Click 'Read Original' for details. Insightful observation, here's an interview question: If you're at a party and two women are chatting with you. One carries a Hermès bag and frequently references plots from "Hello Mr. Billionaire" or "Story of Yanxi Palace," offering unique views on class society and workplace politics; the other, though articulate and peppering her speech with insights from the Harvard Business Review, carries an ordinary-looking bag. Can you immediately judge the social status of these two women? This question tests one's insight and experience. A person's inner qualities and temperament cannot be quickly packaged with money, but a smart person can instantly discern the other's social class. For the two women at the party, if in China, it's actually hard to judge who has higher social status. You might think the first woman is better off financially, perhaps a PR director at a big company; the second has more intellectual taste, maybe a university teacher or media reporter, but not very wealthy. If your social circle is long-term confined to China, your ability to read people might only go this far. Those who frequently travel abroad and have an international perspective can immediately conclude that the second woman has clearly higher social status and is likely wealthier. In Western countries, knowledge is expensive; only those with high social status have matching intellectual taste. Moreover, luxury consumers in developed countries are mainly the middle class; the consumption culture of the upper class leans towards 'natural simplicity.' Japanese author Miura Atsushi specifically wrote a book, "The Fourth Consumption Era," telling people that merely from the perspective of consumption culture, one can accurately judge which social class a person belongs to, extending to broader social consumption stratification and upgrading trends. Here, I will systematically present my personal cognition and insights from four main aspects: 1. What consumption era is China currently in? 2. The 'aspirational class' will lead the fourth consumption era 3. How should brand marketing adapt to the new consumption era? 4. The fourth consumption era is an 'era of consensus economy' Consumption isn't just about spending money and being done. I strongly agree with Mr. Miura Atsushi's main point - "items are self-projection." Everything you buy is a projection of your self-awareness, psychological needs, and life values onto objects. 01 What consumption era is China in? When people talk about consumption, what are they talking about? "The Fourth Consumption Era" actually helps you find yourself in the historical trend. Many things people care about and feel anxious about, you might also care about and feel anxious about, but what many people care deeply about, you might not feel at all. This is because the transition and evolution of consumption eras have different psychological impacts on different social classes. Miura Atsushi divides Japan into four consumption eras based on changes in consumption habits: The First Consumption Era was mainly before World War II, an era of consumption for the elite class; The Second Consumption Era was from the post-war period to before the oil crisis in the 1970s. With the production capacity explosion brought by standardized production, consumption moved from the elite to the masses, and consumption centered around the family rose, pursuing 'high cost-performance ratio'; The Third Consumption Era is close to us; it's an era of using consumption to showcase one's personality. People fell into the consumption black hole of branding, differentiation, and diversification. Box Logo Tees everywhere turned people into walking billboards. In this era, people pursue 'identity and belonging'; The Fourth Consumption Era is a "consumption era that returns to nature and values sharing." People pay more attention to simplicity and environmental protection, and value the results after consumption. The rise of UNIQLO after its transformation and the prevalence of MUJI signify Japan's entry into the fourth consumption era. Current Chinese society shows both "consumption upgrading" - like overseas online shopping, mobile taxi-hailing, mobile payments - and "consumption downgrading" - like group-buying the cheapest, average-quality goods, choosing bicycles for transportation, and spending half of one's income on rent. Why does the same society exhibit such contradictory phenomena as 'consumption upgrading' and 'consumption downgrading'? Looking back at the consumption history of people around us, you'll find that China is currently in a stage where the second, third, and fourth consumption eras coexist. The rise of Pinduoduo carries obvious characteristics of the "second consumption era," indicating that many people in China pursue cheapness and high cost-performance. Even Alibaba executives admit that Pinduoduo's success at least shows its past entry path was effective. Everyone likes cheapness, even as the greatest user value. But from a developmental perspective, everyone still wants "differentiated good things." The rise of influencer e-commerce in China is a typical feature of the "third consumption era." Now, stores opened by influencers account for an increasing proportion of Taobao's sales. More and more people are pursuing consumption to establish more interactive interpersonal relationships. Why is there no influencer e-commerce in the US? There are three main reasons: First, e-commerce platforms like Amazon haven't invested in US social platforms, so transactions aren't integrated; second, US influencers don't do e-commerce but endorse various brands; third, US brands often have long histories and are numerous enough to well represent Americans' consumption needs. China is the opposite. There are very few long-established consumer brands in China, and a large number of emerging Chinese brands cannot represent people's (especially young people's) consumption needs. Particularly, influencer e-commerce represents new consumers' demands for brands, with more interactivity, warmth, and attitude. Unlike the past "national brands," influencer e-commerce focuses on serving tens of thousands or hundreds of thousands of fans, thus better representing consumers' values. An important feature of the 'fourth consumption era' is being more 'social.' Airbnb, bike-sharing, and various ride-hailing apps make life convenient while gradually weakening people's obsession with ownership. At the same time, some people's consumption tendencies become more simple and natural. If you find yourself increasingly