A lot of multinational companies have been anticipating the growth of the Chinese middle class for many years. With the slowdown of the Chinese economy, the growth of this middle class has been hindered. A study was done to examine the growth of the Chinese middle class by considering how much purchasing power they really have and how much access they have to the products companies want to sell.
Chinese consumers’ buying power does not compare well with that of the US consumers. Between 2010 and 2014, only 12% of the Chinese people reported a household income of more than $3200 a year. Their spending power is expected to rise from 44% of consumer spending to 60% by 2025 compared to $32000 in the US today. This spectacular growth, however, is coming from a relatively small per capita base and will arguably remain modest compared with most mature markets even by 2025. This projections mean only a very gradual movement toward consumption led-growth in China. It will be interesting to see how this group of consumers grow in the next few years owing to the economic slowdown in the country. http://www.businessinsider.com/demand-report-on-chinas-middle-class-2015-11
3 comments:
A developing middle class will be critical for China's future. As the country transitions to more domestic-supported aggregate demand, it will need a middle class to coincide with the nation's production.
Because of their relatively slow growth recently, China has been looking for ways to increase growth again. One thing they did was devalue their currency, but consumption in the middle class is huge to help increase growth rates to around 10% again.
China is now trying to maintain a sustainable marketing situation due to the rapid growth of economy.And I agree with what Tyler said about a developing middle class would be crucial for the future development of China's future marketing.
Post a Comment