Interview With Vinay Dixit Vinay Dixit is the Senior Director of Asia Consumer Centers in McKinsey Company and leads the Insights China by McKinsey service line. He joined McKinsey Shanghai office in February 2008 and has led several significant studies on Chinese consumers. Who are China luxury consumers? In terms of age dispersion, are luxury consumers relatively younger than their counterparts in developed markets?
Vinay Dixit: We define Chinese wealthy households with an annual income of RMB 250,000 and above. In terms of Purchasing Valentino Shoes Power Parity, this translates to US$ 67,000 annual income.
One key difference of Chinese wealthy consumers when compared to their counterparts from other countries is their youth. On an average, they are about 20 years younger than their cousins in US or Japan. We do expect that the wealthy consumers in China will retain this characteristic in the next decade as well.
Joel Backaler: The 2009 McKinsey Consumer survey emphasized that companies should no longer assume the existence of a homogenous market and monolithic block of 1.3 billion consumers, adopting a onesizefitsall China strategy. http://www.valentinorockstudsale.com/ The survey introduces the map approach to China market strategy. How will this alter the business models of foreign luxury companies trying to gain a foothold in China beyond tier1 cities?
Vinay Dixit: The last decade has seen remarkable changes in China those relating to consumer evolution, infrastructure development, income levels and consumption patterns, to name a few. Our research (based on 30,000 consumers studied across 60 cities since 2005) clearly shows that a framework is fast replacing the approach when it comes to targeting the Chinese consumers. Several key attitudes are now becoming more and more consistent in a geography of 250300 km radius around key cities, irrespective of the tier in which these cities are.