China’s large and growing population of young consumers hold certain attributes that luxury marketers can address when planning future launches. For one, this group is significantly younger than their peers in Western countries or even Japan, and they are ready and eager to buy luxury products.

Findings of “The 2011 China Luxury Forecast,” launched by Ruder Finn Asia, a large, global independent public relations firms, and the Asian market research institution Albatross Global Solutions, focus mostly on China’s “Post 80s” luxury consumers to reveal future trends for China’s luxury market. A total of 1057 respondents took part in the survey and the findings can be summarized by five key attributes: Optimistic, Self Fulfilling, Mainstream, Digital, and Price Sensitive.

Optimistic: Mainland Chinese consumers expressed the greatest consumer confidence, with 92% of respondents intending to spend the same or more than they did last year, even while facing pressures such as inflation and economic uncertainty. The ratio of their counterparts in Taiwan only reaches 20%. The results show that with an optimistic outlook for the future, Mainland China will continue to lead the growth of the global luxury market in the coming years.

Self Fulfilling: Conventional thought on China identifies status as the key driver for luxury purchases. The 2nd edition of the China Luxury Forecast, published in 2010, revealed that “status” was beginning to give ground to ‘pleasure’. The survey of the ‘Post 80s’ in 2011 has confirmed this trend. For young Chinese buyers, luxury purchases are mainly prompted by self-oriented triggers, especially when an individual seeks to treat him/herself. Social aspects, such as showing off, are granted less importance and moved into the ‘No. 2’ position this year.

Mainstream: Although there is a significant shift from ‘showing off’ to ‘self recognition’, and more emphasis on buying for self fulfillment, China’s ‘Post 80s’ luxury buyers have clearly shown their preference for well established luxury brands. Well established brands such as Cartier, Omega, Rolex, Chanel, Louis Vuitton and Gucci stand on top of their wish lists, with the origin and history of a brand as the most important criteria they consider. Relying on ‘trusted’ brands, the young consumers lacked to show interest to ‘know more about other international brands’, posing a new challenge for brands which are late comers to the Chinese luxury market. Newly introduced brands will have a much tougher time cracking the market than their predecessors.

Digital: The Internet is changing the world — and with it, the luxury industry. While points of sale and brands’ official websites remain the most preferred sources of information, vertical websites and news portals ranked second and third respectively, in online information sources, showing there is a strong need for brands to keep their online messages up to date. And not surprisingly, micro-blogging (weibo) is a rising star among luxury information channels, ranking No. 4 in information resources. Furthermore, ‘Post 80s’ consumers are more open to luxury online shopping, with 35% of respondents saying they currently buy luxury products online.

Price Sensitive: Limited by purchasing power, ‘Post 80s’ consumers are not really impulsive buyers, rather, they tend to compare price and wait for a better deal. They travel a lot outside Mainland China to buy luxury products, especially to Europe and Hong Kong to get better prices, avoid taxes and have an assurance of authenticity. Therefore, international brands should be fully aware that serving Chinese customers is not a ‘China mission’, but an international practice that requires global attention.

Nicolas Jeanjean, executive director of Albatross Global Solutions, said, “At a time when online is more and more present in everyday life, including for shopping, it is interesting to see that when it comes to luxury, consumers are still very sensitive to their in-store experience and the service and information they receive from sales advisors. Luxury is not all about big names with excellent quality and high-priced products; it is above all an experience. This experience involves human beings.”

Elan Shou, managing director of Ruder Finn China, said, “Young consumers are the future of China’s luxury industry. Understand and address their needs; build solid brands through heritage, authenticity and personality. With the rising influence of digital information, it’s really time for the luxury industry to broaden communication efforts towards cross-channel solutions. We are lucky to be in a booming market where people are ready to spend!”

The survey for this year’s China Luxury Forecast polled luxury consumers from Taiwan, Hong Kong, Shanghai,Beijing, Guangzhou and 17 second-tier cities in Mainland China. Over half of those surveyed had annual incomes less than RMB180000. Every year, the China Luxury Forecast examines the key trends in China’s luxury sector, focusing on the factors that will most influence the market, such as purchasing power, key motivators and information channels.