When Women Pull The Purse Strings
Sheconomy surges as females show greater financial clout and independence
For Shirley Yao, who works for a financial company in Shanghai, consumption is a major source of happiness. Yao, in her 20s, earns 15,000 yuan ($2,286) per month. She splurges around 30,000 yuan ($4,569) annually on cosmetics and clothes. She also spends money on ball-jointed dolls, which look lifelike and have flexible limbs, and on idol worship, avidly supporting popular idols, like pop singers, film stars or players, by buying concert or match tickets and the products they endorse, no matter how expensive.
Yao plans to get married by the end of this year. So she bought a pair of wedding rings worth 16,500 yuan ($2,513) from a luxury jewelry brand because its ambassador Cai Xukun is an idol of her. Cai won a talent show program produced by online video platform iQiyi in 2018, where viewers had to pay to vote for their favorite contestant. The show attracted a large number of domestic and overseas viewers, especially women.
“I have been a big fan of Cai for around three years. I spent around 50,000 yuan ($7,616) buying products endorsed by him,” Yao told Beijing Review.
Like Yao, more and more women, particularly the younger generation with increasing income and changing consumption concepts, have become a major force in domestic consumption. Highquality, diversified and personalized products and services that meet their upgraded demands, please them and show their attitudes toward life have become their new pursuit. They are spending more on beauty, fitness and hobbies, making the role of “sheconomy” in China’s consumer market increasingly significant.
The word, first coined in 2007, refers to the new economy driven by the increase in female consumers in industries like tourism, medical cosmetology and culture and entertainment. Their rising purchasing power stems from their rise in the workforce as they receive better education.
According to a report by service consultancy Accenture, there are around 400 million female consumers in China aged between 20 and 60. Their total annual spending can reach about 10 trillion yuan ($1.5 trillion). Those born in the 1970s and 1980s play a major role in deciding household purchases.
“Compared with their male peers, female consumers, who can be more enthusiastic about buying things for a high-quality life, have diversified demands. With the boom in e-commerce platforms and live-streaming, female consumption is expected to play a bigger role,” Cui Lili, Director of the Institute of E-Commerce at the Shanghai University of Finance and Economics, told Beijing Review.
Differentiated demands
Women have driven up consumption in many sectors, including those where men used to be major consumers. Despite the COVID-19 epidemic, consumer spending remained resilient last year due to the boom in live-streaming and then the resumption of offline consumption.
According to QuestMobile, a business intelligence service provider, the number of female Internet users in China had exceeded 500 million by January. More women above 36 and those living in small cities and rural areas have started to shop online.
Different age groups show differentiated preferences in consumption. Those under 24 are interested in beauty and idol-related products while the 2535 segment tends to focus on maternity products. Those above 36 like to buy accessories, QuestMobile said.
As many women are appearance-conscious, beauty industries ranging from cosmetics, clothing, luxuries and cosmetology are showing strong growth potential.
According to market research provider Euromonitor, China’s cosmetics market was worth 507.8 billion yuan ($77.3 billion) in 2020, a year-on-year increase of 6.3 percent. Around 95 percent of domestic cosmetics consumers are women aged between 20 and 40. The market will reach nearly 900 billion yuan ($137 billion) by 2025, a report released last year by Qianzhan Industry Research Institute, a market research consultancy, said.
According to Qianzhan, the dressing style of Chinese women has become more diversified. The value of the women’s clothing market exceeded 900 billion yuan ($137 billion) in 2019.
Another consultancy, iiMedia Research, said women’s purchase of luxuries and high-end personal hygiene products has risen steadily while medical cosmetology has gained popularity.
According to medical cosmetology platform SoYoung, there were over 15 million women who availed of medical cosmetology services in 2020, up around 35 percent year on year. Over half of them were born in the 1990s or later.
The leisure and entertainment industries are also attracting more and more female consumers. Data from Travelgo.com showed that in around 70 percent of households, women make the travel decisions. Products such as online games, electrical devices, sportswear and sports facilities, and wines, which used to be mainly consumed by males, have been embraced by more females.
Idol shows, dramas adapted from popular works and programs on women’s life and work, are becoming increasingly popular among females of different ages. Since the introduction of Idol Producer, the 2018 show featuring Cai Xukun, many video platforms have made similar shows, driving the fan economy. TV drama Nothing But Thirty, which followed the lives of three women in their 30s, and reality show Sisters Who Make Waves, a contest where 30 female celebrities aged over 30 had to compete to make it to a seven-member band, attracted many female viewers in their 30s and triggered wave of empathy.
At the wheel
The rise of sheconomy can be notably seen in the property and automobile sectors. Traditionally, husbands used to buy the house and car for the family. But now an increasing number of women in their 20s and 30s, who are financially independent, are buying their own homes and cars.
In 2020, in a survey by real estate agency websites Anjuke.com and 58.com, 38.8 percent of the women respondents said they could buy a home on their own; and 81.7 percent planned to buy one in five years. Many planned to buy a house of their own before marriage.
Data from Vanke, a residential real estate developer, showed that the average price of a home bought by a woman was 1.74 million yuan ($265,100) in 2019, higher than the average price paid by a man at 1.73 million yuan ($263,600).
According to Yan Jinqiang, a researcher with Beike Real Estate Research Institute, women have higher requirements for housing than men. They care more about factors like commuting time, whether the rooms are sound-proof, how well the kitchen is equipped, and the view from the balconies.
Yan said the increase in the number of female home buyers shows the increasing purchasing power and say of women, who are seeking a sense of ownership and security. “Buying a house is also a good way of wealth management in my opinion,” Yao said.
The auto market has more female consumers as well. Last year, more women bought cars than men, a first in a decade. For women, a car accounted for 22.28 percent of their total spending, higher than men’s 22 percent, according to a poll by China Central Television.
Lurking sexism
To explore the potential of sheconomy, many retailers have introduced shopping festivals with discounts, invite pop idols to become their ambassadors and use advertising showing female power and independence. However, gender stereotypes and sexism still exist.
The Sexy Tea brand was criticized for an advertisement in February that insinuated women are bargains. Then there was the case of Li Dan, a male comedian and e-commerce seller, who angered netizens by promoting lingerie online with the tagline, “Wear it and you will win easily in the workplace.”
Zhuang Yuxia, a researcher with the Shanghai Academy of Social Sciences, told International Financial News that marketing that invites women to shop can lead to irrational consumption, waste of resources and an excessive focus on appearance. “Instead of stressing the benefits of physical beauty and objectifying women, sheconomy should focus more on encouraging women to keep fit, improve themselves through knowledge and develop hobbies,” she said.