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Any Opportunities in the Male Underwear Market in China ?

                    The fashion industry in China is growing fast, and consumers are becoming more and more brand-conscious because of their rising living standards and disposable income. The male underwear market in China is promising, because more than 70% of consumers spend over 3,000 RMB per year on undergarments. However, there are business challenges due to the special requirements of local consumers.

The apparel industry is a 3-trillion-USD business worldwide, accounting for 2% of the world’s GDP. China is still the world’s biggest exporter of clothes, but its local market is increasing both in value and in importance every year, according to Daxue research specialists. Forecasts expect China to overtake the USA to become the world’s biggest apparel market by the end of 2017.

Selling fashion garments for young men and women in China is very popular, and therefore, there are many venture prospects. The demand for foreign brands in China is so high that business strategists are now considering the market a blue ocean with numerous opportunities to seize.

“If the western brands want to attract more Chinese consumers, they may want to keep their western business culture” says Chenruo Zhang, project manager at Daxue Consulting.

“In general, Chinese consumers prefer western brands because they believe the western products can provide them with higher quality and better value compared with domestic brands, although the customers understand that some of the western products are produced in China. Particularly for the high-end underwear market (both male and female), consumers are more interested in personalized services and products. Making the customer feel special is one of the key elements to draw them closer to the brand. As the Chinese culture is becoming more open and modernized, the younger generation does not only want to jump on the bandwagon, but they also want to show off their unique personalities and individuality. If the western brands want to attract more Chinese consumers, they may want to keep their western business culture” says Chenruo Zhang, project manager at Daxue Consulting.

An Overview of the Male Underwear Market in China

Nowadays, the higher living standards of many Chinese citizens directly caused a change in the Chinese male consumers’ underwear purchasing behaviors. We can clearly see that the overall search results, as well as demand for male underwear, have been rising these years.

People online are more curious about men’s underwear. Source: Baidu Index (百度指数).

According to Baidu Index (百度指数), the male underwear search index reports a rising trend from data since 2011. The highest number of daily search queries exceeded 1,100 in 2016, reflecting the increasing attention that consumers are paying to their undergarments.

Further, China customs import data for 2015 confirm that imports of underwear and related products (HS codes: 6107 and 6207) have increased by 25% compared to 2014, that is from 50 million USD to 63 million USD. The tax on underwear has stayed at a constant 30% since April 2016 and China’s new tax plans will not impact this category of products. These factors contribute to the steady rise of the underwear market.

Chinese men spend a considerable sum of money on underwear. Source: Qudao Website (渠道网).

We can observe from different research papers that Chinese men are more willing than ever to splurge on underwear. In 2015, 39% of Chinese consumers spent between 3,000 and 5,000 RMB on male undergarments, with 19.3% paying 5,000 to 7,000 RMB and 12.6% willing to shell out over 7,000 RMB. This indicates that a large proportion of Chinese men attach a great significance to their underwear. However, it is crucial to note that only 37.5% of consumers are content with their purchases. Those highly satisfied are even fewer in numbers, accounting for only 8.4%. The remaining 49% hold a plain attitude towards their purchases. Therefore, it can be inferred that delivering good quality and fashionable underwear has been a challenging venture in China so far.

Indeed, even though consumers spend a lot of money for underwear and imports are rising at a high pace, foreign brands are still struggling to redefine themselves to not only appear luxurious and high quality, but also to meet the demands of the millennial consumers. These young adults require that foreign brands also cater to the very specific demands of local consumers, rather than using the old-fashioned one-size-fits-all approach in product design and promotion.

How Can Daxue Consulting Help You Succeed in this Market?

Victoria’s Secret failed to appeal to young Chinese consumers with its special collection of women’s lingerie late 2016 because it did not understand the culture as well as the aspirations of this new yet powerful customer segment in China. For instance, they used dragon themes in their promotion campaign. Even though the dragon is considered an auspicious animal in the Chinese culture, the way it was included in the promotion of the new lingerie collection showed a gross misunderstanding of the local culture.

