However, the market has evolved. While Xiaomi held a 20.7% share of the Indian smartphone market in 2024, intensifying competition has made this a key battleground. In Q1 2025, its share was reported at 13%. This shift highlights a market in flux and underscores that Xiaomi’s initial strategy must continually adapt. This is due to fierce local competition and changing consumer trends toward premiumization, even in price-sensitive markets.

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Xiaomi’s meteoric rise: a story of unprecedented growth

Xiaomi’s exponential rise in the tech industry is credited to its unique approach. The company has combined affordability with high quality in its smartphone offerings since its inception. A pivotal moment was the 2011 launch of the Mi 1. The model received over 300,000 preorders within 34 hours. By 2014, Xiaomi began its global expansion, quickly finding success in markets like India.

From 2015 onwards, Xiaomi began to capitalize on its smartphone success and implement a diversification strategy. This allows broadening the scope into other segments of consumer electronics and further opens up new avenues for revenue. The company has since significantly expanded its product line. Recently offering over 80 different items, including laptops, TVs, wearables, speakers, and other lifestyle products.

Its global smartphone market share grew to 13.6% in the third quarter of 2025. The company shipped 168.5 million units to secure its position as the world’s third-largest vendor. Overseas markets now contribute a significant 42% of its total revenue in 2024, underscoring its successful internationalization. Xiaomi’s smartphones are constantly ranked among the top three market players in 57 countries and regions globally.

Xiaomi’s game-changing business approach

Revolutionizing affordability as part of Xiaomi’s strategy

The first crucial aspect of Xiaomi’s business model is its commitment to affordability. By streamlining its supply chain and manufacturing processes, Xiaomi manages to keep costs low without sacrificing quality. Xiaomi also saves considerable costs by overwhelmingly selling its phones online via its platform, Mi Market. It also maintains the direct-to-consumer model for its electric vehicles (EVs), which helps to cut out the middlemen and maintain a strong brand equity.

Putting customers first: Xiaomi’s secret to continuous improvement

The company is famous for actively engaging with its customers and listening to their feedback. This is to understand their needs and preferences better and modify based on it. The company heavily relies on feedback gathered from its online user community, named MI, which it then integrates into its product development efforts. This practice is a winning strategy not only because it constantly improves the delivery and quality of the product but also because it helps Xiaomi keep a loyal and engaged user base.

Cutting-edge pricing: Xiaomi’s innovative razor-blade model

Xiaomi’s pricing strategy is also a cornerstone of its success. This involves selling certain products, like smartphones, at low profit margins or even at a loss, to attract customers into their ecosystem. Once customers are integrated, Xiaomi then markets profitable complementary products to them in bundle deals. In this context, customers can be encouraged to buy additional products that generate revenue, such as smart home devices equipped with XiaoAi (小爱) voice assistant.

Building a tech empire: the strength of Xiaomi’s ecosystem

Xiaomi’s ecosystem strategy involves investments in or partnerships with various companies to create a wide range of products. This “Human x Car x Home” strategy has matured into the core of its business.

The company now connects over 823 million smart devices worldwide. Its Internet of Things (IoT) and lifestyle products consistently contribute nearly 30% of its revenue. The strategic glue is Xiaomi’s self-developed HyperOS, an integrated system that provides a seamless experience across smartphones, home devices, and, now, electric vehicles.

Marketing genius: Crafting a global brand

Xiaomi has crafted a cost-effective marketing strategy largely inspired by Apple’s handbook. Instead of investing huge sums of money in launching advertising campaigns, Xiaomi showcases its new products mainly through its social media accounts, including WeChat and RedNote. For instance, Xiaomi’s focus on digital content, like user-generated reviews and unboxing videos. These practices have played a significant role in its advertising strategy, bolstering strong user engagement.

But Xiaomi’s wide notoriety couldn’t have reached such high profiles in so little time if it weren’t for the unique identity and charismatic profile of its founder and CEO, Lei Jun. He has rapidly elevated the company’s profile to great heights, drawing frequent comparisons to Steve Jobs for his visionary leadership style. Under his guidance, Xiaomi has embraced the philosophy of ‘innovation for everyone,’ targeting tech-savvy yet budget-conscious consumers. He constantly makes the headlines, pushing Xiaomi brand awareness alongside his public image.

Conquering new markets: Xiaomi’s strategy in the Indian market

Xiaomi’s entry into the Indian market in 2014 is the most notable textbook example of a well-executed international strategy. It rapidly became the market leader in 2018 by focusing on extreme value, localizing production, and customizing products for local preferences.

However, the market has evolved. While Xiaomi held a 20.7% share of the Indian smartphone market in 2024, intensifying competition has made this a key battleground. In Q1 2025, its share was reported at 13%. This shift highlights a market in flux and underscores that Xiaomi’s initial strategy must continually adapt to fierce local competition and changing consumer trends toward premiumization, even in price-sensitive markets.

Future-proofing Xiaomi’s strategy: Adapting to tomorrow’s tech trends

Although Xiaomi’s business model has generated unprecedented success, the company contends with fierce competitors. Its future relies on adapting to new scenarios, and recent moves show it is executing this aggressively.

1. A successful pivot toward premiumization

What was once a future goal is now a successful reality. In 2024, shipments of Xiaomi smartphones priced above RMB 3,000 in China accounted for 23.3% of its domestic total. The launch of flagship series like the Xiaomi 14 and Xiaomi 15 Ultra. Furthermore, these flagships were developed in partnership with Leica, demonstrating its commitment to competing directly with Apple and Samsung in the high-end segment, improving brand perception and profit margins.

2. The electric vehicle gambit: A new core pillar

The most significant strategic development is Xiaomi’s entry into the smart electric vehicle (EV) sector. In 2024, it launched the Xiaomi SU7 sedan, a move that completes its vision of a connected lifestyle ecosystem. The launch was highly successful, with 136,854 vehicles delivered in 2024 and a production target of 350,000 set for 2025. This represents a monumental pivot, with the company investing approximately RMB 10 billion per quarter in this new initiative. The SU7 is designed to be deeply integrated with its HyperOS. Thus making the car a seamless extension of the user’s existing Xiaomi ecosystem.

3. AI as the ecosystem’s nervous system

Beyond hardware, Xiaomi is embedding artificial intelligence across all its products. HyperOS is infused with AI capabilities for cross-device intelligence. Moreover, the company is developing large language models to power its XiaoAi voice assistant. This transforms the ecosystem from a network of connected devices into a cohesive, intelligent platform, increasing user stickiness and creating new service opportunities.

What can be learned from Xiaomi’s strategies?

