Demystifying China: A Panorama of sub-cultures based on life values
Millward Brown, China
China has experienced explosive growth over the last decade. It has emerged as the third largest retail market in the world behind the United States and Japan (see Figure 1).
Between 1979 and 1997 the growth rate of China's Gross Domestic Product (GDP) was 9.8% annually, about three times greater than the world average. Chinese citizens' bank savings increased 220-fold, from 21 billion yuan (roughly US $2.5 billion) to 4,628 billion yuan (about $560 billion).1 Never in history have so many people made such economic progress in a single generation. In 2003, China's per capita GDP was US$1,300 per annum, equivalent to US$5,000 when adjusted for purchasing power parity.2 By 2010, 40 million households are expected to earn more than 48,000 renminbi (US$6,000) a year, equivalent to US$24,000 in terms of purchasing power parity and enough to classify a household as middle class by US standards. However, incomes vary widely. At US$5,600, per capita GDP in Shanghai is more than five times higher than it is in Chongqing, in the interior of the country.3 Stacking cities on per capita GDP merely shows the topline measure of ability to pay, a loose and inaccurate guide for marketers seeking to successfully penetrate the greater China market.