---
title: "This Demographic Is Reshaping Chinese Consumption"
description: "China's new middle class, with over 300 million people, is driving a consumption upgrade, transforming the country from a manufacturing powerhouse into a global market and service economy. This group's preferences for quality, health, and experience are reshaping both domestic and global markets."
author: "赞赏小侠"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2019-05-04"
language: "en"
canonical: "https://xinjignxiao.com/en/articles/this-demographic-is-reshaping-chinese-consumption-bbe7c3da/"
markdown: "https://xinjignxiao.com/en/articles/this-demographic-is-reshaping-chinese-consumption-bbe7c3da.md"
original_source: "https://mp.weixin.qq.com/s/OjEsso_gMYKCcoX1e1_QUw"
translation: "https://xinjignxiao.com/zh/articles/%E8%BF%99%E4%B8%AA%E4%BA%BA%E7%BE%A4-%E6%AD%A3%E5%9C%A8%E9%87%8D%E5%A1%91%E4%B8%AD%E5%9B%BD%E6%B6%88%E8%B4%B9-bbe7c3da.md"
attribution: "New Distribution — https://xinjignxiao.com/en/articles/this-demographic-is-reshaping-chinese-consumption-bbe7c3da/"
usage_policy: "https://xinjignxiao.com/ai-policy.txt"
---

# This Demographic Is Reshaping Chinese Consumption

> China's new middle class, with over 300 million people, is driving a consumption upgrade, transforming the country from a manufacturing powerhouse into a global market and service economy. This group's preferences for quality, health, and experience are reshaping both domestic and global markets.

Source: Notesman (ID: Notesman)
Content source: This article is an exclusive contribution by Yan Yanchun, partner of Shengjing Net, and is exclusively published by Notesman with the speaker's authorization.

**Notesman invites you to think before reading:**
**Who are China's new middle class?**
**What changes will they bring to China and the world market?**
**How can China and the world market cater to this group's needs?**

Below, enjoy!

As a leader in emerging markets, China has successfully converted its 30-year growth rate into mass wealth, and the consumption power of 300 million middle-class consumers has begun to erupt.

The new middle class loves travel, cares about health, and stands out in consumption, aesthetics, and lifestyle. They are not only the mainstay of China's consumer and service markets but also the growth engine of the world economy.

**The new Chinese middle class is not only the main force in global goods consumption but also in global service consumption.**

With stable income and happy families, the new middle class has begun to focus on their inner spiritual world and pursue a new life movement.

The new middle class is also accelerating China's transformation **from a manufacturing powerhouse to a service powerhouse**. **Medical care, big health, education, tourism, finance, insurance, and other services are the most explosive growth areas in China's future new consumer society.**

The new middle class is accelerating China's shift from the world's factory to the world's market. The new Chinese middle class will be the best market in the world, with French Bordeaux wines, German BMWs, American iPhones, Italian furniture, New Zealand milk powder, and Starbucks coffee entering their lives.

Fresh milk from New Zealand farms can reach Chinese dining tables in three days. Alaskan silver cod, Chilean cherries, Mexican avocados, and Australian steaks are also ubiquitous in China.

Food, healthcare products, cosmetics, and entertainment products are becoming favorites of China's vast new middle class, which loves beauty, health, and family. The new middle class is accelerating China's transformation from a world factory to a world market.

In the next decade, China's over 300 million new middle class and over 300 million Generation Z will drive the world's largest wave of consumption upgrade.

We estimate that in 15 years, China's consumer goods market will grow from 38 trillion yuan in 2017 to over 100 trillion yuan, more than doubling. China will leap from the world's largest manufacturing country to the world's largest consumer country.

Consumption will become the biggest engine for China's sustained economic growth. Since 2014, consumption's contribution to GDP growth has been continuously rising.

In the era of consumption upgrade, everything can be redone. Many old species and old consumer brands may indeed soon disappear from the consumer horizon.

**Today, China's demographic dividend is shifting from quantity to structure.** We see that there are already 250 million people over 65 years old. They are in good health, and crucially, they have spending power.

At the same time, the largest demographic is the rise of the millennial new middle class and Generation Z. Generation Z, born after 1995, exceeds 370 million people and is becoming the main force of new consumption in the next 5-10 years.

China has 1.4 billion people, with over 300 million middle class. Last year, 150 million Chinese traveled abroad. By 2025, this class will exceed 500 million, covering more than half of China's urban population, with total disposable income reaching 13.3 trillion yuan.

**The New Middle Class Feast: From G1 to G2**

The definition of the middle class has never been settled. As early as the first half of the 19th century, the middle class appeared in the United States. At that time, the middle class lived in relatively spacious homes with a living room, kitchen, and dining room on the ground floor, and 3-4 bedrooms upstairs. They included merchants, craftsmen, clerks, as well as lawyers, doctors, pastors, teachers, and minor officials.

In the 20th century, with the rise of industrial civilization and Silicon Valley, a large number of urban white-collar workers emerged, becoming the backbone of the American middle class. Their characteristics were: "fearing God, going to bed early and rising early, working hard, caring about others' evaluations, being well-behaved, focusing on making money, and being respected."

According to the latest World Wealth Report released by Germany's Allianz Insurance, one in seven people globally belongs to the middle class.

The 2018 Global Wealth Report points out that China has contributed the most to global middle-class growth. In terms of absolute growth in personal assets, the United States still surpasses China, ranking first globally.

In 2017, the United States accounted for 44% of global household financial asset growth, while China accounted for 25%. Allianz's report says China's global wealth rise is "impressive."

