New business forms invigorate China's consumer markets

Editor's note: Yi Shaohua is a research fellow at the National Academy of Economic Strategy, CASS. The article reflects the author's opinions and not necessarily the views of CGTN. It has been translated from Chinese and edited for brevity and clarity.

As living standards improve, consumers' focus on consumption has shifted from "availability" to "quality" and even "excellence". Consumption demands are evolving from mass-market consumption to more personalized, multi-dimensional, and diversified preferences. In addition, the way people consume has changed, moving away from a product-dominated perspective to one that equally prioritizes both services and goods. The development has imposed higher requirements on consumption supply. 

New consumption scenarios, represented by the experience economy, first-store economy, and performance economy, have continuously sprouted up, injecting fresh vitality into the consumption market. Therefore, in order to align with these evolving consumption patterns, it is essential to foster innovative, multi-dimensional consumer environments to promote the integration of multiple business forms, including commerce, culture, tourism, sports, and health, thereby stimulating new consumption drivers.

Over the past few years, China has made significant strides in the integration of various business forms, particularly in the development of international consumption hubs and smart commercial districts. In general, these efforts have primarily focused on the following three areas. 

Firstly, the transformation of traditional commercial facilities has been accelerated to stimulate the integration of multiple business forms and create new consumption scenarios. As consumption demand scales up, traditional commercial facilities are shifting from single-purpose consumption venues into hubs for lifestyles and socialization. The integration of various business forms, including retail, dining, lifestyle services, culture, entertainment, sports and healthcare, has become increasingly prominent, expanding from meeting shopping demands to fulfilling intellectual and cultural needs. 

For example, Shanghai's Dahua Tiger City, a commercial district, has set up a "Dahua Night Alley", an immersive nighttime shopping scene designed in the style of old Shanghai. By incorporating pop-up stores featuring Shanghai's signature brands and Baoshan's specialty products as well as cultural performances, it blends commerce with culture and tourism, providing local residents with a great place to relax at night.

Secondly, newly established brand stores are expanding across all business forms, applying technological advancements in real-life settings to effectively tap into latent consumer demand. Lifestyle product stores are incorporating new business forms of arts and entertainment, evolving from selling daily necessities to offering a suite of cultural and creative products, entertainment services and products, and so on. 

For instance, in 2023, a home appliance brand launched its first mall-based "Care and Art Space" store in Tianjin, creating an integrated store and offering an immersive experience for smart living. By intuitively presenting intelligent features, scenario-based solutions, and immersive experience, the store seamlessly connects technology with daily life and forms a "smart living hub". 

Moreover, to cater to the needs of different customers, the store provides customized services tailored to specific scenarios, including balconies, bathrooms, and laundry rooms. 

Meanwhile, it also hosts a variety of activities such as lifestyle aesthetics sessions, handicraft workshops, and course-sharing events. These initiatives have enhanced the brand's ability to reach customers, deepen consumer awareness and perception of technological advancements, and incorporate technology into daily life, allowing consumers to experience emerging lifestyles and trends through shopping, thus significantly boosting their willingness to spend.

Thirdly, industry boundaries are being redefined to offer immersive, experiential, and participatory consumption experiences. Features of products and services are displayed through diverse settings, themes, and fragmented showcases, which lead to the extension of the consumption chain. 

For example, the OCT Harbour PLUS in Shunde, south China's Guangdong Province, has pioneered a model that blends culture and tourism, commercial entertainment, leisure vacations, and ecological wetlands. The complex has strategically introduced more technology-driven and cultural-creative brands and attracted top Chinese and international tech and e-sports brands to enrich its selection of cultural and creative businesses. 

At the same time, it has brought in handwritten journals, collectible figurines, handcrafted creations, and original IP brands to empower its cultural districts. Since its opening in 2019, it has been recognized as one of China's most popular cultural tourism destinations, a new landmark for nightlife in the Guangdong-Hong Kong-Macao Greater Bay Area, and more. 

Meanwhile, Chongqing in southwest China has focused on developing its nighttime business forms in five aspects, namely, dining, wellness, sightseeing, entertainment and shopping. Leveraging its advantage of river resources, the city has emphasized the elements of mountains, water, cityscape, and bridges. 

Centered around the Changjiahui Scenic Area, Chongqing has established a core hub for its nighttime economy that embodies an international image hightlighting the city's three-dimensional mountains, illuminated rivers, charming bridges and bustling nightlife.