Reference News Network June 25 report: The UK's The Economist magazine website on June 23 published an article titled "More Than Just a Lulubu Doll, Chinese Brands Are Flourishing", the following is an excerpt:
Lulubu dolls are hard to get. Even in the large flagship store of its manufacturer, Pop Mart, located in Shanghai, customers are often told they need to wait a week or longer.
It's not just Chinese children who want this doll. Celebrities such as footballer Beckham and pop star Rihanna have recently publicly expressed their love for it.
Since the beginning of this year, the frenzy over Lulubu has caused Pop Mart's stock price to rise rapidly. It is one of many Chinese consumer brands experiencing a sharp increase in popularity.
Over the past few decades, Chinese consumers tended to look abroad for the latest trends in cosmetics, fashion products, food and accommodation. Now, they are turning to domestic luxury companies, high-end cosmetics brands, and bubble tea shops. More importantly, many of these brands have also won loyal followers overseas. Western brands should be worried.
With consumers becoming more price-sensitive, local brands that offer good value are thriving. In many Chinese cities, coffee consumers find that local coffee chains like Kudi Coffee or Luckin Coffee are as good as American company Starbucks, and often cost only half as much. Chinese jewelry manufacturer Laopu Huangjin has succeeded in selling elegant-designed jewelry, which is usually cheaper than products from American giant Tiffany. Local handbag brand Yamashita Yosuke has launched large-scale advertising campaigns across the country to compete with foreign rivals, whose prices are often twice or even higher than those of the former.
Experts at HSBC, Lina Yan (translated), believe that part of Pop Mart's success with the Lulubu doll is due to offering high-quality products with emotional value to thrifty consumers.
Price is only part of the reason why Chinese brands are gaining popularity. In many cases, consumers pay the same price or even more for domestic alternatives. For example, the Chinese tea brand Bawang Chaji, which recently went public in the United States, has some best-selling products priced similarly to the top products of Starbucks China. Zhang Han (translated) from Deutsche Bank pointed out that the company positions itself as a premium brand, not a cheap one.
In China, the fastest-growing electric vehicles are not necessarily the cheapest models, but rather so-called "entry-level luxury cars" priced between 200,000 and 400,000 yuan. Foreign car manufacturers had long dominated this niche market, but now many popular new models in this area come from local competitors such as NIO and Li Auto.
Chinese consumers' fascination with foreign goods is far less than before. The rapid rise of Laopu Huangjin is a clear example. The company sells complex gold jewelry with a unique Chinese style, and the average sales per store are much higher than most foreign competitors. It is also one of the few indigenous luxury brands in China, a field long dominated by foreign companies. But now, most foreign luxury brands perform poorly in China.
Anber Zhang (translated) from research institution BigView Technology said that Western luxury brands once filled the market gap mainly because there were no real domestic alternatives at the time. But this does not mean that Chinese consumers naturally resonate with the design or cultural messages of Western brands. Laopu Huangjin and Bawang Chaji did not try to appear like Western products, but instead emphasized their own Chinese characteristics. This approach has worked.
To fans, the quality of materials and design of Laopu Huangjin surpasses most foreign products. This indicates another shift in Chinese consumer habits: today's shoppers understand products better than before, mainly due to the role of social platforms. Many people now realize that some foreign companies sell products at inflated prices. An industry analyst pointed out that young women now carefully study cosmetic labels, looking for local products with the same active ingredients but lower prices.
This helped another popular Chinese brand - the cosmetics manufacturer Maogeping. The company listed in Hong Kong last December. For years, Chinese domestic cosmetics brands have tried to seize market share from foreign companies such as L'Oréal and Estée Lauder, but struggled in the competition in the premium market. Now, this company named after its founder, famous makeup artist Maogeping, has become the only domestic company among the top ten premium beauty groups in the Chinese market.
Foreign companies tend to focus on China's major cities, while local brands delve into relatively remote areas. Many brands started from smaller inland cities. In 2017, Bawang Chaji opened its first store in Kunming, Yunnan Province in Southwest China. The beverage chain Bingjie Ice City initially started as an ice cream stand in a less developed province in China. Some of the most popular fast food brands in China also expand first to small cities before trying their luck in Beijing and Shanghai. (Translated by Wang Qun)
Original: https://www.toutiao.com/article/7519806741404533274/
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