Why China’s next generation is reshaping global luxury

nd the significance of that shift reaches far beyond its own domestic market. For decades, China was positioned as one of the world’s most important luxury growth engines, largely through its appetite for Western brands, European craftsmanship and visible status symbols. Today, that model is being challenged by a younger, more confident and more culturally anchored consumer who is redefining what luxury means, what it should communicate and, increasingly, who gets to own it.  At the centre of this shift is what the white paper describes as an “intellectual awakening in consumption”, or what is also referred to as “deferred desire”. Younger Chinese consumers are becoming more measured and selective in how they spend, moving away from hype-led purchasing and towards products they believe offer greater quality, performance and meaning. This is not simply a cyclical consumer correction. It signals a more structural recalibration of values, where rationality and emotional relevance now sit alongside aspiration in shaping demand. This changing mindset is particularly evident among China’s Gen Z population, estimated at around 280 million people, or roughly 19 per cent of the country’s total population. This generation has grown up in a China markedly different from that of their parents. They have experienced economic expansion, rising living standards, digital acceleration and a stronger sense of China’s place in the world. As a result, they are not consuming through a lens of scarcity or imitation. They are consuming from a position of confidence, and that confidence is increasingly being expressed through brands, products and experiences that feel culturally resonant and personally relevant. The clearest expression of this shift is the rise of Guochao, often translated as “national trend” or “national pride”. Guochao is more than a retail trend. It is a broader cultural movement that reflects younger consumers’ desire to embrace Chinese heritage, reinterpret traditional aesthetics and celebrate local identity through modern design. The report points to the integration of traditional historical motifs, classical poetry, dynastic symbols and local craftsmanship into contemporary consumer goods, creating a new category of luxury that feels both rooted and current. What makes Guochao so powerful is that it is not nostalgic in a backward-looking sense. It is not about preserving heritage in a static way. It is about recasting history and culture into forms that speak to contemporary life. It is about taking the visual language, symbolism and craftsmanship of Chinas past and translating it into products that are relevant to modern consumers. In that sense, Guochao is not just an aesthetic movement. It is a confidence movement. It signals that cultural identity itself has become aspirational. This confidence is also driving a very visible departure from the kind of conspicuous consumption that once defined the Chinese luxury market. For many years, highly visible logos, overtly branded products and recognisable Western labels served as shorthand for success. But younger consumers are increasingly moving away from those external markers of status and towards what is often described as quiet luxury. They are favouring products that are understated, well made, emotionally meaningful and grounded in craftsmanship rather than display. The emphasis is shifting from what a product says to others, to what it means to the person buying it. That shift matters because it changes the terms of competition. When luxury is driven primarily by brand visibility, scale and heritage offer a significant advantage. But when luxury becomes more closely tied to authenticity, meaning and cultural specificity, the field opens up. Domestic brands, niche designers and culturally aligned labels are suddenly able to compete not by imitating Western luxury, but by offering something Western, luxury often cannot: local relevance and emotional precision. There is also a generational tension embedded within this shift. The report makes clear that younger Chinese consumers are seeking to distinguish themselves from their parents’ generation, which had been more heavily aligned to Western luxury labels and the prestige attached to them. Buying local, customised or niche products allows this new consumer to express a unique, modern Chinese identity. In that sense, consumption has become a form of self-definition. The product is no longer just an object. It is a signal of worldview, belonging and personal narrative.  Digital platforms have accelerated this transformation in ways that are difficult to overstate. Xiaohongshu or Little Red Book and Douyin have become central to how younger consumers discover, assess and emotionally connect with products. The report notes that Douyin alone has more than 600 million daily users, underscoring just how influential these new platforms are in shaping behaviour. But their role extends well beyond reach. These are not simply channels for advertising. They are environments in which taste is formed, community is built and retail desire is curated.  This article by Michael Bate, National Director Retail Advisory at Colliers was first published in SCN magazine.