Op-ed: The Chinese "dama" as consumer cohort

Researchers Meng Wang and Florian Kohlbacher from the International Business School Suzhou (IBSS) at Xi’an Jiaotong-Liverpool University (XJTLU) in Suzhou explain the consumer sentiment of China’s damas, and the entailing business opportunities for marketers who target them properly.

If you’ve spent a bit of time in China, you know exactly who they are. You’ve seen them in squares dancing in unison; in subway stations elbowing their way through the crowds; in markets scrambling for discounted goods. China’s “damas” – literally “big mothers” (大妈) – are best known for their street-level presence here. But they first drew global attention when they unquestioningly rushed to purchase gold in 2013 as the precious metal’s price plunged.

The first English-language use of “dama” came from the Wall Street Journal in August of that year, which used it as a label for bargain-hunting, middle-aged women known to be determined but impulsive, energetic while still taciturn, calculating yet often shortsighted. Before the term garnered worldwide recognition, “dama” was generally used to describe an aunt (specifically the wife of one’s father’s elder brother) or, more generally, as a respectful appellation for an elderly married woman, generally 40-60 years old. The common stereotype holds them to be deeply influenced by Chinese traditional culture, willing to work as housewives for their families and typically tasked with burdens such as housework, cooking and – of keen interest to any marketer – budgeting the family’s daily expenses.

But when gold prices fell from US$1,550 per ounce to US$1,321 per ounce in April of 2013, an army of damas swept jewelry stores across the mainland, as well as Hong Kong and Macao. Driven up by massive sales, the price of gold was buoyed back to US $1,462 per ounce on April 26 in the largest one-day increase of that year. These women, under growing pressure from inflation, had begun seeking more profitable investment channels than their low-interest savings accounts. Gold, a precious metal and one of the key items in a traditional Chinese dowry, quickly became a must-have for this demographic. But so, too, did overseas real estate and, later on, even the digital currency bitcoin.

A sense of value

But damas are more than just brash investors. Based on the in-depth interviews we conducted during our research, many damas are eager for a high-quality life in their later years and aspire to a higher-status identity in order to remedy psychological deficits brought on by physical senescence, particularly among urban residents that enjoy a relatively high living standard and who possess stable assets.

Take Mrs. Yang, 60, as a case in point. She only buys imported, additive-free sauces for her family, trading up to pricier versions of the daily necessities her household already has. Our interviews showed that although many families can already afford to buy as much as they need of basic-necessities, increased attention is being paid to health products and services. “I would rather not eat any sauce than a sauce with additives” Mrs. Yang said. “I could pay twice of the normal price for a bottle of additive-free sauce. Besides, I only buy branded products, big brands–especially for food.”

Mrs. Gao, 49, aspires to improve herself on the way she lives and her perceived social identity. She wears her top-of-the-rack outfits when she goes to department stores or shopping malls, as she believes that salespeople usually judge consumers by their appearance. “Once I went to a department store in a quality outfit and carrying a branded bag. The sellers helped me try on nine outfits because they thought I had enough money to buy one when I was done…I felt like I was a goddess,” she said.

Mrs. Lee, 53, said she uses shopping as a coping mechanism for dealing with her midlife crisis. She is a retired empty nester whose son is currently living abroad. “I usually choose to go shopping when I feel upset or depressed,” Mrs. Lee said. “I feel much better if I can buy something.” To understand why these women shop the way they do, it is necessary to look at what they have been through.

Hard-won prosperity

Damas have a reputation for being hard-bitten, and with good reason. In China people currently aged 40-60 have lived through the mass starvation of the Great Leap Forward, the widespread insanity of the Cultural Revolution, and have had to deal with challenges like the one-child policy as a matter of course. Many have been through poverty and hunger, and pinch pennies with a degree of scrutiny that later generations find hard to understand. Periods of currency devaluation have also left them uneasy with paper money as a store of value and less certain of social stability. 

Now, as these women enter middle age, many are faced with identity-altering life events, such as an empty nest or even the loss of a spouse. But unlike the country they grew up in, present-day China offers consumption as an important means of identification. As a historically savings-oriented cohort, damas can exert substantial influence on the market when they decide it’s time to spend.

