“Her Economy”: Five Trends in the Background of New Consumption Upgrade

According to the 2017 China Woman’s Consumption Survey, more than half of women believe that their income levels are comparable or similar to their spouses, and nearly half of women’s personal consumption accounts for more than one-third of household income. The change of “Women’s Day” to “Goddess Day” and “Queen’s Day” originated from the university campus and became a marketing tool for businesses to cater to women, especially young women – almost all businesses have abandoned the word “women” in marketing copywriting, which is replaced by “Queen” and “Goddess”. The above interesting changes are also the performance of domestic women’s economic status and consumption levels.

In this context, female consumption has spawned a new term “her economy”, which refers to the unique economic circle and economic phenomenon formed around women’s financial management and consumption. According to PR Newswire’s data on nearly 20,000 corporate news articles published by Chinese companies in the past year, in 2019, the “her economy” market will face new consumption upgrades, and female consumers are pursuing higher quality products and services, while stimulating companies with “her economy” as the main market to continuously innovate products and marketing concepts. In view of the considerable potential of China’s female economic market, it has become a top priority for businesses to understand and grasp the female consumer preferences and trends under the tide of “her economy”.

1. Behind the “actively single” is the enthusiasm of Chinese women’s economic independence. “Her economy” is growing rapidly.

According to the “China Women’s Development Program (2011-2020)” published by the National Bureau of Statistics, the proportion of female employed persons in the whole society in 2016 was 43.1%, exceeding the target of 40%. According to the 2017 China Women’s Consumption Survey Report, 52.4% of women believe that income levels are comparable/similar to their spouses; financial independence and income growth have gradually released female consumer demand, and nearly half of women’s personal consumption accounts for more than 1/3 of household income. According to the “Airbnb China Women’s Community in China” report, in 2018, Chinese female landlords accounted for more than half of the total number of landlords. The data released by Airbnb in early March also proves the economic status of women from the side.

The result of women’s economic independence is the rapid growth of “Her economy”. Jingdong Data Research Institute’s “Female Consumer Report – 2017 Jingdong Women’s Book” pointed out that from 2014 to 2016, the number of female users who placed orders in Jingdong on the “double 11” day increased more than four times, and the consumption increased nearly 5 times. The “Double 11” report published by the E-Commerce Research Center showed that female consumers contributed nearly 70% of the total online retail sales of nearly 254 billion yuan that day. According to estimates by Guotai Junan and other securities companies, it is expected that by 2019 this year, the overall market size of “her economy” is expected to reach 4.5 trillion yuan. In the eyes of the industry, the strong female consumer demand market has become the “wind in the mouth” of the continuous growth of the consumer industry, and female consumers have also become the main force to promote the continued growth of the future economy.

2. As “Appearance value economy” blowout, beauty makeup and medical beauty market continues to be sought after.

Coco Chanel once said, “A woman who does not spray perfume has no future.” The word may represent the direction of “Her economy” growth. Beauty is the nature of women.

In the field of beauty makeup, consulting firm and accounting firm previously released a report showing that the global beauty makeup industry sales in 2017 had reached 412 billion euros, and the compound annual growth rate from 2012 to 2017 is 3.9%. The agency predicted that the global beauty makeup industry would grow further in the future, with a compound annual growth rate of 5%, and annual sales would exceed 500 billion euros by 2021. Among them, skin care products accounted for about 27% of the total sales of the global beauty makeup industry, amounting to 111.24 billion euros, and makeup products of 57.68 billion euros.

In addition, China has developed into the largest market for masks in the world. In 2017, China’s mask market has successfully up to 20 billion Yuan sales, accounting for 47% of the global mask market. According to the China Industrial Research Institute, the mask market in China will be growing rapidly in the next few years and it is estimated that the Chinese facial mask retail market will exceed 30 billion Yuan in 2022.

In addition to beauty makeup, “Appearance value economy” has also made medical beauty gradually popularized. The data from ISAPS (International Society of Aesthetic Plastic Surgery) confirms that China has become the third largest medical beauty country in the world, after the United States and Brazil.

3.Women are more willing to meet their “exquisite life”.

With the continuous improvement of the economic level, modern women are gaining recognition for their personal values by pursuing a more qualitative life. From the past family consumption to upgrade to personalization, to pursuit fashion, exquisite, healthy life, comprehensive intelligence and so on. The consumption structure of the multiple demand trends together is a feature of “Her economy.” The research report of Essence Securities shows that the pursuit of value and quality has gradually become the main theme of women’s consumption in the new era. Therefore, in order to meet the change of the female consumers’ psychology and consumption habits, businesses have begun to pay more attention to the brand value and story meaning behind the goods.

4. Female groups have become important participants and promoters of tourism, and the hotel industry is deeply concerned about female preferences.

The booming “Her economy” has also increased the number of women’s travels and expenses per year. The data shows that the average annual travel frequency of female users has increased from 3.4 times in 2015 to 5.7 times in 2017, and the average annual travel cost has increased from 2,424 yuan in 2015 to 4,680 yuan in 2017.

The latest statistics from the Mama Travel Network also show that the proportion of women in the tourist user portrait is 58.6%, and the total number of female users in the 18-34 age group accounts for more than 60%. In addition, orders for two or more people accounted for 74.4% of the total, and short-distance tourism orders for 1-3 days accounted for 60.29%. It can be seen that the female group is becoming an important participant in tourism, and the accompanying and short-distance travel is increasingly sought after.

“Airbnb China Women’s Community in China” report released in March this year also pointed out that female travelers also play a decisive role in travel. More than half of travel bookings are dominated by women, especially for outbound travel bookings, which are mainly done by women.

