Chinese patriotism is new sales octane as millennials embrace home-grown brands at the expense of foreign icons
- Trade war, boycotts stir nationalistic fervour, drives sales of guo huo, or home-grown brands, against foreign icons
- Outpouring of support for local cosmetics makers, apparel manufacturer and snack food producer will endure: McKinsey
In China, nationalism sells.
Months of a gruelling trade war with the US and geopolitical spats with Asian neighbours have stoked nationalistic fervour among millennials, who are flexing their spending muscle, splashing out on guo huo, or Made-in-China brands, at the expense of foreign icons.
The trend helped propel sales of local companies including cosmetics maker Shanghai Jahwa United Co. and apparel manufacturer Bosideng International Holding, outpacing international brands like MAC and Canada Goose during the Singles’ Day online-shopping gala on November 11, amid trade tensions and boycotts.
Dr Yu, a skincare business unit of the century-old Shanghai Jahwa, is one of the top names among the “patriotic” brands that Chinese consumers are gravitating towards to counter Western brands. The unit, whose products are co-developed with local doctors, saw a seven-fold increase in sales to 60 million yuan (US$8.6 million) in December.
“The millennials are more faithful to Chinese brands which are capable of delivering equally good quality products like those from foreign powerhouses, if not better,” said Xue Ying, senior marketing manager of Dr Yu. “The younger they are, the stronger their sense of pride is. This is our chance” to grow our business quickly, she added.
Some of China’s biggest companies now expect the wave of patriotism to have an enduring effect in fuelling sales in the coming years. Among them is Shenzhen-listed Three Squirrels Inc, which considers the makers of Oreo biscuits and Mars chocolate bars among its competitors.