Think tanks should have an insight into consumption trends and release consumption potential.
ZHIKUYAOLAN
editorial comment/note
Global consumption hotspots are constantly emerging, and they inspire great potential. On the one hand, the concept of global consumers has gradually changed. On the other hand, digital transformation has brought about profound changes in consumption patterns. New models such as online shopping and social media marketing are constantly developing. With the release of consumption potential and the improvement of consumption environment, the consumption market in China is also changing. E-commerce and cross-border shopping continue to enrich consumers’ shopping choices. In the future, the improvement of consumer experience, the support of policies and the rise of consumer groups such as silver-haired people will further promote the development of the consumer market.
New changes have taken place in the global consumer market
Reading tips:Changes in the global consumer market have provided new impetus for economic growth. "Towards 2025: Global Consumer Outlook" points out that global consumers are changing from cautious consumption to purposeful consumption. Under the condition of economic uncertainty, consumers pay more attention to goods that enhance their sense of happiness and abundance. By 2025, global consumer spending will increase by 3.2 trillion US dollars, among which more than 131 million new consumers will flood into the market. According to the Big Data Analysis Report on the Regional Development of E-commerce in China released by the Institute of International Trade and Economic Cooperation of the Ministry of Commerce, the online sales of e-commerce market in China increased by 10.11% in 2023. The development of e-commerce in the eastern region is leading, especially in Zhejiang and Guangdong, which has become an important market for e-commerce. Young and middle-aged consumer groups have gradually become the main force of e-commerce. There are obvious differences between men and women in consumption preferences. The Outlook of Global M&A Trends in 2024: Consumer Market published by PricewaterhouseCoopers shows that although global investors are cautious about M&A transactions, with the rise of the middle class and investors’ increasing attention to health and tourism, there will be more M&A opportunities in the consumer market in 2024. In addition, the number and amount of mergers and acquisitions in the global consumer market declined in the first half of 2024, but it is expected to pick up in the second half.
Towards 2025: Global Consumer Outlook: Global consumers are shifting from cautious consumption to purposeful consumption.
Nielsen IQ recently released "Towards 2025: Global Consumer Outlook" (hereinafter referred to as "Outlook"), which shows that although the current uncertainty still exists, consumers are shifting from cautious consumption to purposeful consumption, which not only maintains resilience, but also is more cautious and purposeful in consumption, and gives priority to those goods that can enhance the sense of wealth and happiness.
Outlook pointed out that with the global economy facing persistent and unprecedented challenges, insight into consumer behavior has become a key task for enterprise development. Outlook comprehensively analyzes the impact of economic trends on consumer confidence and changes in consumer attitudes, as well as the key factors that have an impact on purchasing decisions. Outlook predicts that by 2025, global consumer spending will increase by 3.2 trillion US dollars, an increase of nearly 6% compared with 2024. At the same time, more than 131 million new consumers will flood into the market, which indicates that the growth of new consumers will reach a new peak.
Outlook shows that the wealth accumulation of global consumers shows a trend of differentiation. On the one hand, the economic stability of many consumers is gradually improving, while on the other hand, many disadvantaged families are still trying to cope with the increasing basic living costs. Although the overall job market remains stable, fluctuations in key industries make even people with relatively stable financial conditions remain cautious. However, it is worth noting that in the past year, the consumption trend of consumers has continued to shift to the safer end of the economy, with 27% of consumers surveyed saying that their economic situation has not been affected or improved, compared with 21% in the same period in 2023.
The Outlook also shows that from the perspective of consumption expenditure, groceries and household goods still occupy an important position in the expected increase in expenditure, including fresh food (34%), fresh meat (26%), health nutrition (25%) and dairy products (23%). Consumers plan to continuously reduce spending on non-essential items, such as outdoor catering (38%), outdoor entertainment (37%) and food delivery/take-away service (36%). The purposeful consumption around family entertainment (48%) and social/party spending (46%) may remain unchanged in 2025.
