Shoppers in China are making up for lost time, throwing money at luxury goods and cosmetics amid the COVID-19 pandemic, according to a CNBC report on Tuesday (Nov. 17).
Chen Xiaodong, president and CEO of Zhejiang-headquartered InTime, said Chinese shoppers are spending “more than ever,” particularly on luxury and beauty items.
“Consumer intention is still there. The people want to spend more money compared with last year, but the time they spend on a shopping journey (has shortened),” Xiaodong said during the opening remarks of CNBC’s East Tech West conference.
The annual invitation-only conference on Nov. 17-18 is both in-person and virtual this year, hosted at the NL Garden Hotel in the Chinese city of Nansha, Guangzhou, which has been growing as a tech hub.
InTime is one of the biggest retail chains in China, with department stores as well as eCommerce sites. Founded in 1998, the company went public in 2007 and listed on the Hong Kong Stock Exchange. InTime was acquired by Alibaba in 2017.
Chen said people are not running back to brick-and-mortar stores in big numbers, but that they are still shopping and spending, with sales rebounding from 2019. In the current climate, about 20 percent of sales are online.
InTime was already taking advantage of the growing popularity of online shopping before the pandemic hit, and quickly leveraged shopping trends like livestreaming, Chen said. COVID-19 accelerated “the digitization procedure for the physical stores,” he added.
By tapping Taobao Live, Alibaba’s livestream platform, InTime was able to offer users multiple streams to view or place orders. The streams were facilitated by thousands of retail sales employees who signed on as hosts.
Chen said the convenience of livestreaming is that one sales associate could “potentially serve a thousand or 10,000 people concurrently.”
Luxury goods were among the first purchases Chinese shoppers made in the aftermath of the pandemic. The Paris luxury goods provider LVMH saw a 65 percent spike in sales from China in the second quarter, compared to the same period in 2019. Luxury retailer Kering, also from Paris, experienced a 40 percent hike.
Singles’ Day, the annual November shopping event in China, gave Alibaba over $74.1 billion in sales, up from $38.4 billion in 2019.