China is the set to be the next big consumer market. Brands and retailers – hoping in this way for a few more loops of ongoing growth without reconsidering their business model – are scrambling to get their foot down in the country. The most exclusive retail addresses in Shanghai, Bejing, Hong Kong and many other metropolitan areas sell out in record time and at record prices.
Hong Kong has proven to be the revolving door through which brands try their entry, some with more some with less success. But ultimately, those brands that manage to mark their territory in Hong Kong stand a good chance to manage to achieve the same on the mainland.
That globally available natural and other resources are by no way able to cope with equal level of consumption in China as we have achieved in the West is already yesterday’s news. The Chinese government is aware of this challenge, and so are many civil society organisations.
But – how do Chinese consumers react to this challenge concretely? Research in this respect is few and far between – whether it is in Chinese or in English, but evidently much less of the latter still, than of the former. In this article I will summarise the English language resources that are available with more or less recent data. English summaries of Chinese language studies are included whenever possible.
Video: Professor Philip Yeung is the Executive Director of the Clothing Industry Training Authority in Hong Kong. In 2008, he initiated the Sustainable Fashion Business Consortium with a dozen major fashion companies based in Hong Kong. He briefly outlines the development of the fashion industry in the former British enclave and greater China, and explains the challenges of sustainability, advocacy, and consumer awareness within the realm of fashion. Professor Yeung stresses the consumers’ importance and power and the necessity to change their consumption behaviour.
What is the Chinese consumer’s attitude towards consuming more sustainably?
- A consumer market study by CCN (the biggest consumer service website in China, hosted by the China Consumer Journal and the China Consumer Association), published this year (2013)) studied consumers in Beijing, Chengdu, Guangzhou, Shanghai, Shenyang and Xian. The results of the study show that consumers are interested in buying sustainable products and sometimes paying more for them. For products that have been produced in a way that minimises waste, almost 70% are willing to pay 10% more, 6% are willing to 50% more, while 8% are not willing to pay more at all.
- A 2011 Ogilvy Earth study (‘Get going with green’) showed that Chinese consumers are generally speaking well aware of what it means ‘to be green’. At the same time they are just starting to enjoy the amenities of their growing wealth and hence are not necessarily willing to cut back ‘just because the West says so’. Further, there is a fair amount of suspicion with regards to green claims.
The latter is not unfounded, after all China is riddled with illegal manufacturing practises, the latest episode is still driving prices for foreign branded powdered milk to searing (real and artificial) heights. - Sustainable Consumption Urban China Project (SCCS Urb) discussed 51 case studies from China – including at least 4 sets of apparel case studies. Many of the results reviewed and evaluated stem from various analyses of consumer goods studies performed by a government entity. The report makes it clear that often ‘sustainability’ still is strongly linked with (legal) compliance rather than best practise, as well as with practises that avoid unduly high H&S risks. ‘Green’ often goes hand-in-hand with the consumer communication, and business practises, that reduce the risk for consumers. Transparency of companies thereby has very little to do with ethical best-practise, but in turn is used as a means to gain the trust of consumers in the light of severe scandals, some of which were causing deaths through consumption of unsafe goods.
- 2012 research among nearly 400 Beijing residents – also by SCCS Urb – showed that 49.99% respondents were concerned with the quality of the consumption, 25.41% with price, the service accounts for 10.66%, and the ones selecting environment only account for 9.43%. People would necessarily focus more on the quality than other factors of products after multiple occurrences of food safety incidents and elevator accidents. People who have graduate and undergraduate degree account for 76% of the crowd choosing “environment”, fully illustrating the concept of environmental protection is proportional to the level of education. As a consequence, strengthening education will likely also result in improved consumers’ awareness and degree of attention to the environment.
- In a similar study done in Tianjin it was found that overpricing is a serious hurdle to achieve a wider take up of sustainably produced goods: “At the aspect of green product price,72% of consumers willing to pay extra 30% of the price for green vegetables, only 2% of consumers willing to pay more than the double price. But, on the market, the price of green vegetables is usually about three times of ordinary vegetables. 35% of consumers willing to pay 5% more for green appliances, 33% of consumers willing to pay 10% more of the cost, only 3% of consumers are willing to pay 30% more. The consumers in Tianjin willing buy green products, but the high price of green products is the major limiting factor.“
Looking at JUCCCE’s website on Sustainable Consumption it becomes clear that the conversation is largely shaped around the following areas:
– China Dream: The rather fuzzy vision of the the Chinese government on what sustainability means for and works across their society.
– Community Education – Health and Safety, Knowledge Acquisition
– Media & Celebrity Advocacy – Outreach, marketing
– YK Pao Expo Material Reuse – Recycling, re-use.
– A New Way to Eat – Food safety, health
– Safe Restaurant Guide – Food safety
Conclusion
Chinese consumers ‘tick’ differently than either what the Western clichés suggest, or how their European and American peers behave.
For one, their interest in sustainability – and transparency for that matter – is very rational: at a very basic level (food) it is tied to their own safety and the well-being of their families.
Consumers, specifically the middle class, are overall fairly well attuned to what the impact of their behaviour is, but they are equally aware that they only now start to enjoy a lifestyle ‘others’ (the West, the rich) have been enjoying for much longer. While they are not rejecting ‘green products’, the social reputation of the same (‘coolness factor’) is hence absolutely important. Similarly important are manuals and guides (e.g. ‘Handbook Green Consumption‘ (Chinese only)) that make it easy for them to behave well, without spending too much time or brainpower in assessing why and how to do so.
In a sense, the Chinese consumers are at the time both, lagging behind as well as being ahead of their Western peers. They may not buy as many supposedly sustainable products – for different reasons, notably availability and price – but they much clearer statement in regards to that no one will buy just for being green, and that there are clear functional, reputational and quality aspects involved, which do not differ between ‘green’ and ‘non green products’.
Note: We welcome though of course additional qualified input to this article, specifically also from anyone mastering either Cantonese or Puthongua.
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We would like to thank Christina Dean (ReDress, Hong Kong) and Anne Peirson-Smith (City University of Hong Kong) for sharing their insights with us, and pointing us towards the resources that stood at the beginning of the research for this article.
