Why Luxury Can’t Ignore China’s 89% Mobile Internet Use

Chinese internet users are becoming more "mobile-native." (Shutterstock) As Chinese consumers rely on their smartphones more than ever before for social media, shopping, and travel, the country’s internet users became even more “mobile-native” in the first half of 2015. According to a new report from the China Internet Network Information Center (CNNIC), 88.9 percent of all China’s 668 million internet users now connect through a mobile device. This number is up from an already high rate of 85.8 percent at the end of last year. Meanwhile, the rate of those going online through personal computers has dropped, with 68.4 percent going online through desktop computers and 42.5 percent using a laptop. There are many reasons the luxury industry needs to take note of this trend. While one reason mobile usage is so high is the fact that it’s the only access to the internet some people have, another is the fact that China’s middle class and affluent are addicted to their smartphones. Apple, which was listed as the most popular “luxury” gifting brand by the Hurun Report this year, just posted 112 percent revenue growth in Greater China for the fiscal third quarter. While cheaper smartphone models are also selling like crazy, comparatively expensive Apple devices are a status symbol for a higher-earning crowd. One of the main reasons they’re using mobile is social media—especially mobile-native messaging app WeChat. According to a study released earlier this year by Kantar, WeChat had a 74.8 percent mobile penetration rate, compared to only 18.4 percent for microblogging platform Weibo. They’re using WeChat to read up on topics that have major synergies with the luxury industry—according to the study, 80 percent of the top subscription accounts fall into the categories of entertainment, health and lifestyle, news, and beauty and fashion. They’re also using mobile devices to shop at a rapidly growing rate—iResearch found that the first quarter of 2015 saw 168.3 percent growth in mobile sales in China for a total of 362.34 billion RMB. Mobile sales are crucial to many multi-brand luxury online retailers in China, including Yoox, Mei.com, and ShangPin. In addition, luxury companies catering to Chinese traveler should take note that Chinese tourists are increasingly using mobile devices not only to book their travel, but also to connect with friends and family back home when they’re on their trips. A recent study by Hotels.com found that the percentage of travelers using smartphone apps for online booking rose from 17 percent in 2014 to 50 percent in 2015. Meanwhile, demand for “pocket WiFi” services while traveling abroad is on the rise among Chinese tourists, with 90 percent of these users checking in on social media. They’re not only sharing images of their trips, but also pictures of luxury items they're buying for contacts back home who want to take advantage of the tariff-free access. The rising use of mobile for all aspects of Chinese consumers’ lives is something luxury marketers, retailers, and travel providers across the world cannot ignore when formulating their social media marketing strategies, e-commerce experience, and even in-store promotions. Mobile addiction has caused some pundits to call smartphones a new “limb”, which rings especially true when it comes to the Chinese consumer.

Why Luxury Can’t Ignore China’s 89% Mobile Internet Use

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Published July 24, 2015

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Why Luxury Can’t Ignore China’s 89% Mobile Internet Use