liking simple, comfortable clothing when shopping, not even caring about the brand; or when choosing between several brands, you prefer the one that aligns with your values and temperament, regardless of its international fame, it shows your consumption concept has entered the fourth consumption era. I believe China is generally in the process of evolving from the 'second consumption era' to the 'third and fourth consumption eras,' with consumption attitudes gradually shifting from 'family' (valuing family) to 'individual' (valuing the individual), and then to 'social' (valuing society). But in the long run, the second, third, and fourth consumption eras will still coexist. This corresponds to the income structure of domestic residents. According to the classification and statistical data in the "China Statistical Yearbook," the middle-to-high income group, accounting for 20% of the national population, has consumption power approaching that of developed countries. Due to China's huge population base, this 20% middle-to-high income group is close to the total population of the United States. They are the main force behind full first-class train cabins, rising occupancy rates in five-star hotels, and leading global per capita shopping spending overseas. They are the main engine of the "third and fourth consumption eras." The middle-to-low income group, accounting for 80% of the national population, has slow income growth and will remain in the second consumption era for a long time. Some say that those with bachelor's degrees or above account for less than 4% of China's population, and the internet industry's viewpoints, trends, and fads circulate within this 4%. In China, only 28 million people pay individual income tax; at least 700 million people don't have credit cards. A large number of middle-to-low income people still have a strong preference for cheap products, which is the fundamental reason for Pinduoduo's rise. 02 The 'aspirational class' will lead the fourth consumption era Boston Consulting Group once predicted that by 2020, China's consumer market would reach $6.5 trillion, with more than half of total consumption created by the younger generation (those under 30), i.e., people born in the social media era. In this mainstream consumer group's view, items aren't necessarily better if more expensive, nor is high cost-performance enough; they care more about the user labels behind purchase decisions. They buy things to label themselves; they make corresponding consumption decisions based on who they want to become. The meanings behind these consumption decisions are multi-dimensional, such as "I know how to live," "I'm trendy and cool," "I'm tech-savvy," etc. The speed of trend and fashion changes is accelerating, and young people are quickly switching their excitement points, enriching themselves in the process of chasing trends. The medium for transmitting consumption trends is various forms of social platforms. Mickey Drexler, Apple board member and former CEO of J.Crew, bluntly stated: "If you're not obsessed with your product, obsessed with social media, obsessed with digital, you cannot succeed." The circle effect formed in social networks is reshaping the consumption landscape of this era. Why do many post-90s now not use Taobao but prefer community e-commerce like Xiaohongshu? Xiaohongshu initially just made some shopping guides and posted them online. Because the content was good, many users started commenting, asking where to buy these things. So, Xiaohongshu began doing e-commerce. Now, Xiaohongshu uses community to enhance product stickiness, uses e-commerce to meet user needs, further optimizes user experience, thus forming a positive cycle. Use a brilliant assertion from Miura Atsushi's "The Fourth Consumption Era" to explain: "The ultimate meaning of consumption is how to live a more fulfilling life." It can also be said that because time is becoming more valuable, people tend to pay for directions that give time more meaning. The value of community e-commerce is to let you have a good shopping experience and enjoy the pleasure of being recommended and buying within the same time frame. This is giving users' time more meaning, which is why it gains more favor among young people. Because consumers' consumption habits are constantly changing, in the transition to the fourth consumption era, another key factor emerges - the aspirational class. Years ago, the wealthy class was mostly the "leisure class," i.e., those with money and time, leading consumption trends. In today's era, the mainstream of the wealthy class is no longer those relying on privileged backgrounds and inheritance, but social elites with their own careers, i.e., the "aspirational class." They are highly educated, read cultural commentary, follow current affairs, eat healthy organic food, go to the gym, care about environmental protection, etc. This 'aspirational class' has begun to lead the 'invisible consumption' trend, forming an important feature of the fourth consumption era. Those who win the 'aspirational class' win the world. The wealth gap is widening globally. The wealthy class has begun to shift consumption from visible luxury goods to invisible consumption known only to insiders, such as investing heavily in knowledge, art, sports, and lifestyle. Such consumption makes social elites appear "interesting," "tasteful," and "cultured," rather than simply "rich," thus better rationalizing the success of the elite class. Currently, luxury goods are no longer the standard for the wealthy class; on the contrary, the middle class invests a larger proportion of their income in pursuing luxury goods than the wealthy class. This is why in many developed countries, one can immediately tell a person's social status. 