Lower tier city consumers are no less active on social media than those in Tier 1 and Tier 2 cities. A lack of access to offline channels has made them dependent on online channels for every step when shopping, from learning what is on-trend to keeping in touch with brands, from selecting and purchasing products to sharing their shopping experience. To penetrate the lower tier market, it is essential to fully leverage big data tools and online distribution channels, such as social commerce and community group buying, to win over lower tier city consumers and build trust with them.

Through quantitative (based on the quantitative data from multiple Mintel Reports in 2019 and 2020) and qualitative research, this Report compares consumer behaviour and attitudes in different city tiers. This Report examines lower tier city consumers' expectations of social media, both as an information channel and a shopping platform, and by using a series of cases, it explains to brands and social media platforms what strategies would effectively increase their competitiveness in lower tier cities.

• Advantages of social commerce

• The ecosystem of the WeChat ecommerce platform

• Preferences towards short video content

• The key to KOL marketing

• Motivations for sharing

• Attitudes towards personal privacy

Online activities defined in this Report include:

• Online shopping

• Chatted with family/friends

• Watching live stream/short videos

• Listening to music

• Watching films/TV series

• Sharing my life on social media

• Reading social media contents published by public accounts or bloggers

• Playing games

• Reading e-books/comics

According to the National Bureau of Statistics, there were 672 cities in China at the end of 2018, among which 297 are of the prefecture level and 375 are of the county level. As Mintel clients have interest in multiple different aspects (region, city size), Mintel selects different cities for each round of surveys, considering their geographical locations and levels of economic development (eg GDP, per capita income). Mintel classifies China's cities according to the following criteria:

• Tier 1 cities: large economic centres, ie Beijing, Shanghai, Guangzhou and Chengdu*

• Tier 2 cities: provincial capitals (eg Jinan), municipalities (直辖市) (eg Tianjin, Chongqing) and economically developed prefecture-level cities (eg Suzhou, Dalian)

• Tier 3 or lower cities: mostly prefecture-level cities (eg Weifang, Ganzhou and Pingxiang)

* Mintel chooses Chengdu to represent Tier 1 cities in the midwest of China for the purpose of regional comparative analysis.

Through quantitative (based on the quantitative data owned by Mintel collected from 2018 to 2020) and qualitative research (based on in-depth interviews with 20 respondents from 10 Tier 3 or lower cities), this Report compares and analyses consumer behaviour and attitudes in different city tiers. Meanwhile, the Report further explores effective strategies for companies to improve their competitiveness in lower tier cities by analysing cases.

Quantitative consumer research data was collected from various Mintel Reports over 2019-20. The consumer research, exclusively commissioned for China Reports, was conducted by a Chinese licensed market survey agent, KuRunData. The online consumer survey was sampled in 10 cities, each with a sample size of 300 people, for a total of 3,000 people.

To explore the ‘why’ behind the quantitative data, Mintel conducted in-home or online interviews with 20 respondents from 10 lower tier cities listed below. Each in-home visit lasted for about one hour with a moderator doing in-depth interviews with respondents, to understand their lifestyles, purchase preferences and the factors that influence them.

Figure 2: Interviewed cities in the qualitative research

Click here to zoom

Source: Mintel

In the qualitative research, Mintel selectively recruited affluent and educated respondents aged 25-39. In each city, Mintel recruited one male and one female respondent who has a personal income of RMB6,000-10,000 if single, or a household income of RMB14,000-25,000 if married. These respondents are more sensitive to market trends and better able to express their opinions. This ensures the smooth running of the research and is critical to gathering meaningful insights.