Discussion keeps the world turning.
This is Round Table.
It's December 31st.
The clock's ticking on 2024, and we've spent a whopping 44 trillion yuan already.
Consumption this year has been all about making life smarter, more purposeful, and oh so fun.
We'll dive into the bold new trends, reshaping how China spends, saves, and slays.
Ready for the final breakdown of the year?
Let's go! Coming to you live from Beijing, this is Round Table.
I'm He Young. For today's program, I'm joined by Steve Hatherly and Yu Shen in the studio.
First on a day's show!
Did you know China's retail market is cruising towards a jaw -dropping 44 .3 trillion yuan for the first 11 months this year?
That's $6 trillion US dollars worth of purchases shaping new trends with cutting -edge tech, innovative services, and fresh consumer demands.
From trade and discount programs to first -door launches, it's not just shopping, it's a lifestyle evolution.
So as the year draws to a close, let's dive into how 2024 has been rewriting the playbook for consumption and giving the economy a serious boost.
So Yu Shen, help us out here break down the numbers.
Oh yes. All of them.
Ready, go! All right, one by one.
So this is according to the National Bureau of Statistics who reported that the China's retail sales of consumer goods went up 3 % year on year to hit over 4 .3 trillion yuan, which is equals $609 billion US dollars.
I'm already stuttering, you see.
The numbers are so shocking.
Yeah, and that is up till November 2024.
So in the first 11 months of this year, the retail sales of consumer goods totaled nearly 44 .3 trillion yuan, which is $6 trillion US dollars.
And it's a 3 .5 % year on year growth.
And then when we were looking at the online retail sales of consumer goods, that stood at around 14 trillion yuan, which is $1 .9 trillion US dollars.
7 .4 % of growth as well.
Yeah, they broke it down further into specific things.
So for example, retail sales of food and drinks, that increased almost 6 % year on year.
And also in terms of consumer goods items, retail sales reports of sports and entertainment related products, they saw the fastest growth rate as a matter of fact, 10 .5 % year on year, household appliances, audio visual equipment, growth of almost 10%, and cosmetic retail sales.
They didn't have a great year, down 1 .3%, and gold and silver and jewelry sales fell over 3 % as well.
So a lot of great news in the market, but for those specific things, not such a great year perhaps.
Yeah, they saw a small dip in the sales numbers.
And let's take a look at all these different consumption trends that have taken shape this year.
What are the eye -popping ones that you can't wait to share with us?
I mean, the first one has to be the trade -in program, right?
Also, here are more figures on that.
So the Ministry of Commerce shows that since the beginning of this year, the consumer goods trade -in program has already driven the overall sales of related products, exceeding 1 trillion yuan, which is $137 billion US dollars.
So we've been talking about this on Roundtable for several times, how these trade -in programs have been getting people to get this idea that we're changing in our old house home appliances and getting in some new ones.
Like a lot of people this year, they have been making large consumptions, like replacing old cars with new energy vehicles.
There are at least two of my family friends who are doing that this year as well, and also purchasing smart green home appliances as well, upgrading electronic products, et cetera.
So that's all like shopping trends and consumption trends that's closely related to the trade -in program that we're promoting this year.
When we had Fei -Fei on the show, maybe a couple of months ago, a young you'll remember, she was very excited.
She was trading in her refrigerator to get a new one, and this was part of the trade -in program.
So I'm curious. This trade -in program was for many, many, many, many different things.
You just listed a few, but it wasn't just things like cars and electronics or big home appliances.
It could have been furniture as well.
That would be included too, right?
Yes. Well, most electronic I would say, I was going through the list on JD .com, one of the major online shopping platforms here in China, and most of those items that's covered within this program include electronic ones, electronic water heater for shower, and also refrigerator like Fei -Fei did, and stoves.
Nowadays, they're kind of replacing that to semi -electronic as well in many homes.
So yeah, I would say furniture is included, but not so many.
Some even covered phones or computers, like just day -to -day working or office utilizations as well.
But for homes, it's more electronic to me.
And then with the trade -in, I guess it's kind of self -explanatory, but you give your old item, they give you a new item at a discount.
It's not like giving.
You're still paying.
Right. Yeah. It's like basically when you get this new item, bright, shiny new thing with more high -tech features, which is quite the replacement from your old shabby thing at home.
