Expanding the New Retail Formats - "Where to Use" Formats | Cities | Where to Use Them
By mid year, domestic consumption had significantly improved. According to data recently released by the Ministry of Commerce, the total retail sales of consumer goods in May reached 3.78 trillion yuan, a year-on-year increase of 12.7%. From January to May, the total retail sales of consumer goods reached 18.76 trillion yuan, a year-on-year increase of 9.3%, with a considerable growth rate. Compared with the data from the first quarter, it can be seen that as one of the macroeconomic "three carriages", consumption is intensifying its efforts. The recent 618 shopping festival further confirmed this trend. The improvement in consumption data is fundamentally due to the further strengthening of China's economic recovery, the effective implementation of a series of consumption policies, and the continuous expansion of consumption scenarios. Among them, the role of new retail formats represented by instant retail is also very obvious.
2023 is the year of boosting consumption. Recently, officials from the Ministry of Commerce summarized several major characteristics of consumption in the first half of the year: firstly, there was strong sales of upgraded products; Secondly, the consumption of catering and other services continues to rebound; Thirdly, synchronous recovery of urban and rural consumption; The fourth is the rapid growth of online and offline consumption. At the same time, it is particularly pointed out that new formats and models such as live streaming e-commerce and instant retail are flourishing, and online retail is maintaining rapid growth. Upon analysis, all four characteristics are closely related to the new business model. From January to May, the proportion of online retail sales of physical goods in China to the total retail sales of consumer goods reached 25.6%. The offline scene is accelerating recovery, physical retail continues to rebound, and a win-win situation has been achieved both online and offline.
These characteristics were particularly prominent during this year's 618 period. This important "barometer" that reflects the warmth and coldness of the consumer market has always been of great concern. Major retail platforms are actively preparing and participating on a large scale with offline physical stores, with significant results. Meituan flash sale shows that the number of physical stores participating in the event exceeds 700000, covering more than 360 cities, and showing prosperity across all categories, with sales in multiple categories showing double-digit growth. These reasonable and unexpected data are not only a highlight, but also fully demonstrate China's consumption potential.
Instant retail adopts a "local entity+instant delivery" model, effectively linking merchants and consumers. From the perspective of merchants, it provides opportunities for offline physical stores to participate in large-scale shopping festivals, rather than just online carnivals. It overcomes the barriers of space and information, and works together online and offline to assist in the overall recovery of social consumption, further tapping into consumption potential. According to data from real-time retail platforms, during the 618 shopping festival this year, consumption growth in third tier and lower tier cities was more eye-catching than that in first tier cities, thanks to the continuous development of new formats such as real-time retail.
From a consumer perspective, it adapts to the consumer sovereignty consciousness of "I consume and I make decisions". Nowadays, consumers, especially young consumers, have increasingly higher demands for quality, service, experience, and other aspects. On the one hand, instant retail can provide more choices to meet the diverse needs of consumers; On the other hand, more and more users are accustomed to "buy and get what you want", and instant retail can continuously satisfy and optimize the user shopping experience.
The significance of instant retail goes beyond linking consumers and businesses. It will widely connect physical stores scattered throughout the country, meet local demand through local supply, create local taxes, solve local employment, and obviously help to smooth the "capillaries" of the economy. Obviously, these effects far spill over into the consumer sector.
There is controversy over whether current consumption is upgrading or downgrading. The recently released data proves that the trend of consumption upgrading in China is still continuing. This is not only reflected in the astonishing year-on-year growth in the retail sales of communication equipment, gold and silver jewelry for units above the quota, but also in the obvious trends of health, quality, online, and emotional. Is the shopping convenience and consumer satisfaction experience brought by instant retail a reflection of consumer upgrading?
The State Council executive meeting held on June 16th focused on four aspects: increasing macroeconomic policy regulation, focusing on expanding effective demand, strengthening and optimizing the real economy, and preventing and resolving risks in key areas. A series of policy measures were studied and proposed. With the continuous implementation of policy effects, the recovery of domestic consumption will become stronger, and the "potential" of new formats such as instant retail will also become increasingly broad.
