If you are in the wellness industry and would like to set up shop in China, then you are in for some promising news. As Chinese consumers begin to embrace health and wellness, the wellness industry has experienced a surge in a market of more than 1.4 billion consumers.
The growth of the Chinese wellness market has caught the eyes of many business owners in the mainland and overseas. With the online spending on health and wellness goods in the country at an all-time high, the wellness industry has a promising future in China. So will you if you start your wellness venture here. However, how big is the Chinese wellness market? We answer these questions and more in this article. Read on to learn more about the Chinese wellness market and the trends that allow this niche to grow at an exponential rate.
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How Big is the Chinese Wellness Market?
China has grown to become the world’s second-largest economy. With more than 1.4 billion consumers in the country, various markets continue to grow and occupy a large portion of the consumer market over time. One of these up-and-coming niches is health and wellness — a niche that has only recently boomed on the Chinese market.
In a report published by the Asian Development Bank, the wellness market in China represents the majority of wellness spending in the Asia-Pacific region. In 2018 alone, the world’s second-largest economy led its neighbors in the Asia-Pacific region as regards spending on fitness apparel.
Based on the same report by the ADB, fitness technology was also a major spending driver for Chinese consumers. In 2018, the ADB found that spending on fitness and health technology rose to $10.8 billion. With online shopping at unprecedented heights in 2020 and 2021, these figures have gotten much larger.
Except for medical services, health and fitness seem to be recreational pursuits for Chinese consumers. This is especially the case with physical activities. Based on market reports, spending on facilities like gyms, exercise equipment, and fitness classes was seen to be the highest in China.
The physical fitness market in China was valued at $109.35, having the largest market share for this niche in the Asia-Pacific Region. Equally impressive is the fact that the fitness participation rate in the country was nearly 50%, indicating high market penetration for fitness goods.
What is driving the Growth of the Chinese Wellness Market?
The figures mentioned earlier paint a picture of how big the country’s health and wellness market is. However, these alone can, at best, only enable extrapolations that say little about what has contributed to the growth. A more comprehensive view of the Chinese wellness market requires knowing the factors that allowed this development to occur.
Indeed, the COVID-19 pandemic has done much to turn eyes towards the importance of health and fitness. Beyond the clamor for health and wellness engendered by the pandemic are two other driving factors identified by the Global Wellness Summit.
These driving factors do more than portray the causes of the market’s growth. They’re also instrumental in determining who your customer will likely be.
A Rising Middle Class
One of China’s greatest achievements was the bulking of its middle-class demographic. While the results seem to be recent, it’s a development more than 40 years in the making. According to the World Bank, more than 800 million people have been included in the middle class owing to reforms initiated in 1978.
Why should this matter to you?
It’s commonly acknowledged that growth in the middle class engenders paradigm shifts in consumer behavior. With a larger middle class comes a preference for premium products. According to Financier Worldwide, Chinese consumers don’t mind paying a little bit more for products that produce more health benefits.
Also, based on the 2019 data gathered by the Global Wellness Summit, much of the spending in health and wellness came from the middle-class population. With more and more middle-income consumers shifting towards healthier living, businesses in the niche will find most of their customers in this demographic.
More Female Consumers
Indeed, China is notorious for having an excessive number of males in the population relative to females. In fact, the ratio stands at 105 males to 100 females.
Despite the skewed ratio, the country is seeing a surge of female consumers who spend on health and wellness. Females lead males in terms of spending on wellness tourism and supplements.
Hence, if you’re a supplement business, expect to get a lot of female consumers in China.
What Makes Up the Chinese Wellness Market?
Wellness is such a broad term. Hence, it’s crucial to be clear on the industries the wellness market encompasses.
The Chinese wellness market is wide, so we will focus on 3 segments today follows:
- Physical wellness
- Mental health
- Sexual health
Of the three, it is the physical wellness market that has long had a foothold in the country. The physical wellness market encompasses a vast array of products and services.
The surge in the demand for mental and sexual health products and services is a relatively recent development. Sexual health products and services, in particular, are a challenging sector for both cultural and legal reasons.
What are the Trends of the Chinese Physical Wellness Segments
Physical wellness products and services take many forms. In China, vitamins and supplements are popular, especially among female consumers. Also, there remains to be a high demand for fitness equipment and apparel (as you will learn later).
For the longest time, the physical wellness market is a domain of products. However, there’s more to the physical wellness market than products.
Health and fitness apps are finding their way into an increasing number of smartphones in China. This has allowed companies who design these apps to have a high market penetration. The average Chinese middle-class health-conscious consumer is likely to have at least one health and fitness app on his or her mobile phone.