• Founded on the principle of “innovation for everyone,” Xiaomi disrupted the market by offering high-quality, affordable smartphones.
• Xiaomi combines ultra-efficient operations, a razor-blade pricing model (sell hardware cheap, profit from ecosystem), and direct fan feedback to drive loyalty and innovation.
• The recent launch of the electric vehicle range creates an integrated “Human x Car x Home” ecosystem that creates a sticky user experience.
• The company made two major strategic pivots by moving upscale into premium phones and making a massive bet on smart electric vehicles (the SU7 sedan) as its next core business.

This article Xiaomi uncovered: the strategic moves powering a global tech brand is the first one to appear on Daxue Consulting - Market Research and Consulting China.

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From tradition to innovation: Exploring Guochao in Chinese consumer culture

Guochao (国潮 in Chinese), literally meaning “national trend/wave”, refers to the consumers’ preference for Chinese brands, designs, and culture. It goes beyond seeking products solely based on being “made in China” and instead focuses on innovation through a distinctly Chinese approach. The emphasis is not on mass production of goods at a low cost, but rather on creating inventive products that combine traditional Chinese elements with modern ones, evoking a feeling of national pride.

From beauty and fashion to F&B: Exploring the Hallyu wave and its global influence

Hallyu (한류 in Korean), or the “Korean Wave”, refers to the spread of South Korean cultural exports to other countries. It started with K-dramas and K-pop and has been expanding to other areas, including fashion, food and beverage, and literature. Once limited to the Asian region, it is expanding to the Americas, Europe, and even Africa. It has truly become a global phenomenon that even if brands are not operating in Korea or targeting Korean consumers, the wave still influences their consumers.

Differences between Hallyu and Guochao

Evolving Guochao: From domestic pride to global ambition

In the past few years, Guochao has evolved significantly. What began as an inward-looking movement centered on cultural confidence and the rediscovery of Chinese aesthetics, often described as Guochao 1.0, has since matured through several stages. Guochao 2.0 saw Chinese brands deepen their investment in design, storytelling, and product innovation, gradually reshaping perceptions of “made in China” and building recognition across Southeast Asia and cross-border e-commerce channels.

Today, Guochao has entered a new phase often referred to as 3.0, where its ambition is no longer limited to domestic identity-building. Chinese brands in beauty, fashion, lifestyle, and F&B are experimenting with global expansion, exporting not only products but also aesthetics and narratives. While still early and more commercially driven than culturally driven, this shift signals China’s growing confidence in presenting its creativity on the world stage.

Despite this evolution, Guochao’s global influence remains distinct from Hallyu. South Korea’s cultural wave is anchored in entertainment – K-pop, K-dramas, and film – which naturally accelerates soft-power diffusion and has benefited from two decades of coordinated industry development. 

Guochao, by contrast, is propelled by consumer brands and design culture, making its international rise more fragmented and slower to translate into cohesive cultural export. As Guochao 3.0 continues to take shape, it is beginning to step outward, but its trajectory, industry anchors, and global impact still differ fundamentally from the established and entertainment-driven reach of Hallyu.

Hallyu’s impact goes global

Unlike Guochao, Hallyu’s influence expands beyond South Korea’s borders. Even the term itself was popularized after Korean TV dramas, like “What is love?” and K-pop bands like H.O.T., gained popularity in China, Japan, and other regions.

K-beauty trends, for example, are reshaping foreign perceptions and behaviors. The Korean glass skin (물광 피부), which refers to a dewy, transparent, and smooth complexion, along with derm treatments, received attention in the United States. Many Americans now adopt Korean skincare routines and use their beauty products to achieve this look. Some even incorporate derm clinic sessions into their trips to Korea, especially as these treatments gain visibility through social media influencers. Moreover, Olive Young, the top health and beauty store in Korea, is also expanding globally, making K-beauty more accessible. In fact, it is expected to open its first store in California in May 2026. According to one of their representatives, they are discussing with over 400 K-beauty brands and global brands to provide a wide range of beauty and wellness products.

Similarities between Guochao and Hallyu

Popular particularly among the young people

The Guochao and Hallyu trends primarily appeal to the younger generations, such as the MZ Generation (MZ세대). The Gen Z in China is willing to support domestic products across different industries, including fashion, household supplies, and home appliances. They do so because they have high confidence in their national identity and traditional culture, and they have access to digital platforms that promote local brands.

As for Hallyu, it has attracted many young people and the age profile is getting younger. According to the Korea Tourism Data Lab in 2024, among 11 million foreign visitors to Korea in 2023, 36% were aged 30 years and below, a rise from 28% in 2013.

The government backs the trends, promoting local culture and boosting domestic economies

In South Korea and in China, the governments support the Hallyu and Guochao trends, respectively, which increases greater awareness and understanding of the local culture among foreigners and the growth of the domestic economies.

Chinese government support for Guochao

Government priorities around “cultural confidence” and “dual circulation” have continued to reinforce the rise of Guochao, supporting both domestic consumption and China’s growing ambition to project cultural identity outward. In recent years, national and regional cultural initiatives, from museum collaborations to state-backed festivals and heritage revival programs, have made Chinese aesthetics more visible and commercially relevant, giving brands a stronger creative foundation for Guochao 2.0 and 3.0.

Meanwhile, geopolitical tensions and periodic disputes involving foreign companies have further strengthened consumer preference for homegrown brands, not through direct mandates but through a broader climate that favors local innovation, supply-chain independence, and national pride. This combination of cultural policy support and shifting consumer sentiment has helped Guochao evolve from an inward-facing trend into a more confident movement now exploring global expression, even as it continues to grow alongside China’s broader soft-power aspirations.

South Korean government support for Hallyu

South Korea’s government has been supporting Hallyu since the early 1990s. The Ministry of Unification, for example, arranged famous people like K-pop group Red Velvet and balladeer Baek Jiyoung to perform in Pyongyang, North Korea in 2018, as part of a cultural exchange event between North Korea and South Korea. This didn’t only receive attention from local residents, but also from around the world. 

Additionally, under the Lee Jae-myung administration, the government plans to make major reforms in Korea’s culture, sports, and tourism sectors. During the president’s presidential campaign, he pledged to “realize Korea as one of the It aims to expand Korea’s culture market to KRW 300 trillion” by expanding K-culture and enhancing its competitiveness.

