For years, China was a growth engine for multinational consumer durables brands, driving volume, fueling premiumization, and delivering profits above global averages. But the game has changed. Today, China is a tougher, more complex, and highly competitive market where global brands are losing ground to fast-moving local players.
To win back share and position for the future, multinational companies need to rethink their strategy for China. That means tackling the immediate challenges of today while also laying the groundwork for China’s next chapter as a global innovation hub.
Navigating increased challenges in China’s consumer durables market
Since the pandemic is now behind us, China’s economy isn’t bouncing back the way many hoped. The broader economy is under pressure, and price deflation is making life harder for manufacturers. While retail consumption has held up relatively well, competition is heating up, especially from local brands.
In most durable goods product categories, domestic players are gaining share. Multinational corporation (MNC) brands face challenges from domestic manufacturers, who are launching high-end products, iterating quickly, and delivering features that match or exceed those of global brands — often at a lower cost.
How global brands can compete in China’s challenging market
Not everyone is struggling. A few global players have managed to grow despite the headwinds. What sets them apart?
One leading brand in the small appliances space built local research and development centers and focused on understanding what Chinese consumers actually want. The result: fast innovation, relevant features, and double-digit growth in categories like espresso machines and steam irons. Another company in the camera space held onto its top market position by offering the widest lens portfolio in the market and building out a strong presence in both big cities and smaller towns; it grew 17% from 2021 to 2023, outpacing the overall category growth of 14%. A third success story comes from the wearables space, where a brand targeted the professional sports segment with advanced features, smart partnerships, and marketing that spoke directly to niche communities — achieving 13% growth from 2021 to 2023 versus just 1% for the category overall.
These winning brands share a common approach: they pair global strengths with a strong local focus. Whether by tailoring products to niche segments or moving quickly to market with new features, they’re proving that relevance and speed still matter — and that China rewards companies willing to invest and adapt.
Five key actions for multinational brands to rebuild market advantage in China
To regain momentum, multinational brands need to go beyond short-term fixes. They need a strategic reset focused on five key actions:
1. Innovate for China, at China speed
Success in this market means spotting trends early, acting fast, and building for local needs. That requires on-the-ground product teams, close ties with consumers, and the ability to launch new products in months, not years.
2. Rebuild brand strength with a focused product portfolio
It’s time to rethink the product line-up. That means offering the right features at the right price points, creating clearer value for money, and — where needed — launching new sub-brands to capture different parts of the market without diluting the core.
3. Master customer relationships for competitive advantage
Brands that succeed in China are mastering direct-to-consumer (DTC) channels. This means owning the experience online and offline and building in-house capabilities for marketing, customer insight, and activation.
4. Communicate with customers in ways that matter
Chinese consumers are looking for products that solve real problems and feel tailored to their lives. Product messaging needs to be content-rich, occasion-led, and emotionally resonant. Key opinion leaders and content platforms play a huge role here — but only if backed by real investment and smart execution.
5. Embrace a different growth model in China
Winning in China may not deliver the same margins as before, but it can still drive long-term value. Brands need to be realistic about profitability in the short term and commit to investing in capabilities that build future growth.
China is now a global testbed for consumer durables innovation
Looking beyond the current challenges, there’s a bigger opportunity on the horizon. China is already evolving into a testbed for global innovation, thanks to its manufacturing scale, huge consumer base, and rapid digital transformation. The country produces 60%-70% of the world’s appliances and electronics. It’s home to a fast-growing middle class of over 400 million people — equivalent to nearly 90% of the entire European Union population — with increasingly sophisticated tastes. And it’s setting the pace for new types of commerce, from TikTok-driven social selling to influencer-powered product discovery.
In fact, some multinational brands are already using China as a launchpad for global products. One home appliance company validated a robot vacuum in the Chinese market, then scaled it internationally after refining the tech and cutting production costs. Others are exporting successful marketing models, product roadmaps, and ecommerce strategies from China to Europe and beyond.
Multinational brands must reset their strategy and reinvest in China
China may no longer be the easy growth market it once was. But it’s far from irrelevant. For global durables brands, it remains one of the most important markets — not just to defend share, but to shape the future of innovation and consumer engagement. The path forward will demand more from leadership teams: more focus, more speed, more commitment to local investment. But for those willing to adapt, China still offers a powerful platform for growth, both at home and around the world.