Daxue Consulting can help your company avoid making these mistakes by providing you with a thorough market report which ensures that you know your customers well to achieve much success in this developing and promising market.

One of our previous customers needed qualitative research on the lingerie preference of their intended customer segment in Tier-1 and Tier-2 cities. We therefore assembled a small yet representative sample of the intended consumers in Shanghai and Hangzhou. Through in-depth interviews and “shop-alongs”, where one of our researchers accompanied the respondents to an actual brick and mortar store to study their behavior. Our expert researchers were able to accurately pin down various purchasing behaviors as well as the consumer’s decision-making process.

As a result, our customer knew how much money young, middle-class professionals were willing to spend on underwear. During the “shop-alongs”, researchers focused on studying the customer interactions with the product and the sales team. Customer valuations of the features of the product customers while making the purchasing decision were recorded. Analysis into the cultural aspects a foreign lingerie producer must consider were also evaluated (e.g. “is feeling sexy in your underwear important for you?”), and even the actual in-shop interactions consumers had with the product and the salespeople were accessed.

Our thorough research report also gave several recommendations on the product itself; what material and technology are suitable for Chinese consumers and what kind of design is considered attractive.

In the end, the client could make an informed decision on how to approach the Chinese lingerie market and how to take advantage of it to prevail against the competition.

Looking for market research on female underwear? Check out Daxue Consulting’s case study, Fashion and Lingerie Industry in China.

A Look at the Manufacturers: Who Produces Male Underwear in China?

The male underwear manufacturers in China have received positive feedback these years based on their ability to satisfy the special requirements of local consumers as well as making their goods readily available both online and offline.

Quanzhou Junlong Garments (泉州俊龙服饰有限公司), for example, is a bulk producer of under garments in China. Recently, the company has launched their online shopping portal, a distribution channel where dealers and customers can directly contact the manufacturer to get price quotes on bulk underwear sales. Not only can customers buy pre-designed and sometimes even pre-made pieces, but the company’s tailors can also work according to their customers’ exact specifications as far as material and design are concerned. Operating from the province of Fujian (福建) near the Taiwan Strait, the company has become a well-recognized name in the Chinese male underwear market. Its location is also suitable for product logistics, because goods can be transported to major cities in China such as Shanghai or Beijing (北京) and Tianjin (天津) by cargo ships at a very low price.

A comparatively large underwear manufacturing and exporting company in Jiangyin City (江阴市) is the Huazi Knitwear Factory (江阴市华姿针织制衣厂), located some 140 km by car from Shanghai. The company has a relatively large enterprise in the industrial park of the Jiangsu province (江苏), which directly borders the city of Shanghai to the Southeast. Being widely accessible thanks to its convenient location, both dealers and consumers can easily get in touch with the company officials here to discuss their cooperation. Huazi Knitwear Factory is mostly selling huge volumes of underwear and therefore, may not be interested in selling to final consumers or taking part in small scale production projects.

Another fairly significant enterprise dealing with large amounts of underwear in China is the Zhangjiagang Lucky wool Fashion Inc.(张家港牧羊人服饰有限公司), once again based in the Jiangsu province (江苏) near Shanghai. With approximately 500 employees, the company racks up an annual turnover of about 100 million USD, and it specializes mainly in high-quality thermal underwear that offers great comfort. On a side note, thermal underwear was actually extremely popular in China in the past due to its perceived benefits in the Traditional Chinese Medicine (TCM), though many consider it out of fashion.

Quality Still a Major Concern in Male Underwear Market in China

Based on our e-commerce research in China, quality is one of the key unique selling points of the male underwear manufactured in China. Customers generally have a good level of brand awareness to help them distinguish the quality of different products. Alibaba Group’s main e-commerce platform, Taobao (淘宝), also enables consumers to get information about the quality of their products through comments and reviews that mainly revolve around this aspect of products. Appearance is not as important.

