How Gen Z influence China’s consumption trends in fashion?

China’s Gen Z grew up in an enormous economic boom. They have a very different idea about what to do with their money than their parents. How they spend is going to have a huge impact on future business, both in and out of China. 

Our guests from the fashion industry share their firsthand experience and insights about China’s Gen Z: 

Simon Xi 
Senior Director Business and Development 
Coach China 

Dr. Li Jun 
Dean of Shanghai International College of Fashion and Innovation 
Donghua University 

Transcript

Title: How Gen Z influence China’s consumption trends in fashion?

 【You Zhixin】

Hi guys. Welcome to China trends. Let's stay on top of trends shaping our future. I’m Yoyo / You Zhixin and I’m your host today. Today, we are glad to invite two guests with us. Dr. Li Jun, Dean of Shanghai International College of Fashion and Innovation, Donghua University, and Simon Xi, Senior Director Business and Development of Coach China. Okay, today’s topic is China's Generation Zoomers and China Cool in fashion and design industry.

First of all, let me share with you some facts. According to the Chinese National Bureau of Statistics, the population size of zoomers in China has reached more than 260 million, and the consumption scale reached nearly 4 trillion Yuan. That’s huge. Meanwhile China’s Gen Z customers will shape the consumer market in China, and even for the world, for years to come.

I’m sure that with consumption trends evolving in China, brands have a keen interest in what makes China’s Generation Z tick. So for Coach, how do you define China's Generation Z? I mean, who are they? And according to your observation, what’s the feature of their habits, behaviors, interests and so on? 

【Simon Xi】

Generation Z refers to those youths who were born during the late 1990s and early 2000s, now in their twenties around, very energetic, young and passionate group. It is reported that the current population of Gen Z in China is about 264 million, accounting for nearly 20% of the total population, they are valuable talents and like we said, they are the future. Through globalization and the rise of technology, the world has become smaller, the Gen Z have grown up in an increasingly connected and digitalized world. It is also widely reported that the Gen Z is the most educated generation. That’s allowing them to focus on broader issues, and in a global context. China’s Gen Z, who are highly digitally engaged, curious, always looking for new ideas. According to a study, Gen Z and millennial are increasingly backing their own beliefs through their shopping habits, favoring brands that are aligned with their values, and it found that nine out of ten Gen Z consumers believe companies have a responsibility to address environmental and social issues. We are also taking note of their strong passion for quality brands. Our digitalization efforts demonstrate our commitment to reaching out to the younger generation, who are extremely tuned-in to the omni-channel experience.

 【You Zhixin】

From what you’ve said, I can see that you really does a lot of research on China’s Gen Z. I think, from my own experience, Chinese Generation Z consumers have a strong sense of “self-identity”. They are more willing to express themselves. Their social characteristics are apparent. Let’s say social media have shaped their characters. And they are trendsetters. Does it mean that China’s Gen Z consumers are more willing to experience new products and services? And What do you think of their potential in dominating the country's consumer market?

 【Simon Xi】

Gen Z is said to become the backbone of the powerful consumption group. Gen Z consumption made is gradually affecting and the leading and the conception trend in China. What is worth to mention is that our recently cooperation with a very famous Chinese brand, White Rabbit, Dabaitu, we just brought the global debut at the CIIE and then held the grand launched at last week in Shanghai Bund. We hope that through such a comparing cooperation and to embracing more consumers with our innovations and creating new opportunities and write more wonderful charters about Chinese fashion stories. I believe it's a cool and fun initiative to attract young consumers and to look at us.

 【You Zhixin】

Simon just mentioned your collaboration during the CIIE this year with Dabaitu. I was impressed by that collaboration in getting new idea. And I hope many young consumers will be inspired by the new collaboration. Mr Li, what's your observation to the China’s young generation consumers?

 【Li Jun】

New products and services are something that any generation is willing to experience, but the emphasis is different. Probably, my generation focuses on functionality, but China’s Gen Z focuses more on showing their individuality and fun. They are open, innovative, full with curiosity and passion. That’s the reason somehow they are more willing to experience and drive the trend for new products and services. Their potential in dominating China’s consumer market is to greatly promote experiential consumption, change the form of traditional shopping to comprehensive purchasing which integrated with social media, co-creating, metaverse and the other digital retail methods.

 【You Zhixin】

Just as Dr. Li mentioned before, China’s Gen Z consumers are more willing to experience new products and services, different brands, using new ways like metaverse and digitalization to attract their attention. So, for Coach,  have you tried to some new ways to engage this new generation of customers？

 【Simon Xi】

As we said earlier, Chinese young consumers are highly digitally engaged, we’re getting even closer to them in new ways, such as through social media, such as Douyin, RED, Dewu, Kuaishou, Bilibili. We want to be where they are. We’ve increased our investment to drive engagement and to enhance the digital journey with them. There is one other thing, we see the boundaries between what is happening in the store and online are disappearing. The conversation between our sales associates and consumers, especially young generation, is happening in diversified ways. No matter in our stores – very cozy and pleasure environment with artistic and digitized elements, to enable consumers who enjoy a multi-sensory in-store experience, or online engagement via different platforms, it is a seamless experience we want to create.

 【You Zhixin】

So there is a variety ways to attract the attentions of the young generations. So, my next question for Dr. Li, as Dean of Shanghai International College of Fashion and Innovation with Donghua University, you must have launched many collaborations with different brands and designers. And from the supply side, most of your students will become promising designers in the future. Brands are jumping on the bandwagon as they seek a new way to engage this new generation of customers. In your view, how to attract the young group who are with more inclusive and diverse modern education? What’s the key?

