Here are this week’s news and highlights for China:
Singles Day Sales Hit a Record High as Chinese Buyers Rack up their Credit Card Bills: Instalment purchase plans accounted for about an estimated 60% to 70% of credit use in China. Fifteen-month and two-year plans were the most popular among popular plan Fenqile’s Generation Z users (those born in the mid-to-late 1990s), with an average monthly payment of less than ¥200 ($28.50).
China’s Retail Sales Up 8.1% in First 10 Months: Retail sales in rural areas rose 9%, outpacing the 7.9% expansion in urban areas, with overall growth in online sales at 16.4%. Total retail sales amounted to ¥33.48 trillion ($4.8 trillion) in January to October this year. Excluding sales of automobiles, the growth rate reached 9% during this period. The top 200 Chinese companies spanning consumer, technology, industrial, property and financial industries reported September quarter earnings well ahead of market expectations.
70 Years of Economic Development and Policy in the People’s Republic of China: Infographic covering government, economic and social milestones, including major events and data highlights over the past 70 years since the founding of the People’s Republic of China.
More Than 70% of Divorces in China Are Initiated by Women: 74% of the divorces handled by Chinese courts were filed by women, disrupting long-held assumptions that Chinese women tend to endure unhappy marriages. Chinese marriages are inclined to fall apart as soon as three years after the wedding, driven increasingly by improving financial independence of women in China. 46.7% of all homebuyers were women in 2018, meaning economics are less of a factor for staying in unhappy marriages than previously.
Are China’s ‘Quantum-Fuelled’ Products Fad, Fraud, or Both?: A surprising variety of wares, from socks to mattresses, are being marketed online as ‘quantum-fuelled’ with healing properties, despite no corroborating evidence. One vendor claims that its quantum mattress – priced five or six times higher than a conventional model – uses “the principle of a magnetic field to run through one’s meridians and acupoints.” This is language commonly found in traditional Chinese medicine. And then there’s the so-called quantum bracelet, which gives its wearer super strength — or more accurately, the ability “to easily lift one person.”
74% of Elite Chinese Consumers Prioritise Making a Positive Impact Over Materialism: Wealthy Chinese are looking for a more fulfilling experience according to an HSBC survey of its elite customers. Brands must set out to meet this growing demand and produce an enriching lifestyle solution rather than simply offering a product. Over 104 million Chinese mobile users have a paid fitness app on their phone.
Why Does China Love Dyson So Much?: Sleek designs, impressive technology and online influencers are said to be behind premium brand Dyson’s success in China. Although they are expensive, the brand’s market share of vacuum cleaners is estimated to be as high as 61% in China, with its latest V11 Fluffy model selling for around $650. Dyson ranked 28th in the brands that Chinese consumers can’t live without.
Tencent Holdings Limited 2019 Q3 – Results – Earnings Call Presentation: Tencent saw revenue drop 13% in Q3 this year – worse than expected. Initiatives to turn things around include consolidated efforts to better serve enterprises; increasing interaction between content and social apps including ramping up short form content (in response to Douyin); using Mini Programs (and the now 300 million daily active users) to drive healthcare, smart retail and stay mobile; and focusing on expanding overseas using gaming partnerships. WeChat ‘growth programs’ will provide training, tools and resources for systems and a new ‘industry assistant’ dashboard will assist Mini Program owners with analytical insights. QQ will be upgraded with new social functionalities.
This Flowchart Shows How Chinese Consumers Must Navigate the Complex Deals of Tmall: Whether Singles’ Day or the never-ending other promotions on Tmall, these are considerations for consumers before clicking on a ‘deal’.
China, New Zealand Join Hands to Promote Agricultural Services and Products Trade: The China Chamber of Commerce of Import and Export of Foodstuffs, Native Produce and Animal By-Products (CFNA) and the New Zealand Business Roundtable in China (NZBRiC) signed an agreement which will see the two countries share information on the food industry and basic data on the international trade in food. Events such as the China-New Zealand food enterprise summit and reciprocal visits by high-level officials from the two countries will be held regularly. Last year New Zealand jumped from the third to top exporter of food to China, with 8.76% of value, just ahead of Australia at 8.72% and the US at 7.60%.
As Revenue Surges Sixfold, Luckin Loses Even More Money: Luckin Coffee posted revenue of ¥1.5 billion ($216 million) in the July-September quarter, up more than sixfold from a year before. It also reported a widening loss of ¥531.9 million ($76 million), 9.7% greater than a year earlier. Since offering more tea drinks in April, tea now accounts for about 20% of it freshly brewed drinks. Luckin spent ¥557.7 million ($80 million) on sales and marketing over the period, an increase of 147.6% year-on-year. Luckin opened 717 new stores in the quarter, taking its total to 3,680. Meanwhile Starbucks is launching a voice ordering and delivery service through Tmall Genie. One million orders were placed Tmall Genie on Singles’ Day including orders for 810,000 eggs.
Consumer Brands Continue Expansion into Urban Chinese Markets: 22 FMCG brands now have Chinese consumer bases in excess of 100 million urban households according to Kantar. YST, Haday and Coca-Cola saw the fastest gains as big firms continue to launch new products to win consumers who are more in favour of brands that promise to improve their health and lifestyle.
Chinese Buying More Travel Products: In the past five years, the number of travel product orders on Singles’ Day has seen a compound annual growth rate of nearly 60%. Each year, the number of new consumers who bought travel products grew by more than 30% according to Alibaba’s travel platform Fliggy. More than five million people booked overseas trips during the 24-hour festival, along with 900,000 visas and 1 million nights of hotel bookings.
China’s Ultra Wealthy Are Dominating the Global Luxury Market: 27.5% of China’s US dollar billionaires are under the age of 50 versus 13% globally. What’s more, 93.5% are completely self-made.