And then you let's say get like 30 % off.
Yeah, right. Right?
That's the trade -in part.
But you still need to pay for the 70 % of the original tax price.
If it were free, the trade -in rate would be 100 % of every item in the country.
Wouldn't that be fantastic.
Yeah, right. And also for the traded -in old item, people are talking about taking that apart so that maybe you can use the precious material for something else.
I personally see huge growth potential in that area for business propositions.
And then another way is probably to recycle or maybe resell.
So, this is a way to, I guess, give people that incentive to, you've been eyeing that product at home and you think you could get a new one, but you need that impetus to actually do it and to consume.
And this trade -in program has actually excited a lot of people.
Yeah, right. And prompt them to do that.
Yeah, it's actually taking effect here as well.
This is according to XinhuaNews .com that over this year, the retail sales of household appliances and audio -visual equipment.
I wonder what that indicates, like TV and like audio speakers or something.
And also that and furniture, automobiles, and construction and decoration materials increased 22 .2%, 10 .5%, 6 .6%, and 2 .9 % respectively in November.
So, yeah, we can totally see that people are joining into this program and getting their old stuff extended for you.
Yeah, so people are trading in not just for a new one, a new one of whatever it is they're trading in, but for an advanced one as well.
Suning is a major home appliance retailer here in the country.
And they cooperated with a Beijing -based market consultancy firm called AllView Cloud.
They published a recent consumption trend report on their own.
And it showed that with the help of the trade -in program, the home appliance consumption in multiple categories, they've experienced explosive growth in the third quarter or since the third quarter.
And when users choose products, they're paying more attention to high performance products and green products, intelligent products, healthy things that are good for them.
And consumers see it as a time of upgrade.
And this is also the government supporting the market in the sense of giving out subsidies to these companies.
And with this trade -in program, it certainly has injected life to the consumption scene.
And another interesting consumption trend, or this is not necessarily one new thing, but Shanghai has really become the city associated with the so -called first launch economy.
And why does that excite people?
I mean, the first launch economy, this term itself is already, I don't know, sounds exciting to me because it's something that's...
Yeah, brand new. Brand, brand new.
Nobody has ever seen it before.
So this is coined by China Daily that this first launch economy is a new type of economic strategy, where businesses introduce new products, launch new formats or models or services and technologies of their products in open flagship stores.
Like you mentioned, Huoyang.
In Shanghai from January to July this year, they added like 770 of such first stores, which is an increase of 16 .5 % comparing to the same period last year, involving five global first stores.
Just hear that, five global first.
Yeah, every year, Shanghai, they do this first launch in Shanghai program and there's a series of activities and it attracts these really high quality domestic and foreign brands to open the nationwide or Asia first stores in Shanghai through these one -time rewards and other means as well.
So a bunch of flagship stores and innovative concept stores, they continue to enrich the commercial landscape of Beijing.
Shanghai obviously has their program as well.
From data from the Beijing Municipal Bureau of Commerce in the first three quarters of this year, the city saw where we are the opening of 717 brand first stores, flagship stores, innovative concept stores and that's an increase of 40 % compared to the same period last year.
So Shanghai, yes, but also don't forget us here in Beijing, also very big on the first launch economy.
I mean first launch, I remember there is this, is that a car from Xiaomi when it was like being released for the first time, the CEO himself, many of the so -called insta -famous leaders of that company were there as well and people were so excited.
They were surrounding the new car model and they were like taking photos, so did for other car brands as well.
That was like quite a scene to see as well.
It's always a big deal.
Yeah, well the debut of a brand new product.
You know that's eye grabbing for sure.
And also as a fellow Beijinger saying this about Shanghai, yes, I've looked that there could be a little bit of a, you know, regional rivalry between us, but you got to give it to Shanghai that thanks to its very mature business environment and also thanks to maybe higher disposable income per capita of people
who hang out in Shanghai, it is the place to launch a lot of these really fashionable and forward -looking stores.
And the other day when I was paying for something after visiting one of the designer stores in Beijing and I realized that my money went to the Shanghai office and it's because when they first entered China and then most of these stores, they would register in Shanghai.
They would set up office in Shanghai.
