China's consumer market has witnessed remarkable growth over the past two decades, driven by economic prosperity and rising living standards. Today, consumption plays a pivotal role in China's economic growth. However, the market faces challenges due to pandemic fluctuations and the transition to a post-pandemic era. Despite these challenges, the Chinese government has implemented policies to expand domestic demand and promote high-quality growth, leading to rapid upgrades and innovation in consumption patterns and business models. In this context, Deloitte conducted a nationwide consumer survey to analyze future consumer goods and retail industry development trends. This article highlights key findings that will help companies deepen their understanding of consumers, identify new trends, and seize market opportunities.
Return to Rational Consumption:
Chinese consumers are becoming more pragmatic and rational in their purchasing decisions. They prioritize actual needs, conduct thorough research, and compare products to make informed choices. Trustworthiness is crucial, with consumers relying on opinions from real-life relationships, official sources, and professional testing agencies. Domestic brands have gained market competitiveness, and many consumers prefer them due to improved brand power, product capabilities, and channel strength.
Pursuit of Self-Pleasing Experiences:
Socializing has become a major source of joy for Chinese consumers, influencing their shopping journeys. Channels with strong social attributes, such as live streaming and short-video platforms, play a significant role in information search, decision-making, and sharing experiences. While online retailing has grown rapidly, brick-and-mortar stores still offer unique experiences. Concerns about personal information security have increased, highlighting the need for data protection.
Embrace Diverse Innovation:
Chinese consumers are increasingly open to exploring new retail forms beyond traditional channels. Live streaming and instant retail have gained popularity. With the "stay-at-home mode" during the pandemic, leisure activities at home, such as fitness, cooking, and flower arranging, have become significant contexts for consumption.
Embrace Green and Sustainable Practices:
Consumers in China exhibit high social awareness and responsibility. They are willing to support green consumption practices to reduce negative impacts on the environment and society. Green consciousness translates into buying behavior, with consumers favoring eco-friendly products and brands.
Pursuit of Technological Advancements:
Chinese consumers readily adopt new technologies, especially mobile internet. Mobile phones have become integral to their lives, with over 1.05 billion mobile internet users in China. The metaverse, a virtual reality space, has gained traction, attracting brand players to tap into this new territory of consumer engagement.
To thrive in the Chinese consumer market, consumer goods and retail companies must adapt their strategies to align with emerging trends and consumer preferences. Building a brand's private domain, creating unique brand experiences, and establishing omnichannel operations are essential. Trust-building through strong value propositions and an open business ecosystem is crucial. Prioritizing product value for money, integrating omnichannel approaches, and incorporating green and sustainable practices will resonate with Chinese consumers.
Remember, the key to thriving in China's consumer market is understanding the latest trends and adapting your strategies accordingly. Act now to unlock the immense potential of this vibrant market.