The rise of the health-conscious consumer

The health-conscious consumer tribe in China has experienced significant growth over the past decade. This expansion has been driven by rising incomes, increased access to health information, the impact of the Covid-19 pandemic, and government initiatives like Healthy China 2030. As a result, consumers across different age groups, from young professionals to the elderly, are increasingly focused on maintaining a healthy lifestyle – and are willing to invest in products and services that promote health, from robust vitamin regimes to exercise classes.

Key drivers

• Cultural shift: Rising incomes and the Covid-19 pandemic have contributed to a widespread cultural shift towards preventive healthcare, where maintaining health through diet, exercise, and lifestyle choices is prioritised. This trend has also been fuelled by the rising availability of health information online and through social media. In many ways, China’s health awareness boom aligns with that in Western markets.
• Product categories: Nutraceuticals, supplements, organic food, and fitness-related products are popular among this group of health-conscious Chinese consumers. Traditional Chinese Medicine (TCM) products also play a significant role, combining modern wellness trends with more established cultural practices. Chinese consumers also demonstrate a distinct preference for “consumables” in promoting health, creating an especially large opportunity for nutraceuticals and supplements.

Effective marketing strategies

• Content and livestreaming: To effectively engage with health-conscious consumers, brands should focus on delivering educational content that highlights product benefits, proper usage and real-life testimonials. Platforms like Douyin (China’s version of TikTok) are crucial for reaching this tribe, as they tend to prefer authentic, informative content. Livestreaming, in particular, has become a powerful tool for brands to explain product efficacy and function in real-time, providing the transparency that health-conscious consumers value.
• Influencers: Collaborating with health and wellness influencers is another effective strategy. These influencers are often seen as trusted sources of advice, and their endorsements can significantly enhance a brand’s credibility. By partnering with influencers who resonate with this audience, brands can extend their reach and build stronger connections with health-conscious consumers.

Learn more at China Consumer 2024

The health-conscious consumer is just one of several influential tribes shaping China’s consumer landscape. Each tribe offers unique insights into China’s evolving market dynamics and understanding these tribes is key to unlocking new opportunities for growth.

For a deeper dive into these consumer tribes, join the upcoming China Consumer 2024 conference on October 14th, where WPIC will be taking part in a panel session on “Navigating Subcultures and Tribes” and hosting a breakout session on “The Douyin Playbook: Growing in China through Social Commerce”. This event will offer invaluable insights into the latest trends, backed by expert analysis and real-world examples. Don’t miss out on this opportunity to stay ahead in China’s competitive market!

Click here to register

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As we near 2023’s half-way point, retail sales in China have seen marked improvements during the first few months following the complete removal of Covid-19 regulations. In the first quarter of the year, retail sales rose steadily at 5.8%, and in March, there was a notable uptick, with a 10.6% increase in retail sales compared to last year. This represented the highest growth rate since June 2021.

Read on to find out the top five trends that brands should watch out for in the second half of 2023.

E-commerce continues to rise

As the world’s largest e-commerce market, China had over 1 billion consumers shop through e-commerce channels in 2022, making up 45.3% of all online retail sales worldwide. Within China, online sales channels accounted for 51% of all sales in the country.

E-commerce growth has continued throughout the Covid-19 pandemic, and this trend is unlikely to stop even with Covid-19 restrictions now removed. This is especially true as the purchasing power of Gen Z consumers, who grew up with technology and are the most digitally savvy generation, continues to increase.

Brands who want to succeed in China must consider online sales channels in their market entry or expansion plans and reach customers where they are shopping for products.

Source: Statista – in cooperation with MOFCOM China, February 2023

The metaverse: China edition

Over the past year, the metaverse has become increasingly substantial in China, with more brands testing the waters and expanding into this segment. The metaverse can be explained as a virtual world that allows for greater integration of the digital and physical, in areas ranging from socialisation and shopping to work. Technologies include those within the fields of virtual and augmented reality.

