How China’s millionaires spend their money

Extreme retail ... shoppers examine a 6.5-meter-tall replica of a half-length suit in a department store in Taiyuan in north China’s Shanxi province. Eight technicians and 10 stitchers spent nearly two months to complete the suit to mark the tenth anniversary of the launch of the Satchi Suit brand in the Chinese market. Photo: AP

China’s 1.02 millionaires like to travel, invest in property and plan to send their children abroad to school.

That’s the profile Hurun Report and GroupM Knowledge have assembled of how China’s wealth spend their money in their GroupM Knowledge – Hurun Wealth Report 2012.

The full findings:

• Travel is the biggest area of consumption, with the average millionaire spending about 20 days on holiday a year. Sanya, Hong Kong and Yunnan are the most popular domestic travel destination, while France is tops for international travel, followed by the US and Australia.
• Property is the preferred investment choice for China’s millionaires but investing in fixed income and shares is also on the rise.
• More than 85 per cent of China’s millionaires plan to send their children overseas for education. This rises to 90 per cent for the nation’s super rich (personal wealth equivalent to about $US16 million).
• More than 16 per cent of China’s millionaires have already emigrated or submitted immigration applications. 44 per cent have plans to emigrate or submit applications in the near future.
• One third of China’s millionaires own investable assets overseas. For millionaires living in southern China, this proportion rises to 55 per cent. Overseas assets account for 19 per cent of millionaires’ total assets.

Not surprisingly, advertisers are keen to target the rich and super rich and the Wealth Report 2012 finds cosmetics, alcohol and consumer electronics marketers are among the most active in targeting China’s wealthy.

“Comparing media investment of Top 10 luxury brands across different categories, the cosmetics category ranked 1st, with television being the key media type accounting for 76 per cent of its media investment,” the report finds.

“The alcohol category came in 2nd place with almost 90 per cent of its total media investment on television, driven mostly by local premium alcohol brands. The property category preferred media exposure on newspapers while the jewellry category invested almost 60 per cent on television.

“Finally, the watch category invested quite evenly across television, newspapers and magazines.”

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