As the world's second-largest economy, China's middle class now accounts for half of the global middle class. In 2000, only 500 million people worldwide were middle class, half living in Japan, North America, and Western Europe. However, by the end of 2017, the middle class in these industrialized countries had fallen to a quarter, while China's middle class alone accounted for half of the world's.

Allianz defines "affluent middle class" as individuals holding net financial assets between 7,600 euros (approximately 61,200 RMB) and 45,600 euros (approximately 367,100 RMB). In Allianz's report, "middle class" is defined as individuals with wealth between 7,600 (approximately 60,000 RMB) and 45,600 (approximately 360,000 RMB) euros.

Forbes magazine defines China's middle class as: living in cities, aged 25-45, with a university degree, professionals and entrepreneurs, earning $10,000-$60,000 annually.

In July 2016, The Economist said: "China's current 225 million middle class, growing at an average annual rate of 13%, will reach 500 million in five to seven years." The article defines China's middle class as "households with annual income between $11,500 and $43,000, i.e., between 80,000 and 300,000 RMB per year."

According to a 2016 survey by the China Economic Trends Research Institute of the Economic Daily, the average wealth of Chinese households is 144,197 yuan, with urban households at 208,317 yuan and rural households at 64,780 yuan, the former being 3.22 times the latter.

According to a report by iResearch, the average age of the middle class is currently over 30. In first-tier cities, it is 31.8 years old, and in second-tier cities, 35.8 years old. The average marriage rate of the new middle class is 80%, and in some second-tier cities, it is as high as 90.7%. Among new middle-class families with children, the second-child rate in first-tier cities is more than 20% higher than in other regions.

We believe: the post-50s, post-60s, and post-70s who experienced poverty are the relatively wealthy first-generation Chinese middle class (G1, old middle class). They live in a standard middle-class family: successful in family and career, with no worries about food and clothing, and a stable life.

They have strong spiritual pursuits and patriotic feelings, understand the value of wealth and the significance of social stability, are willing to strive for corporate growth and national economic success, and are also willing to create a better future for their children's education and family happiness.

China has 228 million post-80s and 174 million post-90s. A group of upwardly mobile and thriving post-80s and post-90s will become the core force of China's second-generation middle class (G2, new middle class). They are the main force of the new middle class.

The new middle class generally refers to those born in the 80s and 90s, with good education, annual income around 150,000 yuan, and pursuing a quality and attitude-driven lifestyle.

We see that the age distribution of imported goods consumers is showing **a younger trend.** In 2017, consumers born in the 90s and 95s on Tmall Global accounted for 45.2%, surpassing the post-80s to become the largest imported goods consumer group. In 2018, this proportion exceeded 50%.

Consumers, mainly post-80s and post-90s, are more willing to respect self-expression and self-pleasure. Personalized and unique designs are becoming the main demands of consumers. Original designers and fashion buyer shops are growing like mushrooms.

Seizing the fashion industry's opportunities is not only about platform resources, designer standards, and consumer willingness but also closely related to industry capacity upgrades and supply chain optimization.

The middle class is the cornerstone of social stability. They desire social stability, are unwilling to have turmoil and revolution, and especially dislike violence. Turmoil destroys property, and violent revolution not only destroys property but also redistributes it.

Whether an "olive-shaped" social structure with the middle class as the main body can be formed is an important foundation for the stable development of a country or region.

G2 was born after the mid-1980s, when China's economy began to take off. Most are only children. Their parents experienced material scarcity and have relatively conservative consumption attitudes. In contrast, G2 is confident and independent-minded, and their consumption behavior reflects this independence.

McKinsey research shows that G2 is a generation "Westernized" in thought and behavior—they believe expensive things are better, are willing to try new things, pursue taste and status, are loyal to brands they trust, and prefer niche brands.

G2 is more dependent on the internet. Before purchasing new home appliances or personal digital devices, 42% will go online to check others' usage experiences, reviews, or feedback. Only 26% of their parents do the same.

Jack Ma's answer in a recent speech: "How many US cities have a population of over 1 million? 10. How many such cities does China have? 102. A population of 1 million might be a rural area in China, but in the US it's a big city. Hangzhou has 8.6 million people.

In the past 30 years, the US population and middle class have changed the entire world economy; in the next 30 years, China's growing market will fundamentally change the world economic landscape."

The new middle class's demand for new consumption will far exceed all our imagination.

**The consumer market of the new middle class will be full of huge commercial potential.** It is estimated that by 2020, 81% of China's total consumption growth will come from the middle class. The middle class will become the driver and mainstay of China's consumption upgrade in the next 30 years.

Professor Orvar Löfgren of Lund University in Sweden is one of the earliest scholars to study the middle class. In his book "The Good Life," he observed the lifestyle of the Swedish middle class between 1880-1910, describing their life picture through rich folklore materials.

He found that the Swedish middle class at the turn of the 19th and 20th centuries, during their formation stage, not only tried to shake off the "nouveau riche" image but also hoped to draw a clear line between themselves and farmers, workers, and declining aristocrats, with their own unique culture and lifestyle.

It is precisely the yearning for the "good life" that the middle class's culture and values have successfully penetrated every trivial corner of modern daily life.

**If divided by consumption preferences, the new middle class, influenced by Generation Z's new consumerism (pursuing presence, participation, ritual, and happiness), is a typical SoLoMoMe consumer group (Social, Local, Mobile, and Me personalized), focusing more on quality of life and comprehensive spiritual needs, and pursuing personalized needs.**

New consumerism has three trends:
1. From having more to having better.
2. From functional satisfaction to emotional satisfaction.
3. From physical high price to psychological premium.