Hallyu trend spreading to China and other parts of the world

K-dramas, movies, and other forms of culture going viral in China

When it comes to Korean dramas and movies, they have gained a lot of popularity in China. For instance, despite not being legally available in China, The Glory (더 글로리), Squid Game (오징어 게임), and Extraordinary Attorney Woo (이상한 변호사 우영우), and other Korean content have been widely watched in China. When Squid Game went viral in China, many people began to follow the dalgona trend and numerous products and merchandise related to it were sold on various online and offline platforms. Additionally, there are trends in other sectors such as the Korea F&B culture that started in South Korea and then spread to China.

Product placement in K-dramas to target worldwide viewers

As South Korean TV series are watched by people all over the world, Chinese and other foreign brands are leveraging embedded marketing to promote their brands and products. Chinese brands have appeared in several TV series, such as Chinese brand Zi Hai Guo’s instant rice meal appearing in one of the scenes in Vincenzo (빈센조) and e-commerce platform JD.com advertisements in True Beauty (여신강림). Although South Korean netizens weren’t happy about them, they do bring exposure to Chinese brands and products among international viewers.

From love to hate: How brands are leveraging Guochao, eliciting emotional connection and even controversy

Brands continue to tap into Guochao by blending Chinese traditions and modern elements, creating products that evoke nostalgia, cultural pride, and even heated discussion. A recent example is the collaboration between Luckin Coffee and the highly anticipated Chinese game Black Myth: Wukong. Themed “Where Has the Deer Gone?”, the campaign introduced a special beverage, the “Cloud Roaming Americano,” alongside a series of creative merchandise such as cup sleeves and tote bags.

The collaboration cleverly merges coffee culture with the excitement of a domestic gaming phenomenon, targeting younger consumers who are both fans of the game and core customers of Luckin Coffee. Beyond just selling drinks, the campaign offered immersive experiences and collectible items that amplified engagement, strengthened the brand’s cultural relevance, and created widespread buzz on social media. The design of the merchandise drew directly from iconic elements in the game, letting consumers enjoy the product while immersing themselves in the game’s cultural narrative.

This case illustrates how modern Guochao campaigns are no longer limited to heritage-based nostalgia. They combine innovation, pop culture, and interactive experiences, sometimes provoking debate, but always deepening connections with young, culturally engaged consumers.

Guochao missteps by luxury brands

However, not all Guochao marketing cases are successful, as illustrated by two examples in the luxury market in China. Dior’s 2022 release of a pleated skirt sparked outrage among Chinese people. Despite the brand’s attempt to create a product that reflects Chinese culture and heritage, it was criticized for plagiarizing the traditional Chinese hanfu.

Another recent example occurred in 2024 with Fendi, which collaborated with a Korean artisan on a limited-edition bag. The product featured a woven design closely resembling the traditional Chinese knot. While Fendi promoted it as a “traditional Korean knot,” Chinese consumers reacted strongly, labeling the move as cultural appropriation. Many pointed out that Chinese knots are a centuries-old heritage, celebrated throughout dynasties from Tang to Qing and symbolizing good fortune.

Despite customer complaints and growing public outcry, the brand initially remained silent, quietly removing promotional content by February 2025 without issuing an official statement. Discussions on Weibo went viral, with the hashtag #OneChineseKnotADay gaining millions of views, reflecting a collective effort among netizens to defend cultural heritage.

This case highlights the risks brands face when engaging with cultural trends: Guochao-inspired campaigns can generate excitement and loyalty, but misrepresenting or co-opting Chinese culture can provoke intense public criticism, underscoring the fine line between homage and appropriation.

Exploring Guochao and Hallyu and capitalizing on their widespread influence: 

1. Guochao, which means “national trend/wave” in China, and Hallyu, which means “Korean wave,” are two movements that have influenced consumer preferences and choices.
2. Guochao’s impact has primarily been within China, while Hallyu has expanded globally, reaching continents like Europe and North America.
3. Despite their differences, they share similarities. Both movements have resonated with younger generations, especially Gen Z. Additionally, the governments have shown support through financial assistance and public endorsement.
4. The popularity of K-dramas, K-movies, K-food, and other Korean cultural elements has led to collaborations and product placements by foreign businesses looking to capitalize on the trend.
5. Guochao is also trending in China, with both foreign and local businesses incorporating Chinese elements into their campaigns and products to cater to the growing demand.

This article Comparing South Korea’s Hallyu and China’s Guochao is the first one to appear on Daxue Consulting - Market Research and Consulting China.

Recognizing this burgeoning interest, many TCM clinics have introduced evening outpatient services, catering to the scheduling constraints of young professionals who can only seek medical attention after work hours. These trends, reflected in a multitude of news stories, underscore the undeniable emergence of Generation Z as ardent advocates for TCM.

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A short introduction to Traditional Chinese Medicine (TCM)

Traditional Chinese medicine, also known as oriental medicine, is a treasure of Chinese culture. A medical system has been used for thousands of years to prevent, diagnose, and treat disease. It is based on the belief that Qi (气) (the body’s life energy) flows along the meridians (channels) in the body, keeping a person’s mental, emotional, spiritual, and physical health in balance.

The purpose of TCM is to restore balance and harmony between the body’s natural opposing forces of yin and yang, which can block qi and cause disease. Traditional Chinese medicine shines in a wide range of fields, radiating into all aspects of people’s lives, including acupuncture, diet, herbal therapy, meditation, physical exercise, and massage.

Growing interest in TCM therapies among Gen Z

Compared to Western medicine, which primarily focuses on symptom relief, traditional Chinese medicine (TCM) emphasizes treating the root cause of illnesses, aiming to address the underlying issues comprehensively. Due to its minimal side effects and consistent efficacy, an increasing number of young individuals are opting to explore TCM clinics for body regulation. For instance, TCM can effectively address issues such as insufficient qi and blood, decreased immunity, and gastrointestinal problems, thereby facilitating daily health maintenance, disease prevention, and beauty care.

Gen Z’s enthusiasm for traditional Chinese medicine massage soars

Currently, numerous members of China’s Gen Z are showing interest in traditional Chinese medicine’s diagnostic and treatment techniques. Across various social platforms, massage departments within traditional Chinese medicine hospitals are quietly gaining popularity among young individuals. Shared content praising the comfort of TCM massage and highlighting the immediate relaxation experienced during treatments has garnered significant likes and comments.

Qu Qing, an attending TCM physician at the Massage Department of Hangzhou Traditional Chinese Medicine Hospital, noted that during weekends, the department sees a surge in young visitors in their twenties and thirties, with the corridors bustling with activity. Advanced bookings are necessary to secure a massage appointment.

