China's Growing Consumer Culture: Implications for Marketing Strategy
With Dr Robert Taylor, University of Sheffield
Room S-1.04, Strand Building, Strand Campus, King's College London
4-6pm, Wednesday 7 October 2015
*** All welcome ***
China’s phenomenal economic growth in recent decades has led to an emerging consumer culture and, additionally, in the wake of a global recession currently affecting the country’s trading partners in Western countries, the Chinese leaders in the 12th Five Year Plan (2011-2015) have sought to encourage greater domestic consumption of goods and services. Economic development, however, has entailed social costs, witness urban rural inequalities.The emergence of a vocal middle class in China’s coastal cities and the consequent growth of civil society, facilitated by social media, have brought greater awareness of consumer rights and discernment in branded product purchasing. While these trends tend still to be an urban phenomenon, they are becoming more widespread, as government seeks to coordinate city and village markets, a process nevertheless still inhibited by poor infrastructure and low rural purchasing power due to income differentials.Consequently, this paper will focus on increasing consumer discernment in purchasing of products. Chinese government emphasis on moves towards high-tech value added products, prompted at least in part by the need to circumvent import barriers overseas, but as importantly by domestic brand diversification in China increasingly demanded by consumers, have accelerated competition, with implications for marketing strategy.Such demands for competitive innovation and market targeting bring into sharp relief a number of legal issues like trade descriptions and intellectual property. A raft of legislation is applicable to goods and services but is subject to local enforcement. A special concern of this paper is food safety, consciousness of which may determine consumer purchasing behaviour. Significantly, in May 2013 the 12th National People’s Congress created the State Food and Drug Administration which was given broad regulatory powers; administrative approval procedures were streamlined. A more consolidated authority was thus designed to provide a more efficient food safety system in the wake of the 2013 Amended Food Safety Law, intended to assist enforcement at the local level. To this end the Supreme People’ Court has issued its first interpretation of food safety crimes to serve as a binding rule for lower courts adjudicating cases. Greater urban consumer spending power has focused on diversified choice of food products. In the context of food safety, factors like age, sex, marital status, educational level and number of household members, which impact upon purchasing of, for example, green and genetically modified categories, are examined through brief reference to categories of consumers. In summary, greater Chinese consumer choice and discernment will necessarily influence marketing strategy by domestic and foreign firms alike.
Keywords: consumer culture, domestic consumption, urban-rural inequality, marketing strategy.