After the industrial revolution and internet civilization liberated humans from heavy manual labor, the middle class began to inexplicably like things labeled retro, handmade, secret recipe, or private. Mom's cooking is nostalgic, hand-rolled noodles are chewy, and hand-wrapped dumplings are fresh.

Many new middle class are also environmentalists, making their clothing, food, housing, and transportation greener. Green consumption is expanding from organic food to air purifiers, water purifiers, energy-saving and water-saving appliances, green home appliances, green building materials, and green energy vehicles, which are entering their lives.

**New Middle Class:**
**Accelerating China's Shift from Factory to World Market**

The new Chinese middle class will be the best market in the world. French Bordeaux wines, German BMWs, American iPhones, Italian furniture, New Zealand milk powder, and Starbucks coffee are entering their lives. Fresh milk from New Zealand farms can reach Chinese tables in three days. Alaskan silver cod, Chilean cherries, Mexican avocados, and Australian steaks are also ubiquitous in China.

Mexican avocados

Food, healthcare products, cosmetics, and entertainment products are becoming favorites of China's vast new middle class, which loves beauty, health, and family. The new middle class is accelerating China's transformation from a world factory to a world market.

Data from cross-border e-commerce platforms shows that in shopping behavior, the new middle class has shifted from low-frequency luxury purchases to high-frequency daily necessities, even buying toothpaste through cross-border e-commerce.

Today, the new middle class has created many phenomenal products in cross-border consumption, such as "ampoules." It is estimated that 4 million ampoules will be sold this Double 11, equivalent to Spain's annual ampoule market size.

From November 5 to 10 this year, China held its first grand International Import Expo, attracting 172 countries, regions, and international organizations, with over 3,600 enterprises from five continents participating, and cumulative intended transactions of $57.83 billion.

Alibaba's plan is ambitious. Jack Ma's successor Daniel Zhang announced at the CIIE that Alibaba will achieve $200 billion in imports globally in the next five years. This plan will cover Tmall, Tmall Global, B2B, Hema, Yunxi, Intime, RT-Mart, Retail Link, and other businesses, involving multiple import categories from over 120 countries and regions.

As early as 2017, Alibaba proposed the strategic blueprint of "global buying, global selling, global payment, global logistics, and global travel." Through AliExpress and Tmall Overseas, Alibaba can cover more than 200 countries.

Alipay supports settlement in 27 currencies and has launched digital wallets in 9 countries. Cainiao has laid out 8 core nodes of air logistics backbone networks globally, including in the US and Malaysia, and 15 overseas local warehousing and distribution networks, with six procurement centers in North America, Europe, Oceania, Japan, South Korea, and Hong Kong...

Mr. Gao Hongbing, Dean of Alibaba Research Institute, believes that in the past few years, a group of cross-border e-commerce platforms represented by Alibaba has been committed to building a **free, open, universal, and inclusive new global trade platform.**

Not only can billions of consumers worldwide "buy globally," but also millions of small and medium-sized enterprises globally can "sell globally."

This is a Chinese solution explored by Alibaba in the process of building a global consumer internet infrastructure over nearly 20 years, **achieving the first large-scale feedback to the global market in China's nearly 100-year commercial history.**

China's cross-border e-commerce retail import penetration rate (the ratio of people purchasing imported goods through cross-border e-commerce to online shoppers) rose rapidly from 1.6% in 2014 to 10.2% in 2017. In 2017, Tmall Global's consumer numbers were 10 times that of 2014.

Ten Chinese cities, including Beijing, Shanghai, Guangzhou, and Shenzhen, have entered the ranks of the world's 100 international consumer center cities. Shanghai has been Tmall Global's largest imported goods consumer city for many consecutive years.

In the past four years, Tmall Global has introduced nearly 19,000 overseas brands from 75 countries and 3,900 categories into the Chinese market, with over 80% entering China for the first time.

During the CIIE, JD.com directly signed and purchased nearly 100 billion yuan of imported brand goods. Suning's overseas procurement orders are expected to reach 15 billion euros (approximately 120 billion yuan). NetEase Kaola signed orders of nearly 20 billion yuan with over 110 global quality brand merchants.

Miya Baby, launched in March 2014, entered the maternal and infant market with flash sale specials, mainly using a self-operated import model.

Its POP platform is invitation-only, open only to brands in clothing, textiles, and home goods categories. It uses "middle class, mothers, quality life" as its criteria for expanding categories and has begun horizontal expansion to become China's largest maternal and infant company.

Ymatou is committed to breaking regional price discrimination and international circulation barriers in the international retail industry, realizing Chinese people's dream of global consumption. Founded as early as 2009, it is the earliest cross-border e-commerce enterprise in China, born to truly solve user pain points.

It not only established a buyer-based flexible supply chain to meet Chinese people's diverse overseas shopping needs but also built its own official logistics system, Bei Hai International, to ensure fast and safe delivery of overseas goods to Chinese people. Currently, the buyer ecosystem covers 83 countries with over 30,000 certified buyers.

At the opening ceremony of the CIIE, **General Secretary Xi Jinping delivered a keynote speech, using the metaphor of the sea to describe China's economy, which resonated strongly: "China's economy is a sea, not a small pond."**

President Xi said: "It is estimated that in the next 15 years, China will import more than $30 trillion in goods and $10 trillion in services."

