Implication of Chinese consumer behaviour changes on Australian products and services

In the previous article (https://www.sparkseeker.com.au/do-consumer-behaviours-change-over-time-and-if-so-how-they-change/), I discussed my view of consumer behaviour changes in China, and how to anticipate such changes. In this sequel, I continue the discussion to share my views towards the implication of Chinese consumer behaviour changes on the marketing of Australian products and services.

Equivalent to the previously mentioned conditions that triggers a behaviour change, I can argue that Australian product and service providers should prepare the consumer behaviour changes from the following three perspectives:

• Deeply understanding of the consumer needs
• Understanding of the value delivered to the consumers vs. price charged
• Identification of how convenient the consumers can get the value from products / services

Deeply understanding of the consumer needs

First, to prepare for the consumer behaviour changes, products and services providers need to dig deep to understand the fundamental needs of Chinese consumers. Some of the consumer needs are strongly related to lifestyle, whereas some may not. Taking the woman fast fashion for example, it is thriving in China among young women that many are single, may have just started their career, busy at work and like to attract good attentions. One of the key reasons for this group purchasing of fast fashion is that they aim to make good impression / appearing good among peers by following the latest fashion trend, frequently changing what they wear and not spending too much on a single piece of item. It is very much a lifestyle choice. On the contrary, purchasing of skin moisturiser may not be strongly related to lifestyle but more relate to its utilisation.

For products and services that are strongly related to lifestyle, the providers need to be aware of the limitations of marketing since the lifestyle could change overtime for the same group of purchasers. In the case of fast fashion, when a woman gets older, married and starting a family her lifestyle is likely to be changed significantly, as a result, her preference of fashion goods is likely to change as well. The marketing can spend more money on emphasising on the lifestyle image rather than trying to retain the existing purchaser with loyalty programs.

For products and services that are not strongly lifestyle related, providers can pay attention to the most desirable characteristics of the needs and under what circumstance the needs will change. In the case of skin moisturiser, gentle on skin, lower chance of causing allergic reactions could be one of the key characteristics of the consumer needs. The needs however can change depending on pervasiveness of allergic substances under certain climate conditions at a given region and given period. The marketing spend can also focus on the region, the period, and a group of people that most likely to react positively to such key characteristics and be adaptive to quick changes.

Understanding of the value delivered vs. price charged

Value and price are on the different sides of an equation. With consumer basic needs met, whether they will purchase a certain product or service depending on the higher the additional value they perceive and the lower the price they need to pay. Two classic examples in the Australian market is Chemist warehouse and Paspaley pearl. The former provides a retailing channel for pharmatheutical related produces that is competitive because it aims charging less. The latter promotes the uniqueness and quality of the products that is the best in the world, thus charging a premium.

For products and services that are competing on price, all marketing messages should be focusing on bringing in more volume in sales and thus helping solidify the pricing leader position without sacrificing profit. Chemist warehouse and JB Hifi did so by deliberately using large amount of yellow pricing tags and warehouse ambient setup to strengthen their image among consumers of selling commodities and cheaper.

For high value products like Paspaley, they operate the retail channel directly and limit the number of stores to create a good marketing image of being unique and scarce thus further enhance the premium value perception among consumers.

Identification of how convenient the consumers can get the value from products / services

The convenience of value delivery usually comes with two favours. One is that the delivery is part of the core value of the products or services. For things like perishable goods, the delivery to a large extent determines the value of the products. Whereas for other products / services, things like creative design services the convenience of delivery is still important, but only influences the value.

For products / services’ delivery that as part of their core value, providers need to build up the competitive advantage around the logistics by using good management together with cutting edge technologies. Marketing can then leverage the power of influence, by sharing good stories of how logistics is well structured to further convince consumers about the higher core value of the products / services.

If the convenience of value delivery is influencing the value realisation, a natural outcome would be providers to move part of the product and service customisations closer to the consumer to allow for easier / personalised consumption. Marketing needs to follow suit to allow for targeting individual consumer as well to further explore selling opportunities. Image that a creative agency hiring a Chinese local producer to finalise some design piece for its Chinese customers. The same producer needs to be equipped with marketing knowledge to promote additional services as well.

All in all, consumer behaviours changes will impact the products and services marketing in China. Through a better study of why and how the consumer behaviours change and equipped with in-depth understanding of the Chinese market needs, the value vs. price and the convenience for the consumption, a marketer can take advantages of the changes to generate a good return on investment.