Inside China’s New Consumption Era: How the 2027 Action Plan Will Reshape Consumer Demand, Product Innovation, and Market Growth

A Landmark Policy to Drive the Next Phase of China’s Consumption Upgrade

China has entered a new stage of consumption-led growth. In late November, six ministries, including the Ministry of Industry and Information Technology (MIIT), the National Development and Reform Commission, and the Ministry of Commerce, jointly issued the Action Plan on Enhancing the Supply–Demand Alignment of Consumer Goods and Further Promoting Consumption.

Notably, this is the first national-level consumption policy released after the 20th Central Committee’s Fourth Plenary Session, signalling consumption as a strategic driver of economic resilience and high-quality development.

The plan sets two major milestones:

• By 2027:

  • Develop three trillion-yuan consumption sectors

  • Cultivate ten 100-billion-yuan consumption hotspots

• By 2030:

  • Establish a mature, mutually reinforcing cycle between supply and consumption

  • Ensure consumption makes a steadily rising contribution to economic growth

This marks a structural shift from stimulating short-term demand to building long-term consumption capability, powered by innovation, segmentation, and upgraded supply.

China’s Next Trillion-Yuan Consumption Sectors

Across the three news sources, four sectors consistently emerge as the most promising trillion-yuan growth engines by 2027:

1. The Silver Economy and Elder-Friendly Products

China’s elderly population has reached 300 million, with the eldercare goods market doubling from 2.6 trillion yuan in 2014 to 5.4 trillion yuan in 2024.

High-growth categories include:

• Smart eldercare wearables

• Remote medical monitoring systems

• Rehabilitation aids

• Eldercare service robots

• Elder-friendly home appliances

Demand is driven by demographic shift and a rapid rise in health awareness, creating structural, long-term consumption momentum.

2. Smart Connected Vehicles and Automotive Aftermarket

Smart EVs and connected cars remain critical tracks in China’s industrial strategy.

Trillion-value growth will come from:

• Intelligent cockpit systems

• New-energy vehicle ecosystems

• Vehicle modifications

• RV camping and motorsports

• High-quality car rental services

The plan also supports low-altitude consumption, including low-altitude tourism, aerial sports, private aviation and consumer drones, signalling expansion beyond traditional automotive segments.

3. Consumer Electronics and Next-Generation Smart Home

China’s smart home market grew from 102.2 billion yuan (2012) to 756 billion yuan (2024), expected to surpass 1 trillion yuan by 2027.

Key innovation directions include:

• AI-powered ovens, refrigerators and air conditioners

• Household service robots

• AI-enhanced phones, computers, toys, and wearables

• Brain–computer interface devices

• IoT-integrated home ecosystems

AI is becoming the foundation of the next consumer electronics boom.

4. Sports, Leisure and Lifestyle Upgrading

Sports and leisure consumption aligns with rising demand for wellness, emotional wellbeing and youth self-expression.

High-potential segments include:

• Outdoor sports equipment

• Cycling and running gear

• Fitness technology

• Lifestyle sports apparel

• Adventure and motorsports events

Sports consumption is increasingly driven by identity, community and wellness, accelerating premiumisation.

100-Billion-Yuan Consumption Hotspots

In addition to the trillion-yuan sectors, the plan identifies emerging hotspots with explosive potential:

• Beauty and cosmetics (driven by domestic brands and functional ingredients)

• Jewellery and personal accessories

• Infant and child products (a 565.3 billion yuan market in 2024)

• Trend-driven “潮品” (fashion IP, ACGN, collectibles, pet economy)

• Health products and wearables

• Rural consumption upgrades

These hotspots reflect a blend of demographic shifts, cultural trends and interest-based consumption.

The Policy Architecture: How China Plans to Achieve These Targets

After identifying the growth sectors, the Action Plan lays out a comprehensive system of five pillars and nineteen tasks to turn these ambitions into market reality.

1. Expanding Increment: Technology, Innovation and New Tracks

China will accelerate:

• Establishment of new industrial tracks

• First-launch and first-use scenarios

• AI-integrated manufacturing

• Highly responsive production models

• Professionalised innovation demonstration zones

This includes 100 benchmark products, 100 innovative enterprises and a large portfolio of scenario pilots to fast-track commercialisation.

2. Unlocking Stock Potential: Upgrading Existing Supply

The Action Plan prioritises:

• Green product expansion

• Rural consumption upgrades

• Leisure and sport product innovation

• High-end medical devices and diagnostics

• Home-based healthcare ecosystems

• Enhancing the influence of classic, heritage-rich brands

This strategy lifts both consumption quality and industrial competitiveness.

3. Precision Segmentation: Tailoring Supply to Consumer Groups

The plan mandates greater alignment with demographic needs:

• Infants & children → safe, high-quality goods

• Students → upgraded learning and creative-use products

• Young consumers → trend-driven “潮品” and culture IP

• Elderly → adaptive devices, robots and accessible design

Segmentation ensures differentiated supply for high-value niches.

4. Scenario Empowerment: New Retail Scenes, Low-Altitude Economy and Shared Consumption

Scenario innovation aims to reshape how consumers interact with products:

• Debut economy (“first stores”, “first products”)

• Regulated platform consumption

• Shared consumption (shared wheelchairs, strollers)

• Low-altitude tourism and aerial sports

• Automotive aftermarket innovation

This is where innovation meets behaviour, creating new trial and adoption environments.

5. Environmental Optimisation: Financial Support, Regulation and Market Stability

The plan reinforces:

• Stronger fiscal and financial support

• National consumption campaigns

• Better market supervision

• Balanced platform governance (AI recommendations, algorithm regulation)

Retail sales data confirms stable momentum: 41.2 trillion yuan in the first ten months, up 4.3%.

What This Means for Brands and Marketing

1. Product strategy must follow national direction

Brands must prioritise innovation in sectors the government is actively scaling, such as eldercare, smart homes, consumer electronics and sports, ensuring product roadmaps match the direction of policy-backed trillion-yuan opportunities.

2. Marketing must shift to scenario-based storytelling

With “scenario empowerment” becoming a national priority, brands should design marketing around real-life usage scenes, first-launch events and immersive trial formats that help consumers experience products in context.

3. Age-specific marketing becomes essential

The plan reinforces demand from infants, students, youth and seniors, meaning brands must tailor product features, messaging and channels to these groups rather than relying on mass-market narratives.

4. AI integration will differentiate leaders from followers

AI is now central to both manufacturing and consumer engagement; brands need to integrate AI across product design, service delivery and personalised marketing to build differentiation and long-term loyalty. Brands must build AI capabilities across the value chain.

5. Sustainable, culturally rich products will outperform commoditised supply

Consumers expect safer, greener and culturally resonant products, and with policy reinforcing this shift, brands that invest in quality storytelling, sustainable materials and Chinese cultural IP will outpace those offering commoditised supply.

Conclusion

China’s 2027 Action Plan marks the beginning of a new consumption era, one defined by trillion-yuan sectors, AI-driven innovation, demographic precision and scenario-led retail.

For brands, the next five years will reward those who align early, innovate boldly, and build meaningful narratives around technology, culture and lifestyle upgrading.

Reach out to us if you would like to explore how your brand could decode emerging opportunities, shape consumer-centric narratives, and build marketing strategies for China’s next consumption era.