Mark Tanner
11 May 2022 0 Comments

This week’s news and trends in China:

Consumers,  Chinese Consumers

Chinese Consumers More Optimistic About Future – Ernst & Young Report: Chinese consumers are more likely to be optimistic about the future, in sharp contrast to the declining global consumer confidence. 60% of Chinese consumers believed their personal finances would improve in the coming year, higher than the global average of 48%.

China Set to Power World Economic Growth Against Headwinds: In the first quarter of 2022, foreign direct investment into the Chinese mainland expanded 25.6% year on year to ¥379.87 billion ($57.5 billion).

China’s Listed Companies Post over 19% Profit Rise in 2021: China’s 4,669 listed companies collectively posted an increase of 19.8% rise in revenues last year. About 80% of listed companies grew their revenues last year, the third consecutive year of revenue increases for 40% of them.

Local Governments Again Break Out the Coupons to Boost Consumer Spending: At least 12 provincial-level regions said they’d distribute coupons. Guangdong province announced they’d hand out ¥1.1 billion ($166.4 million) worth of coupons during the last three days of the five-day May Day holiday. Peking University analysis into the voucher schemes in 2020 found the number of transactions on WeChat in regions that issued coupons was 25% higher than those that didn’t.

Eileen Gu Angers Chinese Fans with ‘Unpatriotic’ Farewell Message and Video Showing Her Flying Private: It wasn’t long ago that the “Snow Princess” could do no wrong in China, but a parting “Thank you China” message on Weibo on April 27 didn’t go down so well with many Chinese online. Nevertheless, she still set Chinese social media alight after she attended last week’s notoriously exclusive Met Gala in a figure-hugging Louis Vuitton mini-dress, with #EileenGuMetGalaRedCarpet viewed over 250 million times.

Online: Digital China

Fake Friends Shilling Lipstick: Welcome to WeChat’s Hottest Sales Trend: Thousands of entrepreneurs in China are using WeChat to capitalise on a marketing trend that has taken the country’s e-commerce industry by storm: private traffic. Traditional open ecommerce marketplaces like Taobao and Tmall are arguably impersonal and dull, keeping brands removed from a true connection with shoppers. Brands use private traffic to turn occasional shoppers into dedicated consumers by interacting with them in the same way they might text family and friends. But the intimacy is a veneer — enabled by a suite of technologies that help companies collect data on consumers, automate interactions with them, and, in some cases, create altogether synthetic influencers. Sales via private traffic is forecast to top ¥3 trillion ($454 billion) this year.

Chinese Social Media to Display User Locations Based on IP Address, Including Platforms from ByteDance and Zhihu: Weibo, Douyin, Kuaishou, Xiaohongshu, Jinri Toutiao and Zhihu are displaying locations of users based on their IP address. The measure, which is not mandated by law, is aimed to “prevent netizens from pretending to be locals and spreading rumours.” It is also valuable for us at China Skinny, allowing further geographic segmenting for our social listening services.

Premium Food & Beverage

Can Yili be China’s First Global Milk Industry Champion?: China has a domestic milk industry champion that rose steadily over the last few decades and is now ready to take on the world. In 2020, it made it to the top-5 dairy companies globally and aims to enter the top-3 ranks. Yili already sells products in 60 countries.

Understanding the Plant-Based Market in China: Consumption Trends and Customer Personas: Short term activation opportunities include increasing product trials, using novelty campaigns to engage social foodies, and attracting ‘Nutrition Optimisers’ with macro-nutritional advantages. Retention and broader adoption in the mid-term requires genuine competitiveness with animal products such as price, taste and mouthfeel. Mass adoption in the long-term will likely require shifting entrenched beliefs of plant based meat, meat consumption and plant-based nutrition.

Staying Health

Lockdown Stockpiling May Edge China’s Supplements Market Into Global Top Spot: Chinese consumers are stockpiling dietary supplements again against the backdrop of new coronavirus lockdowns in parts of the country. In 2021, China’s supplements market was estimated to be about ¥271 billion ($34 billion), about two-thirds the size of the US. The China market is unsaturated, with per capita spending at just $30, versus $177 in the US, $151 in Australia and $146 in Japan.

Schooling and Education

China’s Prestigious Universities Exit International University Rankings: Beijing’s Renmin University has withdrawn from the international rankings. The university notes that China’s knowledge system has been developed for thousands of years, and is the oldest, richest and most profound knowledge system in the world. The university hopes to “develop Chinese cultural traditions in an innovative way, create China’s independent knowledge system, and safeguard China’s education and cultural independence.” The university was ranked outside the top-500 globally.

Overseas Chinese Tourists

Tour Guides Turn To ‘Cloud Tourism’ as Omicron Empties Scenic Spots: Domestic tourism over the lucrative Labour Day break took a hit as China battled with the latest Covid-19 wave. Tourism spending declined 43% over the holiday, with domestic tourist trips falling from 230 million to 160 million. Tour guides have been forced to adapt, some switching careers and others learning new ways to do their job, such as taking their tours online. Cinema ticked sales fell 81% from 2021’s holiday.

As Long-Distance Travel Plummets, China Vacations Close to Home: Ahead of the Labour Day holiday, online travel platforms forecast that local trips would be the dominant form of travel, especially trips to the rural outskirts of the same city. Trip.com said that rural hotel bookings rose by 560% compared with the three-day Qingming Festival in early April, and 88% of the orders were for stays of one to two days. Qunar’s ticket sales for parks that allow camping increased by over 50% compared with the same period last year. Many people attribute Xiaohongshu (RED) to the rise of  camping and “glamping.”

Chinese sport Sport

China Makes Real Difference in Sport Over Past Decade: By the end of 2021, sports venues in China totalled 3.41 billion square meters in area, with a per capita area of 2.41 square meters. In 2011, it was just 1.05 square meters per person. Trips related to ice and snow tourism soared from 170 million in the 2016-17 tourism season to 254 million in the 2020-21 period, and are forecast to reach 305 million during the 2021-22 season.

Premium and Luxury

Luxury Brands Navigate Shanghai’s Lockdown to Keep VIPs Pampered : For the more wealthy, banks and high-end hotels have joined luxury brands in sending out goodies – a privilege not unnoticed on social media. Besides gifts, some brands have organised online classes. La Mer has taught DIY facial massages while Dior has offered seven-day passes for virtual classes at a premium yoga studio. Prada has hosted a virtual cultural club, inviting writers, directors and musicians to recommend books, movies and albums. As much as 12% of China’s offline luxury retail is in Shanghai.