The latest research released by Nielsen shows that China's retail industry continues to recover, showing a U-shaped trend. Impacted by lobal epidemic outbreak, there are changes in consumers' behavior and shopping patterns which pushes brands to innovate to address new demands.
Justin Sargent, president of Nielsen China, said: "China is one of the few countries globally showing positive recovery, with its GDP in the second quarter posting a very positive 3.2 percent growth. As the latest macro situation is improving, although still not fully back, we believe the consumption market will continue to grow and ultimately feed back into the macro economy."
Increased confidence in business leaders
About 60 percent of business CEOs surveyed shared optimistic views about the full year's business performance in 2020. There were only about 55 percent of business leaders surveyed in May who shared similar views.
About 80% of the business leaders predict that their industry will have positive growth in 2021, and 90% believe that their companies will have positive growth in 2021.
New trends in the FMCG market: innovation, price, channels and cities
Brands in China are also innovating to meet new demands from consumers, whose shopping patterns were impacted by the COVID-19 outbreak. Local brands are the driving force of innovation, accounting for about 80 percent of new product development this year, the Nielsen study said.
With regards to consumer price trends, consumers have increased their daily expenses due to rising inflation. In terms of channels, the growth of e-commerce channels continues, mainly due to shift in consumption from large modern channels; buyers of traditional channels are gradually turning to small modern channels and convenience stores. On the offline side, store capacity continues to shift, and the concentration of supermarkets and mini supermarkets is increasing. Rural areas are still the growth engine of China's offline channels. From January to July this year, offline channel sales in rural areas increased by 2.4%, in contrast to the continued decline in urban areas.