The fast-paced nature of contemporary social life, coupled with poor posture and lifestyle habits, has led to a demographic shift in ailments such as cervical spondylosis, originally associated with middle-aged and elderly individuals, now affecting younger populations, including adolescents. The increasing number of young patients born after 1995 seeking timely medical attention upon experiencing discomfort indicates a heightened awareness of health issues and a growing appreciation for traditional Chinese medicine culture.

Impact of entertainment media on shaping Gen Z’s interest in TCM

In addition to physical therapy, the release of popular internet dramas has also reflected Gen Z’s interest in traditional Chinese medicine culture, resulting in more Gen Z individuals becoming advocates for TCM. According to the latest data from the “China Better Life Survey,” in 2023, the top three consumption categories among young people aged 18-35 were travel (32.77%), digital products (31.67%), and healthcare (31.04%). On May 14, 2023, the drama ” Hòu Làng [后浪],” which focuses on the inheritance of traditional Chinese medicine culture and shapes the growth of young Chinese medicine practitioners, premiered exclusively on Youku.

Utilizing Generation Z’s enthusiasm for health and advocating for the public to adopt the correct lifestyle and attitude towards life were the original intentions behind ” Hòu Làng  [后浪].” The series depicts the serene professionalism of seasoned Chinese medicine practitioners juxtaposed with the youthful vigor of their successors, showcasing the cultural ethos of mentorship and succession. It narrates the journey of Sun Toutou (portrayed by Zhao Lusi), a young woman in her twenties, who, under the guidance of Ren Xinzheng (portrayed by Wu Gang), a professor at the University of Traditional Chinese Medicine, embarks on the path of learning traditional Chinese medicine and inheriting her family’s legacy. As a member of Gen Z, Sun Toutou opens her heart and proactively embraces the study of Chinese medicine. Featuring renowned actors and a compelling script, this television series has piqued the interest of more Gen Z individuals in TCM.

The contradiction between belief in TCM and the actual purchasing behavior of Gen Z

According to our recent survey, an overwhelming majority of respondents expressed belief in food-related TCM concepts, a sentiment that transcended age, gender, city level, and income level. For example, most people believe that maintaining a balance of “hot” and “cold” foods is crucial. Generation Z has emerged as particularly staunch advocates of these traditional beliefs.

However, even though a staggering 67.6% of respondents believe in TCM principles and incorporate them into their daily lives, when scrutinizing the actual purchasing behavior regarding health foods, the presence of traditional Chinese medicine ingredients ranks as the least influential factor. This apparent contradiction can be elucidated through the lens of Guochao, which reflects the growing consumer preference for Chinese brands, traditions, and designs. For young Chinese consumers, embracing TCM beliefs may serve more as a means to express cultural confidence rather than dictating their dietary choices. Interestingly, skepticism about traditional Chinese medicine in food tends to increase with rising income levels.

Consumption patterns in F&B of TCM-related products among Gen Z

As the popularity increases, with the rise of traditional Chinese medicine, many traditional Chinese medicine clinics have opened tea shops, providing innovative formulas combined with pharmacology. Many people on the Internet say that milk tea shops opened by traditional Chinese medicine centers are safer to drink.

Not only that, but in daily life, people also choose to take some supplements for health care, and income has become a key factor affecting the choice of supplements. Vitamins A and C decrease as income increases. In contrast, collagen, lutein, omega-3, and royal jelly tend to be more expensive, and consumption increases as income increases. 

Products combined with traditional Chinese medicine are very popular. For example, launched in 2022, the TCM energy drink “一整根熬夜水” (Whole root all-night elixir) made waves with its transparent bottle showcasing a genuine ginseng root. This innovative product targets aspirational white-collar consumers in top-tier cities, offering affordable ginseng-infused water. As of February 2024, the keyword “whole root” has been viewed approximately 3.2 million times on Xiaohongshu, demonstrating its online influence.

Is traditional Chinese medicine a fad or here to stay?

The growing popularity of TCM-infused foods and drinks is more than just a fleeting wellness craze. Among younger consumers, the appeal lies in the balance between convenience and cultural familiarity. They are drawn to the perceived benefits of Traditional Chinese Medicine, but without the bitter taste, complex preparation, or clinical overtones. Backed by the deep-rooted concept of “medicine and food homology” (药食同源), this movement integrates wellness into daily diets in ways that feel both authentic and accessible. Modern product innovations such as herbal teas and functional snacks have made it easier than ever for consumers to enjoy health maintenance on the go. With government support, including initiatives under the “Healthy China 2030” framework that promote TCM-based preventive care, this trend is well-positioned for long-term growth rather than short-lived novelty.

While it aligns with the broader narrative of cultural confidence (Guochao, 国潮), the current rise of TCM in consumer goods is primarily driven by state health policy and market pragmatism rather than sentiment alone. Regulatory frameworks, such as the National Health Commission’s expanding list of approved TCM ingredients, have ensured safety and accessibility, especially for an aging population. For younger generations, adopting TCM-inspired habits may symbolize a modern expression of wellness rooted in cultural identity, but the industry’s staying power rests on something deeper. By merging timeless traditions with contemporary lifestyles, TCM is evolving into a sustainable pillar of China’s wellness economy, bridging ancient philosophy with modern living.

How does Gen Z embrace TCM?

• The emergence of Generation Z as vocal proponents of traditional Chinese medicine (TCM) is clearly demonstrated by the significant engagement observed on various digital platforms.
• On the internet, TCM culture is experiencing a “secondary spread” through word-of-mouth, enabling more young individuals to deepen their understanding of TCM massage and physiotherapy.
• The surge in popularity of massage departments within TCM hospitals among young individuals further highlights Gen Z’s growing interest in TCM therapies.
• While a significant majority of respondents express belief in food-related Traditional Chinese Medicine (TCM) concepts, such as maintaining a balance of “hot” and “cold” foods, actual purchasing behavior among Generation Z reveals a disparity.
• These trends underscore the undeniable emergence of Generation Z as ardent advocates for TCM, shaping the landscape of healthcare consumption and cultural appreciation.

This article Gen Z emerges as a new advocate for Traditional Chinese Medicine is the first one to appear on Daxue Consulting - Market Research and Consulting China.

In fact, China has a rich and complex history with alcohol, with long-established traditions and etiquette when it comes to alcohol consumption. This form of consumption is usually social or celebratory and has historically been an integral part of Chinese culture. The implication and way of drinking have also changed with the newer generation and a cultural shift in social norms.

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The famous Chinese proverb, “酒逢知己千杯少” (Jiǔ féng zhījǐ qiān bēi shǎo), translates to “with a close friend, a thousand cups of wine is far too little”, accurately depicts traditional Chinese drinking culture and the role that alcohol has in forming and maintaining social relationships. Drinking has always been the way to actively build relationships in Chinese society and culture, whether this is with friends, family, partners, or even professional relationships in the workplace.

