Jun 15, 2020|
Changes in Consumption from COVID-19 Outbreak to Today
by Fei Lu and Vivian Yang
With the development of the COVID-19 in the first half year of 2020, Chinese consumers’ shopping behaviors have been affected and even transformed. The consumption trends can be categorized into four stages. We have identified some major ones in each stage based on the big data of JD.com.
1. During COVID-19：January – February 2020
- Shift to online shopping: High-frequency shopping online (5-8 times/month) increased by more than 50%;
- Changes on categories: Demand grew fast in home care, maternal and child, health, pets, household appliances, entertainment and other “off-season” categories;
- Growth in Certain Consumer Groups: orders from female new users between the ages of 46-55 grew 38%, that of over 56 females grew 54% year-on-year. Consumers under 25 were showing a growing sense of family responsibility, buying for others rather than just for themselves.This consumer cohort experienced the most rapid growth in the purchase of meat, eggs and fruits and vegetables.
2. Resumption to Work: March –April 2020
- From WFH to Office: Resumption of work gradually started with telecommuting. As a result, the transaction amount of audio-video-related equipment (headphones, microphones, etc.) for conferences increased by nearly 20 times year-on-year; As people prepared to return to the office starting in March, related products such as office supplies, shoes, and raincoats increased by 57% month-on-month;
- Surge of New Products Launches: New releases on JD in Q1 2020 are close to 50% of the 2019 total. New products that represent new technologies, new designs, new functions, new experiences and better profits will give brands an early start in the industry. More than 90% of the core brands select JD supermarket as the first platform for new products.
3. “May” be getting better: national holiday from 1st – 5th May
- With the improved weather improving and loosened travel restrictions, consumption boomed. Especially because door to door delivery became possible, large appliances purchases began to bounce back. During the May-Day holiday, online consumption turnover increased by 45 percent compared with the same period in 2019.
4. Mid-Year Shopping Festival – new trends found during 618
- Continued consumption upgrade: According to KPMG’s latest report on May 28th, with the sustained economic recovery and resumption of work and production, the general trend of consumption expansion and structural upgrade has remained unchanged.
- Revenge consumption; Livelihood demand strongest: Over 40 brands sold over RMB 100 million yuan on June 1st, indicating comprehensive recovery and a sharp rebound in some categories.
- Online shopping behavior persists: in face of the epidemic’s uncertainty and driven by the 618 Grand Promotion, e-commerce platforms like JD.com continue to integrate with short video platforms, offline stores, and city consumption stimulus plans keeping consumers active online.
(Fei Lu is senior analyst of JD Big Data Research Institute)