Middle Class in China

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MARKETING China Foto Press Understanding China’s Middle Class Targeting key segments of China’s diverse and rapidly emerging middle class will be crucial as household incomes rise Allison Cui and Kheehong Song G one are the days when companies looked at China as a monolithic land of 1 billion potential customers. Companies are now focusing on how to capture small segments of China’s giant market, and none of these segments is as attractive or as full of potential as the country’s rapidly growing—and multifaceted—middle class. As China’s economy continues to grow, more people will migrate to China’s booming metropolises to find better-paying jobs. These working consumers, once among the country’s poorest, will steadily climb…show more content…
Thanks to achievements part because the data on income in China tends to be in localization, the company has been able to cut prices by either unavailable or unreliable. Thus, companies must find an average of 54 percent in more than 1,000 categories meaningful alternatives to predict what consumers can since 2005. IKEA broke the bottleneck and succeeded in afford and what they are willing to pay for certain goods China because it recognized that middle class consumers and services. Studies by the Monitor Group indicate that wanted and would pay for high-quality products, but not at scores of non-income-related hooks—including age, the the same premiums as the affluent class. stage in a consumer’s career, and location of purchase— influence purchase decisions. Meet the middle class The Chinese badminton industry is a good example. China’s relatively new middle class consists of a rapidly Most Chinese school kids who play badminton do so in an shifting, diverse population. At present, China’s lower outdoor playground with a group of friends, wear non-promiddle class accounts for 44 percent of the total middle fessional badminton sportswear, and purchase a relatively chinabusinessreview.com January–February 2009 39 MARKETING class. As the middle class matures, however, the number of people in the upper middle class—households that earn $12,000 to $25,000—will spike dramatically. Companies must prepare for the different shopping behaviors of each
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