The growth of high-quality consumption among China’s expanding and increasingly more discerning middle-class has become a major drawcard for global brands to enter the Chinese market.
China is the only major economy that achieved positive growth during the COVID-19 pandemic last year. At the first China International Consumer Products Expo (CICPE) held in Haikou, Hainan Province in May, top global luxury groups such as LVMH, Richemont, and Kering all had a prominent presence. The global growth of Hublot, a Swiss watch brand under the LVMH Group, is driven mainly by Chinese sales. In 2010, the Chinese mainland market accounted for less than one percent of its global sales, and in 2020 this proportion was closer to 15 percent. According to a research report released by Bain & Company, global luxury sales in 2020 shrank by 23 percent to € 217 billion, compared with 2019. However, the sales performance of the Chinese market was the opposite. Luxury sales achieved a growth of 48 percent in 2020, accounting for approximately 20 percent of the global market.
More importantly, Chinese brands have also grown rapidly in recent years. Since 2017 the government has set May 10 as the Chinese Brands Day. Emphasizing professionalism and craftsmanship, Chinese enterprises have greatly improved their brands by focusing on professionalization, marketization, and internationalization in brand building over the past four years. Domestic brands are playing a leading role in the reform of the country’s supply and demand structure. While meeting the upgrading consumption demands of people, the enterprises are also attaching importance to innovation and sustainable development.
At the 2021 Exposition on China Indigenous Brand (ECIB) held in Shanghai on May 10-12, a slew of hi-tech machinery and equipment was displayed. These included the Hualong One nuclear reactor model developed by China National Nuclear Corporation, which represents the latest nuclear power technology in the world. Space equipment developed by China Aerospace Science & Technology and China Aerospace Science & Industry, folding screens independently developed and manufactured by Mi Smart Factory, as well as the hydrogen engine independently developed by China First Automotive Works (FAW) with a thermal efficiency of 42 percent, achieving zero carbon emissions and zero pollution discharge, were also exhibited in the Expo. A number of time-honored brands, as well as some emerging brands such as Pinduoduo, Little Red Book, and Himalay, also participated in the Expo.
With the promotion of quality products, Chinese consumers are paying more attention to design, quality, and shopping experience. At the CICPE, various well-known domestic brands such as Huawei, Gree, Haikang, FAW Hongqi, BYD, Moutai, and Tongrentang presented their products. A dragon and phoenix-patterned cheongsam garment on display was priced at RMB 198,000, with a design inspired by the combination of Chinese wedding gowns and Western formal dresses. The techniques used in the cheongsam incorporated the national intangible heritage of handmade dragon and phoenix cheongsam with royal Suzhou embroidery skill, which took 180 days to complete. The large amount of hand embroidery created a relief-like texture in the auspicious patterns.
As China expands its opening to the outside world and integrates with the international market, a larger number of Chinese brands have become the trusted choice of domestic and foreign consumers, and more Chinese companies are cooperating with their international counterparts to develop and launch competitive products. An example is the “OSU-Model-S” solar racing car, displayed at the ECIB and developed by Trina Solar, a Chinese key state laboratory of PV science and technology, in cooperation with Japan Osaka Sangyo University.
The Chinese consumer market is open to the world and Chinese and foreign brands are entering the daily lives of Chinese consumers together. In the fashion life exhibition area of the CICPE, young visitors were more enthusiastic about exhibits in the more subdivided consumption categories such as those products from L’Oreal, Shiseido, and Swarovski. The report on imported goods consumption trend released by the JD Big Data Research Institute shows that quality consumption has become a trend, and diversified and personalized consumption will lead the trend of future imports which will also help to promote the quality and upgrade of the supply side.
Quality brand is the common pursuit of producers and consumers. Chinese brands and international brands will join hands to create a quality life for people worldwide.