Letter from Bejing Mark GodfreyIn China's current box-office smash Lian Ai Zhong De Bao Bei (Baober In Love), the main character, Liu Zhi, is bored with modern, materialistic life.
He pours his apathy with modern Chinese urbanity into a video camera while waiting for his dream-girl. When Baober finds the videotape, she also finds the man she's been searching for. Baober and Liu have grown up in a city transformed by bulldozers and cranes and the resultant glass towers and shopping centres. This massive cultural earthquake has shattered their spiritual world.
Most young urban Chinese, however, have proved enthusiastic shoppers and consumers of luxury products. Better-educated, higher-earning and bigger-spenders than their parents, China's youth is being courted by marketing executives worldwide keen to corner a potentially vast and lucrative market. The executives have reason to be optimistic: a 2001 survey by international market intelligence agency AC Nielsen found that Beijing youths aged 10 to 22 accounted for 1.4 billion yuan in spending every month. Teens accounted for 60 per cent of that total spend.
Spending is becoming easier. Credit-card usage - still tiny in China - will grow by 75 to 100 per cent in the next 3 years, according to the Beijing office of international market research firm CSM. Chinese traditional values which emphasise savings are being jettisoned as ownership of foreign credit cards gets easier: thanks to China's WTO commitments, multinational banks are opening their doors for business on the Chinese mainland.
Student borrowing is a new phenomenon in the land of the rice-bowl welfare system. A survey conducted recently by the sociology department of Shandong University showed student spending on food and basic clothing has plummeted since 2001. Students are spending more on mobile phones, magazines, cosmetics, cinema tickets, travel and gym gear. Many students have taken on part-time jobs and borrowed from banks to finance the extra luxuries.
Academics and cultural experts around the world have been drawn to explore what China's youth spend their money on. "It's great to know what is cool, but the million-dollar question is what makes something cool," says Dr Carl Rohde, a cultural anthropologist from the University of Utrecht, in Holland. Dr Rohde worked with international public relations firm Hill & Knowlton to map the spending habits of young spenders in several nations worldwide. A team of "cool-hunters" under his direction spread out across Beijing and Shanghai to explore what's "cool" and what's not, among China's urban youth.
The ultimate in cool for Chinese youths is g-strings and extreme sports, along with tattoos and piercings (the "ultimate cool," according to the Hill & Knowlton findings). G-strings symbolise sexual freedom and choice, according to youth questioned by the cool-hunters, while extreme sports such as mountain climbing and bungee jumping represent a healthy, alternative lifestyle and adventure. Tattoos and piercings, meanwhile, "defy tradition and exemplify rule of the body", according to respondents.
International cosmetics brand Avon depended heavily on young Chinese women for its $125 million net sales in China last year. The company has also latched onto Chinese youths' preferences for personalisation and their craving for celebrity, recently launching a product line titled UP2U ("Its Up to You") which is aimed specifically at "trendy Chinese teens and young adults", according to a company spokesperson. "The brand is aimed at young women aged 16 to 24 who love to experiment on new things ... These are women who dare to be different and trendy, and who aspire for personal freedom of expression and choice. UP2U is simply an expression and experience that is truly personal."
"China's generation of single children each wants to be unique and each thinks they should be celebrities," says Ms Hung Huang, publisher of Qinchu Yizu (the Chinese edition of US mass-selling Seventeen magazine, launched in 2001).
She targets the magazine at 15 to 22-year-olds in the 47 cities around China where the magazine is sold. "China's youth is not much different from the youth of London, New York or Paris in how they perceive brands. What is different, however, is that they feel neglected by brands as a consumer group."
Sportswear companies are among the favourite brands of Chinese teenagers. Nike is among them, and the firm sponsors a school sportsground programme and donates money towards the construction of sportsgrounds in Chinese secondary schools.
Published in Shanghai to harvest advertising from multinational cosmetics and sportswear firms, the popular Urban magazine is stuffed with adverts from Reebok, Nike, Puma and other international brands.
"This generation hates fake copies of their favourite brands. They're more sophisticated than any other generation about brands," says Hung. "Their emotional axis is their mobile phone. Our readers often write that they feel naked going out without their mobile phone." The mass-popularisation of DVDs brought on big changes, opening up Chinese youths to western influences, she suggests.
A survey conducted recently by a bank in the eastern city of Nanjing last summer, showed that 65 per cent of respondents were prepared to finance purchases through bank lending. The Nanjing branch of the People's Bank of China issued 22 billion yuan in personal loans in the first five months of 2003 alone. Nearly 70 per cent of loans took the form of mortgages. Keen to spend their expected future income now, young locals were borrowing for cars, houses, home appliances and education. Typically, local young professionals borrowed 80,000 yuan to purchase an apartment and 20,000 yuan to buy a car. Only 11 per cent of those surveyed - all had received higher education - said they wouldn't borrow against their future earnings for houses and cars.
Whatever about the latest splurge, Chinese savers, says CSM, are still among the world's most reliable. Mainland deposit accounts total 10,000 billion yuan ($1208 billion). Savers on average put aside one-third of their income, compared with 5 per cent kept in the bank by US households.
Their disenchantment with modernity and consumerism sets on-screen lovers Baober and Liu apart from their peers. They are the exception not the rule, but the film's popularity could suggest it has struck a chord. China's youth may be tiring of looking at life through a shop window.