There has also been a growth in the demand for physical wellness services. These services have often come in the form of telemedical consultations and other services accessible with smartphones.
Given China’s regulations on marketing health care services, advertising seems to be the only obstacle. Nevertheless, it seems to have done little to stop consumers from accessing physical wellness services.
Mental Health in China, not a Taboo Anymore?
Despite China’s large population, a significant portion is over the age of 50. China is also home to a growing mental health care crisis, according to the World Health Organization. In addition, Chinese culture espouses a complete approach to health beyond the physical. These alongside other factors have created a market for mental health services in China.
Traditionally, China’s healthcare system had a community-based approach to mental health, meaning that prevention rather than intervention was key. However, the emergence of teleconsultation services for mental health has allowed patients to bypass community-level interventions and take mental health matters into their own hands.
Mental health is accessible to more people in China these days owing to apps and teleconsultation services.
A Growing Niche for Sexual Wellness & Health with Adult Toys (and more)
Sex, as a topic of casual conversation, remains to be a cultural taboo in China. Nonetheless, its status in Chinese culture has done little to quell the demand for products that cater to sexual health.
According to Arizton, China dominates the sexual wellness market both domestically and internationally. Retailers of adult toys in the country are profiting significantly despite marketing challenges. Internationally, China is a key source of sex toys, manufacturing more than 83% of the world’s adult toys.
The Chinese government has regulations on advertising sex toys and services. For this reason, much of the advertising is either word-of-mouth or via online channels accessible only through VPNs.
The Case of Lululemon in the Chinese Wellness Industry
Lululemon is one of the most recognized fitness apparel brands in the world. Due to its scale and status worldwide, it easily broke into the Chinese consumer market, positioning itself in the wellness industry.
The Canadian-based apparel brand experienced significant growth in China in 2020. According to China Daily, Lululemon’s profits went beyond the company’s targets (these were undisclosed in the report). As a result, Lululemon expanded to more than 59 stores in China, with most being in the major cities of Shenzen and Shanghai.
There are many reasons behind the growth of the brand in China. According to Jing Daily, the growing middle class had a lot to do with this development. Since its founding, Lululemon Athletica has catered to this demographic with its line of yoga apparel.
The apparel line has also capitalized on the comfort delivered by its products. As the COVID-19 pandemic hit, many in China were forced indoors. This created the perfect environment for the apparel to be worn for home workouts and everyday life at home. This gave rise to the “athleisure” trend in the country.
Whether Lululemon intended to position itself as a brand for home and fitness usage is a topic beyond the scope of this discussion. Nevertheless, it has penetrated the Chinese wellness market successfully with a product of diverse use.
How to Sell your Brand in the Chinese Wellness Market?
There are a few different channels that you can use to sell wellness and health products in China. You can sell them through brick-and-mortar stores, online stores, or distributors. Each of these channels has its own advantages and disadvantages and one option is not exclusives. A combination of sales channels will often bear the most fruits, and if you have the budget & ambition, we would certainly encourage you to not limit your options.
Working with Chinese Distributors
- You can reach a wider audience. By partnering with a Chinese distributor, you’ll have access to millions of potential new customers in China who may not have been able to find your product or service otherwise.
- You can save money on shipping and fulfillment costs. Because the distributor will be handling all of the shipping and fulfillment for you, you won’t have to spend as much money on those costs.
- The distribution process is much faster in China than it is in other parts of the world. products can reach stores and consumers much more quickly when you work with a Chinese distributor.
However, working with Chinese distributors also come with its set of challenges. Some of the most common ones include language barriers, cultural differences, a lack of trust, no full control over the distribution process, and most importantly, finding a reliable Chinese distributor is not easy, it takes time and resources.
Open a Brick & Mortar Store
Selling through brick-and-mortar stores allows you to reach a large number of potential customers, but it can be expensive and difficult to set up and maintain a physical store in China.
However, being active both offline and online is some of the best strategies brands can have on the Chinese market. Brick and mortar will allow your customers to have direct interaction with the product, ask the questions they may have face to face. A brand with a physical store can organize events, access a public that may not have paid attention to them otherwise, etc
By having a physical store, you’re able to build brand awareness and create an opportunity for customers to experience your products firsthand. Additionally, you can establish a stronger connection with your target audience, which can help increase sales and loyalty. Finally, it also gives customers a sense of security and trust when buying from you since they know that they can go to your store if they have any problems or questions. Although, nowadays, all of this can be achieved online.
Sell on a Chinese eCommerce Platform
Selling through online stores is cheaper and easier than selling through brick-and-mortar stores, but it may be more difficult to reach a large number of potential customers if you don’t know how to market your store properly.
