We will be in an environment that is surrounded by technology 360 degree.
In times when almost every product and service goes into a price hike, the appeal of “free” as a marketing concept is obvious. Nowadays, there are opportunities for consumers to obtain products/services without having to pay. From 2004 to 2011, we see a rise of consumer acceptance of free products and services from 17% to 23%. More and more brands are deploying a free strategy in their marketing campaigns. With no perceived differences between products these days, the ability to induce consumers to try a product, albeit by a free strategy, is already a foot in the door for marketers. “Free” has gone from its initial role as a promotional tool to a long term business model. “Free” can come in very different formats, such as barter, consumers participating in a promotional activity or paying for products by performing services for the corporation.
T8：Grass Roots Decision Makers
There’s an ancient Chinese saying which gets it right: “When everybody adds fuel the flames rise high.” The new way to succeed in the internet age is to deploy the wisdom and strength of the general public to the greatest possible extent. People who participated in discussion on the internet rose from 2.8% in 2009 to 9.4% in 2011. A single move or pronouncement from a marketer can quickly get a huge response from consumers, and can end up making big waves. Xiaomi mobile phone is a success arising from grass roots participation. Its MIUI operation system is tested and perfected with the participation of its users consumers and the changes are upgraded every Friday. For the users of Xiaomi, everyone can potentially become a designer of the mobile phone and decide what a better user experience is.
The ‘cocooning’ man or woman is not a novelty. Faith Popcorn, the famous US trend forecaster, first proposed ‘Cocooning’ as a trend in 1992. In recent years, this trend has gained critical mass and is becoming more prominent in China. Cocooners are called Zhais in Chinese. The proportion of people that fall under this typology has been on the rise for the past 7 years. In a proprietary research done by MEC on Zhai lifestyle, 76% of the respondents believed that Zhai would be a lifestyle of choice for more and more people. The proliferation of the Zhai lifestyle brings with it an entire Zhai economy, such as home delivery service, E-shopping, increased need for communication and technology products etc.
Implications and Recommendations：
- With the continuous integration of technology and media (T3: Hybrid Economy & T4: Tech 360), brands should have a core idea that can be expanded and content that is liquid enough to flow from one channel to another. Conversely, each channel can carry different pieces of information about the brand, inviting consumers to participate in piecing together the brand content or using the bits and pieces of information to create their own UGC (user generated content) about the brand.
- With the development of T1: Me Consumption & T8: Grass Roots Decision Makers, how to leverage the power of grass roots decision makers is the next Mount Everest that marketers have to climb. Marketers do not just have to invite consumers into their brand communications, but also to tap into their creativity and innovativeness and let them participate in the development of products and services.
- The boundaries of ‘new media’ will continue to broaden. With the development of T1: Me Consumption, T6: Free??Free!! & T8: Grass Roots Decision Makers, every consumer can potentially be a new channel for a brand to communicate through. At the same time, the “free strategy” is an effective means to enroll consumers to communicate the brand message in exchange for goods and services.
- In order to ride on the continuously growing trend of T12: Zhai, there are three things that a brand can do: 1) Become a friend of the consumer in the digital world, and help them to lead a healthy yet colorful Zhai lifestyle; 2) Build a positive, forward looking brand personality and host events that entice Zhais to leave their homes and into the physical world to socialize with others; 3) Act as a bridge to assist Zhais to bridge the virtual and physical worlds seamlessly.
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 new and upward growing trends will give marketers an edge in tackling the market. The goal of Consumption Trends China 2012 is to be a springboard to inspire marketers, and assist them to think of new business concepts, new products or services and new experiences for consumers.”