However, consumption patterns have also become more open and pluralized. The consumption patterns of damas are constantly changing, in particular those of city dwellers. The latter group’s abundant savings and typically stable income allow them not just to buy inexpensive daily necessities as they did before reforms began, but also other goods and services that help establish who they are for themselves and others. Conspicuous goods, for example, satisfy not only material needs but also social needs, including satisfaction of these women’s desire for prestige.

Survivors turned consumers

Consumer preferences tend to change over time, and damas are no different. According to a report on Chinese consumers by McKinsey from 2012, while young consumers mainly spend money on clothes and electronics, stable and greater disposable income enables middle-aged consumers to spend more on cars, houses and premium luxury products. Middle-aged consumers also pay great attention to a product’s perceived value—its aesthetic and social significance. Academic researchers and marketing managers usually tend to focus on younger consumer groups and, more recently, older cohorts. 

But damas, despite their undeniable presence in Chinese society, have been largely neglected by market research. Our work aims to remedy this, and thus far we have identified at least the following types of consumers within the dama cohort:

Pragmatic dama

Within the 40-60 year bracket, damas swing between tradition and new trends. Our interviews showed that they often save a large proportion of their wages to ensure security in terms of family finances. However, some Dama ladies are willing to pay premiums on health-related products and daily necessities—particularly when it comes to food and children’s items . “I am only given a 2,000-yuan retirement pension every month, but for food, if I can afford it, I won’t hesitate to buy [more expensive products] for my family” said Mrs. Sun, 55.

Modest dama

The majority of dama we interviewed appeared satisfied with their position in life. Many were satisfied by what they possessed and felt comfortable in their own skin, unconcerned about what others thought of them. “I dislike unrealistic comparisons, and I am not jealous of what others have,” said Mrs. Wang, 53. “I feel happy for them having a branded bag or jewelry. Sometimes
I would like to have one as well, but I am absolutely not envious of any of them.” Since dama are often busy taking care of their grandchildren or sometimes even looking after their own aged parents, they are more willing to spend so that these groups can have a better life rather than on themselves. “I like hearing others say that ‘Look at that nice dressed-up man, that’s the son of Mrs. Lee.’ I feel proud every time,” said Mrs. Lee, 53.

Poseur dama

In China brands often serve as a medium for identification, such as when Chinese businessmen buy a BMW or Mercedes-Benz for business use to show their firm’s prosperity and positive prospects. Damas take advantage of brands in shaping the social identity of themselves and their family as well. Mrs. Wang, 47, said, “I sent my son to the best and most expensive junior high school in our district when he was about 12, and though he didn’t get the grades needed to enter the best high school after three years of studying there, I didn’t regret it, because I wanted to let him come into contact with the upper-class students there.” Even though she earned only average wages, Mrs. Wang regarded the school as a branded educational product, and thus the obvious best choice for her son. As studies have shown, higher prices can make consumers feel like they’ve bought themselves a piece of the middle class.  

Wealthy dama

While similar in background to pragmatic dama, wealthy dama tend to be well-educated and have often worked in well-paid government or private business jobs. Based on our research, this group is less price-sensitive and more willing to pursue a higher quality of life. Mrs. Yang, 60, only purchases cosmetics from top brands. “I am already in later midlife, I want to maintain my youth by relying on cosmetics, and they need to be high-end brands like Dior, Estée Lauder and such,” she said.

But all of the above interviewees are considered damas for a reason, and they do share common characteristics. According to our research, their consumption patterns skew younger and have in recent years become increasingly concerned with issues of food safety, prompting them to look more often to upscale comestibles. And, as the gold rush of 2013 suggests, they tend to shop collectively, with word of mouth playing a substantial role in directing their purchasing power.

In the media and in our interviews, damas have emerged as an affluent group of consumers offering new, unique marketing opportunities for firms involved in education, e-commerce, health products and even daily necessities. With further research and testing, firms in China will be more empowered to approach these women on their own terms and with a solid idea of what they really want—as well as an appreciation for their importance in shaping modern Chinese consumption patterns. ♦

Meng Wang is a postgraduate research student in the International Business School Suzhou (IBSS) at Xi’an Jiaotong-Liverpool University (XJTLU) in Suzhou.

Florian Kohlbacher is an associate professor of marketing and innovation the International Business School Suzhou (IBSS) at Xi’an Jiaotong-Liverpool University (XJTLU) in Suzhou. He is an internationally renowned expert on business and consumer trends in Asia.

Editor: Hudson Lockett (@KangHexin)