This means that drinking in China is appropriate during group meals and other social group events, such as KTV, business functions, weddings, birthdays, etc.  Alcohol is also used to celebrate special occasions, like the Chinese New Year/Spring Festival, the Mid-Autumn Moon Festival, or even weddings and birthday banquets. People gather around tables with family and friends and enjoy good food while drinking alcohol together.

Chinese drinking etiquette: How to properly “Ganbei”

Chinese drinkers will convey cheers by saying “Ganbei” (干杯) to their friends. The literal translation is “empty cup,” which is used to encourage guests to finish their entire glass. It’s considered rude not to at least take a sip when someone is offered a toast, but it is not necessary to finish the entire beverage (though it would be much appreciated).

Basic rules when making a toast in China

Most meals with alcohol in China usually start with a toast, and it can be considered rude to start eating or drinking before the entire group has had their beverages and food prepared. Moreover, while this can vary between social settings, it’s generally impolite to drink before the host makes a toast. Usually, the first toast should be an “empty cup” as a sign of respect and as a way to start the meal or event. However, this applies more so to drinks served in shot glasses (generally spirits such as baijiu, sake, etc.).

When making a toast, people usually use the right hand as a sign of respect, and to keep their glasses at a lower position than others (especially the host). For extra formality, the left hand can also be placed underneath the cup while it is being held by the right hand. The proper way to receive or offer a glass of alcohol is always with both hands.

Drinking etiquette and hospitality in China also mean that a guest’s glass will probably never be empty. It’s a custom for the host or friends to automatically refill each other’s glasses to the brim whenever it’s empty or a toast has been made, even when it is not requested. In general, younger drinkers should be refilling the glass of those who are older or outrank them (boss, more senior friend, an older family member, etc.), but this isn’t a very strict rule when going out with a group of friends.

How can one remain relatively sober despite all these drinking pressures and rules?

Refusing to drink more will be easier if a guest establishes their limitations at the beginning of the meal rather than midway. One can politely say “我酒量不好” (wǒ jiǔliàng bùhǎo) to express a low capacity for alcohol intake, or give some sort of excuse in advance (not feeling well, having an early morning the next day, health problems, etc.). Some people will also physically cover their cup with a hand to stop an over-hospitable host who wants to keep the liquor flowing.

A key feature of Chinese drinking culture: Alcohol in the workplace and modern pushback

Surprisingly to some foreigners, alcohol also has a very prominent role in Chinese professional culture. This refers to work banquets, networking events, client dinners, and anything with a social element.

Drinking at work can also be great for networking, with respectful toasts to important clients and executives allowing employees to interact with those higher up on the corporate ladder. However, the Chinese workplace drinking culture has seen its fair share of problems in recent years. In August 2020, an employee of Xiamen International Bank refused to drink and was slapped by his supervisor for it. Women are even more vulnerable in these scenarios, as two female employees of Didi Global Inc. and Alibaba, respectively, reported cases of sexual assault by clients and superiors after heavy professional drinking.

What alcohols are popular in China?

Baijiu is the most popular alcohol in China, made from sorghum, rice, or wheat, and contains very high alcohol content. The most famous premium baijiu is Kweichow Moutai, which was sold at Sotheby’s for USD 1.4 million for 24 bottles in 2021.

Red wine, brandy, whisky, and spirits such as tequila and vodka have also been gaining popularity, with demand for spirits generally growing amongst younger consumers.

Some other popular drinks in China are beer and cocktails, which are gaining popularity amongst the younger generation. Due to Western influence, there isn’t a shortage of bars with modern and innovative drink recipes in China.

Wine culture in China

The people of China have been drinking wine for over 3,000 years because of the country’s rich history with grapes and other produce like plums and peaches (which also lend themselves well to becoming alcohol). As such, there are currently over 50 types of grapes used in Chinese winemaking—some blended together while others remain singularly varietal—and this number continues to grow each year as more varieties become available thanks to technological advances in winemaking.

Historically, wine has been tied to art and culture. The famous calligrapher Wang Xizhi of the Eastern Jin dynasty created his greatest work while drunk off of wine, and failed to surpass it while sober. A number of ancient poets like Li Bai and Han Yu have all written about wine and the act of creating art with wine.

Red wine’s popularity in China might also be due to its auspicious red color, a predominant lucky color in Chinese culture. Traditional Chinese Medicine also believes that red wine provides some health benefits, making it a healthier alternative to baijiu.

Food pairings are often found in China’s bars and pubs

Along with alcohol, food pairings have also evolved with time and cultural shifts. For many, the go-to pairing with Chinese food is tea. The challenge of pairing Chinese food with a certain type of alcohol is difficult because of how many different categories of Chinese food there are.

For many of the bars in China, consumers can find both Western and Chinese food, depending on the bar. Some menus will have traditional Chinese side dishes like dim sum, dumplings, and crispy duck, while other, more Westernized pubs will have sliders, fries, and other appetizers. This has to do with the evolving night scene in China, as bars are incorporating some traditional street food elements into their stores in the menu and decoration. Other bars lean more into the Western style to appeal to both local and global consumers.

Bars in China

With more and more Gen Z customers going to bars, the drinking scene in China has transformed into a space for activities like card game playing and studying.

There is also this concept of themed bars in China that often revolves around a popular social media trend or is based on a movie/TV series. The interior of these bars is built to transform consumers into a different world, alongside themed drinks that often require creative ingredients that draw a lot of attention on social media.

For example, there is an MBTI bar based in Shanghai, China, that matches consumers’ cocktail flavor to their personality based on a test. The purpose behind these bars is to gather a community of people together and to drink to create a good experience, rather than drinking to get drunk.

Drinking etiquette cheat sheet

Chinese drinking culture is complex and one of the most important aspects of Chinese social life, as it has been for centuries. It’s important to recall that alcohol is used as a way of building relationships, which is why the Chinese drink so much. Alcohol is also used to shape business relations, and one’s drinking ability has a very real impact on outcomes in the corporate and professional world.

• It’s rude not to drink if someone offers you a toast.  
• Both hands should always be used when giving or receiving a cup.
• “Ganbei” is used as “cheers,” but literally translates to “empty cup” and is used to encourage friends to completely finish the cup.
• Alcohol consumption can be used as a measure of hospitality and friendship. So, it’s important to be tactful with one’s words when refusing a drink.
• Drinking has shifted from getting drunk to an experience with the rise of themed bars.
• There are many different food pairings that go with alcohol in China, where you can find both Chinese and Western side dishes.