Among them, from the perspective of travel destinations, the top ten domestic travel destinations for female travellers include Shanghai, Chengdu, Chongqing, Beijing, Guangzhou, Hangzhou, Nanjing, Xi’an, Xiamen, Suzhou. The top ten favorite overseas and Hong Kong, Macao and Taiwan cities that female travellers most like include Osaka, Hong Kong, Tokyo, Bangkok, Taipei, Kyoto, Seoul, Chiang Mai, Phuket, Kuala Lumpur.

In short, whether it is to meet the material needs of female consumers, or to meet the spiritual needs, in the face of “Her economy”, businesses in various industries have been changing according to changes in the market, from the perspective of women, to deeply segment the market, to enrich the female consumer market, to study and develop new products, to provide more personalized and humanized goods and services, and continuously to enhance the market experience of “Her economy”. The reason is that the prospect of “Her economy” is extremely attractive – the Economist Intelligence Unit EIU released the Asian Women Online Shopping Research Report in 2014, which mentioned that there are 41% of Asian women, who will also buy something for their family when they found themselves buying too much, due to guilt. In mainland China, the proportion of women who buy something for their husbands, children and parents owing to guilt is 67%. Even the sense of lingering can be a driving force of consumption It shows the huge potential of the female consumer market. It is no wonder that Ma Yun said: “Women will become the real consumer dominaters in the future, now it is just beginning.”

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The data refreshing record of “double 11” shows a consumption upgrade in China

On November 11th, 2018 Shopping Carnival, the e-commerce platform gave a consumption list that set up a new record.

Under the seemingly simple data, it has been a huge historical change in Chinese society since the reform and opening up 40 years ago, and the accompanying consumption upgrade.

First of all, this change stems from the continuous growth of the Chinese economy and the continuous income increase of Chinese people. In 2009, China’s e-commerce transaction volume was close to RMB4 trillion. By 2017, this figure reached RMB29 trillion, an increase of more than 6 times. The bigger background is that China’s GDP in China was RMB35 trillion in 2009, and in 2017, China’s GDP exceeded RMB80 trillion for the first time.

November 11th, 2018 Shopping Carnival

In this “double 11” activity, the number of middle and high-level consumers who consumed more than RMB1,000 was significantly higher than the population below RMB1,000. The heavy consumer groups who consume more than RMB5,000 have continued to increase their growth rate for two consecutive years, and the growth rate is 3.4 times that of the RMB500-RMB1000. This not only means that the consumption power of the mainstream consumer groups of the Internet post-80s and 90s will increase with economic growth, also means that with the development of smart phones, Internet consumption of middle-aged and older people over 50 years old is released. The older people naturally have stronger spending power.

The total turnover reflects the changes in Chinese economy and reflects the escalation of consumption, which is already a commonplace. More interestingly, the structural changes in the transaction dataactually reflect deeper structural changes behind China’s consumption upgrades.

Ten years of “double 11” data shows that apparel, shoes and bags have always been the most expensive category in online consumption. However, in the five years from 2013 to 2017, the proportion of this category showed a downward trend, and more transactions were distributed to 3C digital, home improvement furniture, beauty care and other sub-categories.

This change first came from the intergenerational changes of the Internet population. The Internet population in China started from post-80s. Today, they are all in middle age. Compared to post-90s with the more obvious personal preferences, the post-80s consumption structure and consumer goods category will naturally change.

From the consumption data of this “double 11” activity, it reflects more family meaning. Among the 3C digital categories such as maternal and child consumption, home improvement furnishings, and home appliances, the post-80s group has higher consumer preferences than other age groups. The prices are more expensive for the Personalized Umbrellas products of maternal and child, home improvement, 3C digital. Naturally it also drive the upgrade of the entire consumption.

Urbanization process drives China’s consumption structure upgrade

A more profound change than the intergenerational change is that China’s urbanization process has already shown a structural impact on Chinese consumption.

In 2013 in China, for most people, eating and wearing are no longer a problem. Apparel, shoes and bags are more of a manifestation of their own consumer needs. Then,does the decline in the proportion of clothing and shoes in the total turnover reflect the decline in the demand of Chinese people to show their own? No. The real reason is that with the intergenerational changes and the development of China’s urbanization, the Chinese people’s view of consumption has turned and upgraded.

A person’s hobby for football, travel, and electronic products was actually developed during adolescence. This requires not only money, but also the support of external environment, education quality and other resources. Urbanization, because of its scale effect, provides multiple factors.

When a generation that grew up in urbanization became the main force of consumption, the psychological satisfaction and spiritual enjoyment that they pursued have surpassed the stage of using clothing and shoes to show their own. They turn to tourism, sports, electronic products, hand-made and other categories. Therefore, the leisure Reverse Umbrella service consumption has been a hot spot in recent years.

The popularity of tourism products is a typical example of the rise of this type of consumer power. For example, a person in charge of an Internet travel platform said that the outbound travels dominated by young groups, such as the reservations for tickets for the World Inverted Umbrella Cup, La Liga, Premier League and NBA, have increased significantly. A very simple truth is that the love for La Liga, the Premier League, and the NBA, is generally derived from adolescence and requires a holistic atmosphere.

It is not difficult to imagine that their consumption will be more diversified with the growth of post-00s. The cultivation of adolescence will lead to a wider range of consumer interests in adulthood, such as the collection of LEGO, collection of musical instruments, art and so on.

From this perspective, the current phenomenon of China needs to find the answer from 30 years ago. The current “double 11” data not only reflects the overall growth of the Chinese economy, but also reflects China’s urbanization process and the structural changes of the population.

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