China’s Generation Z outspends peers in U.S., UK on luxury good
January 29, 2019 Category China News Round-up, Weekly
Members of China’s Generation Z are confident, carefree and spend over USD7,000 a year on luxury goods – even before they turn 21, according to a study by research firm OC&C Strategy Consultants. Spoiled by parents and grandparents for being the only child in their families, these youngsters are living it up compared to their cautious, conservative peers in the West. They are pumped up about the future and not worried about their career prospects or international politics, the study found. “This is a generation that has never known worry, so they spend more and save less,” said Adam Xu, Partner at OC&C based in Shanghai. “We don’t know if they’ll grow up to be successful but we do know that they are already a significant spending force that consumer brands must pivot towards.”
China’s Generation Z did not have to share while growing up and saw only an ever-rising wealth creation. By contrast, their peers in the U.S. and Europe witnessed the 2008 financial crisis and its aftermath, are graduating with historically high student debt, may not earn enough to afford a roof over their heads and are more politically conscious than earlier generations. The survey questioned 15,500 people born in 1998 and after, across nine countries including Brazil, France, Germany, Italy, Poland, Turkey, the UK and the U.S. Almost 2,000 youngsters were from China. Chinese Generation Z accounts for 15% of their household’s spending in the survey compared with 4% in the U.S. and the UK, and although the vast majority are not yet earning a salary, they consume a lot.
In a separate survey last year, the same research firm found that over half of Chinese Generation Z shoppers spent more than CNY50,000 on luxury goods last year, compared to their stingier elders. Only 32% of Millennials spent that much, compared to 34% of Generation X. But the survey has also uncovered two worrying trends: Generation Z is not saving like earlier generations and is willing to take on debt to fund their purchases, the South China Morning Post reports.
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