We believe that more quality goods and services at reasonable prices will flood into China's booming consumer market, which will also promote fair competition and long-term prosperity in China's consumer market. The already affluent middle class is the largest group consuming these imported goods and services.

The China Chamber of International Commerce, Deloitte, and Alibaba Research Institute jointly released the "Report on the Continuously Opening Giant Market - China's Import Consumption Market" in Shanghai.

The report points out that consumption's role as the primary driver of economic growth has become more prominent. In the first half of 2018, final consumption expenditure contributed 78.5% to GDP growth. Taking last year's Double 11 as an example, imported goods accounted for about 40% of the total 168.2 billion yuan in sales.

With the conclusion of the Shanghai World Import Expo, the Sino-US trade war will eventually move toward mutual compromise, and China has sent the strongest signal to the world.

This year, 22 new cities were added as cross-border e-commerce comprehensive pilot zones, and tariffs were cut three times within a year:

From May 1, tariffs on medicines were comprehensively reduced; from July 1, tariffs on 218 automobile and parts items were reduced; from November 1, import tariffs on 1,585 items were reduced.

When China joined the WTO, the average tariff level was 15.3%, and official data shows that after November 1, China's average tariff level dropped to 7.5%.

With the reduction of import tariffs and the promotion of cross-border e-commerce platforms, good products and services from around the world will inevitably accelerate into China, and the threshold for global brands to enter the Chinese market has been greatly lowered.

As China's largest cross-border import e-commerce platform, Tmall Global's shopping experience has been greatly improved. With the global supply chain service supported by Cainiao Network, the average delivery time for retail import bonded model shortened from 9.2 days in 2014 to 4.5 days in 2017.

In domestic cross-border pilot cities such as Shanghai, Hangzhou, Shenzhen, and Guangzhou, next-day and same-day delivery for global goods purchased through Tmall Global is now the norm.

The traditional import model relies on large containers, from port to port, from brand owners, agents, distributors, and retailers down to consumers.

Alibaba's new import model, however, is composed of fragmented parcels from hundreds of millions of consumers, and it goes directly from brand owners to consumers without intermediate links.

Through the "grass planting" (recommendation) of internet celebrities and beauty KOLs (key opinion leaders), niche pharmacy brands like Martiderm (a Spanish ampoule brand) began to gain a large number of fans in China, especially its ampoule essence series, which quickly became an internet-famous product.

Just two years later, China has become Martiderm's largest overseas market. In 2017, the Chinese market accounted for 40% of its global sales. Its ampoule series products are so popular that even some Fortune 500 brands are scrambling to imitate them. Martiderm is called the "originator of ampoules" by Chinese netizens.

The influx of imported goods will inevitably have a huge impact on local Chinese consumer brands and related industries, and some local enterprises with lower competitiveness will accelerate their elimination and bankruptcy.

**New Middle Class:**
**Accelerating China's Shift from Manufacturing Powerhouse to Service Powerhouse**

As a leader in emerging markets, China has successfully converted its 30-year growth rate into mass wealth.

The new middle class loves travel, cares about health, and stands out in consumption, aesthetics, and lifestyle. They are not only the mainstay of China's consumer market but also the growth engine of the world economy.

The US service industry has become the core industry of the US economy.

Since 2000, the service industry's share of GDP has risen from 68% at the beginning of the century to 74% in 2017. It is also the core force for employment. According to data from June 2018, service industry employment accounted for 86.11% of non-farm employment. Among them, education and healthcare, professional services, leisure and hospitality, and retail account for over 52% of employment.

The new Chinese middle class is not only the main force in global goods consumption but also in global service consumption.

With stable income and happy families, the new middle class has begun to focus on their inner spiritual world and pursue a new life movement.

**The new middle class is also accelerating China's transformation from a manufacturing powerhouse to a service powerhouse. Medical care, big health, education, tourism, insurance, and other services are the most explosive growth areas in China's future new consumer society.**

1. Lifestyle Diseases and the Big Health Industry

Big health is about caring for life in all aspects, including clothing, food, housing, transportation, birth, aging, illness, and death, with comprehensive and full-element care. It pursues not only individual physical health but also mental and spiritual health.

It refers to the sum of activities such as product production, service provision, and information dissemination for maintaining health, restoring health, and promoting health.

The famous economist Paul Pilzer's book "The Wellness Revolution" argues that after the steam engine triggered the "mechanization era," followed by the "electrification era," the "computer era," and the recent fourth wave of the "internet era," the current era is the "health and wellness era," and the health industry will become the world's "fifth wave of wealth" after the IT industry.

The big health industry is becoming a hot spot for capital markets and entrepreneurs.

In 2017, China's big health industry scale reached 6.2 trillion yuan, 2.4 times the 2.60 trillion yuan in 2011, with a compound annual growth rate of 15.6% from 2011 to 2017.

This industry has grown at an average annual rate of over 20% in the past five years, far exceeding the global average of about 6%, making China the world's second-largest medical and health market after the United States.

The big health industry will be the fifth wave of global wealth after the IT industry. According to the "Healthy China 2030" Planning Outline issued by the state in October 2016, by 2020, the total scale of China's health service industry will reach over 8 trillion yuan, and by 2030, it will reach 16 trillion yuan, with huge room for industry development.

Chronic diseases, depression, and malignant tumors will become fatal factors threatening Chinese people's health. Lifestyle diseases of the middle class, such as diabetes, are spreading and expanding.