Big Data Analysis Report on Regional Development of E-commerce in China: The scale of cross-border e-commerce market in China is growing rapidly.
According to the Big Data Analysis Report on the Regional Development of E-commerce in China released by the Institute of International Trade and Economic Cooperation of the Ministry of Commerce (hereinafter referred to as the Report), online sales in China increased by 10.11% year-on-year in 2023, among which Shanghai’s e-commerce sales accounted for the first place in China. The "Report" pointed out that the national e-commerce development showed a trend of "strong in the east and weak in the west". The number of shops, sales volume and sales volume in the eastern region accounted for 61.58%, 86.88% and 89.89% respectively in China. Zhejiang, Guangdong, Jiangsu, Fujian, Shandong and Shanghai are the first echelon of e-commerce development in the country. The sales of e-commerce in the six provinces and cities account for 82.25% of the country, and the sales account for 83.37% of the country.
The "Report" pointed out that young people aged 31 to 40 have become the main force of e-commerce consumption, and this group accounts for a relatively high consumption in the field of improving the quality of life. People aged 24 to 30 are highly interested in digital products and household items, and people aged 41 to 50 account for the highest proportion of consumption in the field of culture and entertainment.
It is worth noting that in the online consumption of various commodities in 2023, the proportion of men is higher than that of women. The consumption preference of male groups is concentrated in the fields of real estate purchase, outdoor sports, computer digital, accessories watches, office equipment and so on; Women’s consumption preferences are mostly maternal and child products, daily necessities and other relatively high-frequency consumables, as well as medical health, household appliances and other daily necessities.
The "Report" mentioned that the scale of the cross-border e-commerce market has grown rapidly, and the development model of the comprehensive test area has become increasingly mature. In 2023, China’s cross-border e-commerce import and export was 2.38 trillion yuan, a year-on-year increase of 15.6%. In the first half of 2024, China’s cross-border e-commerce import and export was 1.22 trillion yuan, a year-on-year increase of 10.5%, which was 4.4 percentage points higher than the overall growth rate of China’s foreign trade in the same period. The top five comprehensive test areas of cross-border e-commerce transactions are all from the eastern region, accounting for 48.69% of the total cross-border e-commerce in the country. In 2023, the import and export volume of Shanghai cross-border e-commerce comprehensive test area reached 262.39 billion yuan, ranking second among the 165 comprehensive test areas in China.
Global M&A Trend Outlook in 2024: Consumer Market: The global consumer market is expected to see more M&A transactions.
PricewaterhouseCoopers’ Outlook on Global M&A Trends in 2024: Consumer Market (hereinafter referred to as Outlook) shows that more M&A transactions are expected in the consumer market, but the timing is not clear. Investors are also cautious when choosing transactions.
Outlook pointed out that compared with the first half of 2023, the number and amount of M&A in the consumer market decreased by 22% and 4% respectively in the first half of 2024, among which the decrease of M&A amount was not obvious, mainly due to several new large-scale transactions. In the first half of the year, M&A activities of investors from the Middle East, India and Japan increased, and this trend is expected to continue. This also shows that the rise of the middle class may bring more domestic trading opportunities, and companies with healthy balance sheets are also seeking investment opportunities.
Outlook believes that more M&A transactions are expected to occur in the consumer market in the second half of the year, but investors are also more cautious when choosing transactions because of the uncertain timing. In the second half of 2024, the hot spots of M&A in the consumer market focus on health and welfare, hotels, tourism and leisure, packaging and consumer goods. Consumer goods companies will continue to check their business portfolios. Besides business portfolio optimization, it is expected that three themes, namely initial public offering (IPO) and privatization, merger and adjacent acquisition, and bail-out M&A, will affect M&A activities in the second half of 2024.
Outlook also pointed out that the pressure of transformation through mergers and acquisitions to meet the needs of fast-growing consumers has not been effectively alleviated, and it is expected that transaction participants will focus on transformation and transaction preparation in the near future. Once the overall market situation improves and trading performance improves, trading activities will grow rapidly in the next 6 to 12 months.
