Consumers in China
China is an economic superpower with the world’s third largest GDP ($4.2 trillion), behind only the US ($14.3 trillion) and Japan ($4.8 trillion). However, despite almost catching Japan in total GDP, China’s GDP per capita is only 1/6 that of Japan’s (and 1/8 that of the US’s). This sets China apart and means its future potential is huge, as is many things related to China.
Chinese have saved more than Americans, so they may be relatively better off in the current economy and have money to spend in the next few years. For those of us trying to sell to them, we just have to be able to convince them to spend. That’s the hard part. Let’s consider what the Chinese buy now. After a house and a car, what is the third item that the Chinese rank as the most important purchase? It’s a TV. And not just any TV, but a flat screen TV, the larger the better. I heard this stat at Berkeley recently.
Another interesting anecdote is that many Chinese families want their children to learn to play the piano, so piano teachers are in demand, and soon as families get wealthier, pianos will be in greater demand too. In particular, the piano that will be most demanded will be a high quality inexpensive upright. Whoever can make this will win the piano market in China. And just like with TVs, as families get richer, they will buy the tallest upright (and then the longest grand) that they can afford.
Speaking of rich, China already has more high net worth individuals than Russia, India, and Brazil combined. Add in the over 200 million online users, and I would bet that selling luxury goods online would be a good business. (Current popular online goods: cosmetics and mobile phones)
