Chinese Consumer Confidence measured at 105 in Q1 2016, a decrease of two points from Q4 2015 but still the sixth most confident country in the world, according to the latest Nielsen survey.
Confidence in East China increased from 115 to 117, boosted by local consumers’ promising personal finance prospects. Consumers in East China are more optimistic regarding their personal finances, with 76% respondents saying they have good or very good expectations for their personal finances in the coming 12 months.
The stronger demands for high quality products have pushed forward the trend of consumption upgrading in China. China’s regions have developed at different speeds and consumer trends vary greatly among different groups and regions. Understanding the preferences and mindset of consumer groups is the key to successfully expanding a business in China, according to Yan Xuan, president of Nielsen Greater China.
Willingness to spend remains strong across cities, especially in lower tier cities, which drives sales growth. But in tier 1 cities, expectation of rising real estate prices drive down people’s willingness to spend.
In towns and rural China, with the rising disposable income, people’s willingness to spend keeps increasing, which ultimate boosted people’s intension to travel, although the number is still fewer compared to upper tier cities.
The results offer further evidence of a trend toward rising consumer spending power in the country’s less-developed rural areas.
Men’s willingness to spend hit 54 in the first quarter, higher than female consumers at 49. Men’s rising enthusiasm for spending is mainly derived from their promising expectations on employment prospects and personal financial situation.
Some 38% of the female respondents said they would stock up on goods taking advantage of sales, discounts or promotions. By contrast, only 32% of male respondents said they would do the same. Male consumers are also less likely to make impulsive purchases affected by the promotional activities, with 46% saying they only buy things they need. Only 39% of the women surveyed said they will do so.
The survey also found that male consumers tend to put more of their discretionary money into savings or family improvement while female consumers prefer new clothes and skin care and cosmetics, both online and offline.
There are other differences between men and women when it comes to online shopping behavior as well. Men prefer to buy electronic and gaming products (26.09%), while women spend more money on cosmetics and personal care products (26.96%). The survey also found that both male and female consumers spend the most discretionary spending money on clothing (70% vs 80.47), household goods (33.75% vs 36.88%) and food, beverage and health products (14.37% vs 12.91%).
Also read: Chinese Consumers More Selective on Spending Habits