The latest guide to advertising after consumption upgrade!

When placing advertisements, many advertisers prefer first- and second-tier cities, believing that they have strong spending power and strong user awareness.

However, with the upgrading of consumption, third- and fourth-tier cities have changed their previous "backward" perception and demonstrated stronger consumption willingness and ability than before.

"More willing to spend money" has become a major characteristic of residents in third- and fourth-tier cities!

With the gradual saturation of first- and second-tier cities and the benefits of urbanization, the population of third- and fourth-tier cities has grown strongly in the past few years. Due to lower living expenses, relatively cheap prices and relatively higher actual disposable income, this provides an opportunity to accelerate consumption upgrades in third- and fourth-tier cities.

At the same time, a higher educational background has also given consumers different consumption concepts and methods, and their educational level is obviously higher than that of those born in the 1980s and 1990s. Therefore, they know how to "please themselves" better and are more willing to spend money. They are the main group of people who "buy, buy, buy" and are often referred to as "small town youth".

McKinsey predicts that in the next decade, the proportion of middle-class and above consumption among Chinese urban households will increase significantly, and is expected to reach 81% in 2022, becoming the main contributor to China's consumption upgrade. Among them, the middle class in third- and fourth-tier cities will become the group with the fastest growing proportion in the future.

However, as "future income increases," the consumption habits of users in third- and fourth-tier cities will play a decisive role for advertisers.

So, for young people in small towns, where does their money go?

In a family in a third- or fourth-tier city, women often play the role of " consumer decision makers ", responsible for purchasing half or more of the family's food and daily necessities, accounting for over 90% of the total.

As the "housekeeper" of the whole family, young and old, they tend to pay more attention to practical daily necessities such as toothbrushes, cups, toilet paper, milk, rice, etc. At the same time, they are also "working hard" to improve their quality of life, such as buying whole grains regularly, using an electric toothbrush to brush their teeth, and choosing three-ply toilet paper.

In first-tier cities like Beijing, Shanghai and Guangzhou, you can see that almost everyone on the subway has an Apple phone, and luxury goods are also not uncommon. In third- and fourth-tier cities, although luxury consumption is not as concentrated as in first-tier cities, with the popularization of e-commerce and overseas shopping, young people's consumption desires are also moving towards light luxury.

According to CBNData's "2017 Luxury Consumption Trend Report in the New Retail Era", the unit price of luxury goods purchased by consumers in county-level cities in the luxury market has increased year by year. The unit price of luxury goods purchased by consumers in third- to sixth-tier cities exceeded that of first- and second-tier cities in 2015. The top 10 cities in terms of online luxury consumption growth are almost all third- to sixth-tier cities. Among them, cosmetics and watches are the luxury goods preferred by consumers in third- to sixth-tier cities.

The consumption upgrading trend in third- and fourth-tier cities is directly reflected in durable consumer goods. Automobile consumption is the most typical example. Due to the inconvenience of public transportation, cars, which were once considered luxury goods, have quickly become popular in third- and fourth-tier cities, and having a private car is a necessity for most people.

According to the 2016 statistical report of Automobile Weekly, 77% of users who wanted to buy a car in 2017 were from third-tier and lower cities, far exceeding those from first- and second-tier cities.

Consumers in the third and fourth tier markets are more pragmatic in their purchases of home appliances. They tend to make supplementary purchases to meet their basic needs first, and then upgrade. In the third and fourth tier markets, most consumers are accustomed to purchasing home appliances in physical stores.

In the past few years, many home appliance brands have accelerated the expansion of their channels , making third- and fourth-tier cities the preferred destination for expansion of large chain retail companies and e-commerce giants.

From January to November 2017, many home appliance companies achieved significant growth in the third- and fourth-tier markets. The cumulative retail volume and retail sales growth of Gree Air Conditioners in the third- and fourth-tier markets are significantly faster than those in the first- and second-tier markets. The average retail price of range hoods of ROBAM Electric Appliances has increased fastest in the third-tier market, which is the company's best growing market.

The diversification of entertainment methods has made more and more people willing to spend money on spiritual enjoyment. Traveling is a preferred way of life for "small town youth". Tourism data shows that the demand for outbound travel among citizens in third- and fourth-tier cities has surpassed that of citizens in first- and second-tier cities.

Compared with first- and second-tier cities, cultural consumption patterns in third- and fourth-tier cities are relatively simple, with relatively few cultural activities to choose from, such as dramas, performances, and sports events. After work, watching movies has become a stable and high-frequency demand in small and medium-sized cities. During holidays, it is very common to see families going to the cinema to watch movies together.

The 2018 Spring Festival period best illustrates this trend. According to Endata statistics, box office growth in third- to fifth-tier cities during the 2018 Spring Festival exceeded 60% year-on-year, and the number of moviegoers also increased by more than 50% year-on-year. Among them, the non-first- and second-tier box office shares of "Operation Red Sea" and "Detective Chinatown 2" reached 47.4% and 53.3% respectively.

With the upgrading of consumption and education level, the consumption capacity of third- and fourth-tier cities will gradually catch up with or be equal to that of first- and second-tier cities.

Therefore, advertisers may wish to prepare in advance and focus on third- and fourth-tier cities.

The author of this article is @兔子. It is compiled and published by (Qinggua Media). Please indicate the author information and source when reprinting!

Product promotion services: APP promotion services, advertising platform, Longyou Games