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2018 Chinese New Year Sales (1): Shanghai

According to figures from the Shanghai Municipal Commission of Commerce, the total revenue of the 276 retail and catering enterprises surveyed in the city with regard to their sales performance over the 2018 Spring Festival period (8-21 February) showed a 10.4% year-on-year increase. In the case of those malls with a combined catering, entertainment and retail offer, the year-on-year increase was almost double, coming in at just more than 20%.

Photo: A Yuyuan lantern show welcomes in the Year of the Dog.
A Yuyuan lantern show welcomes in the Year of the Dog.
Photo: A Yuyuan lantern show welcomes in the Year of the Dog.
A Yuyuan lantern show welcomes in the Year of the Dog.

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 Shanghai, a somewhat diverse depiction of its retail landscape emerged:

1. Retail Sales Growth

According to figures from the Shanghai Municipal Commission of Commerce, the combined revenue of the 276 retail and catering enterprises surveyed across the city showed a 10.4% year-on-year increase over the Spring Festival period. More specifically, the city’s 10 leading retailers recorded a combined total revenue of RMB442 million, a 10.6% year-on-year rise. It was a similar story among the 10 leading catering enterprises, which together recorded a total of RMB54 million, a 10.1% year-on-year rise. The star performers here were those retail destinations that also offered catering and recreational facilities, with Raffles City, Metro City, UFun, Wanda and Bailian all recording a rise in sales of more than 20%.

2. Themed Promotions

As might be expected, all of Shanghai’s key retail destinations marked the looming New Year in a suitably festive style. Over at the Jiuguang Department Store, shoppers queued to receive its New Year lucky bags, while the Bailian Shiji Shopping Mall hosted the God of Fortune on the fifth day of the New Year period as he distributed traditional red envelopes. For its part, the Shanghai World Financial Centre staged two traditional opera performances daily throughout the holiday period and, not to be outdone, Raffles City Changning opened the first Japanese crane machine centre in the city, with plenty of earphones, computer accessories, masks and dolls available to be “grabbed”. Adopting a slightly different strategy, Printemps’ “Wish Come True” sale offered up to 32% discounts on the latest spring fashions. Also favouring the discount approach, Shanghai Landmark offered RMB30 off certain RMB99 sports brands, while a number of other items – including several clothing and cosmetics ranges – saw their prices cut by 50%.

3. Festive E-commerce

Many of the e-commerce platforms serving the city enjoyed a bumper new year, with festive goods particularly in demand. In the case of Cainiao – Alibaba’s logistics network free delivery was offered on all new year goods, while JD Logistics lived up to its promise to deliver every day of the year. Overall, the top 10 mainland cities in terms of volume of online New Year orders were Shanghai, Beijing, Guangzhou, Shenzhen, Hangzhou, Chongqing, Suzhou, Chengdu, Tianjin and Wuhan. Shanghai, with the highest overall level of consumers, topped the list, while Suzhou was the only city to make the top ten that was not a provincial capital.

4. Highest Overall Gift Spend

For the mainland overall, per-capita spending on gift-giving averaged out at RMB1,308 over the Spring Festival period, with Shanghai having the highest regional average at RMB3,157. Typically, spending centred on items for parents and grandparents, red envelopes, entertaining and other gifts.

5. New Year’s Eve Dining Out

With still a month to go before the festive period, Shanghai’s restaurants reported they were fully booked. Similarly, semi-cooked festive takeaway dishes from many of the city’s leading catering establishments – largely available to order online – were also in considerable demand, despite prices ranging from RMB500 to RMB1,000. In total, Chinese New Year’s Eve dinner-related revenue showed an 11% year-on-year rise across the city.

6. Unmanned Stores and Logistics

Suning’s mini-stores, JD’s unmanned convenience stores and several other unmanned outlets continued to trade throughout the 2018 Spring Festival holiday period, while Alibaba, Tmall’s Chaoshi (chaoshi.tmall.com) and Taobao’s World (world.taobao.com), as well as several other e-commerce platforms, also maintained a delivery service. Overall, more than 400 electrical appliance and digital product stores on Alibaba and Tmall remained open throughout the Spring Festival period.

According to Cainiao, all of its core activities, including smart warehousing, were maintained over the holiday period, while JD.com’s drone delivery services also remained available. Both Cainiao and JD ensured continuity of service by offering staff financial bonuses, compensatory time-off and subsidised home leave.

7. Recreational Spend

About one million visits to Shanghai’s cultural and recreational resources were reported over the Spring Festival, resulting in a total spend of RMB200 million. In total, some 2,300 Spring Festival-themed activities took place in the city’s libraries, community centres and other public spaces, with most events either free to attend or with highly-discounted access costs. In total, 600,000 visits to these public venues were reported across the course of the week-long holiday.

In the case of the city’s theatres, some 34 different programmes (totaling 262 performances) were on offer, with 290,000 people attending such events, resulting in a total spend of RMB8 million. On the cinema front, a total of 66,500 screenings took place, attracting an audience of 4.12 million people and a total spend of RMB181 million, a year-on-year increase of 31%.

8. Tourist Attractions

Shanghai’s most popular tourist attractions all enjoyed healthy visitor numbers over the holiday period, led by Nanjing Road shopping street with 3.9 million, followed by Little Lujiazui (2.26 million), The Bund (1.9 million) and Yuyuan (1.71 million). In terms of other popular destinations, the Oriental Pearl Tower attracted a total of 144,200 visitors (around the same level as 2017), while the Shanghai Science and Technology Museum and the Shanghai Natural History Museum welcomed 240,600 visitors, a 6.1% year-on-year rise. Among the few to experience a drop in numbers was the Shanghai Wild Animal Park, with only129,500 people visiting, a year-on-year decline of 16%.

Source: www.commerce.sh.cn and other mainland websites.

Shanghai Office

Content provided by Picture: HKTDC Research
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