As such, in China, the price of underwear depends mostly on the quality of materials used in its production—the better the material quality, the higher the price. Design and texture as well as the volume are important considerations too, but material quality is of the highest importance. Indeed, Chinese authorities are not unknown to discover clothes that are outright dangerous to human health, containing banned carcinogenic substances, for example.

A Day in the Life of an Underwear Dealer

The dealers need to consider not only quality of the product but also the reliability of the supplier. Minimum order number also needs to be factored in when purchasing from bulk distributors. The minimum volume of products manufactured and delivered by the company depends on the number of employees working in the company. Considering the size of the Chinese economy and the number of people living in the country, most manufacturers require a reasonably big order quantity.

Usually, the delivery date is decided at the time the order is made. However, it solely depends on the quantity that has been ordered and the number of labors working on the same. It is not unusual to have a “flexible delivery schedule”.

Current Trends of Male Underwear in China

As we said earlier, competition is mainly in the product quality, especially when it comes to comfort. However, fashionable logos and messages have become an important tool to boost the trend in the male underwear market in China. The development patterns can be described as follows:

Emerging franchised shops

Currently, the majority of male underwear is still sold in shopping malls. It is very uncommon to see specialized underwear stores when one walks the streets of Chinese cities. However, there is a growing trend of franchised stores focusing on men’s undergarments. Both methods have distinctive privileges. Selling in malls can exert the brand agglomeration effect while franchised stores facilitate the cultivation of a strong brand image. Further, even though Chinese men are not very used to shopping in specialized underwear shops, we can expect this behavior to change in the near future because of the growing affluence as well as the service quality demands of consumers.

Play more emotional cards

Males nowadays live a fast-paced life. The mounting pressure they are facing requires a larger amount of emotional care on both physical and psychological level, which calls for more targeted and functional underwear.

A typical example is Mark Your Man, a brand that became an overnight sensation on Chinese Valentines’ day that took place on 20^th May 2017. By letting women put their autographs or palm print on the underwear, every underwear was redefined as a unique gift from women, which not only brought the female into this segment but also highlight the emotional bond between lovers conveyed through underwear.

Mark Your Man are sought after by loving couples. Photo source: Fashion Huanqiu (环球时尚).

Extends beyond comfort

Additionally, the mindset of male customers has experienced a transition. Underwear is not solely measured by comfort anymore; underwear fashion and aesthetics are also pivotal criteria for selecting undergarments.

In March 2017, ELLEMEN Digital invited 30 men of varying ages and occupations to participate in an interview about demands for underwear. The brands’ selection shown was more diverse than expected. 24 brands were mentioned, among which Uniqlo(优衣库) and Calvin Klein (卡文克莱) are the most widely accepted ones. Notably, while comfort is still the primary concern, other factors also stand out. For instance, keywords like style and sexiness were brought up by 14 interviewees.

The keywords in the blue circle (transparent, man’s underpants and underpants) are most often used when searching for men’s underwear. Source: Baidu Index (百度指数)

The unique demand for male underwear in China can also be identified by the increasing frequency of related keywords, such as “transparent”, “briefs”, “super thin”,or “mini” in the Baidu Search engine.

Customization for Unique Individuals

Customization is another trend in the male underwear market in China. Businessmen and entrepreneurs constitute a huge fraction of the Chinese brand AIMER MEN(爱慕先生)’s target group.

Taking their clients’ non-standard body shape into consideration, AIMER MEN introduced tailor-made services that include measuring ten different body parts of the customer to ensure a perfect fit as well as appearance. After ordering, it normally takes 20 days for the end product to be completed and delivered. Similarly, another Chinese brand IVU launched a “business type” undergarment specifically positioning the company for middle-aged businessmen who are highly likely to have a beer belly.

In conclusion, there definitely are numerous benefits to take advantage of for high-quality producers on this market. Daxue Consulting will help you get a perfect understanding of the male underwear market in China. Contact us to know more.

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— Daxue Consulting (@DaxueConsulting) 23 novembre 2017