03 How should brand marketing adapt to the new consumption era? Perhaps the definition and characteristics of the "fourth consumption era" seem not distinct enough, even somewhat vague. However, in my view, the insights and thinking behind the "fourth consumption era" are extremely valuable. Why is "MUJI" regarded as a typical case of the fourth consumption era? Domestic consumers buy products because of this brand, but it's often hard to describe what "MUJI" actually sells. In fact, "MUJI" in Japanese means "no brand". They aren't limited to any category but focus on simplicity, cleanliness, environmental protection, and human-centered design in product design. This isn't a "category brand" but a "lifestyle brand" or "life attitude brand." Mr. Miura Atsushi even regards "MUJI" as "a reaction against traditional famous brands." People born in the television era understand brand value mainly as "memory and trust"; a good brand is one that more people "remember and trust." People born in the social media era have a much weaker brand awareness. People from different classes and life experiences, after "grouping by kind" on social platforms like Weibo, WeChat, Facebook, and Twitter, and after long-term interaction, are more likely to reach a consensus on certain lifestyles and attitudes. This trend, reflected in the marketing field, produces an increasingly common phenomenon - many good brands can't clearly state what they 'mainly sell.' For example, Eslite Bookstore appears to sell books but is more like a coffee shop or lifestyle store; Hema Fresh - is it a seafood supermarket, restaurant, or wet market? Such descriptions seem inaccurate; Xiaomi - is it a phone company or internet company? It can't be generalized... Although these brands can't clearly define their "category positioning," the target user groups and their lifestyle characteristics behind them are very clear. Management guru Al Ries famously said: "Marketing is not a product battle, but a perception battle." Therefore, successful consumer brands in the past had "a set of common tactics for building brand perception," which was to use influential traditional media, heavily advertise, occupy users' perception of the category in their minds, and then distribute products everywhere through various channels. If your first impression of computers is "Lenovo" and your first impression of phones is "Huawei," then their brand marketing has worked on you. However, this approach is hard to replicate in the social media era. Nowadays, people spend most of their leisure time on social platforms and don't have much energy to pay attention to or remember what a certain brand sells. Countless apps or public accounts first gather a group of people, then sell them anything that crosses categories, centered around this group with common characteristics. For example, the nut brand a person buys might be Three Squirrels, or it could be MUJI or NetEase Yanxuan, which aren't specialized nut brands. Since users spend a lot of time on social platforms, the new brand marketing approach is to "penetrate the social process and use experience to mobilize users' emotions." This is also why many celebrities' "marketing effects" are inferior to some self-media personalities. Sometimes I think social media and the vast number of self-media personalities (influencers) might be the catalyst for "upgrading from the third consumption era to the fourth consumption era." Brand marketing is increasingly breaking away from product category boundaries, positioning itself on consensus of lifestyle and life attitudes. 04 The fourth consumption era is an 'era of consensus economy' For a long time, domestic officials, media, and economists have been accustomed to using "consumption upgrading" to describe the structural trend of national consumption. I don't fully agree with this. What is "consumption upgrading"? For example, you used to buy coconut juice; after upgrading, you go to Thailand to buy young coconuts; you used to buy UNIQLO; after upgrading, you buy Hong Kong custom brands. This means that after your income grows, the level and quality of your consumption upgrade accordingly. However, the academic concept of "consumption upgrading" often misses a lot of valuable information. The evolution of lifestyle is not equal to "consumption upgrading." The evolution from the "third consumption era" to the "fourth consumption era" has transcended the dimensions of quality, cost-performance, and brand. Many people might not expect the current wave of "consumption downgrading" in mainland China. What is "consumption downgrading"? It's not about buying counterfeit or inferior goods. For example, NetEase Yanxuan's de-branding is "consumption downgrading" - bags from the same manufacturer, with a Coach label cost thousands of yuan, without a label cost hundreds; you don't pay for "brand premium" but enjoy the same quality service. For example, the sharing economy is also related to "consumption downgrading" - the car is the same, riding or driving is the same, but the car doesn't belong to you; you only pay a small fee for the usage process. "Consumption downgrading" is not paying for "excess added value," which is the value orientation of the fourth consumption era. In the fourth consumption era, there will be a trend of "value fusion" between merchants and consumers, i.e., continuously seeking consensus on value cognition and lifestyle, rather than merchants unilaterally guessing and guiding consumer needs. For example, merchants will seek consensus with consumers on product reviews. Why does Xiaomi actively create a "benchmark culture"? That is, using specialized apps to test the performance of various parts of a phone and then giving a score. Xiaomi also invests in various review platforms and sells through e-commerce. These methods gradually make consumers accustomed to evaluating phones through third-party data, rather than just looking at whether it's a foreign big brand as before. This is Xiaomi proactively reaching a consensus with consumers on value cognition. For example, if you become an influencer "advocating a green lifestyle" and sell "urban new green lifestyle" products in your public account, it becomes much easier. Because influencer e-commerce is classified by personality, not by product attributes. This is you proactively reaching a consensus with consumers on life attitudes. The fourth consumption era is precisely an 'era of consensus economy,' where buyers and sellers continuously reach consensus on lifestyle and value orientation, thereby achieving maximum efficiency and minimal 'regret,' and social platforms will continue to play a key hub role in this process. Li Meng, Founder and CEO of IMS New Media Business Group, second-term student of Hupan University, pioneer of decentralized fan economy. Source: Li Meng (ID: mslimeng) From October 23-24, during the Autumn Sugar and Wine Fair, the '2018 FMCG City Distribution Logistics Conference' hosted by New Distribution will be held. We will invite industry bigwigs, FMCG warehousing and distribution experts, and distributors transitioning to unified warehousing and distribution platforms to discuss and answer questions about the future development trends of FMCG city distribution logistics and practical cases of distributor transformation to unified warehousing and distribution, hoping to bring you different inspiration and thinking! -END-