KPMG has issued a survey of China’s luxury shoppers that provides a good snapshot of the psychology of the country’s elite. The accounting firm’s message is that China is a land of opportunity for high-end brands. But the raw data from the survey also paint a more interesting picture of China’s elite as an insecure and status-obsessed group, who plaster themselves in highly visible luxury labels to feel confident. They exhibit a love of foreign brands, of sending their offspring overseas and of keeping money outside the country. This makes them appear distrustful of their government and of the quality of locally produced goods. Their foreign travel greatly increased last year too, which probably has something to do with China’s recent leadership transition and the incredibly high flows of money outside the country.
KPMG’s full survey is available here. For retail executives interested in China, it is worth reading in full for its lengthy case studies of luxury goods firms that have done well serving China’s elite.
But on a social and political level, some of the findings we would highlight are:
- 85% of Chinese millionaires plan to send their children abroad for education. For billionaires, the figure is 90%.
- 71% of KPMG’s survey participants traveled abroad in 2012, up from 53% in 2008.
- Despite China’s tight currency controls, one-third of Chinese millionaires have what KPMG calls “investable assets” outside the country
- Only 8% of wealthy Chinese want a Chinese-made car, while 57% would choose a German car
- But 33% (the majority of those surveyed) prefer Chinese food over other cuisines
- 59% of wealthy Chinese prefer “high awareness” luxury brands
- 32% (the majority of those surveyed on this question) buy luxury goods because it affords them a sense of status.
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