ities have grown more quickly than in big cities, including clothing, food, beverages and home appliances, Chen added.
During Spring Festival in February, small-town youths in third- an
d lower-tier cities outperformed their peers in bigger centers of population in consu
mption across major e-commerce platforms, including the number of orders placed and the range of products bought.
In third- and fourth-tier cities, total online spending during Spring Festival rose by 55 percent year-on-year, comp
ared with 51 percent in first-tier metropolises. Spending by small-town youths on beauty products rose by 7.8 perc
ent year-on-year, compared with a 5.4 percent increase among their peers in larger cities, according to a report rel
eased by Tmall－Alibaba’s e-commerce platform－and market research company Kantar Worldpanel.
Small-town youths have also boosted the movie industry. For example, in the first quarter of this year, some
56 percent of the box office for The New King of Comedy came from lower-tier cities, as did 46 percent for Crazy Alien.
major platforms for them to learn about the outside world. They also l
ike to use social networking platforms such as Pinduoduo and WeChat, on which they can bu
y products, socialize with friends, learn about the latest fashion trends and make purchases, Yu said.
“For example, Pinduoduo asks consumers to invite friends to join the platform, to help r
educe prices, which can be a good way of obtaining new customers and retaining them,” he said. “C
onsumers also like purchasing activities that can strengthen connections with friends.”
Sun said that because they face less work pressure and shorter commuting time, small-town youths have more free time com
pared with their peers in big cities. They mainly spend this time online or getting together with friends.
Some 88.7 percent of small-town youths surf the internet, 80.6 percen
t hang out with friends, and 60 percent watch movies, according to Sun’s report.
unt for about 20 percent of the total, but they have quadrupled in the past two years.
“If you can prove to small-town youths that the products are useful, they are willing to pay,” Lan said. “Some inno
vative Saky products have also seen rapid growth in lower-tier markets, including one that removes stains from teeth.”
Chen, from Roland Berger, said that while small-town youths are narrowing the gap with their count
erparts in bigger cities in many ways, they still have many distinct demands. If companies want to win t
hem over, it is important for them to have a deep understanding of lower-tier markets and to draw up strategies acc
ordingly, whether in building brand awareness, or providing specialized products and distribution channels.
For example, while helping a jewelry company to access lower-tier markets, he found tha
t jade inlaid with gold is very popular, although it is considered unfashionable by consumers in large cities.
niscent of local experiences, artistic and portable. “The souveni
r market is huge and growing, given the expanding Chinese middle-inc
ome population and consumers’ increasing purchasing po
wer. But to earn money in this market, souvenir-makers should do a much better job.”
China has the world’s largest and fastest-growing middle-income group (more than 400 m
illion, or 140 million families as of 2017), said Ning Jizhe, head of the National Bureau of Statistics, in January.
Their annual family income is between 100,000 yuan and 500,000 yu
an. This enables them to buy cars, properties and tourism packages, Ning said.
“Many im2pulsive purchases will be made during travels, either for self or to gift to relatives and friends,” said He.