The potential spending power of young, wealthy city-dwellers is well-documented. Eighty percent of wealthy Chinese are under age 45, according to a recent McKinsey report entitled The Coming of Age: China’s New Class of Wealthy Consumers. That’s compared with 30% in the US and 19% in Japan.

The economic crisis has shaken the assumptions of the Chinese middle class like anyone else. They are less likely to take risks, spend unnecessarily, or change jobs on a whim than they were a year ago. However, individual confidence – belief in oneself – remains remarkably high, especially among females.

Female consumers in their late teens and early 20s interviewed for the research have clear plans for their futures, which involve 1) early 20s: marriage, 2) mid-20s: having a child, and 3) late 20s: returning to work.

Rather than being a hindrance to a career, the young marriage age increases the opportunities for urban women, who expect to have their child (only one child) by their late 20s. The presence, normally, of four sets of grandparents mean that childcare is free and easy to find, so women don’t have to give up their careers, and most don’t want to. Unlike for previous generations, or for people living in rural areas, these women see work not only as a right they are not willing to give up, but also an escape from the pressures of home and family.

With these social/familial obligations taken care of at a relatively young age, but both men and women retain a sense of adventure and personal belief that might for people in the West or Japan peak in their 20s. This enthusiasm is often channeled into a career, the primary means of achieving money, status, friends and personal freedom.

More details of this and nine other consumer shifts are available in Five by Fifty’s China Shifts 2009 report. For a sample, contact us.

Japanese office workers in their 20s prefer communicating on the sports field.

Mori Building, a Tokyo-based property developer, manages offices occupied by several leading Japanese and international companies such as Rakuten, TV Asahi, Yahoo! Japan and Goldman Sachs. Participants in the survey were readers of Office Life News, a free magazine distributed to people working in Mori offices.

The survey found that 85% workers in their 20s see such “informal communication” as important. By comparison, only 24% of workers over the age of 50 responded that it is “important”, with 47% seeing it as “somewhat important.”

New recruits at an admission ceremony for Toyota. Casual Friday is still a dream for most corporate employees.

Workers in their 20s stated they value communicating with coworkers outside of the office because they can “get new information” (59%), and because it can “improve the work atmosphere in the office” (34%). 70% of workers in their 20s said they would like to increase opportunities to informal communication with coworkers.

Mori Building has begun organizing activities to give workers a chance to meet up outside of the office, such as the “Mori Cup” a soccer tournament for teams of people working in Mori Offices.

Swedish fashion chain H&M has scored a hit with young consumers in Japan.

Japanese marketers have identified a new target segment – the so-called “yutori” generation. Born roughly between 1987 and 1990, members of this generation are now becoming working members of society, and are harder to pin down than one might imagine. They were the first generation to enter schooling after sweeping education reforms that reduced the study week from six days to five, and the number of subject reduced. The new system was called “yutori (loose) education” at the time, as it
essentially gave students more time to play with friends and develop their own interests.

A recent Nikkei survey of the yutori generation came up with some interesting statistics. The yutori generation prefer spending free time alone, or with friends of the same sex, rather than going on dates. Compared to the previous generation, they tend to watch TV less and read more, and rather than the convenience of shopping online, prefer the experience of going to shops and taking time to make a purchase.

Segments such as travel, automobiles, and beer are not doing well with this market segment as this generation is simply not that interested in traveling abroad, owning a car or drinking alcohol. However, there were a number of products that scored hits in 2008.

Products that appeal to a sense of playfulness are popular with the yutori generation.

Toymaker Bandai released a bubble bath that resembles 10,000 yen bills that dissolve in the bath, a product probably aimed at older generations seeking to relive the glory days of the bubble economy.
Surprisingly, it caught on with a much younger generation, and follow up products include cosmetic sheets for removing excess facial oil resembling 10,000 yen notes, and a body shampoo in a beer bottle that spurts out when opened, all giving a feeling of playful extravagance, while on a tight budget.

Other popular products revolve around self-improvement and study, such as a notebook based on the study habits of Tokyo university students, and items for organizing papers and study materials in a stylish way.