Comparing China's Elderly to its Millennials & Gen-Z
With China anticipated to become the world’s most valuable ‘silver’ market as of 2050, brands need to understand how marketing to elderly consumers in China differs from marketing to Chinese Millennials and Gen Z.To make this process easier for you, China Skinny has pieced together an overview of some of the major differences between the two consumer segments:
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What proportion of China’s population do they make up?
Elderly/’Silver’ Consumers
By the end of 2019, China’s elderly population was 254 million.
While they currently make up around 18 percent of the total population, the number of elderly is expected to rise to a third of China’s population by around 2050.
Millennial/Gen Z Consumers
In 2019, Millennials (1980-1994) and Gen Z (1995-2009) consumers made up close to 40 percent of China’s population. This means their consumer segment has around 560 million people. Most (around 60 percent) live in urban areas.
With a population of 149 million people, China’s Gen Z is the largest of its demographic group in the world.
Where do these consumer groups live in China?
Around 60 percent of silver citizens live in urban areas and the amount of active seniors (between 60 and 69 years old) in these areas is estimated to be close to 90 million.
Close to 60 percent of China’s millennials and Gen Z consumers live in urban areas.“Chinese millennials – particularly those with the best talent, skills and education – mostly prefer the big cities, like Guangzhou, Beijing, Shanghai and Shenzhen, because there are more opportunities,” said Guo Xin, President and CEO of Career International.
How many are online?
Elderly Chinese make up approximately five percent of the total online Chinese population as of March 2020. That accounts for around 45 million people – small by Chinese standards, but they have become the fastest growing segment which has accelerated since Covid-19.
China has an estimated 400 million millennials and 150 million Gen Zers, making the group around 550 million combined. Each month around 60 percent of Chinese millennials shop online. That translates to around 240 million people.
What platforms do they use?
Elderly Chinese use apps like Ximalaya, WeChat, Douyin (TikTok), QQ, Taobao, Pinduoduo, JD.com, Tangdou and others on a daily basis.
Super apps like WeChat, Alipay, Taobao and Douyin are driving Gen Z mobile use across a range of activities. They drive many of the niche apps that specifically target their generation such as Bilibili videos or Keep fitness.Young consumers reportedly spent the most time (24 percent) on video apps (excluding short videos), followed by apps that were used for instant messaging, music and short videos.
What features do they prioritise in products?
84 percent of elderly consumers said they now purchase higher quality products and services than previously, while 79 percent agreed they need to try new products and services to stay up to date.
Of the elderly respondents, 18 percent mentioned safety as their primary concern when buying products specially made for seniors, while 26 percent of their children stated this factor as the most important.
Amongst 3,700 Chinese millennials surveyed in 2020, close to 50 percent said that ‘practicality and function’ was the most important factor in choosing which product to buy.
Following this, the next most important factors were brand (23.1 percent), price (16.2 percent) and packaging design (10.9 percent).
Of those who spent rather than saved their discretionary income, 34.5 percent prioritised investing in themselves through classes, while 31.7 percent said they preferred spending it on improving their current living conditions.
What is their financial situation like?
Around 88 percent of elderly in China were reported to have a pension. Given the average annual per-capita pension of $5,783 USD (38,000RMB) of urban seniors and their average consumption expenditure of $3 957 USD (26,000RMB), as a whole, China’s urban silver consumers have considerable purchasing power.
In 2019, the China Report on the Development of the Silver Industry estimated that the spending potential of China’s elderly population would increase from 4 to 106 trillion RMB by 2050, making it one third of China’s GDP.
Around 63 percent of Chinese millennials said they had additional income streams aside from their full-time salaries. After rental costs, Chinese millennial men reported that they spent the most on the food and beverage category, while women said they spend the most on daily necessities.
Of those millennials surveyed, 91.8 percent said they had either used credit cards or online consumer credit services like Alipay Huabei and JD Baitiao.Gen Z consumers in China are said to be reliant on their parents for income. In spite of this, Chinese 20-year-olds are quickly becoming the top consumers of luxury brands and will soon become the top consumption group in the country.
Do they have any specific preferences as a consumer group?
In a 2019 survey, over 90 percent of elderly said that they believed children and elderly should have separate living arrangements, reflecting a change to the traditional beliefs of mainland seniors.
Elderly consumption trends to watch include tourism spending growth, demand increase for elderly universities, growing health consciousness amongst silver citizens, and more active use of the internet by seniors.
Amid the pandemic, Chinese Gen Z consumers have demonstrated a strong desire to support local brands, ranging from food products to sportswear and cosmetics.
With rising disposable incomes amongst Gen Z and a decline in marriage rates in China, marketers should note how these factors influence young Chinese consumer lifestyles. China’s millennial consumers are generally accepting of online social networking, second-hand luxury goods and sustainable development. Chinese Gen Zers are comparatively more dependent than millennials when it comes to being connected to social media on their mobiles.
To really understand different consumer groups in China and how this translates to your marketing strategy, get in touch with China Skinny.
