As part of our ongoing Q&A series with China practitioners, we spoke to Renee Hartmann of China Luxury Advisors to learn more about an extremely valuable, but often ignored segment of Chinese luxury consumers. We asked Renee four key questions to provide our members with new information and insights about this demographic:
- 01. What Chinese customer group should luxury brands be paying more attention to right now?
- 02. How can brands tell which Chinese students can or can’t afford their products?
- 03. Which brands are effectively targeting the Chinese overseas student population?
- 04. What should brands be doing to target this group?
01. What Chinese customer group should luxury brands be paying more attention to right now?TOP
Luxury brands have largely missed the opportunity to engage with Chinese students studying overseas. Given China’s one child policy and cultural emphasis on education, sending a child abroad to study is considered the ultimate luxury purchase. According to the Hurun Report, 85% of Chinese High Net Worth Individuals and 90% of Ultra High Net Worth Individuals plan to send their children abroad to school. The number of students studying in the U.S. is rising even faster than China’s GDP. During the 2010-11 academic year, 157,588 Chinese students were studying in the U.S. – an increase of 23 percent from the previous year, according to the Institute of International Education. China sends more of its students to America than to any other country.
02. How can brands tell which Chinese students can or can’t afford their products?TOP
Luxury brands should be paying attention to all Chinese students studying overseas, regardless of whether the student can afford luxury products themselves. All Chinese students are recognized as authorities on the overseas lifestyle by their friends and family. This gives Chinese students studying overseas significant influence on luxury purchases within their extended social networks.
China Luxury Advisors recently conducted research within this influential population. Of the students surveyed, 31% escort friends and family while shopping overseas at least once every quarter, 34% purchase luxury goods to take back to China at least once a quarter.
A whopping 96% of students surveyed purchase luxury goods to take home at least once a year. Even more interesting: 74% of respondents are asked for their advice on luxury purchases by friends and family at least once a quarter.
03. Which brands are effectively targeting the Chinese overseas student population? TOP
We haven’t seen any brands actively targeting this extremely influential sector: only 25% have been contacted by luxury brands during their stay overseas.
04. What should brands be doing to target this group?TOP
Brands need to take creative approaches to reach this group and provide them with unique experiences and offers that resonate. Digital marketing is also a key area for exploration, as this customer group is active on both Western and Chinese social media.