Changing appetite

While China's purchasing power remains strong, consumers' tastes are changing. They now tend to show less enthusiasm for fancy brands, and instead pay more attention to services.

A nursery aide training class in Jinan, Shandong province. Chinese consumers are now tending to pay more attention to the service industry. [Photo/China Daily]

In the first nine months of 2012, the amount of tax rebates Chinese customers received on goods bought overseas increased by 63 percent, according to Global Blue, a Switzerland-based shopping tourism company.

A survey conducted by Boston Consulting Group Inc suggested that, despite the country's slowing GDP growth, 40 percent of Chinese consumers plan to spend more on "non-mandatory products" by 2013.

Consulting company McKinsey & Co said China will overtake Japan to become the world's largest consumer of luxury products in the next three years, a result of a rapid increase in the number of middle-class families in China.

The company said tastes are changing. Rather than engaging in conspicuous consumption, people are now tending to pursue quality and good shopping experiences.

"After 20 years, the purpose of consuming luxuries in China has gone from showing off to being something more practical," said Zhou Ting, head of Fortune Character, a magazine that covers luxury markets.

Luxury buyers are now tending to think that highly noticeable logos are obnoxious, she said.

In another sign of the trend, a larger number of consumers are now shopping overseas. A report from the National Tourism Administration said 77 million Chinese tourists may have traveled abroad in 2012 and spent $80 billion. A year before, 70 million had gone abroad and spent $69 billion.

Shen Danyang, spokesman for the Ministry of Commerce, said the country's consumption patterns have changed, noting that sales of home appliances and automobiles, as well as in restaurants, are increasing at a slower rate.

"These trends suggest we'll face significant pressure in the expansion of consumption in 2013," he said.

He also agreed the service industry may be the next big driver of consumption. One indicator of the trend is that more foreign capital is now being transferred from manufacturing to the service industries, Shen said.

Contact the writer at weitian@chinadaily.com.cn