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2018 Chinese New Year Sales (6): Shenzhen

Many Shenzhen retailers reported a surge in sales throughout the 2018 Spring Festival period, with premium items and imported goods particularly in demand.

Photo: Shenzhen shoppers on the lookout for suitable Spring Festival decorations.
Shenzhen shoppers on the lookout for suitable Spring Festival decorations.
Photo: Shenzhen shoppers on the lookout for suitable Spring Festival decorations.
Shenzhen shoppers on the lookout for suitable Spring Festival decorations.

Overall, figures from the Ministry of Commerce showed that from New Year’s Eve to the sixth day of the Chinese New Year (15-21 February) this year, the total takings of retail and catering enterprises across the mainland exceeded RMB926 billion, up 10.2% in comparison to the 2017 Spring Festival golden week period. The most in-demand items tended to be traditional New Year goods, organic foodstuffs, gold and silver ornaments, smart home appliances and new digital products. In terms of emerging trends, a notably higher percentage of New Year items and takeaway meals were ordered online, while mobile payments and customised travel bookings also became more commonplace.

In order to fully assess changing Spring Festival buying patterns, new retail trends and regional purchasing idiosyncrasies, the HKTDC’s mainland offices monitored the sales performance, promotional strategies and digital engagement of the leading retailers within their geographical remit. This has resulted in a unique snapshot of seasonal consumer / retailer behaviour in seven key markets across China – Chongqing, Dalian, Guangzhou, Nanjing, Shanghai, Shenzhen and Wuhan.

In the case of Shenzhen, a somewhat diverse picture emerged of its retail landscape, with a number of highlights meriting particular attention:

Overall, one of the most pronounced shifts this year was the heightened demand for better quality products, with medium- to high-end items, as well as imported products, actively sought out by consumers. This saw the primary focus of New Year shoppers switch from necessities to indulgences, with the premium, high-tech and eco-friendly categories all benefitting.

Aside from shopping for New Year-related items, many consumers also took the time to engage in other activities traditionally associated with the season, with visiting temples, perhaps, the most notable example. In terms of more contemporary developments, there was a distinct upturn in the volume of New Year items and home delivery meals ordered online, with mobile payments and bespoke travel bookings also entering the mainstream. Prompted by the generally higher levels of disposable income, spending was also up with regard to travel, cultural activities and recreation, with takings at the city’s cinemas, for instance, up by 50% year-on-year.

With many of the city’s migrant workers maintaining the tradition of retuning to their home towns to mark the New Year, their pre-departure gift-buying also made a substantial impact on the local economy. This led to an uptick in sales across several categories, including specialty New Year goods / foods, apparel, gold and silver ornaments and the latest digital devices, especially smartphones and tablets.

Given the diverse range of confectionary, alcohol, beverages and home appliances available this year, it would be no surprise if many consumers were bewildered by the sheer number of options on offer. According to staff at the city’s Carrefour supermarket, this year’s Spring Festival special offers and promotions were more wide-ranging than ever before, while also extending across a greater number of categories. This led to dried goods, imported fruit and small appliances heading the list of preferred parental gifts.

In terms of individual outlets, Sam’s Club, the Walmart-owned members-only retailer, this year’s best-selling items included premium fresh commodities and high perceived value own-label goods. The retailer’s online operation also operated a home delivery service throughout the holiday period for the first time.

As a sign of the changing times, the 2018 Spring Festival period saw the three traditionally-favoured seasonal purchases – local specialty products, health products and clothing – lose out to a trinity of more high-tech items in the form of drones, smart speakers and robo-vacs. According to data supplied by TMall, one of the mainland’s leading e-commerce platforms, sales were also notably up for four other high-tech items – steam mops (320%), dishwashers (188%), robotic window cleaners (169%) and robotic cookers (145%).

On the catering front, one of the big changes for 2018 was the move by many mall-based outlets to start offering quick cook-in-an-hour New Year’s Eve dinner packages, typically including such festive favourites as Fo Tiao Qiang and a selection of seasonal platters. Many of these dishes were freshly made to order and then delivered in refrigerated containers.

In light of changing demand, many of the city’s hotels and restaurants cut the minimum booking numbers required for New Year’s Eve dinners from the 10, 16 or even 20 previously specified, with tables for eight diners (or even fewer) widely available. In part, this change in policy was triggered by the growing preference for ordering half-cooked home delivery meals online.

On the travel and tourism front, according to figures provided by the city’s Culture, Sports and Tourism Administration, Shenzhen welcomed 6.82 million visitors over this year’s Spring Festival period, a rise of 4.6% year-on-year. In total, tourism receipts exceeded RMB9.8 billion, an increase of 9% over the comparative figure for 2017. 

In terms of domestic visitors alone, the number increased by 6% year-on-year, reaching a total of 5.5 million and generating RMB7.7 billion in tourism revenue, a year-on-year rise of 10.4%. Many of these in-bound tourists attended one or more of the special festive events staged in and around the city.

Shenzhen Office

Content provided by Picture: HKTDC Research
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