The metaverse presents uncountable new opportunities for brands, businesses and developers, as shown by the over 16,000 metaverse-related trademark applications from Chinese companies. Many of the big tech companies in China, including Alibaba, Baidu, Tencent and ByteDance, have released their own metaverse ecosystems, wherein users can create avatars and interact in a virtual environment. In fact, since the second half of 2021, over 37 digital collections have been released by brands on Alibaba’s Tmall Luxury Pavilion, purchased by thousands of customers.

Compared to countries such as the US and the UK, Chinese consumers are showing greater interest in the metaverse, especially as it relates to gaming. In fact, among Chinese consumers who are interested in the metaverse, over 82% are optimistic about its future benefits, which is much more than among those in Western countries.

Virtual influencers: The new celebrities

AI-generated virtual influencers are amassing huge numbers of followers and becoming celebrities in China, with the industry expected to increase from $870 million in 2021 to $6.7 billion in 2025. This comes at a time when China is cracking down on human celebrities and influencers, with virtual influencers becoming safer, scandal free alternatives.

Technological advances have allowed these virtual influencers to hold live streams, walk down virtual runways and pose alongside products, just as a real influencer can. Especially among fashion brands, working with virtual influencers in China has become increasingly common.

Although the fanbase for human influencers is much larger than the growing fanbase of virtual influencers for now, they are certainly a trend to keep an eye on.

Our furry companions

Over the past ten years, the pet industry in China has seen a 2,000% growth rate. Chinese pet owners are increasingly treating their furry companions as beloved family members or children, and are more willing to spend on them. The younger generations in China are moving away from the traditional family unit, with many preferring to live alone and looking to pets to fulfil their emotional needs.

As a result, all categories within the pet market are seeing surges, from pet food and pet toys to pet tech devices and clothing. The entire pet industry is expected to reach US$113.9 billion in 2025. With over 76% of pet owners in China under the age of 30, online purchase channels are at the forefront of the pet market.

Healthy, premium and natural pet foods and treats are hugely popular among pet owners, who are mostly young, highly educated consumers living in higher-tier cities. These consumers are not only interested in their own health but also the health of their animal companions.

Other trends include pet tech devices such as automated feeders, smart cameras, or smart litter boxes, many of which can connect to WiFi and be controlled by apps on mobile devices.

Adventure and the outdoors

Another trend that has surged over the past year is a fascination with the outdoors. From skiing to camping, Chinese consumers are more willing than ever to try out new hobbies and activities, especially after the end of Covid-19 restrictions.

The Winter Olympics in Beijing helped to drive interest in winter sports, leading to a growth in sales of winter sports equipment among Chinese consumers. Moreover, the popularity of Team China’s Eileen Gu, who won the gold medal in the Freeski Big Air event among others during the Winter Olympics, has also added to the excitement and hype around winter sports. Many of these new enthusiasts are first-time skiers and require an entirely new set of clothes and gear, making China a budding and still not fully tapped market for brands within this category.

Aside from winter sports, Chinese consumers are also showing greater interest in hiking and camping as summertime activities, which is a market that is expected to increase to above $100 billion by 2025.

As we continue into 2023, brands need to be aware of the changes happening and the shift toward a digital lifestyle. More than ever, Chinese consumers are living a significant portion of their lives online, even as they continue to expand their interests offline. Brands who want to engage and connect with potential customers in China must understand their positioning in the market and have a grasp on both Chinese consumer offline behaviour and how to reach them online.

This article was first published in The RED Edition Issue 8 by RedFern Digital

The post The China trends to know about in 2023 appeared first on Focus - China Britain Business Council.

According to Statista, almost 60% of China’s online live commerce shoppers are female, and they make up around 51% of Chinese e-commerce users in general. But with so much noise, and so many choices, what influences the platform they decide to shop on, and how can their habits inform your China strategy?

