Chinese Products Are the Best... Gen Z Trend, Prioritizing Cost-Effectiveness with 'Gukppong' as a Bonus [China Spotlight]

Preference for Affordable Chinese Brands like Coffee, Cosmetics, and Mobile Phones
Eco-Friendly Practices through Secondhand Trading Also 'Trending'

China's Generation Z (born in the mid-to-late 1990s to early 2000s) has fallen into rational 'cost-effective consumption.' The perception that imported products are always better is weakening, and as the 'gukppong' (patriotic pride) culture permeates, more people are choosing affordable and reasonable Chinese-made products in various fields such as coffee, cosmetics, and smartphones.

Generation Z Immersed in Cost-Effective Consumption Culture

Chinese media are paying attention to the consumption culture of Generation Z, who are obsessed with cost-effectiveness. The Chinese media outlet People.cn recently reported that "the trend among Generation Z is rational consumption," explaining that "they prefer domestic (Chinese) brands that are high quality and affordable." It added, "In the first half of 2024, the sales share of new skincare products made in China surpassed overseas brands at 66%," pointing out that "this is influenced by Generation Z's pursuit of cost-effective products."

Young Chinese consumers also prefer Chinese smartphone brands over the iPhone. Apple recently cut the price of the iPhone 16 by 500 yuan (about 97,000 KRW) just one month after its launch due to sluggish sales in the Chinese market. Including subsidies, discounts can reach up to 1,500 yuan (about 300,000 KRW). According to market research firm Counterpoint, iPhone 16 sales in China increased by 20% in the first three weeks after launch compared to the previous year, but overall iPhone sales in the recent three-week period decreased by 2% year-on-year. Experts analyze that this is influenced by young consumers' preference for Chinese brands such as Huawei, Vivo, Oppo, and Xiaomi.

The automobile market shows a similar trend. According to the sales ranking data for the Chinese automobile market in the first half of 2024 released by the Passenger Car Association, six Chinese brands ranked within the top 10.

They offer affordable hamburgers and coffee for 9.9 yuan in China. Photo by Baidu

In beverages, native brands offering coffee priced between 8.8 to 9.9 yuan and bubble tea at 5 yuan are strong. Meanwhile, Starbucks, beloved worldwide, is experiencing a decline in sales in China. Last year, Starbucks lost its top sales position to the Chinese brand Luckin Coffee. Even at weddings, it has become common not to prepare wine but to order large quantities of milk tea from native brands like HeyTea or PaWangChaXi to serve guests. Xiao Wei, a groom who prepared HeyTea for his wedding, told China Business News, "The '喜' in HeyTea (喜茶) is pronounced the same as '囍,' which fits well with weddings."

According to a recent survey by market analysis firm XiaobaoGao, 68.4% of Generation Z cited 'cost-effectiveness' as the most important criterion when choosing products. Companies expect Generation Z's consumption to increase gradually and are focusing more on the cost-effective, China-made consumption culture of Generation Z. Guangming Daily reported, "In the next 10 years, 73% of Generation Z will become office workers, and the consumption scale newly created by them will reach 16 trillion yuan."

Growing Interest in Eco-Friendly and Secondhand Products

Chinese news reporting that the number of consumers buying second-hand products is increasing. Photo by CCTV capture

Interest in eco-friendly products is also rising among China's Generation Z. According to the "Report on the Development of Internet Digital Consumption" released by the China Network Information Center, the number of online shopping mall users in China has exceeded 900 million, of which 230 million have purchased eco-friendly products. A 2023 survey conducted by the e-commerce site Taobao also showed that buyers of eco-friendly products increased by 40% compared to three years ago, with most being Generation Z.

Generation Z also satisfies their shopping needs by buying and selling goods on secondhand trading platforms because it is eco-friendly and economical. The daily average transaction volume on Xianyu, China's version of Danggeun Market, has exceeded 1 billion yuan (about 194.6 billion KRW). Over 100 million people registered products on Xianyu last year. Another secondhand product app, 95fen, has seen its transaction volume increase more than 30 times over the past five years. Seventy percent of active users on these two platforms are Generation Z. Practical items related to daily necessities are popular in secondhand trading, with shoes, bags, and clothing ranking in the top three by transaction volume.

Professor Jin Xun of the International Business Department at the University of International Business and Economics explained, "Generation Z's interest in eco-friendly consumption influences brand product design and campaigns."