Views:1 Author:Site Editor Publish Time: 2020-06-29 Origin:Site
More than 75 per cent of Chinese consumers reduced or postponed purchases on apparel and footwear and their total spending decreased by 45 per cent in the first quarter of 2020, according to a latest survey by New York-based global management consulting firm Oliver Wyman, which found there was little retaliatory spending in April and May. The largest apparel market is expected to see a 15 per cent contraction in 2020, equivalent to about $60 billion in market value.
On the bright side, the survey found that consumer spending would probably return to its 2019 level in the second half of 2020.
“It is going to be a turbulent year, with structural and longer-term shifts in the apparel and footwear market in China,” said Imke Wouters, partner of Oliver Wyman, who led the survey.
“Despite the industry downturn, we are seeing the further growth of e-commerce, with an accelerated penetration into sub-segments, such as high-income customer groups. The post-COVID market is expected to be more polarized across income levels and city tiers,” an Oliver Wyman press release quoted him as saying.
The COVID-19 outbreak has exacerbated the spending gap between the high and low-income groups. The low-income group tends to buy less and trade down for essentials. More than 70 per cent of the low-income survey respondents said they would prefer good value for money, and more than 60 per cent said they would purchase essentials only. On the other hand, the respondents from the high-income group said they would trade up and go for both value and quality, with 54 per cent of them saying they would still look to buy products offering higher quality and functionality, and 56 per cent of them saying they also preferred items offering value for money.