 【Li Jun】

China’s Gen Z are diverse, curios, inclusive, fashion action and quick response. Those are in line with the core feature of the fashion industry, you know, fashion is always changing, which allows Gen Z to better understand fashion. The key to attract Gen Z is to join in their communities, use their own language, listen to their own story，and have fun with them, also follow hot topics. I think that’s the key to attract them. More importantly, we need to guide them to understand the correct learning methods, manage the classical knowledge and the regulation of fashion, so that they can learn by themselves in changing times, recognize the opportunities, and promote their achievements and innovation.

 【You Zhixin 】

I agree that using their language is very important. And I’ve noticed another trend that is very interesting. Nowadays, there are numerous homegrown brands are showing up on the stage, and a growing sense of national pride is emerging among China’s young consumers. So, is this challenging for international brands, like coach? Also, the application of traditional Chinese cultural elements in fashion industry has become popular. The trend we called GuoChao, or China Cool in the fashion industry. How does this trend affect international brands and the concept of their design?

 【Simon Xi】

For our brands, China is not only an important market but also the source of inspiration. Chinese consumers are a key force in fashion industry. We have been actively seeking cooperation with so many outstanding local artists, talents, brands, to create resonance and connect with Chinese consumers.

Also, back to 2018, Coach held the first runway show outside of its home city New York, here in Shanghai. We collaborated with four Chinese artists to present the Chinese design. And then launched the China Collective series with the talented local designers. And there is one thing we collaborated with Professor Li and his colleagues to be shared since last year. Coach teams up with Shanghai Donghua University to jointly launched the "China Cool" project for young design students. We sat down together and talked about what China Cool is and how it will be embodied in Coach, with the young talents, which is not only an interesting process, and also we aim to provide exposure to young talented Chinese designers on a bigger stage.

【Li Jun】

The consumers preference affected brand concept in design. Localized design strategy will increase international consumers and market share. And like KFC’s Beijing chicken roll. And Pizza Hut’s Dahongpao milk tea. I think in fashion areas, similar, very similar. The consumption performance of Chinese young customers is very obvious, and which leads to the unique China’s retail market. In the China's Gen Z, actually, I think they don't care where the brand come from, they come from international background, or China's local background. They just purchased the right and recognized product with good design and fun. So good design and fun. I think it's very key for them.

【You Zhixin】

As we explore with the China Cool in the fashion industry and any successful examples that you have ever experienced?

 【Simon Xi】

On Women's Day this year, one of our cooperation with Donghua University - the Caring Catty - made their commercial debut, with part of the proceeds of the product donated to the Chinese Women's Development Public Welfare Project. I think that's reflecting what young Gen Z lifestyle is. Right? Professor Li. 

【Li Jun】

 Yeah, I think the Caring Catty, this collection is very interesting. So, the students seem, they actually choose the hot topic when I mentioned. The Gen Z is an interesting topic. It's quite popular in university campus. you know, students, they like lu Mao. Actually, lu mao is caring kitty. So, which represents the students would like to use this topic and transfer it into fashion products. I think today’s China Cool, it's not limited in the old, like a very firm, and those old idea about how this Chinese traditional style is. It's not only limited with Forbidden City, dragon's traditional patterns. But in the fashion world, like for Gen Z, they manipulate fashion using their own design language.              

 In academic system, we call this kind of fashion, at least there are two key elements for them to manipulate. First is they would like to set up their own identity, how they are understanding about transfer this kind of China's, like iconic idea, into more than contemporary manipulating. The second way is that their design should with contemporary fashion understanding. They need to use much more light and global language to manipulate how China's young generations understanding about today's their lifestyle. 

 【You Zhixin】

You’ve made very good points that let me get to know the Guo Chao concept, not only from the perspective of the consumer side, also designer side. Do you think the changes in Gen Z consumer preference will reshape China's retail landscape? And this question is for both of you.

 【Simon Xi】

Well, the young power is definitely reshaping the future. In fact, I just want to share one more story about our Internal KOL program. We have one internal project to train our sales associate into KOLs. A few years ago, we found that many of our young sales associates, among them who are also Gen-Z – they are keen to be our online ambassador. They start to share posts the OOTD on WeChat, Red, Bilibili, in order to share what’s the latest news, what is the trend, by forming a direct channel of communication with consumers, our in-house brand ambassadors are able to introduce products, post videos, organize live streams and strengthen sales virtually. This is both ways connection. Our Gen Z colleagues is leveraging the new trends and tools to engage with the consumers. All these not only request retail to create an engaging, entertaining, and digital journey for our consumers, but also build up a physical and digital playground in which they can try, experiment with and enjoy, both online and in store.

【You Zhixin】

 And what about you, Mr. Li? 

【Li Jun】

The traditional consumer one-way purchasing mode is coming to the end. China’s retail market is approach to the new era of consumer and fashion brand co-create time. And Gen Z have a very rich experience. And have already tried different various retail formats. Those traditional methods, for of just selling things. They think that's really unattractive to them. So no matter online or offline, combining retail with interesting experiences, such as bands,  games, and hanfu, will attract Gen Z to increase the sense of participation. The era of co-creation of products by consumers and brands has arrived. Consumer experience is closely integrated with social media, and interesting consumer experience will also become an important product content driving social market. At last, I think, China’s strong manufacture and e-commerce infrastructure, rich resource of China Cool provide the great possibilities for Chinese Gen Z consumers to co-create products with their recognition and reshape the future of China’s retail landscape.

【You Zhixin】

Okay Thank you. We talk about the features of China’s Gen Z. We talk about the future of the consumer market in China. And just as you said that the consumer market and fashion industry is always being keeping involving all the time. So, I look forward to more fun and fresh design in our markets.            

So, thank you for joining our first China trends, hope you enjoy today's podcast and any comment from you are welcome. See you next time and we'll bring you more from conversations on bandwagon happening in China. Thank you.