COVID-19: What’s Next? An Update from China
As the impact of the COVID-19 pandemic continues to be felt around the world, many countries are beginning to focus on how to resume everyday life. FleishmanHillard’s TRUE Global Intelligence’s recent study, COVID-19 Mindset: How Pandemic Times Are Shaping Global Consumers, found that consumer behaviors will likely be forever changed due to the crisis and that attitudes toward reopening differ around the globe.
China, one of the first countries to be impacted by the virus, mandated a stay-at-home order beginning in mid-January. With that order recently lifted, we’ve started to see signs of how consumers are returning to what will be the “new normal.” I wanted to share a glimpse of what we’re seeing here in China, including the impact on the food, agriculture and beverage industry.
In-person restaurant dining is returning.
During lockdown, all restaurants in China closed dine-in options and of those that could serve take-out, many were unable to operate as they depended on workers from outside the city who weren’t allowed to travel to work. Now restaurants are experiencing a strong recovery, with workforces coming back and people being allowed to eat in. While social distancing is not enforced in China currently, wearing masks while in crowded places and public transportation is still mandatory.
Grocery store e-commerce platforms are imperative.
While panic shopping for essentials was rampant during lockdown, Chinese grocery stores have robust e-commerce platforms in place, which helped mitigate crowds. Today grocery stores are returning to normal, with shoppers wearing masks for protection. Bloomberg reported that MissFresh saw a quadrupling in online orders for groceries during the first five days of the Lunar New Year compared with the same period last year. And JD.com Inc. said its sales of fresh food increased by 215%, reaching almost 15,000 tons during the 10-day period ending February 2, compared with the same period last year. While Chinese online grocery volume has increased to RMB 300 billion, the offline retail market is still 10 times larger, so there is plenty of room to grow sustainably.
Gatherings are beginning to take place again, but people are still cautious.
Once stay-at-home orders were gradually lifted in China from province to province, we saw many people starting to gather in larger groups, especially families. Hotel bookings are picking up again, as well as larger scale events such as weddings. However, we aren’t seeing mass gatherings on the same scale as before. People are still cautious – especially around others they aren’t familiar with.
Health is a stronger consideration at purchase.
Due to the pandemic, we’ve seen more consumers in China selecting higher quality and healthier products when making purchasing decisions to prioritize their safety. Endorsed by the public health experts, high-protein food consumption has increased a lot. Home cooking has become a must, especially during the traditional Chinese Spring Festival, and whole lunar new year month, and cooking recipe videos have overwhelmed social media channels. Picnics and camping have become another trend as people take advantage of the warm weather and long weekend holiday, encouraged by their local government.
As we enter the new normal of everyday life in China (and around the world), trends we already saw shaping the food, agriculture and beverage industry will continue to be expedited, such as e-commerce.
Coupled with long-lasting financial and health concerns, in-person shopping and dining experiences will likely be forever changed. However, the resiliency of Chinese consumers can already be seen, accompanied with an urge to return to tradition, community and togetherness. Businesses across the industry will need to continue to be agile and adapt to changing consumer behavior in order to survive – and thrive.