What do you know about the South Korean F&B market?

This article Ganbei! An in-depth guide to Chinese drinking culture and its cultural shift is the first one to appear on Daxue Consulting - Market Research and Consulting China.

Chinese mini dramas (also known as micro dramas) first appeared in China in 2018, shortly after Tiktok’s debut, and have since exploded in popularity, especially among younger viewers. These bite sized stories are filmed vertically and somewhere between 1 to 3 minute per episode. Initially, these stories gained traction for their compact narratives, fast pacing, short production cycle and low cost.

The production rate of these dramas is rapid, China produced more than 8,000 new mini dramas in 2024, ten times more than the rest of the world combined. The market for these videos has grown to RMB 50.4 billion (USD 6.9 billion) in 2024 and is consumed on social media platforms such as Douyin (Chinese version of Tiktok), Kuaishou, and Xiaohongshu.

Why Chinese mini dramas work: Addictive, accessible and engaging

Mini dramas are easily consumable and accessible on mobile devices, hence consumers can share their opinions directly in the comment section of a video. What draws viewers to these short dramas are the dramatic characters and plot twists. What was once low quality and low effort content that’s popular on social media has been replaced by these high production competitive short dramas that dominate the landscape and became a baseline expectation from the viewers.

For some series, users are able to watch the first few episodes for free. However, the subsequent episodes can cost RMB 140 (USD 20) or more depending on the number of episodes. This “freemium” model, paired with bingeable storytelling, has fueled both viewership and monetization.

Lucrative market: Low production cost and high revenue

While a traditional TV series takes about four to five months to film and costs at least tens of millions of RMB, mini dramas are often produced in just three to four days at a cost of RMB 400,000 – 800,000. Outside of the low production cost, mini dramas are also extremely lucrative, with most of the revenue generated from viewer payment and advertising income. With the market valued at RMB 38.4 billion in 2024, RMB 20.7 billion came from audience payments, RMB 15.8 billion came from advertising revenue, and RMB 800 million came from revenue sharing.

The surge in mini drama production also fueled a need for filming locations, and abandoned spaces in the countryside of China have all turned into filming base with different setting and background. For example, a village in Xi’an transformed an abandoned 15,000 square meter textile plant into a facility with sets such as palaces, villages, jail cells, hospitals and libraries.

Brands jump in: Product placement through storytelling

According to the latest Statistical Report on China’s Internet Development released in August 2024, 52.4% of internet users are now mini drama viewers. Brands have leveraged this surplus of views as a marketing strategy.

The Chinese skincare brand Kans has emerged as a market leader in the mini drama space, partnering with influencers to create mini drama episodes that feature their products. The drama uses popular tropes such as “CEO falls in love” and embedding the product naturally in each episode. In 2023 Kans produced a total of 5 mini dramas with Douyin influencer @Jiang17 with an investment of RMB 50 million,  and generated RMB 3.34 billion (USD 464 million) in sales and over 50 billion views as a result. These dramas can emotionally connect with its viewers, and making Kan’s skincare products a part of the character’s daily lives has helped the brand increase awareness. This shows that mini dramas can be used as a marketing strategy without being overly promotional.

Starbucks also caught onto the trend and created their own mini drama series in 2024 called “I Opened a Starbucks in Ancient Times”, and the storyline follows a modern barista transported to ancient China, where they introduce coffee culture to the local community. This ties in Starbucks as a brand to Chinese culture, and along with the drama Starbucks also launched promotions and coupons for viewers. The blend of storytelling and product placement generated over 2 million views in the first day, with strong social media engagement from consumers.

Government tightens restrictions on Chinese mini dramas

China has mandated a licensing requirement for broadcasting micro dramas and enable tighter control on what content gets published online. All Chinese mini dramas must hold an online film distribution permit. In a recent campaign, the National Radio and Television Administration removed 25,300 mini dramas, totaling close to 1.4 million episodes, for non-compliance.

China is also monitoring the relationship of the character in the shows, and censors have deleted more than 700 videos of dramas that depicted fighting between in-laws. Many of the drama are known to exaggerate conflict between family members such as husband and wife and intergenerational conflicts, which is seen against by the government. They deleted shows that promotes “unhealthy and non-mainstream views on family, marriage and love”, mainly due to the declining marriage rate in China.

What does this mean for marketing in the future?

As mini drama continues to grow, consumers are drawn to brands that they can build an emotional connection with. Product placement in these dramas can keep the product at the top of mind for viewers as they associate the narrative and characters with the brand. The high level of attention that is going towards this content opens opportunities for brands to create their own show and stories where it’s not just pure marketing but also entertainment.

Chinese mini drama as a form of advertisement

• Mini dramas first appeared in China in 2018; each episode is 1-3 minutes long and are filmed vertically. They are known for their dramatic plot twists and intense narratives.
• Compared to traditional TV series, mini dramas are low production and highly lucrative, with the market valued at RMB 38.4 billion in 2024.
• Kans (a Chinese skincare company) partnered with a Douyin influencer to create 5 series of dramas that had over 50 billion views and generated RMB 3.34 billion.
• Starbucks launched a fantasy drama connecting its brand to Chinese culture, gaining 2 million views on day one.
• The Chinese government is tightening their restrictions on mini dramas and banning stories that have conflicting relationships between the characters, such as a fight between husband and wife.

This article Chinese mini dramas: A new frontier for brand storytelling is the first one to appear on Daxue Consulting - Market Research and Consulting China.

Read our white paper on China’s beauty industry

Yet China once had a rich history of scent. Any account of the Imperial Court reveals the integral role of fragrant oils, sandalwood, blossoms, and spices, some brought from the ancient Silk Road. Empress Cixi, the infamous “Dragon Empress”, was known for her love of scented products. Today, as fragrance slowly reclaims its place in domestic culture, Chinese perfume brands are beginning to reinterpret scent through a distinctly Chinese lens, drawing from traditional aesthetics and olfactory heritage. As perfume gradually gains popularity, especially among younger urban consumers, there is a clear preference for soft, natural, and clean scents that reflect restraint and harmony, values deeply embedded in Chinese aesthetics.

How Chinese perfume brands tap into cultural heritage to claim a foreign brand dominated market

Historically, the fragrance and perfume market in China was dominated by foreign luxury houses such as Chanel, Dior, and Jo Malone. These brands benefited from their long-standing prestige and the aspirational value associated with Western luxury. For many Chinese consumers, wearing these international fragrances was a symbol of sophistication and status. The dominance of imported brands shaped the market and delayed the emergence of local innovation for years.