We asked four women what their typical buying journey looks like: Jenny Jing, a 38-year-old production manager and mother of two living in Beijing; Cecilia Wu, a 38-year-old editor living in Kunming; Fiona Yang, a 34-year-old teacher living in Beijing; and Cicely Shang, a 34-year-old working in tech and living in Shanghai.

What were the last products you bought for yourself online?

Jenny Jing: Skincare products from a Canadian brand called Cocoon.

Cecilia Wu: Two pairs of Birkenstock sandals

Fiona Yang: Bleaching agent (for clothes). I accidentally died my favourite jacket blue and wanted to get it back to white again. It worked! Made my jacket good as new.

Cicely Shang: Cosmetics, coffee capsules and catnip

Which platform did you use to make your purchase and why?

Jenny: Xiaohongshu this time. But I often use Taobao. I follow a skincare professional on Xiaohongshu who has her own clinic, so she is able to share industry knowledge, insider tips and secrets. Taobao used to be my first choice for this kind of thing, but now I only go there for Li Jiaqi.

Cecilia: Douyin. Normally I use Taobao because they have almost everything, but for these Birkenstocks, the brand’s official Douyin store offered a discount, so I went with that.

Fiona: Taobao. I always use Taobao because it puts the customer’s needs first. If you have a dispute or an issue arises between you and the seller, you feel confident that if something goes wrong, they will fix it. In general, you have more options with Taobao than JD.com and the quality is almost the same.

Cicely: The Harmay mini programme, then Tmall. Harmay [a retail chain selling beauty brand samples with a market value above US$76.4 million] carries so many niche brands and the prices are below market rate.

If an influencer persuaded you to buy this product, tell us more about them. Which influencers do you like and trust, and why? 

Jenny: Yes, there are loads of small influencers on Xiaohongshu who influence me, I’d say. The main one is called Haha Chen. We have a similar body size, she lives in Beijing like me, has a daughter like me. She’s aged around 34. The fact that we are similar means I can trust that I won’t be going too wrong if I follow her lead.

Cecilia: No influencer persuaded me to buy the Birkenstocks.

Fiona Yang: I wasn’t influenced by a streamer this time. I don’t even have Douyin downloaded now because it’s too addictive.  

Cicely: This time, I was watching 钳钳妈阿曼达 (‘Qian Qian’s Mom Amanda’) on Xiaohongshu. I think she’s just over 30 years old and I’ve been following her for more than three years now. Her style/aesthetic is similar to mine, and the items she recommends are always really practical and it’s clear she uses them herself.

What convinced you to buy this product when it came down to it?

Jenny: Nothing really, I just wanted to try something different, and you can return the product within seven days so it was a pretty low-risk purchase.

Cecilia: In this case, the time-limited discount!

Fiona: It was the best price I could find. If I didn’t get this deal, I knew I would regret it. In general, these time-limited deals definitely make me more impulsive. If a site or a person says ‘take advantage of this deal or you’ll miss out’ I usually just pull the trigger.

Cicely: The product seemed to perform well according to the influencer, so I thought I’d give it a try.

Did you get a special discount on this item?

Jenny: Yes, the influencer gave a discount price on the items I bought.

Cecilia: Yes, because I bought on Douyin, the price was RMB 100 (£11) lower than the store.

Fiona: Yes, that’s the major reason why people like me prefer to buy online these days instead of at a shopping mall.

Cicely: No discount this time.

Did you buy the product directly in the app or did you see it in one app, then go and buy it in a different one?

Jenny:  Yes, I bought the items directly from Xiaohongshu because the discounted price can only be claimed during the influencer’s live stream. But sometimes, before I decide to buy it in Xiaohongshu, I quickly go to Taobao, search the same item and check people’s reviews and comments there too.

Cecilia: Yes, I bought the shoes directly from the Douyin app, because it’s cheaper and the delivery is fast.