Online sales in China are growing rapidly, offering opportunities for businesses of all sizes to reach a large and growing market. There are marketplaces for every business and if you are looking to enter the Chinese wellness market, we strongly encourage you to invest in eCommerce in China.
With the rise of Chinese cross-border eCommerce, even companies that are not registered in China yet can start selling in the country. Cross-border is particularly interesting for brands in the wellness sector where for some segments it can take years to obtain a Chinese business license allowing you to sell locally.
Now, figuring out your sales channels in China is one thing, but without a well-thought-out marketing and communication strategy, you won’t make any sales. Indeed in a country plagued by health safety scandals and poorly copycat brands, companies have to prove themselves worthy of their target audience’s trust while navigating the rough competition. So let’s have a look!
How to Promote your Brand in the Chinese Wellness Market?
Before we take a look at the best channels to promote your brand, a quick reminder of 2 important things to keep in mind when promoting wellness and health goods in China:
- Understand the Chinese culture of health and wellness. In China, good health is seen as a matter of great importance, and people are willing to invest a lot of time and money into maintaining their health. This means that there is a large potential market for wellness and health products in China.
- Create targeted marketing campaigns specifically for the Chinese market. Because the Chinese culture of health and wellness is unique, it’s important to create marketing campaigns that are tailored specifically for this market.
Now that we have reminded you that localization is the most important aspect of promoting and selling a brand in China and that you’ll have to build your whole communication strategy around Chinese consumer’s cultures, let’s us talk about the best place to run your campaign and work on your reputation & visibility.
Baidu & Chinese Search Engine
Baidu is the largest search engine in China, with over 80% market share, and is the first step of the purchasing process of Chinese consumers. Being present in Baidu’s SERP on your targeting keyword will not only give you enormous visibility but also credibility. The more people can find related content to your brand on Baidu, the more legit you’ll look, and that is a crucial criterion for brands and companies in the wellness industry.
If you are going for paid advertising, Baidu has a very sophisticated targeting system that allows you to target your ads to specific demographics and interests. This ensures that your ads reach only the people who are most likely to be interested in them.
Public Relations to boost the legitimacy of your brand
The Chinese market being highly competitive, it can be difficult for a brand to stand out among all the noise. A strong PR strategy can help a brand capture attention and create awareness.
The Chinese public is often skeptical of new products and services, and it can be challenging to win their trust. A well-executed PR campaign can help a brand build credibility and establish itself as an authority in the industry.
Effective PR can help a brand shape its image and create a positive perception among consumers. By communicating the right messages through the right channels, a wellness brand can raise awareness and drive sales in
Conquer the Chinese Wellness Market through Social Media
Chinese social media platforms are a powerful way to reach out and connect with Chinese consumers. Here are three reasons why your wellness brand should use Chinese social media:
- The vast majority of Chinese consumers use social media platforms for news and information.
- Platforms like Weibo have built-in features that make it easy for users to share content with their friends and followers.
- Social media platforms are a great way to build relationships with potential customers.
- Chinese social media offers great build-in tools to businesses.
Here is a list of social media we think are great to promote your wellness brand in China:
- Wechat: It is simply to big to ignore but also is one of the best nurturing channel available in China. It’s weekly content post will effectlively replace your email marketing campaigns. It allows you to create VIP & Loyality card, to create booking mini program, share important info and so on.
- Weibo: One of the most popular social media in China. Perfect to grow a large following and reach out to new target. Contrary to Wechat, Weibo is openly commercials and is not limiting the amount of ads.
- Xiaohongshu: It is the lifestyle & beauty app targetted at wealthy (& healthy) women. It may not be as big a Wechat or Weibo, but the app has become a key stop in the purchasing process of many consumers soughting out peers reviews.
Chinese forums and Q&A
Probably the fastest and most efficient way to gain the trust of Chinese Wellness Consumers as forums and Q&A are fed with users generated content, which for a consumer means “peer reviews”.
Not only will Chinese consumers check out these forums to learn more about a certain product or brand, but they also are looking for tips there. Indeed, Chinese citizens are very interested in health and wellness and are always looking for information and advice about how to stay healthy. Thus, a strong presence on these forums will increase your visibility. On top of that, Chinese forums results rank well on Baidu.
There are two approaches you can combined when using Chinese forums in your marketing strategy:
- Undercover marketing. Build multiples “real” user profile to increase the discussion about you.
- Business account: Become a useful & regarded member of these community using your official brand account. For wellness brand, Zhihu, is the perfect channel to do so.
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