Over the past decade, China has witnessed a fascinating evolution in consumer behaviour, where a wave of nationalistic branding known as guochao has swept the nation. Tom Pattinson explores how the trend has impacted Western brands
Guochao, which translates to “national trend” – or can be more eloquently translated as ‘China chic’ – encapsulates the rise of Chinese brands that celebrate and promote Chinese cultural identity. This movement gained momentum during the Covid pandemic, raising questions about whether China’s nationalistic sentiment intensified during the crisis. Now, as China gradually opens up again, is the country still embracing internationalism, and does the allure of Western brands hold strong?
China’s emergence as an economic powerhouse led to a growing sense of national pride and confidence among its citizens. This shift in attitudes paved the way for guochao, as consumers sought products and brands that reflected their Chinese identity. Domestic brands embraced this opportunity by incorporating traditional Chinese elements, symbols, and designs into their products and marketing campaigns.
Chinese consumers displayed a strong preference for locally-made products, leading to a shift away from Western brands. Chinese online celebrities or influencers, known as “wanghong”, played a crucial role in promoting guochao brands through social media and live streaming platforms. They effectively captured the attention of Chinese consumers, fostering a sense of patriotism and national unity.
The Covid pandemic further fuelled nationalistic sentiments among Chinese consumers. As the world grappled with the crisis, China’s swift response to contain the virus resonated deeply with its citizens. Combined with an inability to travel internationally and experience overseas retailers, a collective sense of resilience and pride intensified support for local brands.
Amid the pandemic, China’s focus shifted inward, emphasising self-sufficiency and reducing reliance on foreign products. Chinese consumers actively sought alternatives to Western brands, turning to domestic options for their daily needs. But this trend was not limited to essential goods; it also extended to fashion, cosmetics, and lifestyle products, where guochao brands gained significant market share.
In recent years, some Western brands have faced challenges and experienced a decline in popularity as Chinese consumers shifted their preferences towards domestic brands. Fast food brands, including KFC and McDonald’s, both saw their sales decline as Chinese consumers sought out Chinese alternatives or options that celebrated Chinese culture and traditions. Likewise, Coca-Cola, a quintessentially American brand, faced competition from Chinese beverage companies that offered products infused with Chinese herbal elements or regional flavours, appealing to the patriotic sentiments of consumers.
Whilst Western brands are still showing strong growth in the Chinese market, they have faced more fierce domestic competition and have been forced to adapt their strategies, incorporate Chinese elements into their products and marketing, and actively engage with the guochao trend to regain or maintain relevance among Chinese consumers. The key for brands is to understand and respond to the changing preferences and to strike a balance between their international identity and the local cultural context.
CBBC’s Antoaneta Becker, who recently returned from a fact-finding trip to China, notes that one of the main differences post-pandemic verses pre-pandemic is the demand for ‘China Chic’ and that ‘In China for China’ is now a prerequisite for brands to succeed in the Chinese market. “Western brands must show appreciation of Chinese heritage to relate to Chinese consumers,” she says.
Many foreign brands have successfully navigated the nationalistic branding environment and created campaigns that have resonated with Chinese consumers, managing to leverage the trend to further build their presence, with many luxury brands leading the way.
“Luxury brands are trying to make their brands more accessible and integrated into people’s lives,” says Natalie Lowe CEO and Founding Partner of The Orangeblowfish. She gives the examples of Prada – who recently opened a store in a local fruit and vegetable market in Shanghai, and Louis Vuitton, who opened a restaurant in a heritage building in Chengdu – further enabling the brands to integrate into the local community and connect with the country’s history and culture.
Apple has also emphasised its commitment to the Chinese market by launching region-specific features, offering localised services, and partnering with Chinese celebrities for endorsements. Starbucks has also incorporated Chinese elements into its store designs and limited-edition products, releasing collections featuring traditional Chinese motifs, such as the Chinese Zodiac or local landmarks, which resonated with Chinese consumers.
Meanwhile British luxury fashion brand Burberry has integrated Chinese elements into its designs, using traditional Chinese motifs like the dragon and the colour red, and also collaborated with Chinese celebrities to create exclusive collections, leveraging their influence to connect with Chinese consumers and foster a sense of cultural pride.
Josie Zhang, President of Burberry China, said that their newly launched social retail store, ‘Open Spaces’, in Shenzhen, is the company’s pride and joy. “Chinese consumers are extremely passionate about fashion, and are socially savvy and eco-conscious,” she says. “Heritage is in our DNA, but today’s consumers are setting the tone, so we spent a lot of time thinking about how to bring together heritage, fashion and modernity with classic design to fit that demand.”
Burberry’s digitally immersive Shenzhen store merges online and offline with a high degree of localisation. The brand created special capsule collections were created for Chinese Valentine’s Day and Lunar New Year, as well as further incorporating Chinese elements into its designs.
Atul Chhaparwal, Managing Director of Diageo for Greater China, explained that entering the China market with imported spirits is a challenge when 98% of the marketplace is dominated by the domestic spirit baijiu. However, he said Diageo has a strong localisation policy and is continually innovating products to appeal to Chinese consumers whilst respecting local culture. “We produced a Forbidden City Limited edition Johnny Walker Blue Label whisky and are creating designs for Chinese festivals, including Lunar New Year,” he said.
A company’s ability to strike a balance between its international heritage and Chinese sensibilities will play a vital role in capturing the attention and loyalty of Chinese consumers going forward.
As China gradually emerges from the pandemic, the desire to consume Western products remains, but it is now imperative for those brands to have localised products and strategies for the Chinese market. Gone are the days of simply selling Western products using Western marketing techniques.
In an era of increasing global interconnectedness, it is crucial for brands operating in China to respect national policies and cultural sensitivities too. Companies must strike a delicate balance between capitalising on Chinese patriotism and embracing internationalism.
Brands must demonstrate a genuine commitment to understanding and respecting local customs, traditions, and values. Incorporating Chinese elements into marketing campaigns can still be impactful, but it should be done thoughtfully, avoiding any potential cultural appropriation or insensitivity.
Collaboration with Chinese influencers and celebrities remains a powerful tool to achieve this goal. By engaging these KOLs, brands can tap into their reach while aligning their messaging with national policies.