Fiona: I don’t shop around. It’s too time-consuming. That’s why I really just use Taobao. It gives me a headache doing lengthy comparisons. I prefer to have options because I want to see different styles and prices, but overall I prefer just to buy from a platform I trust and know than shop around for the cheapest products.

What I like about the way Taobao functions is that once you see a product you like and click ‘Like’, when you go back to the previous page, Taobao automatically shows you options for the same product (so you don’t need to search again) and makes it super easy to do your own price comparison. It takes so little effort. Then you can just focus on the reviews rather than the price.

Cicely: I saw the recommendation on Xiaohongshu and then went to Harmay and then finally to Tmall to make the purchase.

How often do you buy imported/foreign brand products on these platforms? 

Jenny: I never buy foreign brand clothing, but I do buy many international brand products for the children as well as skincare products. I buy foreign brand skincare and make-up every two or three months on Taobao and kids’ stuff every one or two weeks, such as baby formula, Vitamin D or A and nappies.

Cecilia: I’d say I buy foreign brand beauty products like La Roche-Posay and Lancôme once every one to two months.

Fiona: I buy imported brands from Taobao (Tmall) since it was one of the earliest platforms to stock foreign brands, and the prices are always similar to duty-free shops at the airport. I also think Tmall has stronger relationships with overseas brands and better quality control. I know it’s the real thing. Mostly I buy cosmetics like Lancôme or Dior or Cote perfume. Sometimes I buy little things from Coach or sports brands like Puma or Nike. If they have something that domestic stores don’t, that’s when I buy them from Tmall because I’m getting something I couldn’t otherwise.

Cicely: I’d say I buy foreign brand products once every quarter – mostly Lululemon and Nespresso!

What influences your decision to buy those foreign brands, and which country’s brands do you trust the most?

Jenny: For me, it’s about quality and safety. In general, I trust Japanese and German brands the most because I know they are serious about quality control. Also, there is a British clothing brand called Next that I like a lot! The designs are really cute, it’s good quality and the price is good too. Unfortunately, it only had an online shop in Taobao for a while, and then it closed, so now there are no online or offline shops in mainland China for it, but it is available in Hong Kong, I think.

Cecilia: The quality and safety aspect, for sure. I feel products from the UK, Europe and the US are especially good.

Fiona: I just buy things based on my personal taste. I seldom try new things. I’m quite a loyal customer. If I like a brand, I use it for years, like Lancôme, for example. Most of the brands I like are from the US, and in general, I think that’s because I see them as mid-range luxury. They’re more affordable than high-end European brands.

Cicely:  I like Lululemon because I know it’s a durable product. And Nespresso holds up for daily consumption too.

Which is your favourite e-commerce platform and why?

Jenny: It’s hard to say. I use Xiaohongshu mostly for myself, JD.com mostly for the children and Taobao for daigou or stuff I can’t buy on JD mall.

Cecilia: Taobao because of the sheer selection, and JD.com for same-day or next-day delivery.

Fiona: Taobao.

Cicely: Tmall for brand assurance, fast logistics, and convenient returns and exchanges.

Are there any platforms that you never use? And if so, why not? 

Jenny: Amazon. I don’t see the reason why I need it. Many years ago, the page looked messy, and the payment method wasn’t China-friendly, but I haven’t used it for years, so maybe they’ve made some changes [Amazon shut down its domestic operations in 2019].

Cecilia: I don’t use Xiaohongshu. I feel like the content is more about showing off, whereas people on Douyin are just having fun.

Fiona: Pinduoduo. It’s like Taobao but with a much lower price, sometimes even below RMB 10, but the quality can’t be guaranteed, so I don’t like it. I also get annoyed by their model. You can make things cheaper by getting bonus discounts for sharing deals with your friends. In other words, you have to ask your friends to help click on the link Pinduoduo sends you to get the price down, usually by just RMB 1 or 2.

