China’s consumer market is entering a pivotal phase of structural transformation. While short-term pressure on domestic demand remains, China’s GDP per capita has surpassed USD 13,000, signaling strong long-term consumption potential. In 2025, consumer behavior is defined by a mix of rational upgrading and shifting priorities. Brand loyalty is weakening, marketing fatigue is rising, and consumers are increasingly selective about what deserves their attention and money.
For global brands, understanding these shifts is essential to unlocking growth in the world’s most dynamic consumer market.
Rational Consumption – Value Over Brand Halo
Chinese consumers are no longer paying for brand premiums without justification. Surveys show more than half frequently compare brands, and nearly 70 percent feel indifferent or resistant toward traditional marketing messages.
Consumers now want “premium with a reason.” They are willing to pay more, but only when product value is tangible, credible, and aligned with real needs. This behavior was especially visible during the recent Double 11 shopping festival, where hype-driven promotions lost appeal while value-driven categories strengthened.
AI-powered comparison tools further accelerate this shift. Product decisions are increasingly informed, data-driven, and less emotional than before.
Rise of Chinese Brands – From Cost Advantage to Cultural Confidence
Local brands continue to outperform international names across most categories in 2025. According to the latest BrandZ China Global Brand Builders ranking, ByteDance, Xiaomi, Shein, Haier, and Huawei lead the list, reflecting the maturity of Chinese brands expanding globally.
The rise of Chinese brands is supported by three pillars: competitive pricing, stronger product capabilities, and emotional resonance rooted in cultural identity. From design language to storytelling, Chinese brands increasingly speak the same cultural “code” as local consumers. This is an advantage global brands cannot overlook.
Reconstructed Priorities – Health, Wealth, and Skills
Against a backdrop of uncertainty, Chinese consumers are reprioritizing what matters. A “certainty triangle” has emerged – health, financial security, and personal skills.
People invest more in fitness, savings, and self-improvement, reshaping their consumption choices. This shift supports the rapid growth of service-based consumption. From January to October, service retail sales grew 5.3 percent year-on-year, reflecting demand for experiences and personal development.
Brands that support physical well-being, emotional stability, financial confidence, or skill-building stand to benefit.
Channel Evolution – Blending Online Efficiency with Offline Warmth
Chinese shoppers want the best of both worlds: digital convenience and physical engagement. Nearly half prefer hybrid shopping journeys that combine online discovery with offline experiences.
Online retail remains strong, growing 9.6 percent in the first ten months of the year. At the same time, offline retail is undergoing reinvention. New formats such as membership warehouse stores, unmanned shops, and curated multi-brand stores continue to see double-digit growth.
The future of retail in China is not channel competition, but seamless integration.
AI as a Consumer Companion – Redefining the Shopping Journey
AI is now deeply embedded in everyday consumption. An estimated 77 percent of Chinese consumers frequently use AI tools for recommendations, decision support, and daily tasks.
During Double 11, AI was both a popular product category and a driving force behind the sales process. Smart glasses saw a 25-fold increase in sales on Tmall. Companies like Midea used AI visualization tools to help consumers preview appliances inside their homes, while Tmall leveraged AI systems to match coupons with high-intent shoppers, boosting conversion rates.
AI is no longer a “feature” but a new interface for consumer interaction.
Emotional Consumption – Products That Spark Joy, Identity, or Humor
Even as rational decision-making strengthens, emotional consumption is thriving. Young consumers are paying for emotional value – identity expression, humor, nostalgia, and comfort.
Categories such as collectibles, IP merchandise, and blind boxes have doubled in sales year-on-year. “Ugly-cute” cushions, humorous office products, and personalized décor items have gone viral because they deliver more than utility – they deliver emotional relief and cultural expression.
For brands, emotional storytelling is becoming as important as product performance.
County-Level Markets – The Next Wave of Consumer Growth
Lower-tier regions are emerging as powerful growth engines. From January to October, county-level retail sales rose 4.6 percent year-on-year, outpacing major urban areas. Holiday-driven consumption such as rural tourism and ancient-town travel also continues to grow steadily.
With improving infrastructure, rising incomes, and ongoing urbanization, county-level markets offer a significant opportunity for brands willing to localize assortment and expand distribution beyond tier 1 and tier 2 cities.
Policy Momentum – Strong Government Support for Consumption
China continues to strengthen policy support to stimulate domestic demand. Measures such as trade-in subsidies for household appliances and vehicles are driving steady retail growth. The government’s multi-stage issuance of ultra-long special treasury bonds also aims to accelerate equipment upgrades and boost consumption potential.
Officials indicate more efforts ahead to improve employment, raise income levels, and enhance the overall consumption environment – key factors that will support long-term market expansion.
Implications for Global Brands – Adapt or Lose Relevance
To remain competitive, global brands must adapt to China’s evolving consumer landscape.
- Deliver clear value. Transparent pricing, superior quality, and functional innovation matter more than global reputation.
- Localize cultural narratives. Brands must connect with China’s cultural context, rather than importing global campaigns unchanged.
- Build omnichannel experiences. Integrate online efficiency with offline immersion, ensuring a seamless consumer journey.
- Embrace AI-driven engagement. Use AI for personalized interactions, product recommendations, and content creation.
- Capture growth in lower-tier markets. Tailor product portfolios and distribution strategies to tap into county-level consumption.
Finding Balance in a Market of Contradictions
China’s 2025 consumers appear paradoxical – more rational yet more emotional, digitally native yet eager for offline warmth, loyal to domestic brands yet open to global excellence. Behind these contrasts lies a stable upward trajectory. China’s total retail sales reached more than RMB 40 trillion in the first ten months, growing 4.3 percent year-on-year.
Ultimately, success for global brands will come from balancing rational value with emotional resonance. Brands that understand these nuanced needs – and provide authenticity, relevance, and real value – will earn trust and unlock sustainable growth in China’s evolving consumer landscape.