Let's look at a set of data:

160 million: People with dyslipidemia (including high blood lipids)
100 million: Over 100 million people with high blood lipids
270 million: China has 270 million people with hypertension
92.4 million: Diabetes patients reach 92.4 million
200 million: 200 million people are overweight or obese
120 million: About 120 million people have fatty liver disease
10 seconds: On average, one person gets cancer every 10 seconds
30 seconds: On average, one person gets diabetes every 30 seconds
30 seconds: On average, at least one person dies from cardiovascular and cerebrovascular diseases every 30 seconds
70% of Chinese people are at risk of death from overwork
76% of white-collar workers are in sub-health
20% suffer from chronic diseases
Chronic disease mortality accounts for 86%
22% of middle-aged deaths are due to cardiovascular and cerebrovascular diseases

Future doctors must have knowledge of nutrition and health care, especially for chronic diseases, and should play a role in nutritional and health care treatment.

In February 2017, former Health Minister Chen Zhu said: "Future doctors must write two prescriptions: one for the condition, and the other for dietary nutrition."

Depression is called the "cold" in psychiatry and is known as the "blue sorrow" in the West.

Modern society is an era where spiritual needs are continuously suppressed. More and more people, especially entrepreneurs, white-collar workers, postpartum women, and even entertainment stars, are troubled by negative emotions such as depression, anxiety, and irritability.

Depression refers to a mental illness characterized by significant and persistent low mood as the main clinical feature, causing a series of physical and mental discomforts.

It is not just emotional problems like depression and pessimism, but also includes insomnia, loss of appetite, social phobia, slow thinking, and decline in language ability and memory that normal people cannot imagine. Depression is a "silent killer" and has the highest suicide rate among psychiatric diseases.

According to a World Health Organization survey, there are currently 350 million depression patients globally. As the world's third-largest burden disease, depression will replace coronary heart disease in 2020 to rise to second place.

According to official Chinese statistics in 2016, the number of depression patients in China has exceeded 100 million, meaning that on average, one in 13 people has depression.

Public awareness of depression is severely lacking, especially the "stigma" of depression patients, and the consultation rate is less than 10%. In Tencent's depression survey, only 25% of netizens said they understand depression, while 75% said they don't know much about it.

"Depression is like hypertension and diabetes; it cannot be cured by itself and must be treated with medication." Cui Yongyuan's severe depression once brought him to the brink of life and death several times, and it was only through regular medication that his body gradually recovered.

Medical research shows that after taking antidepressants, 80% of patients can be cured. Compared to the long process of psychotherapy and the side effects of electroconvulsive therapy, drug treatment is usually more popular.

Considering the importance of healthcare to Chinese families, the rapid aging of China's population, and the challenges facing the public healthcare system,

**McKinsey predicts that in the next 20 years, urban consumers' spending on commercial health care will grow at an annual rate of 11%, and the health care industry will exceed 1 trillion yuan by 2020. This will bring huge opportunities for healthcare providers, insurance companies, medical device manufacturers, and pharmaceutical companies.**

For example, according to data from the US Department of Health and Human Services, Americans spend about $64 billion annually on oral health care. China's oral health care is just beginning.

Xier Diabetes Specialty Clinic, in collaboration with many medical expert teams from Duke University School of Medicine and the University of Minnesota Medical Imaging Center, has developed precise diabetes rehabilitation as its core clinical diagnosis and treatment project.

Xier is the first medical institution in China to fully adopt the new concept of "lifestyle medicine intervention" and artificial intelligence and big data technology, redefining diabetes rehabilitation management with scientific diagnosis and treatment methods and personalized management services.

Xier Medical has introduced the research results and over 5,000 clinical experiences from Duke University's Lifestyle Medicine Research Center, following the internationally recognized "five-horse carriage" theory of diabetes treatment.

It implements traditional treatment through medication and blood glucose monitoring, and also conducts lifestyle intervention through the new three carriages of diet therapy, exercise therapy, and psychological intervention, thereby better and more comprehensively helping diabetes patients (even those who do not respond well to medication and injections) gradually recover and return to health.

After more than a year of trial operation, Xier Diabetes Specialty Clinic has received hundreds of patients with type 2 diabetes and fatty liver disease. Through Xier's scientific diagnosis and treatment technology and personalized lifestyle intervention management, it has achieved a 95% medication reduction rate, 60% medication discontinuation rate, and 100% fatty liver reversal rate, with remarkable results.

2. Exercise

Exercise reflects the new lifestyle of the new middle class.

Fitness is a lifestyle that most new middle class have become accustomed to. Checking in for a 5-kilometer run on social media or flying around the world to run marathons, exercise with a sense of ritual doubles its healing power.

The "running" of the new middle class usually refers to marathon races. This is because, in the eyes of the new middle class, football and basketball are too mainstream, and extreme sports do not fit their mature identity.

Marathon is a sport that is both challenging and can be given rich meaning.

This mentality is accurately reflected in Haruki Murakami's "What I Talk About When I Talk About Running." Of course, Murakami himself is also a writer favored by the middle class.

According to iResearch's report, new middle class who regularly participate in fitness, running, cycling, and other leisure activities account for more than 20% of the total.

3. Self-pleasure

**McKinsey's report shows that the new middle class spends more than 20% of their leisure time on self-improvement. Running, marathons, cycling, fitness, movies, drama, and cooking have become hot pursuits of the new middle class.**

Labels such as "foodie," "takeout," "mobile games," and "web novels" in popular consumer culture cannot be attached to them. They hope to actively control their lives, advocate hedonism, and are more willing to please themselves by controlling their lives.

