Mainland consumers to spend more on health, experience, premium products in 2018
Companies that can tap into the growing trend among mainland consumers for healthy options should do well in 2018, analysts say
For 26-year-old Vera Han from Shanghai, a gym membership, an overseas trip and skincare products top her wish list for the new year.
“The gym membership and the need to splurge on skincare products is something that I owe myself,” said Han, who works in the city as a media professional.
Han is not alone. As disposable incomes rise, Chinese consumers are turning to premium products with health benefits, according to analysts.
“The government wants to tackle the unbalanced development between urban and rural households,” said Wang Jun, an analyst at Hua Chuang Securities. “This is expected to enlarge the scale of communities in second and third-tier cities and thus boost sales of goods like braised food, beer and flavouring sauces.”
China has seen high-speed economic growth for the past three decades. But the massive investment pouring into property and infrastructure projects have led to worrying debt levels, which has prompted the government to roll out curbs to contain spending by local governments.
Meanwhile, a national push for developing domestic consumption has taken off since 2013, when Chinese president Xi Jinping pledged to lead the push for a more balanced and sustainable “new economy”.