Premium segments are leveraging Chinese identity and heritage, leaving imitation behind

In recent years, a significant transition has taken place. Chinese luxury brands are moving from imitating Western luxury to building a distinctly local identity. Top-tier brands like To Summer (观夏), Uttori (五朵里), and Barrio (巴莉奥) embrace strong cultural uniqueness, following the Guochao (国潮) trend. These brands use Chinese symbols and storytelling as core brand assets. To Summer, for example, incorporates ingredients like osmanthus, lotus and bamboo, and offers an immersive flagship experience that blurs art and retail. Uttori and Barrio similarly build on minimalism and nature to project refined, culturally grounded luxury. Their strategy targets affluent, culturally confident consumers looking for sophistication with a Chinese soul.

New affordable brands follow the same trend, as the mass market’s interest in Chinese culture is rising

At the same time, culturally inspired affordable brands are rising. Chunfengshili (春风十里), positioned as both deeply Chinese and low in price, adopts a poetic and artistic approach. Fragrance names reference ancient poetry, and marketing mimics classical literati culture. Scent Library (气味图书馆), while more international in tone with scents not specific to China—like marshmallow, blueberries, and even cannabis—taps into everything. The brand also uses nostalgic cues like White Rabbit candy to connect emotionally with younger consumers. Their lower price points make them collectible and social-media friendly, fueling online buzz and experimentation. These brands democratize Chinese identity in perfumery, making it accessible while still emotionally rich.

Chinese perfume brands marketing strategies

To Summer: Shopping as an immersive experience

To Summer’s flagship store in Shanghai redefines the perfume retail experience. More than just a boutique, the space feels like a scent museum, with carefully curated interiors and an art gallery on the second floor. The brand offers perfumes, diffusers, candles, and hand creams, inviting visitors to spend up to an hour exploring and testing the collection at their own pace. Products often sell out quickly, adding an aura of exclusivity.

Flagship stores in China are powerful branding tools, acting as experiential destinations rather than transactional spaces. To Summer’s store has become a “must-visit” location in Shanghai, not only for perfume lovers but also for cultural consumers seeking aesthetic and sensory experiences. In a market where social media and word-of-mouth are crucial, creating such immersive spaces allows brands to become part of lifestyle narratives.

Scent Library: Nostalgia and diversity to create online hype

Scent Library taps into collective memory and online buzz through a mix of nostalgia and sensory experimentation. Its famous White Rabbit candy perfume revives a beloved childhood treat, sparking emotional connections with Chinese consumers. The brand continues to release playful, candy-inspired fragrances that resonate with younger audiences.

Beyond nostalgia, Scent Library’s appeal lies in its wide range of unconventional scents and low prices. This encourages customers to buy, compare, and share their opinions online. The result is a self-sustaining “hype loop”, where social media users generate buzz through scent reviews, favorites, and collection posts, making the brand a mainstay in fragrance discussions on platforms like Xiaohongshu and Douyin.

Documents targets young generation seeking a “niche identity”

Documents (闻献) stands out for its “anti-mainstream” marketing and commitment to cultivating a niche, “Zen and cool” identity. The brand avoids typical e-commerce channels and livestream sales, focusing instead on offline “ritual spaces” like its Night Temple concept store on Huaihai Road, Shanghai. Indeed, more than half of all perfume products are being sold outside of e-commerce platforms. These all-black minimalist environments are designed to evoke spiritual calm and exclusivity.

This aligns perfectly with the preferences of China’s Gen Z consumers, who seek individuality and differentiation in their brand choices. By merging immersive physical experiences with symbolic storytelling, DOCUMENTS builds a loyal, culturally curious fanbase and encourages organic user-generated content online. The brand recently gained traction after L’Oréal took a minority stake in the brand, investing more than USD 1.4 billion.

Melt Season is building its brand’s identity through collaboration

Melt Season’s perfumes aim for a natural, wild-life and nomadic aesthetic. One key example is its partnership with the popular Chinese TV series “To the Wonder” (我的阿勒泰), which coincided with the launch of the prairie-inspired perfume “Roaming Wind”. This collaboration was driven by founder Ni Lishi’s intuitive response to the series’ visuals, which matched the brand’s creative direction. The campaign generated significant buzz and visibility on Chinese social media, highlighting Melt Season’s ability to capitalize on cultural relevance and emotional resonance.

The rise of Chinese perfume brands

• Perfume is a relatively recent lifestyle category in China, shaped by traditional values that favored subtlety and natural scents over bold or artificial fragrances.
• The market was long dominated by Western luxury brands, which symbolized status but left little room for domestic innovation.
• Today, Chinese premium perfume brands like To Summer, Uttori, and Barrio are defining a new, culturally rich luxury by integrating heritage symbols and immersive retail experiences.
• Affordable brands such as Chunfengshili and Scent Library are also embracing local identity through poetic narratives and nostalgia-driven products.
• With experiential flagship stores, unique scent profiles, and storytelling that resonates with younger generations, Chinese perfume brands are transforming fragrance into an expression of modern cultural confidence.

Contact us for in-depth beauty market research in China

The cosmetics market in China is a rapidly evolving landscape, driven by the rising demand for high-quality products, innovative ingredients, and sustainable practices. Daxue Consulting offers specialized market research in China, providing a comprehensive understanding of the preferences, behaviors, and emerging trends shaping the cosmetics market.

Our Chinese consumer insights empower businesses to tailor their products and marketing strategies to resonate with local tastes and expectations. We offer consulting services that help you stay ahead of industry developments and achieve sustainable growth. Connect with us today to discover how our expertise can support your brand’s success in China’s thriving cosmetics market.

This article Scent of a nation: how Chinese perfume brands are reclaiming identity is the first one to appear on Daxue Consulting - Market Research and Consulting China.

Download our report on China’s Pet Economy

Pet owners in China value emotional connections with their pets

The surge in pet economy in China is largely driven by the post-1990s and post-2000s generations, who account for over two-thirds of China’s pet owners in 2024. These younger consumers often view pets as emotional partners or even child substitutes in a society increasingly marked by delayed marriages and shrinking birth rates. Ownership among those born after 2000 alone jumped 39.5% in 2024. This generational shift reflects a growing desire for companionship amid rising urban loneliness, career pressures, and unaffordable housing, all of which make traditional family-building less accessible or appealing.

Chinese pet owners not only keep their pets indoors but also involves them into every aspect of their daily routines, whether it’s cooking together, sharing TV time, or celebrating birthdays with cakes, gifts, and parties. The bond between pet and owner is no longer functional; it’s familial and deeply emotional.