But so many friends send you these links. Ok, it’s an easy favour to do for people, but it’s so annoying! Go there and click, go there and click. I didn’t want this app on my phone, but I felt obliged to download it to help my friends get cheaper deals. Since then, I deleted the app. Now when friends ask me to open their links to get them discounts, I just say, “sorry, it’s not worth it for RMB 1!”

China Consumer 2023

This article was produced as part of a series for China Consumer 2023.

Learn more about CBBC’s flagship consumer event of 2023 here.

The post How Chinese women really shop: 4 case studies appeared first on Focus - China Britain Business Council.

From Cibei (Mercy) Coffee in Yongfu Temple, to Muhuanxi (Bathe in Happiness) in Faxi Temple in Hangzhou, to Jianfo (Meet the Buddha) Coffee in Longxing Temple in Taizhou, temples seem to have become a standard setting for coffee shops in China.

It’s not just the names of these outlets that gives a nod to their zen ambiance; their coffee offerings do, too. At Cibei Coffee, for example, an Americano is known as Di Fan (Wash Worries Out), the latte has been replaced by Ting Xue (Snow Stops) and Huan Xi (Happiness) refers to a mocha. A blind box offer called Sui Yuan (Let It Be) has also been introduced, where consumers are invited to draw a fortune stick, a common practice during a temple visit.

The rise of temple coffee is closely linked to the new-found popularity of temple visits among younger people in China, with Gen Z and Millennials becoming some of the most devout worshippers after China dropped its stringent Covid rules. It has been reported that bookings for temple-based scenic areas recorded a more than three-fold increase year on year since the beginning of 2023. The post-90s and post-00s generations also accounted for nearly 50% of the total temple footfall in February according to Chinese online travel agency Ctrip.

Burning incense and praying to Buddha are particularly popular among Gen Z, with the topic of ‘Temples’ on China’s lifestyle-sharing platform Xiaohongshu drawing in more than 160 million views, plus another 100 million reads of the hashtag ‘Pray in Temples’. Shared posts under these tags often include wishes about finding the right partner, passing exams or securing university or job offers.

Temple coffee shops have won over young consumers with their “sharp contrast” between Eastern religion and the Western origin of coffee, arousing curiosity among a generation always looking for new and unique consumer experiences. The presence of monks at a café, some even working as baristas, also appeals to young visitors. What’s more, these scenes of course create great photo opportunities, generating online engagement while fanning overall enthusiasm for the trend.

This latest temple coffee trend stands in stark contrast to a similar attempt by Starbucks in 2012. The opening of the American chain’s outlet near Hangzhou’s Lingying Temple turned into a controversial episode, with some viewing the move as being “too commercial” and “incompatible” with the sacred nature of the monastery, while others even argued that it was “an erosion of Chinese culture”.

The success of temple coffee today lies in a more detail-oriented re-packaging and marketing approach. Temple coffee can’t just rely on the simple installation of a coffee shop within a temple; it also requires comprehensive branding that integrates religious aspects, aesthetics and the spiritual and psychological demands of temple goers.

Examples include Money God Coffee at the God of Wealth Temple in Hangzhou, whose niche is offering caffeinated drinks symbolising wealth, while Xi De (“Happiness and Morality”) in Lingying Temple focuses on good luck in education and careers. These curated experiences are synonymous with the characteristics of each temple, which shows respect for religious culture while also enhancing an immersive consumer experience.

The success of these coffeehouses sets an example of how religious or cultural venues can create another avenue for differentiation through marketing. While setting themselves apart from traditional coffee providers by leveraging the seemingly contradicting image of “West meets East”, they are able to tap into different spiritual demands, enhancing their own uniqueness while speaking to consumers’ emotional needs, which is key to further unleashing the consumption potential of China’s coffee market.

Entering China is a key decision for businesses of all sizes. Call +44 (0)20 7802 2000 or email enquiries@cbbc.org now to find out how CBBC can provide you with the platform to unlock your potential.

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