Table of Contents
Executive Summary
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- Impact of COVID-19 on consumer spending
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- Figure 1: Short, medium and long term impact of COVID-19 on consumer spending sentiment, October 2020
- Economic growth is sustained
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- Figure 2: Summary of key economic indicators, China, January-September 2020
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- Figure 3: Monthly growth of total retail sales of consumer goods and foodservice in China, March 2018-September 2020
- Figure 4: Growth of total retail, by key sectors, 2019-September 2020
- Impact on consumer spending
- Impact of COVID-19 on household income eases up
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- Figure 5: Changes in source of income after COVID-19, May 2020 vs September 2020
- Saving habits have not changed after the outbreak
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- Figure 6: Current financial situation, 2016-2020
- Generally optimistic attitudes towards the future
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- Figure 7: Confidence in improving future financial situation, 2016-2020
- Financial priorities remain almost unchanged
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- Figure 8: Financial priorities in the next 12 months, % very important, December 2019-September 2020
- Premiumisation is still on-trend
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- Figure 9: Triggers of discretionary spending in the last 3 months, September 2020
- Potential in discretionary consumption
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- Figure 10: Attitude toward spending, September 2020
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- Figure 11: Attitude toward spending, September 2020
COVID-19 China Context
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- This update was prepared on 30 October 2020
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- Figure 12: Worry about being exposed to COVID-19, China, February-October 2020
State of the Economy
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- GDP continues to rise in Q3 2020 after rebounding in Q2
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- Figure 13: Quarterly growth of GDP in China, Q1 2000-Q3 2020
- PMI maintained above the threshold in Q3
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- Figure 14: Monthly purchasing managers’ index, China, January 2018- September 2020
- Import and export value continues to grow
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- Figure 15: Growth in the total value of imports and exports, China, January 2007-September 2020
- Unemployment rate drops but pressure remains
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- Figure 16: Monthly surveyed urban unemployment rate, China, January 2018- September 2020
- CPI fluctuates mainly due to changing food prices
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- Figure 17: Consumer price index, China, January 2000-September 2020
- Recovery of real incomes has sped up, consumption levels returning
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- Figure 18: Growth of per capita disposable income (price-adjusted), China, Q1 2019-Q3 2020
- First increase in retail sales glimpsed, marketing sales continue to improve
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- Figure 19: Monthly growth of total retail sales of consumer goods and foodservice in China, March 2018-September 2020
- Mintel predictions in Q2
- Items that are taking a short-term hit but are quicker to recover:
- Items that take longer to recover:
- What has happened in Q3
- Sectors that are holding up well:
- Sectors that are taking a short-term hit but are quicker to recover:
- Sectors that will take longer to recover:
- The sector that will struggle for longer:
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- Figure 20: Growth rate of retail sales, by key sectors, China, 2019-September 2020
Change in Household Income
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- Impact on household income after COVID-19 eases up
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- Figure 21: Changes in source of income after COVID-19, May 2020 vs September 2020
- More affluent households have higher willingness for spending in the future
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- Figure 22: Changes in source of income after COVID-19 for bonus and salary, by monthly personal income and company type, May 2020 vs September 2020
- Spending willingness of younger generation recovers faster
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- Figure 23: Changes in source of income after COVID-19 for salary, by age, May 2020 vs September 2020
Current Financial Situation
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- Saving habits have not changed after the outbreak
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- Figure 24: Current financial situation, 2016-2020
- Consumers in their 30s and 40s have more potential to spend
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- Figure 25: Current financial situation, % saying “I can save a considerable amount of money every month”, by age, December 2019-September 2020
- Married couples without kids save more
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- Figure 26: Current financial situation, % saying “I can save a considerable amount of money every month”, by marriage status, December 2019-September 2020
Confidence in Future Financial Situation
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- Consumers’ confidence in the future is improving but not fully returned
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- Figure 27: Confidence in improving future financial situation, 2016-2020
- Tier one and two cities have more financial confidence
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- Figure 28: Confidence in improving future financial situation, by city tier, December 2019-September 2020
- Couples with no kids convert to an optimistic attitude faster
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- Figure 29: Confidence in improving future financial situation, by marriage status, September 2020
Financial Priorities
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- Impact on financial priorities by COVID-19 not felt
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- Figure 30: Financial priorities in the next 12 months, % very important, December 2019-September 2020
- Female consumers saving more for preventative reasons
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- Figure 31: Financial priorities in the next 12 months, % very important, by gender, September 2020
- Post-90s bearing more financial burden but not giving up self-indulgence
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- Figure 32: Financial priorities in the next 12 months, % very important, by generation, September 2020
Factors Triggering Discretionary Spending
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- Improving quality of life is key
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- Figure 33: Triggers of discretionary spending in the last 3 months, September 2020
- High income consumers prefer high-quality and on-trend products
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- Figure 34: Triggers of discretionary spending in the last 3 months, by monthly personal income, September 2020
Attitude towards Spending
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- Not so strict spending budgets
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- Figure 35: Attitude toward spending based on budget, by marital status, September 2020
- More consumers prefer to pay in full
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- Figure 36: Attitude toward spending with instalment, by monthly personal income, September 2020
- Families with kids and high earners have more brand loyalty
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- Figure 37: Attitude toward spending on brands and retails with price difference, by monthly household income and marital status, September 2020
- Impulsive spending still there
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- Figure 38: Attitude toward spending product when it is on sale, September 2020
- Married consumers with no children care about value-for-money
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- Figure 39: Attitude toward spending on affordable products, September 2020
- Consumers under-29 are more receptive to private labels
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- Figure 40: Attitude toward spending on private label products, September 2020
- Figure 41: Attitude toward spending on private label products, by age, September 2020
Appendix – Methodology and Abbreviations
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- Methodology
- Abbreviations
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