So there's almost like this tradition of commerce that has been thriving from Shanghai and emanates to the other parts of the country.
So I think in a way we're seeing a continuation of that tradition and kudos to Shanghai, you know.
It's great to see that the economy is thriving over there.
And in Beijing we get some brand new stores too, which is nicely brought up.
717 was the, pardon me, the exact number there.
Another big trend this year, cultural tourism, yes.
We talked about that a lot on the show.
I mean, I think just yesterday we were mentioning how we had this policy of welcoming foreign visitors to China and allowing people from over 50 countries to stay here for six days.
Now the number has been raised to up to 10 days.
That's according to the National Immigration Administration who said on December the 17th that the permitted stay for eligible foreign travelers have already been extended from the previous 72 and 144 hours to 240 hours.
So 10 days, guys, 10 days touring around in China.
That's a big advertisement.
But anyways, under the updated policy, the eligible citizens from 54 countries, including Russia, Brazil, Britain, the U .S.
and Canada, can enter China visa -free when transiting to a third country or region.
So that means that even when you're just stopping by, you will have a few days, if you have that few days' time, to walk around, you're still welcomed.
Yeah, and it makes a big difference too.
China recorded almost 30 million inbound foreign visits between January and November this year.
That is an increase of over 86 % year on year.
And of those visitors, 17 .5 million of them entered the country visa -free.
That is a massive, almost 125 % increase from the previous year.
So if you need evidence that that policy is working, well, there it is.
Yeah, who doesn't love visa -free travels, right?
And if you turn your eyes to the domestic travel sector, 2024 has been a big year too.
And you can see that the travel industry has really dug deep into coming up with more travel products, such as, well, you guys mentioned, cultural tourism.
So how has that panned out?
I mean, for me, the most obvious feeling is that a lot of the so -called the little potatoes from the south, or southern China, that's the nickname given from the northern Chinese citizens as well.
But these southern travelers, they're traveling up north to places that's known to be very cold, like cities like Harbin, to experience a very different taste of China.
Even though we're all living in China, the different regions and areas can really decide a very different feeling, the local vibe and everything.
Yeah, you get the ice and snow tourism in the north, right?
And with the ninth Asian winter games in Harbin about to begin just in, I think, one month in February 2025, I think it's just going to start a new wave of loving and faves for snow sports and ice sports as well.
So, yeah, just hopefully that can get more little potatoes up north.
Well, it's kind of a loving and endearing term because when people from the south might not be, well, this is generalizing a little bit, not so tall and wrapped up in wraps.
Oh, it's because of their height.
I thought it's because they're cute.
Okay, well, there's a dispute on...
So, I guess, everybody, you're subject to your way of interpretation and just bear in mind it's a term of endearment as such, right?
Domestically speaking, still on this topic, the county economy was big in China this year.
Since the beginning of the year, more and more travelers were visiting county areas.
So, it's not just the big cities that people are going to.
And as a result, a number of county -level hotels, they had a great year, economically speaking, from local hotel brands to international hotel groups, too.
They're increasing their layout in lower -tier markets and counties and towns.
And the changes in county hotels reflect the vitality, I guess we can say, of the county economy.
Nowadays, there are over 2 ,800 county -level administrative regions in China, and that accounts for nearly 40 % of the country's total economic output.
And that covers the population, of course, of hundreds of millions, and the market potential is massive, too.
Yeah, exactly. That's showing a very big market potential out there that's attracting people to visit smaller towns.
Actually, personally, my family has been on that trip, as well.
For more than once during this year, my parents and their friends are traveling to multiple smaller cities that used not to be known for famous traveling sites.
But these days, people can just hop on a car and make a stop and just tour around in smaller counties and enjoy the local food.
For them, the food was the best, because you never expect what tiny little restaurant may offer you.
Those are the best ones, the hidden gems, right?
And with more people visiting those smaller cities and towns, well, of course, big brands see their opportunity once they see those numbers reflected, and that's exactly what happened, as well.
According to release data in 2024, the number of coffee delivery orders for multiple brands, like Starbucks and Luckin Coffee and Koti Coffee in county towns, increased by almost 100 percent year -on -year.
It's hard to do better than that.
And the number of delivery merchants also increased by 159 percent year -on -year, so big, big growth in the county levels of the country.
