Top hidden consumer trends in China for Q4 2023
Massagers, fat-loss meals, essential oil patches, pets, and more
In 2023, we published several posts on the top hidden consumer trends. These trends were identified from online sales data across major e-commerce platforms in China, including Tmall, JD, and Douyin. In today's post, we will provide you with an update and highlight emerging categories that are experiencing significant growth in gross merchandise values (GMV).
In 2023Q4, online sales remained steady on a year-on-year basis. However, there were signs of cooling down in December, as the month-on-month GMV growth turned negative for major e-commerce platforms.
Most categories rebounded in Q4 of 2023. However, the average selling price (ASP) only experienced minimal growth across most categories, indicating that consumers continued to prioritize price-for-value over other factors.
The Sports & Health category continued to outperform in 2023 Q4, with both GMV (+19% YoY) and ASP (+15% YoY) rebounding strongly. Specifically, cycling sports, including items such as bicycles, mountain bikes, and cycling clothing, experienced even stronger growth in both GMV (+89% YoY) and ASP (+20% YoY) compared to the broader Sports and Health category.
Digital electronics also extended the rebound into 2023Q4, with camera lenses, Polaroid cameras, and electronic education equipment showing stronger growth in GMV and ASP.
Top 5 fastest-growing emerging categories in the past three months
In addition to the growth of the general categories, we have identified five fast-growing niche categories that are gaining popularity in the consumer market in 2023Q4. Below are the five fastest-growing product categories in the recent 3-month window, with average monthly online sales exceeding RMB 10 million (~USD 1.4 million).
No.5 Neck & shoulder massager (GMV +157% YoY in 2023 Q4)
Automatic neck and shoulder massagers have been gaining popularity since early 2023, as more consumers are looking for self-care and comfort. Industry leader Breo Technology (688793.SS) saw a 68% increase of GMV across Tmall, JD, and Douyin in 2023 Q4. In addition to flagship neck massagers, companies like Breo have also introduced innovative products like the Trapezius massager, which targets office workers and fitness enthusiasts. Scalp massagers also gained popularity in 2023Q4.
Cultural context: Chinese consumers believe that the head is concentrated with Meridian (经络), which refers to the pathways in the body through which vital energy flows according to Chinese medicine. Regularly massaging the head is believed to improve overall health and well-being.
No.4 Fat-loss meal replacement (GMV +161% YoY in 2023 Q4)
Fat loss and fitness are increasingly becoming the priority among Chinese consumers, boosting the demand for fat-loss meals such as smoothies, meal replacements, and dairy replacements. Breakfast replacement smoothies have also become popular among young professionals as nutritious and convenient breakfast options.
Weight loss has become a booming market in China, despite slow recovery and cautious spending. We previously posted a story about how Semaglutide is capturing the consumer market in China, becoming the latest buzz in business circles and a hot topic among investors, businessmen, and high-net-worth communities.
No.3 Anti-aging sunscreen (GMV +201% YoY in 2023 Q4)
Chinese consumers have long been knowledgeable about the ingredients and efficacies of skincare products. In 2023, we have observed that consumers are increasingly prioritizing efficacies that address specific skin concerns, such as aging and sensitive skin. Products with only basic efficacy and a single function are no longer sufficient. Consumers are now looking for products that integrate their routine skincare with targeted solutions for skin concerns. For example, anti-aging sunscreen has become popular among young adults.
No.2 Essential oil patch (GMV +248% YoY in 2023 Q4)
Essential oil patches are patches infused with natural oils extracted from plants, which are used for their therapeutic properties. These patches are applied to the skin, where the essential oils are gradually released. This practice is commonly seen in traditional Chinese medicine. Consumers purchase essential oil patches because they believe in their various health benefits, such as stress reduction, mood improvement, and pain relief.
No.1 Pet Leash (GMV +469% YoY in 2023 Q4)
China recorded its lowest birth rate since 1949, with the total population shrinking by 2.08 million in 2023. As the birth rate plummets, many young people are turning to pets for companionship instead. In addition to essential items like pet food and leashes, we have observed the rapid growth of niche categories. For example, automatic pet feeders have gained popularity among busy young pet parents. There is also an increasing demand for specialized products like anti-aging dog food, foot care for pets, and low-fat, low-cholesterol pet food — pet owners are projecting their own wellness preferences onto their pets.
Read our story on China’s pet market’s landscape:
Bonus nominee: BYD Auto enters the upmarket arena
BYD Auto recently unveiled its first luxury SUV, the Yangwang U8 (仰望U8). This luxury plug-in hybrid SUV offers self-driving capabilities, the ability to sail on water, and a 360-degree "tank turn" maneuver. With a price tag of over 1 million Yuan (over 153K USD), this new model has caused a sensation among Chinese internet users, as it marks a departure from BYD Auto's established brand image of producing affordable cars.
Let us know in the comment section what you think about BYD's new launch!
We recently published a comprehensive study on post-pandemic consumer spending in China. To conduct this study, we utilized consumer transaction data from WeChat and Alipay — a rarity in the market, which are China's major digital payment channels. Our study covers essential changes in consumer behavior, expenditure patterns, sector-specific trends, and offline and service spending, across different income and age groups. For readers interested in getting a macro overview of post-pandemic consumer spending, we recommend checking out our latest post:
Some brands and sectors are performing well, even amidst fears of a "consumption downgrade". Read our previous posts to learn more.