Understanding the Behavior of Chinese Millennial Consumers Written by Raymond Lam Translated by Thaniya Kanthahatthi, Lecturer, Department of International Trade, Faculty of Business Administration

The behavior of Chinese millennial consumers is changing faster than any other market in the world. The rise of social media has played a major role in fueling this change. The Chinese market and its consumers are complex due to its size and large population, which means that Chinese consumers have different and varied needs for products and services. The enormous increase in purchasing power in the Chinese market has attracted many international businesses to enter the market. To successfully penetrate the Chinese consumer market, it is important for businesses to understand the needs and attitudes that shape Chinese consumers’ behaviors, which is key.

Today’s Chinese consumers can be said to be fascinated by the ever-changing economic, social and cultural trends. The Chinese have become increasingly dependent on communication devices such as mobile phones and tablets. From the perspective of Chinese consumers, applications such as WeChat are a must-have on their devices and have become an essential part of their daily lives. The usage behavior of WeChat is deeply rooted among modern Chinese consumers. The popularity of this application has grown exponentially since its launch in 2011. Chinese consumers know and call WeChat as Wēixìn (Weixin). WeChat has created convenience and speed in the daily lives of Chinese consumers who download and use WeChat. Today’s Chinese consumers choose WeChat over Line because of its advanced and comprehensive operating system, whether it is registering for classes, paying for consumer goods and services at shopping malls, street food stalls, calling taxis, booking movies, booking train tickets, booking airline tickets, paying water and electricity bills, calling someone to do laundry, sending things, cleaning the house, transferring money to friends, and sending red envelopes during the Chinese New Year. Top up mobile phones, donate money, buy funds, Chinese consumers use WeChat as an online wallet on their mobile phones because financial transactions via the WeChat application are not only convenient and fast, but also offer discounts and promotions with higher interest rates than banks. The WeChat land is a beautiful virtual image filled with everything customers need and want. WeChat’s virtual communication system allows consumers to communicate easily and can also use video conferences with many people at the same time. WeChat has greatly improved the flexibility of their daily lives and work through online channels.
Chinese consumers have been quick to show their loyalty to WeChat. MAUs, based on the number of monthly active users in China, totaled 706.7 million in 2016, representing 93% of the global user base. However, WeChat has yet to meet its goals for international expansion. However, Tensent executives are not discouraged, as the company’s success in the Chinese market is undeniable. WeChat is also popular in Southeast Asia, South Asia, and Latin America.
The WeChat application combines functions that allow users to send text messages, voice messages and broadcasts, play video games, make video calls, share photos and videos, keep up with news, shop online, and other services that are useful for daily life and share location. China, which has the highest percentage of males over females in the world, has a core user base of 67.5% male users and 40.4% of working-age consumers from various organizations. This group of users has a high and stable income. They have high purchasing power and spend their money on entertainment and shopping. There are also freelancers who make up 25.3% of the total user base.
Source: Walkthechat
It is worth noting that there are currently about 10 million public legal entities with official WeChat accounts. Of the total number of WeChat users, 72% are public legal entities in various industries of the Chinese economy. More than 54% of all official accounts have invested in managing their own public accounts. 84% of official accounts use the WeChat app to inform consumers of their news, and there are many marketing campaigns and activities to promote sales to consumers via WeChat.

Source: Walkthechat
The trend of WeChat usage by Chinese consumers is remarkable. 94% of users use WeChat daily, 61% of users open WeChat more than 10 times a day, 36% of users open WeChat more than 30 times a day. 32% of all users use WeChat for more than 2 hours a day, and 50% of users use WeChat for at least 90 minutes a day. The majority of WeChat users (born in the 1980s and 1990s) (65%) are monthly active users, and 55.1% of users have more than 100 friends on WeChat. In 2016, the number of messages sent via WeChat increased by 67%, with an average of 74 messages sent per user per day. Users also make 100 million phone calls via WeChat every day, a 180% increase from 2015.

To understand Chinese consumers, it is essential to learn about their behavior through various activities. WeChat has broken down all the main activities of users on the WeChat app as follows:

Online shopping has become a norm for Chinese consumers. In 2016, the number of Chinese consumers shopping online on WeChat increased by 31%. In recent years, a growing number of new fashion brands have created official public accounts on WeChat to market and promote their products to Chinese consumers. 80% of these official accounts post a variety of content on weekdays, with 36% of all WeChat posts made on Wednesdays and Fridays.

Source: Walkthechat
WeChat’s red envelope giving feature has completely broken the traditional red envelope giving behavior among Chinese people. Chinese users sent red envelopes to their family and relatives via the WeChat app, totaling 2.3 billion yuan on January 1, 2016, according to Tencent.
WeChat, designed and developed by Tencent, is a form of Internet technology and communication innovation that has not only impacted the use of cutting-edge technology but has also changed the way Chinese consumers spend their money and their daily lives. WeChat’s unique platform has managed to consolidate multiple functions into one place, resulting in cutting-edge products that serve users better than Western apps like WhatsApp or Facebook. A whopping 53.6% of consumers surveyed said they would be happy to pay for goods and services via WeChat if they had the choice. Chinese consumers are now traveling abroad cashless, avoiding overseas credit card charges. With the expansion of cross-border payments, Chinese tourists can now pay via WeChat in more than 20 countries.

With its excellent operating system, WeChat has captured the hearts of consumers and has influenced many businesses, both Chinese and foreign, to find a way to enter WeChat by creating their own official public accounts on the WeChat application in order to reach the Chinese consumer group. Entering WeChat is an important first step in introducing their own products and creating marketing campaigns to successfully stimulate sales to the current Chinese consumers. The trend of communicating via the Internet that is widespread in China has made the behavior of the current Chinese consumers become a digital nation. It is estimated that up to 200 million Chinese consumers have linked their credit cards to mobile payment or money transfer applications, and this number is expected to continue to grow in the future.

Translated from the article The Best Guide to Chinese Consumer Behavior on WeChat (2017)
Written by Raymond Lam source: https://www.dragonsocial.net/blog/
Translator: Professor Thaniya Khanthahatthi, 25 April 2018