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Nicole Zhao, Managing Director of InVizible
Chinese consumers are an undeniably powerful segment of the global consumer market, with their spending expected to double over the next 10 years, reaching $12.7 trillion by 2030.
Within the U.S., the influence of Chinese consumers is also on the rise. Asian Americans as a whole (among which Chinese Americans represent about 25%) have seen their disposable income increase by more than 300% in the past 20 years and represent the fastest-growing single-race non-Hispanic ethnic group in the U.S.
For marketers, Chinese consumers represent an enormous and growing opportunity. But these discerning consumers expect marketers to reach them on the channels they use with content that reflects a nuanced understanding of their culture, interests and values. As managing director of a creative agency that helps launch and expand brands to and from the Chinese market, I see this all the time.
Here are seven insights to help marketers reach this important audience:
They’re concentrated in urban centers.
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The majority of Chinese Americans live in major U.S. cities, specifically New York, Los Angeles, San Francisco and San Jose. This has two-way implications for marketers: If they want to reach Chinese Americans, they should focus on these markets. It also means that if they’re launching local campaigns, their messaging should resonate with Chinese Americans.
Creating a marketing message that’s specifically for the Chinese consumer is challenging. It requires a thorough understanding of the social context and historical reference, and infusing cultural cues in an authentic way. I find, for most of the brands, a professional Chinese marketing consultant or a Chinese local institution or designer with deep culture understanding is the most practical way.
They’re global consumers.
Many of the Chinese consumers living in the U.S. today moved here to attend college, with more than 300,000 Chinese students enrolled in U.S. colleges annually. What’s more, over half of all Chinese Americans are foreign-born. When trying to reach Chinese Americans, marketers need to project a more global perspective that reflects this truly international demographic.
For brands that wish to market to this group, providing Alipay as a payment option could be more efficient than a Chinese-themed product offering. The branding messaging for this specific target market needs to avoid stereotypes that lump these dynamic groups together or with older generations.
They’re on a wider range of social media platforms.
Although many Chinese Americans are on U.S. marketers’ go-to social media platforms like Facebook, Twitter and Instagram, they tend to rely more heavily on the platforms popular in China, like WeChat. In addition to targeted ads on WeChat, marketers can tap into popular apps, such as Little Red Book, a geo-based shopping app that originated in Shanghai.
Whether it’s the student population, Gen X Chinese Americans that stayed in the U.S. after attending college, older generations or high-earning tech executives, Chinese consumers are often tied into close-knit cultural communities that include their social circles back in China, community groups and Chinese charities. So, a marketing approach such as word of mouth is highly effective in this market. Social recommendations are much more powerful than traditional advertisements.
They’re early adopters.
Chinese American consumers love new technology and are often energized by new experiences, making them a strategic demographic for marketers launching new products. These consumers are often early adopters and aren’t afraid to try something new.
They’re brand-centric luxury consumers.
China is the third-largest market for luxury goods, and Chinese Americans share that love of luxury brands, making them a key target for U.S. luxury marketers. In addition to luxury, Chinese Americans are overall more brand-centric, meaning that well-known U.S. brands with an established aesthetic and clear value are more likely to be embraced by this audience.
They’re not impressed by superficial attempts to capture Chinese culture.
In an attempt to reach Chinese Americans, many marketers have taken a bare minimum approach, relying on outdated designs or gimmicks often rooted in Chinese stereotypes. Instead of red Chinese figures, or yet another Chinese New Year campaign or Chinese Zodiac “year of the [fill in the blank]” product, marketers need to put in the time to understand the nuances of Chinese culture.
For example, for Chinese New Year, luxury brands Prada, Hermès and Tiffany & Co. created luxury mahjong sets that leverage the brands’ iconic craftsmanship yet shows the respect and restraint that has won the hearts of many Chinese luxury consumers. To release them around Chinese New Year also shows a deeper understanding of the culture — playing mahjong at family gatherings is a fine memory shared by many Chinese.
The Bottom Line
Chinese consumers in America are poised to play a big role in the overall U.S. consumer market, as well as major segments like technology and luxury, for years to come. Marketers can’t afford to overlook this key demographic, but they also can’t afford to apply a one-size-fits-all approach. To reach the Chinese American consumer, marketers need to take the time to understand who they are, where they are and what they value.
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Author: Nicole Zhao, Forbes Councils Member