Consumption has become the primary driver of China's economic growth for three consecutive years, with the online retail industry experiencing remarkable development. By analyzing sales data from various e-commerce platforms, it was found that the network consumption pattern has evolved significantly due to the influence of big data and artificial intelligence. The current trend is characterized by quality, smart features, and personalization. Experts suggest that on the supply side, efforts should focus on intelligent manufacturing, innovation, and design improvements to enhance product quality and create new demand through better supply.
According to recent statistics from the National Bureau of Statistics, consumer spending contributed 64.5% to China’s economic growth in the first three quarters of this year, reinforcing the consumer-driven growth model. Xing Zhihong, a spokesperson for the National Bureau of Statistics, noted that the continuous rise in consumer spending, the emergence of new business models, and the improvement of consumer policies have effectively unlocked the potential of the market.
From a consumption perspective, online sales have shown strong growth. In the first three quarters of this year, sales of physical goods through online channels increased by 29.1% year-on-year, while non-physical goods saw even faster growth at 52.8%. In the first half of 2017, China’s online retail transaction volume reached 3.1 trillion yuan, up 33.4% from the previous year, marking an acceleration of 5.2 percentage points.
Gao Feng, a spokesperson for the Ministry of Commerce, pointed out that the online retail market has been expanding month by month, driven by factors such as netizens’ growing purchasing power, upgraded consumer preferences, integration of online and offline commerce, and innovative business models. Online retail now contributes more than one-third of total retail sales.
By analyzing data from major platforms like Alibaba, Amazon, Jingdong, and NetEase, it was identified that current online consumption trends fall into five key categories.
First, consumers are becoming less price-sensitive and more focused on quality. According to the Ministry of Commerce, during promotional periods, prices of electronics and household appliances rose, yet high-end products like dishwashers and water purifiers saw sales over five times higher than the same period last year. Top quality consumption items include dishwashers, self-balancing electric vehicles, fitness clothing, travel, latex mattresses, lip gloss, smart toilets, dehumidifiers, and moxibustion devices. Jingdong reports explosive growth in foreign fresh products, with cherries from the U.S., lobsters from New Zealand, and salmon from northern Europe selling well during the “6·18†event.
Second, smart consumption is emerging as a significant growth area. Alibaba’s data shows a substantial increase in smart consumption, covering smart homes, virtual reality, and other cutting-edge devices. Sales of AI TVs, smart refrigerators, motion-sensing bicycles, robot vacuums, juicers, dishwashers, and VR glasses have all seen sharp increases. Jin Xuejun from Zhejiang University believes that as consumers mature, smart devices will continue to grow rapidly.
Third, rural online consumption is growing faster than urban areas. According to the Ministry of Commerce, rural retail sales reached 537.62 billion yuan in the first half of 2017, up 38.1% year-on-year—4.9 percentage points higher than city growth. Growth in central and western regions and third-tier cities exceeded the national average, becoming a new driver of consumption.
Fourth, online retail is helping domestic brands gain prominence. Gao Feng stated that domestic brands have gained a strong competitive edge, especially in home appliances and mobile phones, where they dominate the market. In the first half of 2017, domestic brands accounted for 74.5% of total sales, and around 85% in home textiles and appliances.
Liu Nan, CEO of "Nut Bud," observed a trend of “downgrading†in consumption, which doesn’t mean lower spending but rather a shift toward higher-quality products. Consumers are no longer willing to pay for brand premiums as before. Premium domestic brands like “Good Kids†and “Children’s Beginnings†have gained popularity this year.
Fifth, cross-border e-commerce is gaining traction. Amazon reports that seniors are increasingly participating in cross-border shopping, with those spending over 5,000 yuan being the most active group. Beyond traditional markets like the North Sea, provinces such as Sichuan, Shandong, Hubei, and Liaoning have also seen rapid growth in purchasing power.
Liu Nan believes that demand for cross-border e-commerce will remain strong, especially as consumer upgrades and the “second-child era†drive more personalized and specialized consumption. The variety of products available in the market continues to expand, meeting diverse consumer needs.
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