As the Lantern Festival approaches—the first major traditional festival after Chinese New Year—new research from Mintel reveals that food is the biggest spending focus for Chinese consumers during traditional Chinese festivals, with 67 percent of urban Chinese consumers buying festive foods during festivals, followed by 65 percent choosing in-home food. The social aspect of food is also important as 61 percent of consumers say they spend more on eating out during festivals.
Consumers love festivals as they create opportunities for interaction with others. Over six in ten urban Chinese consumers say that catering for the festival tradition is the key factor encouraging them to buy products during festivals compared to other times of the year. For over half, the key factor is gifting.
“A major emphasis of traditional festival shopping is food and fun,” said Matthew Crabbe, regional trends director at Mintel. “Festivals offer a unique opportunity for retailers and brands to conjure up some magic by creating fun and entertaining ways for consumers to celebrate festivals, give gifts, treat themselves and share good times with friends and family. All retailers need to achieve this is solid knowledge about the lifestyles and ‘retailtainment’ (mixture of retail and entertainment) interests of their customers, and the imagination to come up with interesting new ideas.”
A significant part of the festival experience for consumers is the opportunity to travel. Mintel research reveals that 35 percent of urban consumers plan to spend more on domestic travel, and 27 percent plan to spend more on overseas travel. Mintel forecasts that the growth in holiday expenditure around traditional Chinese and Western festivals will increase by 16 percent CAGR between 2015 and 2020.
“Travel spending is also internationalising China’s festival shopping influence. In fact, the consumer economy, and festival retail, is not just about buying products, it is also about leisure, entertainment, services and travel. Our research shows that holiday spending is one of the stronger growth areas within today’s consumer economy. Shopping and holiday/leisure and entertainment spending combined add special significance to the motives for consumers to spend money during festival times,” Crabbe continued.
Apart from traditional festival shopping, urban consumers are also welcoming online shopping festivals. When it comes to future online shopping festival spending intentions, it is apparent that most consumers expect to spend more on most types of products and services in the coming 12 months. Nearly six in ten of those surveyed by Mintel would love to buy more fashion, footwear and accessories, followed by in-home food and eating out during the next online shopping festivals.
There is some resistance to online shopping festivals though, with 45 percent of urban consumers unwilling to spend more during these occasions, instead, preferring to shop for things as and when they need them.
There is also concern about how online shopping festivals create delays in delivery, due to the massive delivery bottlenecks created during online shopping festivals. One third of urban consumers say they feel that slow delivery times during online shopping festivals is an issue.