Multi-party efforts to release China’s consumption potential
Reading tips:The scale of China’s consumer market is constantly expanding, but consumers are still cautious about prices and expenditures. The Survey Report on Consumers’ Willingness to Consume in China in the Third Quarter of 2024 shows that consumers’ willingness to consume is generally in the boom zone, but they still feel high about the market price, especially in the context of slowing income growth, and consumers tend to guarantee their purchasing power at low prices. At the same time, although consumers are active in tourism, they are more cautious in spending, especially for high-income groups. In the future, it is necessary to stabilize consumers’ expectations and increase income, and improve the social security system. The Report on the Development of Shopping Tourism in China released by china tourism academy shows that shopping tourism is gradually becoming a trend, and more than 90% consumers have shopping behavior during their travels. The rise of experiential consumption promotes the transformation from tourism shopping to shopping tourism, emphasizing the combination of shopping and cultural experience. In the future, the construction of shopping and tourism destinations should focus on cultural experience, the needs of tourists, supply chain cooperation and digital transformation. The 2024 Consumption Report of Silver-haired People points out that the consumption difference between silver-haired people and young people is narrowing. Its consumption in education, fashion, science and technology and other fields has increased significantly, and it shows strong consumption power and acceptance of new things. The consumption of silver-haired people is upgrading to active health, leisure and entertainment.
Investigation Report on Consumers’ Willingness to Consume in China in the Third Quarter of 2024: Consumers’ Willingness to Consume in China is generally in the boom zone.
China Small and Medium-sized Business Enterprises Association and Lixin Data Research Institute recently jointly released the Survey Report on Consumer Willingness in China in the Third Quarter of 2024 (hereinafter referred to as the Report). According to the Report, consumers’ willingness to spend in China is generally in the boom zone.
According to the Report, some consumers surveyed believe that the current market consumer price is still on the high side. Under the background of slow income growth, especially expected income growth, they expect to ensure their purchasing power to grow steadily through low prices of goods. In addition, consumers have a positive attitude towards travel, but tend to be cautious about tourism expenditure, and the budget of tourism expenditure of high-income consumers has dropped significantly. Consumers’ choice of tourist destinations is based on the principle of proximity, and they prefer to travel freely. In addition, travel agencies should actively develop tourism projects that adapt to semi-self-help tours and customize independent small group tours, so that the demand side and the supply side of tourism can be smoothly connected.
The Report makes the following recommendations. First, we attach great importance to and earnestly implement the policy objectives of "stable expectations, stable growth and stable employment" and solve the core problem that affects consumer consumption, that is, the problem of having money to spend. The second is to further promote the improvement of social security such as pension, employment and medical care, so as to solve the problem that consumers dare to spend without worries. Third, we attach great importance to the signal that consumers are concerned about the consumption environment in the third quarter, and try our best to improve the current consumption environment through various means such as law, administration, culture and education. Fourth, attach great importance to the important influence of expectation on consumption behavior, strengthen expectation management, including attaching importance to and caring for the rare opportunity of stock market recovery, and actively promoting the investment of patient capital. At the same time, increase the proportion of securities investment in consumers’ family financial assets, maintain the optimization of consumers’ family financial assets structure and the appreciation of the total amount, and promote the growth of consumption through wealth effect. Fifth, because some consumers are still unclear about the Action Plan for Promoting Trade-in of Consumer Goods, it is suggested that publicity should be intensified, and publicity channels should be actively broadened to let more consumers know about the policy.
China Shopping Tourism Development Report: It is a trend that "tourism shopping" moves towards "shopping tourism".
China tourism academy recently released the Report on the Development of Shopping Tourism in China (hereinafter referred to as the Report). This is the first report of domestic shopping and tourism industry, which interprets the development status and future trend of shopping and tourism industry in China.