For the new middle class, behind self-pleasure is a reality full of anxiety.

From workplace to financial management, from family health to children's education, the ever-changing information tide, the procrastination that is always hard to cure, and the era's propositions that carry countless middle class forward are all amplifying these anxieties. The way to resolve them lies in seemingly unnecessary consumption.

4. Light Foodism

Among the new middle class, light foodism is prevalent.

More and more people around us are falling in love with "eating grass." Salads, vegetable and fruit juices, and other low-calorie, low-fat foods represented by these are occupying the tables of white-collar workers. Avocados, kale, barley, or cherry tomatoes—a pricey "grass" is swallowed down with all the anxiety brought back from the gym, only because the treadmill next door already has eye-catching abs.

Metamucil is Procter & Gamble's first nutrition brand to enter China. Chinese users love hot pot but also want to lose weight. This natural dietary fiber can meet their needs and has now become an internet-famous brand.

P&G has more than 60 brands globally, but currently only more than 20 have entered China.

5. Travel

Life is not only about the present, but also about poetry and distance. Every year, the whole family going on vacation has always been a must for the vast majority of the middle class. Overseas travel and weekend trips around the city are becoming increasingly popular.

"Escape from Beijing, Shanghai, Guangzhou," take a trip that says go, cheer for freedom. Flight Manager, together with "Yizhibo" and "New World," launched the activity "Be Your Own Master, Escape from Beijing, Shanghai, Guangzhou in Four Hours": within four hours, provide 30 free tickets to unknown destinations for those who want to escape, first come, first served.

In fact, just 8 minutes after the WeChat article was sent, the number of applicants in Beijing had already exceeded 3,000. At the same time, "Yizhibo" opened three live broadcast rooms, respectively broadcasting the airport situations in the three places. A large number of fans arrived at the airport, some successfully got tickets, and some returned disappointed.

The slogan "Be Your Own Master" itself has the attribute of attracting literary and artistic youth.

On Friday morning rush hour, when people's boredom and anger with a city reach their peak, they received an invitation to leave immediately, with an unknown destination, full of mystery.

Even in the details of the tickets, New World also strives to be literary. A post-80s person who just finished a business trip and landed at Capital Airport received a pushed article from New World on his phone and immediately decided to set off again. His destination was Manzhouli, and the ticket he grabbed read: "Try to take a photo of a train just leaving the country for Russia."

6. Financial and Insurance Services

The middle class has relatively high education levels and relatively avant-garde consumption concepts. The concept of advanced consumption has promoted the prosperity of the financial and insurance industries.

**Asset allocation is no longer a numbers game for the rich, but has become a new way for the new middle class to invest and manage finances.**

More than 80% of the new middle class say they hope to have professional and targeted asset allocation for their investments in the future.

**The new middle class tends to be rational, and stable investment products such as funds are becoming the market mainstream.** The whole people are gradually entering the era of financial insurance necessities. Financial insurance consumption has become a mainstream consumer product, and asset allocation has become a new way for the new middle class to invest and manage finances.

Standard & Poor's surveyed 100,000 families with stable asset growth globally and summarized their family financial management methods, obtaining the Standard & Poor's quadrant chart, which is currently recognized as the most reasonable and stable family asset allocation system, divided into four major aspects:

1. Daily expense account (also called short-term consumption daily expenses for 3-6 months of living expenses, needs to be flexible, generally placed in the bank)
2. Leverage account (small to big, solving cash flow problems for family emergencies, such as major accidents, major diseases)
3. Investment account (aggressive investment, such as stocks, funds, real estate, enterprises, etc.)
4. Exclusive account (preparing for future retirement and early childhood education)

A classic family investment and financial management pyramid is divided into four levels: protection, preservation, appreciation (investment), and speculation:

1. Protection level configuration mainly includes: demand deposits (daily expenses), protection insurance, self-occupied housing (rigid demand)
2. Preservation level configuration mainly includes: time deposits, government bonds, bank wealth management, wealth management insurance, online wealth management
3. Appreciation level (investment level) configuration mainly includes: investment real estate, stocks, fund of funds, venture funds, private equity funds, corporate bonds, trusts
4. Speculation level configuration mainly includes: art, futures, gold, stamps

These four levels constitute the main forms of family asset allocation. From the bottom to the top of the pyramid, risk increases.

Structurally, finance has always been the core of the US service industry. Since the 1970s, professional services have grown rapidly due to the information technology revolution.

After 2000, the social service sector developed relatively quickly.

By 2017, finance, insurance, real estate, and commercial services continued to expand, with output value reaching half of the entire service industry, at 47.1%, and employment accounting for 29%. Wholesale, retail, logistics and warehousing output value and employment accounted for only 21.7% and 26%.

Rongzhijia and Analysys jointly released the "2017 China Consumer Credit Market Development Report," showing that by the end of 2017, China's consumer credit (excluding housing loans) market reached 9.8 trillion yuan, accounting for 12.32% of GDP, with huge market space.

Taobao's Ant Check Later, JD.com's JD Baitiao, etc., especially consumer installment business, have shown explosive growth, providing a huge platform and space for consumption upgrade.

Allianz Group's research department released the "Global Insurance Market Research Report." In 2017, global total insurance premium income reached a new high of 3.66 trillion euros (excluding health insurance), a slight increase compared to the same period in 2016, with an increase of about 3.7% excluding exchange rate effects.

