china consumer

China’s consumer market in the post-epidemic era

The epidemic has brought unprecedented challenges to the lives of people around the world. China is the only country that has achieved positive economic growth during the epidemic. In the post-epidemic era, Chinese consumers’ needs, purchasing methods, consumption behaviours and attitudes have undergone tremendous changes.

The epidemic has brought unprecedented impact to the world

The epidemic is still spreading around the world. Retailers and consumer goods companies play an essential role. They not only help people fight the virus, but they are also the backbone of ensuring employment and stabilizing society. But looking at the world, the prospects of these companies are still unpredictable. As of September 2020, many countries are still in the second or third wave of the epidemic; the Americas have failed to contain the first wave, and the number of new cases per day has accounted for 55% of the world.

In contrast, the situation in China is more optimistic. Since the initial coronavirus outbreak in Wuhan, the government has devoted all its efforts to epidemic prevention and control and finally effectively controlled the virus’s spread. Since mid-March 2020, through a series of measures such as travel restrictions, virus detection, and digital health tracking, most China areas have achieved “zero cases”.

Economic recovery in the post-epidemic era

Chinese consumers expressed confidence, optimism and willingness to spend on the economic recovery. According to a survey, Chinese consumers’ optimism about their country’s economic recovery after the epidemic has stabilized at around 50%, while that of the United States is about 22%. This is in sharp contrast to the pessimism that pervades Europe, Australia, and Japan. American consumers are also relatively optimistic. The main reason behind this may lie in culture and expectations for the future.

From a global perspective, Chinese consumers are most confident of returning to everyday life after the epidemic, and 60% of the respondents expect to return to normal within two to three months. 13% of German consumers and 5% of Japanese consumers hope their lives to return to normal at the same time. In other parts of the world, 80% of consumers believe it will take at least four months to return to normal.

The robust digital ecology and foundation have allowed Chinese consumers to turn online quickly

China’s digital ecology and infrastructure are more mature and complete, ensuring that various online services launched in response to the epidemic can be completed with high quality, especially the ability to be delivered within a few hours or a few days. Some companies that have embarked on digital transformation have accelerated their development momentum and successfully catered to consumers’ demand for online shopping and other ever-increasing digital services.

Online retail sales growth

During the epidemic, the use of delivery apps surged, driving further growth in online sales of food and daily necessities. At the peak of the epidemic, China’s grocery sales’ online penetration rate increased by 15-20%. It is expected that at least 6% of the growth will be maintained for a long time; more than 55% of Chinese consumers said they are likely to do so.

Many grocery retailers adopt a combination of online and offline marketing models, seize the opportunity of strategic decision-making, and focus on digitally empowered omnichannel business models so that they can respond quickly when the epidemic begins. This means that the companies mentioned above have the necessary supply chain and digital application infrastructure at the beginning of the crisis and can smoothly accelerate e-commerce.

Back to Home: Reconstructing Home

Both retailers and consumer products companies need to rethink the way they manage their marketing and product portfolios. For example, alcohol consumption almost completely shifted to the home scene at the beginning of the year. Despite the current strong recovery of restaurants and bars, it is expected that the importance of the home scene will still be higher than before the epidemic. Beverage manufacturers should explore the underlying motivations of consuming beverages at home and adjusting brands and packaging specifications accordingly.

Health: Building trust in changing consumption habits

The health and quality awareness of Chinese consumers has generally increased due to the epidemic, and they are actively seeking ways to improve their overall health and immunity. According to our research, family safety, public health, concerns about the spread of the epidemic, and personal health are among the top 10 issues that Chinese consumers are most concerned about.

The above concerns have also caused significant changes in consumer behaviour. For example, two-thirds of respondents said they are more concerned about product safety than before the epidemic. As people pay more attention to healthy lives, nearly one-third of consumers have increased their fresh food consumption.

About the Author

Karren Brandenburg

Karren Brandenburg is a travel and shopping expert. She has been quoted in Street Insider, Yahoo Finance, Reuters, ABC News, and MarketWatch. Karren has a total of 18 credit cards, using reward points to see the world on a budget.