1. ¹School of Business, University of Hong Kong, Hong Kong
2. ²Hong Kong Polytechnic University, Hong Kong

Correspondence: Kineta H Hung, School of Business, University of Hong Kong, Pokfulam Road, Hong Kong. Tel: +852 2857 8348; Fax: +852 2858 5614; E-mail: kineta@business.hku.hk

Received 6 September 2005; Revised 27 April 2006; Accepted 3 October 2006; Published online 24 May 2007.

Abstract

Identifying distinctive target segments is a fundamental challenge faced by international marketers. This paper describes an approach to understanding consumer market structures in an important international market, China, and to segmenting Chinese consumers by integrating insights from generational cohort and social institutional theories. We conduct two empirical studies to verify how China's recent momentous ideological events could give rise to and affect the life experiences of different generation cohorts in the country. The results of Study 1 support the conceptual framework and establish three distinct cohorts in China: Red Guards, Modern Realists, and Global Materialists. Study 2 builds on the findings of Study 1: it links cohort differences to differences in consumer values (materialism) and choice behaviors (foreign vs local brands), and then compares them with parallel consumers in the United States. This paper outlines and tests an approach to segmentation that can help international firms identify distinct segments in and design effective marketing strategies for China.