And then there are more residents of, say, smaller towns and counties that's below cities.
They are also traveling abroad, too, in online travel agency Chunar.
During the national day holiday, the number of outbound travel orders from residents in the smaller cities and below cities are increased nearly three times year -on -year, demonstrating a huge potential for county economy, as well.
I think, as a Chinese person, you can definitely see this as development of the economy.
Because even let's say 10 years ago, when speaking of counties, sometimes when you chat with folks from smaller cities or counties, the way to demonstrate how big or small it is, is often this line.
Is there a Starbucks?
Oh, yeah, right. Or like 10 years before that, it was, do you have a McDonald's?
Or maybe, oh, maybe Guxu, or something like that.
It's like the Chinese version of KFC, something like that.
It's like you need some kind of measurement that can immediately - It's a benchmark, so you know where you're talking about.
And also, when you talk about delivering coffee in these counties instead of tea, it's really interesting.
This is another, in a way, another side of globalization.
Yeah. And trust me, you know, as someone who's from a very small town, Tatamogush, Nova Scotia, in Canada, if a big brand comes in, that can be pretty exciting, actually, for the residents of the town.
We don't have that in Tatamogush.
So yeah, I'm a little bit envious when you hear about a big coffee chain or a big hamburger chain or chicken chain coming into the town.
It's pretty cool. I think we've mentioned this multiple times on Roundtable throughout the year, at least since I've joined the program, the silver economy catering to seniors, big year for that, too.
We were just mentioning that yesterday as well, like for a lot of the silver -haired, say, generation people at their 60s, where sometimes we see them above their 50s as well that's counted in this generation of group of people as well, that they are not only enjoying a lot of the new societal resources
that's provided to them, like the universities or colleges built specifically for older people, but also they are generating a huge consumption power by getting, I don't know, clothing and just streaming through online shopping trends as well.
They're starting a lot of new hashtags on the red as well, now that I'm seeing.
Well, I didn't notice until my dad has this trend of watching people selling clothes on red.
I didn't even know he had red.
So, again, this is their generation, generating new trends for shopping and consumption and they're becoming a main force as well.
One of the things that I'm curious to know about, and I must admit I don't know, I've seen the term, I've heard the term, but maybe we can elaborate a little bit on this.
China Sheik became a thing this year.
Can you tell me in detail perhaps what that's all about?
China Sheik is more on dressing up or just drinking and eating Chinese -style food and drinks.
For example, there are tea drinks.
Since the summertime, various Chinese tea drinks have occupied the shelves of large and small supermarkets as well.
And we see that a lot of tea brands, I can't really name each and every one of them, but there are so many new ones emerging every once in a while that's specifically doing tea and different types of tea, mixed with milk, some doesn't.
It's just a big variation of teas offered to, especially younger generation, to get a bigger variety and knowledge about how different types of tea from different areas and regions in China is cooked, what different taste they can provide and all that.
So nowadays, when we talk about China Sheik, it's not just Hanfu anymore, girls, guys as well, dressed up in Hanfu and taking pictures in the city and stuff.
It's all about the lifestyle.
You eat more healthily, you eat the grains.
According to the ancient books, you follow the traditional Chinese herbal treatments to adjust your health, and also you drink tea a lot.
That's like new consumption trend.
More commonly seen among young Chinese these days, I'll say.
So China Sheik doesn't just involve fashion.
It can involve a healthier lifestyle with Chinese products and also perhaps cultural activities and all of those things related.
Yeah. It's pretty much like Chinese culture and style permeates into all corners of life, and businesses are quick to jump on that bandwagon and develop products revolving that Chinese style.
And people really like it here.
And there's this other one of a consumption trend that I find to be really interesting too, and we only have like 30 seconds to talk about it.
Consumption for emotional value.
Spend a little bit of money and get happy.
Why not? It gives your energy a boost.
It makes you feel good, and you're paying for that moment to feel good, and people are willing to spend a little bit of money or quite a lot of money for that, and that's maybe moving away from conspicuous shopping but into something that is partially, possibly a little bit more meaningful.
And we've covered all these consumption trends on the shows on Roundtable throughout the year.
Roundtable does you keep on top of things.
That's happening in China.
Oh, yeah.
