It’s not wrong to say that Asian Americans are not only the most affluent multicultural segment in the U.S.—they’re also the fastest growing. The median Asian American household income is 39% greater than the national median income. The buying power of Asian Americans is currently at $986 billion, and by 2020, it’s expected to increase by 32%. That’s $1.1 trillion—and that means this is a market American brands need to take advantage of.
Understanding the overall Asian American culture and how that contributes to consumer habits is important for American brands. As far as Chinese shoppers, word of mouth is important, McKinsey & Company discovered—reviews from family and friends exert quite an influence over consumers, so making a good impression on your individual customers is essential. Asian American consumers are ready to shop, and they have lots of reasons to hit the stores.
There are a few specific ways American retailers can advertise effectively to this ethnic group. First of all, American brands need to make sure they’re creating high-quality products. Asian American consumers aren’t going to spend their money on just anything; they’re in search of high-quality, authentic products.
“Since 2008, the number of Chinese households that can afford luxury products has doubled, thanks to increased disposable income and the variety of shopping channels,” reads a 2017 article in the Asia Times. Indian Americans are similar: they’re the most affluent Asian American consumers, and while they’re willing to spend their money, they’re only interested in high-quality products. Unless your brand is creating something that’s truly top-of-the-line, you won’t be able to compete.
Another big way to reach an Asian-American audience is to focus on e-commerce. Attracting customers with a brick-and-mortar store just isn’t enough these days: shoppers are highly connected online, and they want a shopping experience that’s mobile and personalized. China’s e-commerce market has exploded lately, and it shows no signs of regressing. Consumers appreciate features such as digital payment, platforms where they can interact about products, and e-commerce shopping festivals. If American retailers want to be competitive in the Asian American market, getting online is essential.
And in addition to focusing on e-commerce, American brands can broaden their Asian American audience by using technology in general. Nearly everyone today has a smartphone, but Asian American consumers are some of the most connected people out there. In July 2018, around 1.52 trillion mobile phone subscriptions were registered in China. Big-name brands are taking advantage of this; for example, Tiffany & Co. offered an augmented reality experience to select customers in China before the unveiling of a new collection. China’s tech is closely rivaled by India—in 2017, Indians downloaded 12.1 billion apps on their smartphones. Combine these numbers with the 24 hours a week the average American is online, and it’s safe to say that Asian Americans are spending their fair share of time online. Considering the statistics, it quickly becomes evident that technology is the best way to reach this demographic of consumers.
Asian American consumers are ready to buy, but they’re not going to purchase your product unless you get it in front of them. By making high-quality products and focusing on e-commerce and technology, you can do just that.