This week’s news and trends in China:
Professor Barbara Kahn on Retail Innovation in China: “A lot of people have said this and I certainly believe that China is way ahead of the rest of the world in retail,” says Wharton professor Barbara Khan. “And that there is a lot of innovation that was going on in China, and the rest of the world didn’t know about it … I think Alibaba was way ahead of anybody else on that, and the rest of the world is trying to catch up,” says Khan, referring to seamless integration between what you see online with what people will experience when they go through the physical store.
Western brands aim for the sky in Xi Jinping’s China: If Beijing succeeds in its Common Prosperity ambitions in channelling the bulk of wealth to the middle class, it will significantly expand the pool of potential customers for multinationals. That is why so many liquor, luxury and consumer goods companies are pouring money into the country, and financial services groups are beating down the doors to join them. Top luxury brands such as Gucci and Hermès are seeking to capitalise on investments in less expensive lines, such as cosmetics, that are accessible to a broader range of buyers.
Over 85% of Young Chinese Intend to Have Side Jobs: A recent survey by China Youth Daily shows that 85.5% of 18-35 year old Chinese are willing to take up side jobs. 15% already do. About 72% believe that a side hustle provides more possibilities, while 63.5% said that it enriches spiritual life and offers a more colourful life outside of work. Popular choices include online businesses, being internet celebrities, and selling online courses.
Live Streaming is the New Bright Spot of China’s Singles Day: Among the respondents surveyed by Kantar who have watched live streaming during the Singles’ Day festival, 83% said they watched “live streaming from the brands I am interested in”, higher than “professional KOL’s live streaming” (43%) and “live streaming with celebrities” (30%). In related news, L’Oréal had a public spat with livestreaming stars Viya and Austin Li after promising to give them the lowest price for a face mask and then effectively sold it cheaper on the L’Oréal livestream.
Scan-to-Order Sweeps Across China, to Customers’ Chagrin: Increasingly, restaurants across China are implementing a system in which diners scan a QR code and self-order from their phones. For many diners in China, this is the new procedure at sit-down restaurants. Want to see a menu? Scan the QR. Want to order? Just do it from your phone. Need the bill? It’s all at your fingertips. But is this a convenience, a hassle with major data privacy concerns, or a missed opportunity to provide a memorable experience?
Chengdu Becomes the Largest Imported-Wine Market in China: JD’s Data: Chengdu pulled ahead of Beijing and Shanghai, two of China’s largest metropolitan areas, becoming the largest consumer market of imported wine, accounting for roughly 20% of the value of the country’s overall import wines during the Singles’ Day promotion on JD Supermarket. Imported wine sales showed a trend towards high-end brands. Consumers under age 35 have purchased 62% of all imported wine. Deluxe single malt whisky increased by 16 times YOY in the first 10 minutes of the promotion and sales of fruit cider increased by 24 times compared with last year.
Oatly Opens Its First China Factory To Double Down On Asian Market: Oatly has opened its first factory in China, just months after it established its first Asian production site in Singapore. The Swedish oat milk giant described the new factory in Ma’anshan, Anhui province as part of its “wider initiative to build factories fit for the future” and to meet growing demand across Asia. The factory will be able to produce 150 million litres of oat-based products each year at full capacity.
China’s Record-Low Birth Rate Underscores Population Challenges: China’s birth rate dropped to a new low in 2020, confirming the demographic challenge facing the government as it tries to deal with a shrinking labour force and growing population of elderly people. There were 8.5 births per 1,000 people last year, the lowest in data back to 1978. For Chinese men, starting a family now comes at a price. But not all love is lost as dating blind boxes take off in China as younger generations look for love on social media.
China Finds 12 Million Children that it Didn’t Know Existed: China undercounted the number of children born between 2000 to 2010 by at least 11.6 million – equivalent to Belgium’s current population. The difference could be the result of some parents failing to register births to avoid punishment if they breached the one-child policy. About 57% of the children later registered were girls, indicating the discrepancy could be partly linked to parents not reporting girls so they could continue to try for a boy.
China Outbound Tourism Set to Jump More than 25% this Year — State Media: Chinese outbound tourism numbers are set to jump by more than 25% this year from 2020 but remain “basically at a standstill” compared to pre-pandemic levels. A total of 25.62 million Chinese tourist trips overseas are expected to be made in 2021, up from last year’s 20.3 million which plunged 86.9% on 2019. Macau was noted as the ‘bright spot’ of those numbers. CCTV suggests that the pace of recovery in 2022 will depend on ‘how other destinations handle tourism’.
China Remains the Top Sender of International Students to the United States in 2020/2021: More than 317,000 Chinese students enrolled in US institutions in 2020/21 as China remains the number one source of international students in the country. The number represented a 14.8% drop from 372,000 the year earlier, just lower than the 15% drop of international students studying in the US overall. Mission China has issued over 90,000 student visas since May 2021.
Chinese Parents Find New Ways to Give their Children an Edge: Beijing’s crackdown on tutoring has not stopped families wanting the best for their kids. Instead of signing up for barred foreign language classes, parents instead opt for non-core curriculum subjects like art, which are taught in English. New Oriental offer “new concept camping” holiday courses where children stay at university campuses with classes in the day. Zhipin and Liepin, two local recruitment websites, are strewn with adverts posted by parents looking for domestic staff with bachelor’s degrees and foreign language skills who will help “look after their children” — with no housework skills required. BE Education, an educational consultancy advising Chinese families on overseas studies, says interest in UK boarding schools is picking up after plummeting during the pandemic.
China Eyes 100,000 Movie Screens and Closer Ties to Cannes: Six Takeaways From Country’s Five-Year Film Plan: Over the next five years, China plans to expand its fleet of movie screens to more than 100,000 – up from 77,769 screens as of this March – and release at least 50 $15 million-grossing films a year as it seeks to retain its title as the world’s largest film market. Every cinema in the country based in a county-level city or above must devote one screening hall to the so-called “People’s Cinema” circuit for the showing of propaganda films. The plan’s ultimate goal, however, is to build China into a “strong cultural power” by 2035, spreading positivity, patriotism and a “loveable image of China.”
In China, Luxury Must Bridge Digital and Physical Like Never Before: With the recent Shanghai instalment of its Women’s Spring-Summer 2022 Fashion Show, Louis Vuitton balanced the traditional premium it places on lavish, exclusive events with the democratising effects of livestreaming and social platforms. The livestream of the event was viewed a total of 158 million times on Weibo, WeChat, Tencent Video, Douyin, Kuaishou, and OTT. Weibo hashtags related to the event were used nearly one billion times in total.