Gen Z and millennials hold key to growing luxury goods market in China

After a three-year downturn between 2013 and 2015, China’s luxury market is booming once again as consumers, led by Generation Z and millennials, indulge in shopping to keep up with the latest seasonal trends.

A survey conducted by global consulting firm OC&C Strategy Consultants showed that over half of Chinese Gen Z (born after 1995) shoppers spent more than 50,000 yuan (US$7,250) last year, compared to only 32 per cent for millennials (born between 1980 and 1995) and 34 per cent for Gen X (born between 1960 and 1980).

But now marketers want Chinese shoppers to spend more on online luxury purchases. They are hoping to lift the share of online sales from the current 9 per cent. And among the three age groups, Gen Z indicated that they were keen to shop more often online.

“Gen Z consumers are more inclined to spend on luxury goods than older generations for several reasons: they are often still living with their parents because they have little hope of buying their own apartment when property is so unaffordable,” said Veronica Wang, associate partner, OC&C Strategy Consultants.

“And because they’re not motivated to save, they have more disposable income. They also have a different work ethic and set of values to their parents – they are more open to enjoying life.”