This past weekend I had the chance to go to a nearby resort with my co-worker’s family. It was a great opportunity to see how China’s newly wealthy spend their money, and I was reminded of what priorities they have when it comes time for vacation.
To me, the urge to get the most use of the money spent, was surprising. For instance, we had many places that we wanted to visit after we checked out, but our friends insisted on waiting until noon to leave the hotel. When noon did finally roll around, there was a giant mob of people checking out as well. It seemed as if everyone had whiled away their morning in an effort to get their full allotment of hotel room time.
We saw this in the hot springs themselves as well. The resort boasted having over 100 kinds of water infused with different herbs. This meant that roughly every 5-10 minutes we would switch which pool we were soaking in. No one seemed to be aware of what the benefits of each herb were exactly, but it seemed as if everyone was willing to brave the below freezing temperatures to run from one tub to the next, if we didn’t try every pool, it would have been a waste.
As Dan, from China Law Blog, mentioned in a recent post, Chinese consumers seem to be willing to pay far more for a product than it might actually be worth, if it looks like a luxury good. However, there have also been several reports, that indicate that these same consumers are later disappointed by the products they bought at inflated prices (which is unsurprising). As much as China’s nouveau riche seem to only be concerned with foreign brands, value is becoming a far more important quality.
From what I saw this weekend, “western” designs based off of ideas of what Europe or the US might look like are now competing more with “foreign” designs in general. There were Thai inspired lobbies, coffee from Brazil and Jamaica, and spas inspired by Turkish baths. Chinese consumers have started to recognize the prestige of global products, not just those that come from developed countries.
However, there is still little attention paid to the actual details, and consumers are still unsure of what is or isn’t a good deal. The coffee cost $5 a cup and was made from instant crystals. The Turkish bath included fish that nibbled at your dead skin, a practice that started in Japan, but no sweat rooms or vigorous scrubbing. The same goes for many other “foreign” goods in China, even though value is a priority, it is still very hard for China’s consumers to gauge international products for which they have no previous experience.
The thing to remember though, is that Chinese consumers are quickly learning how to distinguish between these goods. So building a company off of goods that simply look good, might not be a workable long term plan. It is important to remember that Chinese consumers are looking to foreign products for exotic styles and high quality.
Finally, I found it a little funny, that there seemed to be very few couples alone at the hot springs. There were groups of couples, or groups of same sex friends, but I don’t know if I saw more than 1 or 2 couples on a romantic get-away out of the hundreds of people.
In many Chinese hotels, especially near tourist sites, you’ll find that the public spaces are used much more frequently compared to what you would see in the US. If there isn’t a lobby where they can play cards, than they will play in their rooms with the doors propped open. Social spaces are a must when it comes to Chinese tourists, who more often than not are travelling with a group of friends, rather than as a family or couple.
Nowhere was this more apparent than on the cruise I took down the Yangtze River last year. The company had carefully segregated the passengers into Chinese and non-Chinese, which at first left a few of the foreigners a little frustrated. By the second day though, it was clear why they had done it. The foreign quarters were almost completely silent, every door was closed, and very few people were traveling in more than pairs.
On the Chinese side of the boat, doors where always open and the sound of mahjong tiles seemed omnipresent. Children literally ran up and down the hall in some kind of marathon, while their parents shouted at them to come to dinner. While this was driving a few of the foreigners crazy, even though they were just passing through it, the Chinese passengers viewed it as a normal use of the social space.