That aside, population is also an interesting challenge for the Chinese government to tackle. A negative side effect of the one-child policy is that China is now facing an aging society. To combat this, the government has implemented a new policy allowing families to have two children instead of one. Because of this, most car manufacturers are predicting that China is going at the direction that the US has taken. Larger family equals larger vehicles.

But not quite, most young families will have a slightly larger vehicle, yes. But at the same time, grandparents and young, single people are increasingly interested in micro EVs.

With increasing urbanization in China, most people live in a large city environment, so parking and traffic can be a total nightmare. That pushes these two consumer groups to consider micro EVs, which are cheap, affordable and easy to park. Right now, the micro EV market is dominated by Chinese car brands, with the Hong Guang MINI EV being the bestselling micro EV from January till September this year, one month even selling 14,495 units. It seats four, has around 170 KM (106 miles) range, comes with back up camera, and the best part is it only costs around $4,000 USD.

Silver-haired Consumers

According to the Beijing Daily, China has changed its laws regarding the maximum age that a person can hold a driver’s license from 70 years old to no age limit. This will further boost China’s automotive sales. People like my grandparents always dreamed of owning a car, however with age limit they were unable to do so.

Most Chinese grandparents are a lot more involved in their grandchildren’s daily lives than here in the US. For example, grandparents typically pick up the grandchildren from school every day so the young parents can focus on work.

Micro EVs serve this purpose quite well. They typically have more than enough range and seating capacity. They are a lot easier to maneuver in the busy city streets and most of them are made of plastic outer skin making them quite resistant to damage.

Incentives and Low Maintenance Make Micro EVs Attractive to Young People

China is using incentives and policies to encourage people to buy EVs, typically to win the Chinese car buying lottery for EVs is a lot easier than a typical internal combustion engine car. That is another reason why younger single people are turning towards micro EVs.

But young people also car about their image, so some Chinese car manufacturers saw this trend and began develop micro EVs to be more attractive. The new design philosophy has turned cheap and boring looking EVs into something trendy and cool. The Brand BaoJun is at the forefront, with its E200 (first image) looking like it could be coming out of the Ironman movie, and with its red and gold paint scheme, its especially popular among young first-time car buyers. Compare to a conventional internal combustion engine car that needs to be maintained regularly, EVs require very little maintenance, which is also very attractive to busy, young people. It completely eliminates the need of warming up the engine in the winter and cooling down the turbo in the summer, no more messy oil changes every 5000 miles, and brake pads last a long time because of the regenerative breaking. All of this reduces the stress of owning a vehicle in a city environment.

What About Western Manufacturers?

This new trend did not start in China, in fact the Smart Fortwo EV and Fiat 500e can be seen everywhere in the winding European streets. But Western car brands do not appear to be competitive selling Western models in China – likely because of price and regulation. For a Western brand to be able to compete in this segment it needs to lower its cost dramatically and also custom design a product that fits this market instead of bringing models from overseas and try to make it work. That means domestically operated factories and locally sourced materials needs to be used. For example, the Baojun is created by SAIC-GM-Wuling Automobile, General Motors’ light-vehicle partnership with the Chinese SAIC Motor Corp. 

The Future of Micro EVs

While Chinese families are increasing the demand for SUVs, China has a massive population with diverse needs, and it is important to keep in mind that not all consumers feel that bigger is better. As China becomes increasingly urbanized, experts are predicting the micro EV segment will continue to grow exponentially.

Read More:

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The post Micro EVs a New Trend In Chinese Car Buying appeared first on China Marketing Insights.

Everywhere you turn there are reports about Chinese millennials. And yes, they are the future of the market, but we often neglect a massive consumer group, dama’s (大妈) or retired Chinese women in their 50s, 60s and 70s. In 2018, over 11.9% of the Chinese population is over the age of 65, which is well over the 7% mark that United Nations set as the standard for an aging society. 

Here are some features of this group: 

• They are sensitive to price, but it doesn’t mean that they don’t have money.
• Usually, dama manage the family’s finances, they know where to spend money generously, and where they should make careful decisions. Price isn’t an issue when it comes to children or grandchildren’s education. But when it comes to eating and other FMCG, they value quality the most. Brand name doesn’t have much influence on them. 
• The article shares an example of one woman who has spent over 60,000 RMB on custom dresses for dance performances, because that’s a hobby that she highly values.
• In terms of entertainment, dama are always looking for a deal. For example, when they want to go to KTV, they choose the afternoon, because they can typically get group buying deals. If they want to dance, they choose to dance outside in parks and squares because it is free. They don’t have to do SPA or go to bars to relax themselves, they’d rather invite a few friends and climb mountains. 
• Many are tech savvy and many use mobile e-commerce

This article shares some great insights into this often overlooked generation of consumers, I guess the question is, how do we connect with dama influencers? My guess is that there are many long tail micro dama influencers that are very active members of WeChat groups. But not sure if there are any other online communities where we can find them. 

Read more: 大妈的消费世界: 60000元买舞群，600元出国玩

The post The Overlooked Consumer Group: Retired Women or 大妈 appeared first on China Marketing Insights.