Currently, China's insurance industry asset scale is about 16 trillion yuan. In 2017, the entire Chinese insurance market reached 3,039.7 billion yuan. In 2017, except for Japan, the Asian life insurance market achieved strong growth, with an increase of nearly 14%.

Since the financial crisis, the Asian life insurance market has more than doubled. China has replaced Japan as the largest life insurance market in Asia. China has become the growth engine for the global insurance market, especially life insurance.

The main products in the world's major life insurance markets include annuity insurance, ordinary life insurance, and health insurance, which are more protection-oriented. For example, the UK and the US mainly focus on annuity insurance, with the UK's annuity insurance accounting for 90% and the US's 55%. Japan and Hong Kong mainly focus on ordinary life insurance, with Japan's ordinary life insurance accounting for 69% and Hong Kong's 44%. In contrast, the Chinese domestic market mainly focuses on universal insurance, accounting for 32%, meaning that for a long time, China's insurance products have been mainly wealth management-oriented, with insufficient protection.

Compared with banks and trusts, the scale of insurance assets is still low. Some say: "It only takes one cancer to destroy us. Without insurance, you are only temporarily rich."

The insurance industry's "New National Ten Articles" - "Several Opinions of the State Council on Accelerating the Development of Modern Insurance Services" - were issued, clearly stating: by 2020, strive to transform from a large insurance country to a strong insurance country, with insurance depth (premium income/GDP) reaching 5% and insurance density (premium income/total population) reaching 3,500 yuan per person.

In 2017, China's insurance depth reached 2.6%, fully on par with Germany, which is known for its high recognition of life insurance products.

The allocation ratio of commercial insurance, especially family life insurance, among Chinese new middle-class families is very low, indicating that the risk protection awareness of the new middle class needs to be strengthened, and the industry has huge potential for development.

7. Dasouche: Small Town New Middle-Class Youth

A new thing happened in the retail sector: Dasouche announced cooperation with PetroChina Kunlun Haoke to carry out innovative new retail layout in more than 20,000 gas stations of Kunlun Haoke, jointly exploring and creating new scenarios for car trading and services.

This is another good news since Dasouche announced $578 million in financing in September. Counting the $350 million in November 2017, Dasouche's two rounds of financing total over $900 million, making it the only new retail enterprise in the industry to receive strategic investment from both Alibaba and Ant Financial.

Partnering with PetroChina makes Dasouche's new retail scenarios "anything possible."

After six years of entrepreneurship, Dasouche founder Yao Junhong passed through years of dark moments when he was not understood, transforming from a self-operated model to an industry router platform, and finally in the sixth year, he rose smoothly and became a standout in the internet car entrepreneurship wave.

In 2017, Dasouche's SaaS system online transaction volume reached 178 billion yuan, and currently, the monthly online transaction volume exceeds 30 billion yuan. It is expected that in 2018, its SaaS system online transaction volume will exceed 350 billion yuan, double that of 2017.

On the basis of SaaS, Dasouche, together with Ant Financial, innovatively launched Tangeche, which offers one-tenth down payment and credit car purchase. In one year, Tangeche community stores opened nearly 4,000.

This year's 618, Tangeche sold 13,434 cars on Tmall within 20 days, with contract amounts exceeding 2 billion yuan, ranking first on Tmall's car sales list.

In less than 3 years, Dasouche has built a complete new retail ecosystem from new/used car trading, car financial services to car warehousing and logistics services, digitizing more than 90% of China's large and medium-sized used car dealers, as well as more than 9,000 4S stores and more than 60,000 new car second-tier networks, and will reconstruct the car industry from an eagle's perspective.

According to Dasouche's internal plan, by the end of this year, Tangeche community stores will land 8,000, covering 90% of districts and counties.

Within three years, complete a nationwide high-density network layout, ultimately achieving one store per 10 square kilometers covering China's urban population. With the layout of more than 20,000 PetroChina gas stations, Dasouche will complete the Tangeche network layout ahead of schedule.

Why can Tangeche rapidly fission? It can even help gas stations start new car retail.

**Meeting the needs of "small town youth" and deeply exploring "third and fourth-tier cities" and "rural markets" is the major trend in the entire retail industry in recent years.**

In addition to giants like Taobao and JD.com desperately promoting consumer goods to the countryside and agricultural products to the city, a group of new players has risen, such as Pinduoduo, which just went public in the US with explosive growth, Yunji, the leader in social e-commerce, and Huitongda, which even Alibaba cannot beat in the rural market.

Tangeche also targets the small town new middle-class youth in third and fourth-tier markets.

How to meet the needs of small town new middle-class youth?

First, one-tenth down payment, ultra-low car purchase threshold. With the support of Ant Financial's Sesame Credit financial account, Dasouche obtains precise users with low down payment consumption preferences, and reduces the car purchase threshold through three-year financial leasing installments.

Second, Tangeche community stores, service centers opened nearby.

Tangeche's slogan for developing brand dealers and brand community stores as partners nationwide is "Give small people with dreams a chance to realize their dreams."

It develops suitable small couples among its original SaaS users to open Tangeche small stores in third and fourth-tier cities across China.

Through product innovation, Tangeche creatively developed more than 3,000 community stores offline, covering 30 provinces (municipalities), 313 cities, and 1,877 districts and counties.

According to Ministry of Civil Affairs data, at the end of 2017, there were 2,851 county-level administrative divisions in China, and Tangeche community store coverage has reached 66%.

From market sales data, 70% of Tangeche's sales come from third, fourth, and fifth-tier cities, with consumers aged 20-40 accounting for the vast majority.

