What Brands Can Learn From China’s Recovery – How Consumer Behaviors Are Changing in the ‘New Normal’ State

April 21, 2020

Last week, we looked at the movement happening within key business verticals, Travel, Hospitality and Luxury, in China, as consumers begin to re-engage and resume daily life in the ‘new normal’ state.

This week, we are building on the learnings and shifting to some of the crucial consumer behaviors that are either developing or emerging as new, potentially sustained behaviors – including buying behaviors and psychological trends, all which brands should be aware of as they make decisions in the future about their businesses.

On Thursday, April 30th, we will be hosting a webinar for brands outside of APAC to gain initial learnings from China’s adjustment to the ‘new normal’, with insight into many more of the emerging behaviors brands should keep top-of-mind. Registration is available through this link:

Webinar: Emerging from COVID-19: Learnings From China’s Recovery

Here is a brief overview of some standout consumer shifts thus far:

Behavioral Trends

Generational Shift – Older generations (65+) have been encouraged to increase their digital footprint and learn how to shop online: According to QuestMobile China, the share of ecommerce used by over 50s jumped from 11% to 14% year-over-year during the pandemic period. As we expect this trend to sustain, this should encourage brands to evaluate how they’re messaging to these generations, as well as how they depict them in digital content in order to help fuel strong connection. Also consider how to further streamline the shopping experience for these generations, as they continue to flex their new skillsets.

Learning & Skillsets Shift – Online education interest is soaring due to school closures: Dingtalk, a software developed by Alibaba and widely used by schools and students, saw over 1.1 billion installations in China during the pandemic period. Not only traditional education is shifting online, but also many other courses and learning activities, like music lessons, which is a dramatic difference from the traditional consumer experience.

Working Dynamic Shift – The COVID-19 crisis has completely altered the work-from-home dynamic for people around the world: This is a relatively new dynamic for Chinese consumers, and in fact for many metropolitan city-based consumers who are used to regularly commuting to their offices. With the coronavirus persisting in other parts of the world, people are starting to prepare for a life where working from home happens more consistently, which involves readying all aspects of their work-from-home setup, from technology to furniture to even apparel choices. Brands should be mindful of this, in both the products they prioritize, and in their messaging and content, to help support this new remote work lifestyle.  

A Shopping & Buying Trend

Influencer Shift – More time spent online with brands and influencers, particularly in live environments where purchasing takes place: Live shopping experiences with key opinion leaders (similar to Western influencers), for example, have already been quite popular in many Asian countries. Alibaba-owned Taobao, a pioneer in live streaming, saw the number of livestream sessions on its platform double during February, when COVID-19 was at its peak. We see live shopping and more live experiences with brands and influencers as a growing trend and opportunity in other parts of the world.

A Psychological Trend

Shopping Motivation Shift – At the convergence of purchasing trends and psychological consumer behavior is the anticipated trend of “revenge spending” in China: This is to suggest that because the worst of COVID-19 has passed, Chinese luxury shoppers will operate with a “life is too short” mindset and will look to spend any money they might have been saving during the crisis to treat themselves or their loved ones to something indulgent. To support this trend, high-end Hangzhou Tower mall opened for five hours on February 22 and achieved more sales than on the same date a year ago. Additionally, in the month of March, beauty and fashion brands on T-mall experienced double-digit sales growth as compared to last year.

While this behavior may in fact proliferate in China and elsewhere, there’s also likely to be a focus on more conscious spending, so brands will need to watch their customers and engage with them closely to understand what will motivate them moving forward.

What This Means for Brands

Staying close to consumer behaviors is critical for brands, particularly as it relates to the ability to shift business models, develop new routes to market and strong engagement methods quickly enough to maintain and recapture growth. With a ‘new normal’ being defined in China, and varying reflections of the ‘new normal’ to come in the rest of the world, the most important thing is to be prepared. Brands have a role to play in helping consumers shape and define their lives in a post-COVD environment, and the brands that focus on this now will be the ones consumers remember today, tomorrow, and in the future.

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