The Chinese lunar New Year is traditionally the greatest human migration in modern times. However, in 2021, the traditional custom of returning home during 2021 Spring Festival was not encouraged due to a few local outbreaks of COVID-19. These inconveniences did not stop Chinese consumption during the 2021 Spring Festival.
The total volume of Chinese consumption during the 2021 Spring Festival breaks records
According to data released on the evening of February 7, 2021 by China’s Ministry of Commerce, from New Year’s Eve to the sixth day of the first month (February 11-17), key retail and catering companies across the country achieved sales of approximately 821 billion yuan, reaching an increase of 28.7 % over the 2020 Spring Festival Week and 4.9% over the 2019 Spring Festival Week.
Due to the impact of the pandemic, Chinese national consumption experienced a rare decline in 2020. However, the data released by the Ministry of Commerce on the evening of the 17th showed that the consumption data during the Spring Festival in 2021 not only increased by nearly 30% compared with 2020 during the epidemic period, but also significantly increased compared with the 2019 Spring Festival Week before the epidemic. In short, despite the global economic recession, and small COVID-19 outbreaks within the country, Chinese consumption during the 2021 lunar New Year hit a record high.
Although the shadow of COVID-19 has not completely disappeared, the consumer market during the 2021 Spring Festival showed “vigor and vitality” according to the Chinese Ministry of Commerce, which was conducive to the further development of the normalization of the epidemic.
Chinese consumption during the 2021 Spring Festival leads to the rise of smart and contactless services
The prevention and supression of COVID-19 has led to the rapid growth of security and smart consumption, and at the same time the development of contactless transaction services has accelerated. On February 18, China UnionPay disclosed data that during the 7 days of the Spring Festival in 2021 (New Year’s Eve to the sixth day of the first lunar month), UnionPay network transactions amounted to 1.38 trillion yuan, an increase of 4.8% over the same period last year, setting a new high.
Online shopping for New Year’s goods, “online festivals”, and digital red envelopes have become a new trend for the Spring Festival this year. While most shopping centers close during the holidays, online shopping, express delivery and other channels remained open, capturing all the New Year’s gift exchanges and last-minute splurges.
With the popularization and application of new technologies such as 5G and 4K, people can experience an “online” Chinese New Year anytime, anywhere. Residences of Hebei, Fujian, Shandong, Guangxi, Gansu Provinces can watch fireworks on Internet, visit temple fairs, enjoy lanterns online, visit relatives and friends by video calls. Yunnan, Guangdong, Hubei, Heilongjiang, Dalian, Xinjiang, Tibet and other places carried out activities such as “a mobile phone to visit the business district”, “online flower market”, and other activities like online coupon collection for offline discounts, which aims to let the local people enjoy the New Year. Governments in Beijing, Shenzhen, Suzhou and many other places handed out digital red envelopes worth tens of millions of yuan, allowing local people to take the lead in enjoying the special “big gift packages” brought by smart technology.
Source: CCTV, 2021 online Spring Festival
The stay local policy during 2021 Lunar New Year has led to a boom in local leisure consumption in China
The stay-at-home policy adopted in response to the pandemic in 2020 boosted indoor consumption, while the stay local policy during 2021 Chinese New Year for those who work far from home boosted the local consumption especially in leisure industry.
Different from some long-distance domestic family travel in previous years, this policy promoted the development of local tours, as well as short-distance self-driving tours. The passenger flow of leisure and entertainment venues such as parks, scenic spots, museums, movie theaters, and ski resorts has increased significantly, and the bookings of resort hotels and homestays in the suburbs. Additionally, many domestic films were released, detonating the Spring Festival film market. According to the Ministry of Commerce of China, during the Spring Festival, the national movie box office revenue exceeded 7 billion yuan, setting a record for the Chinese New Year holiday. In only one and a half months since 2021, the movie box office exceeded 10 billion yuan, nearly half of last year.
During the Spring Festival holiday this year, the amount of local consumption by locals increased by 3.8% compared to the period before the Spring Festival and 13.6% over the same period last year. Among them, Liaoning, Shandong, Gansu and Jiangsu accounted for the highest increase in the consumption of locals compared to the same period last year. The share of consumption of locals in Shanghai and Beijing also increased by more than 17% compared with the same period last year.
Source: Douban, One the top movies during the 2021 Spring Festival
Goods consumption, especially gifts stands out in Chinese consumption during the 2021 Spring Festival
The stay local policy has promoted a substantial increase in the consumption of household goods as well. Traditional products such as New Year gift boxes, home appliances, snack food, seasonal clothing, fitness equipment and other traditional products have sold well. In addition, the 2021 Spring Festival coincided with Valentine’s Day. As a result, gold and silver jewelry, beauty products, and flower gifts and consumption of other quality goods were particularly high.
According to monitoring by relevant agencies, the average daily passenger flow of shopping malls in 10 first- tier and second-tier cities across the country increased by more than 200% year-on-year, reaching 86% of the same period of the Spring Festival in 2019.
Data source: Ministry of Commerce of China, designed by Daxue Consulting, YoY increase in sales during the Chinese new year, 2021.
High level of Chinese consumption during the 2021 Spring Festival indicate that the country’s economy has put COVID-19 behind them
Chinese consumption during the 2021 Spring Festival not only broke records but showed us new consumption trends generated under the new pandemic policy are conducive to the further advancement of the normalization of the COVID-19: smart and contactless consumption are developing rapidly, local leisure consumption are raised by the stay local policy, additionally, goods particularly gifts consumption are extremely popular.