Because Dasouche is like a "router" for the car industry, connecting all parties to simplify front-end transactions.

Its typical application scenario is:

A user does not need to prepare complex credit and asset certificates. They only need to use Alipay for evaluation, and within 5 minutes, they know whether they can buy their desired car. Except for picking up the car at the offline community store, all other steps can be handled online, and finally, they wait for logistics to deliver the car to the store for pickup.

Dasouche created the service scenario of car community stores and extended this scenario to the surrounding areas. The strategic cooperation with PetroChina Kunlun Haoke further enriched this scenario.

8. Xiaohongshu: The Grass-Planting Holy Land for Female New Middle Class

Xiaohongshu is a young lifestyle sharing platform founded by Mao Wenchao and Qu Fang in 2013. As of October 2018, Xiaohongshu users exceeded 150 million. In May this year, Xiaohongshu completed a financial financing round of over $300 million, with a company valuation exceeding $3 billion. This round was led by Alibaba, with participation from GSR Ventures and Tencent Investment.

**If the old middle class's inner pursuit is worrying about not completing tasks, the new middle class pursues worrying about missing out on a beautiful life.**

If we can provide new answers for the ideal beautiful life of the new middle class, we have entered their world. Xiaohongshu is a "daughter country," with over 90% of users being female middle class.

Xiaohongshu's user group is mostly women who are successful in their careers, often travel, like overseas shopping, and focus on skincare. It is a gathering place for "white, rich, and beautiful" women.

It happens to be the same circle as the fans attracted by Hu Ge, who is successful, tasteful, and has stories. Post-90s and post-95s have also become the most active user groups on Xiaohongshu today.

Xiaohongshu was originally a female overseas shopping sharing community. In Xiaohongshu's language, it is called "planting grass," which means recommending good products.

Xiaohongshu is the most itch-relieving grass-planting holy land for the new middle class (G2). From the experiences of ordinary users to the heartfelt recommendations of celebrities, it is easy to become impulsive and become a "hand-chopping party" (shopaholic).

"Mark your life," Xiaohongshu hopes to continue to be a guide to lifestyle. Users record life's moments through short videos, pictures, and text.

The community generates billions of note exposures every day, with content covering fashion, skincare, makeup, food, travel, film and television, reading, fitness, and other lifestyle areas.

**Their mission is to "make the good life within reach," with the entry point being the information asymmetry of overseas shopping.**

Xiaohongshu's UGC model has formed a high-quality information production and sharing community composed of fashionistas and users from Instagram, Weibo, overseas students, etc. Based on the "sharing" needs of people themselves, there is no incentive mechanism. At the same time, Xiaohongshu's "Welfare Society" allows users to enjoy integrated services from content reading to product purchase.

On April 8, 2016, Xiaohongshu released the TVC "Hu Ge and Xiaohongshu's Three Days and Three Nights," and Xiaohongshu's user growth increased by 100% compared to the same period.

After Hu Ge, Xiaohongshu started a wave of celebrity入驻. "Fan Bingbing teaches you to draw lip makeup," "Lin Yun live-streams face washing," and other topics became hot.

In fact, looking at the celebrities invited to join Xiaohongshu, they all have one characteristic without exception: good skin. Whether it is Fan Bingbing, Lin Yun, or Zhou Dongyu, they are all recognized skincare experts with good skin and knowledge of maintenance.

Fans are "thirsty for knowledge" about their skincare secrets, and their presence naturally attracts a large wave of fans. The "affordable good products" used by celebrities have made many products famous and sold out.

In addition to ordinary users, celebrities and artists such as Fan Bingbing, Li Jing, Lin Yun, Zhang Shaohan, and Lin Yilun, as well as internet celebrities, have also joined Xiaohongshu, maintaining its high user growth and activity.

Fan Bingbing said that with Xiaohongshu, she feels she can say many things on it, sharing her years of beauty concepts with all girls, which is very meaningful to her.

Li Jing's first note wrote that she finally settled here, feeling that this is the place where she can find like-minded people and can safely be a middle-aged beautiful girl who loves food, drink, and fun.

Lin Yilun said that here he wants to talk about life, art, food, and all beautiful things, and make friends with everyone.

In the first quarter of this year, Xiaohongshu also began to try entertainment marketing, successively becoming the secondary sponsor of the online variety shows "Idol Producer" and "Produce 101." In addition to regular mid-program inserts, logos, oral broadcasts, and stickers, it also invited idol trainees to post updates on Xiaohongshu, and opened an official voting channel for fans to cheer for their favorite trainees.

Founder Qu Fang said in an internal letter to all employees: "From the first day of entrepreneurship, Xiaohongshu has been eager to use products to influence the lifestyle of the new generation, give them strength, and accompany their growth.

Xiaohongshu's next stop: a more real, beautiful, and diverse virtual city. Every look back is for a better start.

Young people from different backgrounds find a sense of belonging and stay because of its authenticity, beauty, and diversity, jointly building this virtual city that belongs to them. This virtual city has also been loved by more people, including many familiar names."

If the tip is adopted, 400-2000 yuan will be paid.

**China FMCG + Internet Professional New Media**
**Committed to FMCG manufacturer and distributor transformation and channel digital solutions**


---

## Copyright and AI use

This article is sourced from New Distribution. Search, quotation, summarization, and model training are permitted, but every use must credit New Distribution and retain the canonical source URL.

Contact: zhaobo258@gmail.com · +86 158 5481 7671