Mark Tanner
20 July 2021 0 Comments

This week’s news and trends in China:

Consumers,  Chinese Consumers

Second-hand Trading Takes Off in China as Apps Such as Alibaba’s Idle Fish Make Recycling Easier: Video: Mark Tanner shares his views on why second-hand sales are booming in China. Between 2019 and 2020 the value of merchandise sold on Alibaba’s second-hand platform Idle Fish doubled to ¥200 billion ($31 billion) and is expected to hit ¥500 billion ($77 billion) this year.

Convenience Bee — China’s First Truly Successful Cashier-Less Store Chain?: In 2017, a mob of start-ups opened cashier-less stores started in China. By the end of the year, there were 200 such stores nationwide. But most have since closed down, unable to survive on the thin margins of the industry. Convenience Bee not only survived the boom and bust, it seems to have thrived with revenues already comparable with the top three foreign convenience store brands in China: FamilyMart, Lawson, and 7-Eleven. Convenience Bee has opened more than 2,000 stores in 20 cities in four years.

Chinese Gen Z’s New Obsession: Murder Mystery Games: As the Jubensha game craze sweeps across China, luxury brands are recognising the potential of suspense-driven interactivity. Jubensha sales are estimated to top ¥15.4 billion ($2.2 billion) in 2021 to 9.4 million consumers. Over 70% are under the age of 30, and over 40% play Jubensha more than once a week suggesting a huge appetite for suspense-driven interactive narratives where the players themselves take control. The game’s popularity echoes that of variety show Who’s the Murderer, which first aired on Mango TV in 2016.

Online: Digital China

China Hits 1 Billion Online Video Users in 2020 but Growth Begins to Slow Even as Companies Find New Ways to Make Money: The number of active users of online video in China surpassed 1 billion in 2020 but user growth slowed to 2%. Livestreaming reached a market value of ¥150 billion ($23 billion) in 2020, up 42% on the year before.

China is the World’s Trendsetter When it Comes to Commerce: More physical retail stores are using QR codes on products to link to social media apps and garner ‘social currency’, while web-only retailers are investing in pop-up stores, leveraging off their social media followings. Brands are collaborating with the biggest gaming platforms to launch virtual possessions from clothing to cars. For example, Aston Martin, Maserati and Tesla have all offered virtual cars in the massively popular Game for Peace. With almost 518 million gamers in the country, China is the world’s biggest gaming market where 56% of mobile gamers are female and 47% are under 30 years of age.

Premium Food & Beverage

IWSC Market Insight: the Chinese Wine Market: A high level background of China’s wine market, importers, influencers and more. A third of China’s wine drinkers live in Guangdong province.

TWE Launches Rawson’s Retreat from South Africa for China: Penfolds’ parent Treasury Wine Estates has quietly rolled out South African made Rawson’s Retreat for China to bypass up to 218% punitive tariffs imposed on Australian wines. Rawson’s Retreat was originally produced and made in South East Australia for the China market. Between December and March, Australian wine exports dropped by over 95%, and France quickly replaced Australia as China’s biggest wine supplier.

China’s Favourite Fiery Liquor Is Getting a Millennial Makeover: China’s potent national tipple, usually imbibed over long banquet meals, faces a challenge. The older generation, for health reasons, is consuming less of what’s broadly viewed as the booze of choice for men in their 40s and above. Jiangxiaobai is hoping to appeal to Millennials and Gen-Z with a marketing blitz including colourful baijiu bottles emblazoned with enigmatic phrases that appeal to the young. The company is also offering peach and grape flavoured drinks that seem closer to cocktails. Chinese consumers spent $147 billion on baijiu in 2020 versus $89b on beer, $52b on wine and $7b on brandy and cognac.

Parents and Kids

On China’s Internet, Bad Parenting Advice Is a Big Problem: Parenting influencers claiming they can turn kids into superstar students are attracting huge followings on Chinese social media. But their advice is often highly problematic. In April, the industry was rocked by revelations that several WeChat accounts ostensibly run by ordinary parents were in fact controlled by one education technology company. More than one-fifth of Chinese families spend over 20% of their household income on their kids, according to a 2021 survey. China’s market for products targeting parents and babies is estimated to be worth ¥3.2 trillion ($495 billion).

Overseas Chinese Tourists

China Unveils Its First National Passenger Aircraft—Rivalling Airbus and Boeing: With more than $72 billion in state support, China Eastern Airlines is set to operate roughly 1,000 new Comac C919 airplanes, due to take flight before the end of this year. The airline has seen travel demand this past spring reaching beyond pre-pandemic levels with 2,700 local flights a day with the Shanghai and Beijing routes most popular.

Designers and Fashion

Alibaba-Backed Fashion Rental App YCloset Shuts Down After Five Years: After five years, shared fashion app YCloset has stopped operations. As the business scaled, it struggled to keep up with high expenses in shipping, dry cleaning, and staying abreast of the latest fashion trends. YCloset once boasted 20 million users.

Li-Ning Moves Into Skateboarding With Erik Ellington: After scoring several high-profile fashion collaborations, Chinese sportswear giant Li-Ning is moving into the skateboarding lifestyle market, starting with a collection designed by skate legend Erik Ellington. “Chinese consumers are excited about street sports and street culture, and skateboarding is at the core of this,” says the brand. Since February 2018 Li-Ning’s capitalisation has jumped 13.75 times to $29.18 billion. Local competitor Anta is tracking to overtake Adidas for market value soon.

Schooling and Education

China Bars Foreign Curricula, Ownership in Some Private Schools: A new law which comes into effect on 1 September halts the teaching of foreign curricula in schools from kindergarten to grade nine (K-9) and prohibits the ownership or control of any private K-9 schools by foreign entities.

Premium and Luxury

Defying Conventions, Chinese Millennials Turn to Watches: For decades, high-end watches were associated with status-obsessed businessmen of a certain age – a dwindling demographic since China’s corruption crackdown in 2013. But in recent years, the luxury watch market has been boosted by the interest of Chinese women and younger consumers on the back of high-impact representation of watches in Chinese pop culture and the popularity of a slew of watch-focused social media accounts. Knowledge about luxury watches is considered a sign of exposure to a world of more refined tastes. Second-hand is no longer a dirty word with transactions on preowned watch platform Watcheco rising six-fold in 2020.