China’s consumption recovery gains momentum amid mid-year shopping fest
BEIJING — China’s consumption recovery has gained impetus from the mid-year online shopping spree amid the country’s efforts to improve domestic market demands and upgrade consumption.
During the “618” festival, a large online shopping event held in the run-up to June 18, the value of orders on JD.com totaled 379.3 billion yuan ($57 billion), up from 343.8 billion yuan in the same period last year, latest data showed.
Trading in offline shopping malls also picked up momentum boosted by pro-growth policies and sales promotions during the shopping fest.
Intime Department Store saw the highest customer flow in the second quarter during the period, with sales of some brands rising over 30 percent year-on-year, according to the company.
China’s retail sales went down 6.7 percent from a year ago in May, narrowing by 4.4 percentage points from April. “The recovery of consumption will pick up pace as people’s lives return to normal,” said Fu Linghui, spokesperson for the National Bureau of Statistics.
A breakdown of the consumption data showed that high-end purchases such as smart home appliances and health care posted stellar performances, echoing the country’s consumption upgrade trend.
Sales of gaming TV and large-capacity double door refrigerator soared by 87 percent and 65 percent, respectively, data from the retailer Suning.com showed. Health products have also been favored by consumers, with significant sales increases on varying trading platforms.
In the medium to long term, consumption will continue to transform toward high quality and diversification, said Wang Yun, a researcher with the Academy of Macroeconomic Research.
“Consumption will play a more important role in driving the economic cycle,” Wang said.
Thanks to sustained policy support, China’s domestic vehicle market became brisk in May with production and sales up 59.7 percent and 57.6 percent, respectively, from a month earlier, boosting related service consumption such as car maintenance and repair.
China’s service consumption has seen rapid growth in recent years, Wang noted, calling for introducing targeted policies to further tap the potential of the super-large market.
In the face of challenges brought about by the COVID-19 epidemic, enterprises have leveraged digital technologies to improve the resilience of the supply chain.
The shoe brand Onemix launched customized products on JD.com in the run-up to the “618.” To catch young customers, the firm has used big data to find users’ needs, and design product styles and colors based on the findings.
Supported by the resilience of supply chains provided by the e-commerce platform, the company was able to regulate production and reorder in a targeted manner, effectively easing inventory risk that is common for clothing brands.
Digital capabilities of new entity companies will help small businesses to break through constraints concerning capital, technologies and talents, thus improving supply quality and promoting consumption upgrade, said Zhao Ping, vice president of the Academy of China Council for the Promotion of International Trade.
To facilitate the symbiosis of small, medium and large companies, China has detailed measures to encourage large firms to build digital service platforms suitable for smaller companies.
Looking ahead, technological innovation will improve supply and demand matching for online consumption, and play an important role in promoting high-quality economic development, said Zhang Chunyu, a researcher with the Chinese Academy of Social Sciences.