Back in China after Covid

05 Dec 2023 | Research & Business Knowledge

Article by ICG member Felicia Schwartz, China Insight

After returning from a trip to China this summer where I led a research project on green and clean behaviour for a cosmetic brand, a UK client eagerly asked me about my impressions.

It’s been a couple of years I had not been able to enter China, despite being there virtually almost daily via online focus groups and ethnoboards. This query was thus a welcome invitation to take a more analytical look at my 3-week trip through Chengdu and Shanghai.

What has changed in post Covid China?

New lead-cities emerging: Covid certainly did not stop China in its tracks. I was hugely impressed by Chengdu which has developed in strides since I was last there a few years back and has become a super- dynamic, thriving city, well deserving its “promotion” by the Chinese government from Tier 2 to a “new Tier 1” city. There was a buzz just walking in the streets and shopping areas. Fashionable millennials strut in the city centre and the more relaxed atmosphere (and distance from the central government) provides for a vibrant club and music scene and relatively overt presence of an LGBTQ community. It is clear that brands now have to look beyond Beijing and Shanghai to understand cutting-edge China.

A new retail model: I am not easily impressed by a shopping centre, but Taikoo Li Chengdu is a sight to be beholden. The onetime site of a Buddhist monastery turned alfresco mall is now a temple dedicated to contemporary style. In addition to offering blue-chip shopping (LV, Hermès, Cartier Gucci and the other usual suspects all have stores here), a new model of retail integrating culture, art and lifestyle experience is on display here. Many of the flagship stores boast cafés, restaurants, art installations and other unique ways to engage with brand stories through IRL and virtual means. A gigantic 90-degree curved LED digital display which delivers a 3D view without glasses completes the mesmerizing experience.

The search of well-being: I found Shanghai similar to my last visit just before Covid with the exception of lots more by the way of “small pleasures” such as specialty coffee and milk tea shops literally popping up everywhere. Gyms, yoga and other well-being centers have expanded and it seems people in general are much more focused on health, wellbeing and mental balance post Covid, something we also witnessed in the focus groups.  My colleagues took me to a Gong and hand-pan workshop on a Friday evening (as you do!) where the focus was on spiritual introspection and awakening through the musical practice. The studio was packed with fashionable Genz’s.

The advent of quiet luxury: In terms of consumption, urbanites are more intent on quality and more discrete consumption rather than buying anything because “they can” or due to social pressure, as one respondent articulated in a focus group in Shanghai. This means subtle and elegant designs (best known as “old money style”, a hashtag that has been trending on social platform Xiaohongshu), noble materials worked according to craft traditions and outstanding designs instead of outstanding logos are what is “in”. Indeed (largely niche) Brands that are more minimalist, timeless and emphasise quality workmanship and materials really started taking off over the last year or two.

It seems this trend stems partially from a similar socio-economic context to the one that has spurred the trend in Europe and North America. Whilst the middle classes are squeezed, the rich spend more discretely. These top spenders in China are of course also more mature luxury consumers, favouring classic styles and intrinsic quality over bling. Yet even younger consumers are captivated by the trend. Paradoxically, as China remains a status driven society, quiet luxury has just become a new status signifier and trendy way to be recognised as being “in the know”.

Felicia Schwartz has founded China Insight after spending 14 years in China as an agency planner. With teams in Beijing, Shanghai and London, China insight offers market research across China and Asia as well as semiotics, foresight and consumer video documentation.