According to the Report, with the trend of experiential consumption becoming more prominent, it has become an industry trend to move from "tourism shopping" to "shopping tourism". More than 90% of the respondents have shopping behavior during their travels, and nearly 70% of the respondents have simple or complete shopping plans before shopping, so tourists have strong shopping initiative. According to the Report, the trend of experiential consumption makes the "tourism shopping" that only focused on commodity purchase in the past gradually turn to "shopping tourism" that regards shopping as an experiential activity, and the compound shopping place is gradually developing into an independent shopping and tourism destination, from closed to open in physical space, from shopping to leisure and then to cultural experience in tonality.
The Report summarizes four directions for building shopping and tourism destinations in the future. First, strengthen cultural experience and shape distinctive personality. The second is to attach importance to tourist groups and improve the quality of experience. The third is to strengthen the cooperation between upstream and downstream supply chains of tourism and develop experiential shopping and tourism routes. Fourth, continue to promote digital transformation, continuously improve the convenience of offline shopping based on digital technology, and further enrich the shopping experience.
"2024 Silver Hair Consumption Report": The consumption difference between silver hair people and young people in China is shrinking.
The consumption report of silver-haired people in 2024 issued by JD.COM Institute of Consumption and Industrial Development (hereinafter referred to as the report) shows that the consumption difference between silver-haired people and young people is narrowing. In recent years, the consumption of silver-haired people in education, fashion, science and technology, sports and other aspects has increased significantly. From January to September this year, the turnover of silver-haired people purchasing education, training and jewelry increased by 284% and 201% respectively compared with the same period in 2019. The turnover of local life and travel, mobile phone communication, beauty and skin care, digital and outdoor sports all increased by over 70%.
According to the Report, with the rapid development of social economy and the dynamic changes of the elderly population, the new generation of silver-haired people, represented by the "post-60s", have generally higher education level, consumption power and ability to accept new things. They are innovating the inherent image of silver-haired people with brand-new life attitudes and strong consumption power, showing a new look of silver-haired people crossing the digital divide, paying attention to self-investment, pursuing healthy social relations, expecting personal value improvement and actively enjoying life.
At present, silver-haired people and young people have more "intersections" in the consumption of sub-categories, and the consumption of gold and silver investment, gold, hetian jade, coffee utensils, fruits and other categories has increased significantly in both groups.
According to the Report, silver-haired people have become a new kinetic energy for online consumption growth, with their spending power and willingness to spend greatly improved and the types of shopping more abundant.
The "Report" also shows that the active health awareness of silver-haired people is constantly improving, and their consumption power in nutrition and health care, traditional nourishing and sports and fitness is getting stronger and stronger. From January to September, 2024, the turnover of gastrointestinal probiotics and health wine increased by more than 10 times and 3 times respectively, the turnover of medicinal materials and codonopsis pilosula increased by more than 60%, the growth of fitness equipment such as kettle bells, leg clamps, horizontal bars and arm exercisers all exceeded 100%, and the turnover of peak rackets, badminton steamers and badminton trainers all exceeded 80%.
The leisure and entertainment consumption of silver-haired people has been continuously upgraded, which has driven the consumption growth of photography, tourism and musical instruments. For example, the turnover of live broadcast equipment has increased by over 100%, and silver-haired people are also "big pet owners". They pay more attention to the quality of life and health and safety of pets in their consumption decisions, and are willing to buy high-quality food, supplies and health products for pets. The data shows that the turnover of prescription cat food and prescription dog food increased by 332% and 102% respectively, the turnover of pet health products increased by 111% respectively, and the turnover of pet vaccine, pet medical service, pet prescription drugs and pet food increased by more than 70% respectively.
China Economic Times reporter Sun Zhao compiled according to public information.
General supervision systemWang Hui Che Haigang
Supervision systemLi piguang Chen Bo Wangyao
Editor-in-Chief Mao Jinghui and Editor-in-Chief Jiang Shuai
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