Cats surpass dogs as the most popular pet in China

Cats have overtaken dogs in popularity, a significant cultural shift. In 2017, dogs still led in numbers, but by 2024, China was home to 72 million cats compared to 52 million dogs. Urban living conditions have played a crucial role in this change. Cats are quieter, cleaner, more independent, and require less space, making them ideal companions for apartment dwellers. The post-pandemic shift to remote work also accelerated this trend, with many people turning to cats for low-maintenance comfort and emotional companionship during lockdowns.

While dogs remain popular for their social and active natures, engaging in hiking, swimming, and even watching television, cats are increasingly taking part in such routines too. The number of mentions on cat training on social media (RedNote, Weibo and Douyin) surged by nearly 50% year-over-year in April 2025, reaching 8.4 million, suggesting a subtle yet notable transformation in the way people engage with their feline friends.

Exotic pets in China reflect a desire for identity, self-expression, and the unconventional

A growing number of Chinese consumers are gravitating toward exotic pets to express personal identity and stand out from the crowd. According to our social listening analysis on China’s pet economy, in April 2025, mentions of pet snakes on social media exploded by 482% year-over-year, partly influenced by the Year of the Snake in the Chinese zodiac, as they represent symbolic luck. The growing interest in snakes in recent years points to a lasting shift rather than a passing fad as reptiles and exotic pets have become a popular way to express a unique and unconventional personal image in China.

Similarly, birds like parrots and pigeons are becoming urban fashion statements, favored not only for their aesthetics but also their intelligence and expressive behaviors. Online videos of colorful, talkative birds have further cemented their role as stylish, unconventional companions. Even rodents and fish are joining the trend: angelfish saw a 441% growth in popularity thanks to their diverse appearances and collectors’ interest, while hamsters are now often featured in elaborately staged photo shoots with miniature props and accessories. These are becoming lifestyle hobbies for collectors and creators.

Digital platforms are refining how people adopt pets in China

Pet ownership in China has historically been informal. Many people adopted strays from the streets or fed animals casually without treating them as full-time companions. However, online channels have been facilitating pet adoption and introduced a wider variety of pets. Marketplaces like MaiZhiChongWu (买只宠物) and JD.com allow consumers to browse, compare, and purchase pets easily, enjoying discounts and delivery the same way they would with consumer goods.

Social media positively impact the number of adoptions as well as increase the spending per pet

Social media like Douyin and Xiaohongshu introduce potential owners to cute, viral pet content. Pets visibility on Chinese social media increases the interest in pet adoption. One striking example is the rise of huskies. In 2025, huskies became the most mentioned dog breed on Chinese social media, accounting for 37.9% of all breed-related mentions. Their viral appeal, due to videos highlighting their expressive, mischievous personalities, drove a wave of purchases despite their large size and demanding care needs.

Their online presence not only encourages more people to adopt pets but also increases how much they’re willing to spend on them. The pet market is growing faster than the number of pets in China, meaning the spending per pet is increasing. From 2023 to 2024, the number of cats owned went up by 1.6% and dogs by 2.5%, while the overall market grew by 7.5%.

Digital platforms now shape every stage of the pet owner’s journey

Driven by a growing interest in pets’ physical and mental health, Petkit’s smart devices monitor hydration, sleep, and diet, syncing seamlessly with health-tracking apps. Owners can now book vet appointments through WeChat mini-programs, manage vaccinations, and even receive grooming reminders. This level of integration reflects the modernization of pet care and the convenience expected by China’s urban, tech-savvy consumers.

Pets are disrupting many other industries beyond their scope

As relationships with pets evolve in China, the ripple effects are reshaping multiple sectors in the pet economy, highlighting the need to understand shifting consumer behaviors and engage them more effectively.

Traveling with tails

The travel industry in China is one of the most dynamic beneficiaries, with hotels, transportation and activities becoming more pet-friendly. Airlines like Hainan now offer in-cabin pet transport, and even high-speed trains between Beijing and Shanghai provide pet consignment services for small animals. By November 2024, Hainan Airlines transported over 10,000 pets in-cabin across 27 major cities. Meanwhile, Shenzhen Bao’an International Airport opened China’s first dedicated pet lounge in 2024, a spacious facility equipped with air quality monitors, species-specific zones and play areas.

Beauty brands offer special products for pets

In the fragrance and perfume market in China, the rise of pet-centric products has blurred the line between animal care and human luxury. Big names like Kiehl’s have launched pet grooming lines, while Dolce & Gabbana has ventured into pet fragrances. Seasonal outfits, ranging from rain boots and cooling vests to traditional Hanfu costumes, are now common on Chinese social media feeds. Celebrating holidays with themed pet outfits is increasingly popular, and matching human-pet fashion sets have become both a style choice and a bonding ritual.

Pet wellness experiences grow more diverse and sophisticated

China’s first pet gym, GOGOGYM, located in Shanghai, offers treadmill workouts and hydrotherapy for dogs, signaling that pet wellness is no longer limited to traditional grooming. Pet spas now offer services such as stress-relieving massage therapy, cryo-recovery, and even holistic treatments like sound baths.

Food and beverage companies also offer food for pets

Businesses from China’s food and beverage industry are also evolving to accommodate this trend. In Chengdu, restaurants entice patrons with free treats for their pets or offer discounts to those who show pet photos. Malls in cities like Shanghai now feature pet-friendly cafes and burger joints with dedicated pet menus, allowing pets to dine alongside their owners. Meanwhile, the popularity of dog and cat birthday celebrations has created new opportunities for pet bakeries, event planners, and specialty retailers focused on gifts, accessories, and decorations.

How the pet economy in China is disrupting many industries

• China’s booming pet economy is more than a trend, it’s a lifestyle transformation.
• Younger generations are embracing pets as family, fueled by emotional connection, social media influence, and rising disposable income.
• Viral breeds like huskies and shareable content are driving both adoption rates and premium spending.
• Digital platforms now guide every step of the pet journey, from discovery to daily care.
• As pets reshape how Chinese consumers live, shop, and express themselves, they’re also redefining entire industries.

This article How the rise of the pet economy in China is disrupting industries is the first one to appear on Daxue Consulting - Market Research and Consulting China.

Download our 2024 China Summer Sports Market report

What’s driving the demand for winter apparel in China

The winter sports market in China, a relatively immature market, is gaining momentum, especially after the 2022 Beijing Winter Olympics. To illustrate, from November 1st to December 20^th, 2024, ski resort bookings in Heilongjiang, Jilin, Liaoning, and Xinjiang, increased by 50.49% year-over-year. Moreover, JD.com data shows that the sales of ski jackets saw a year-over-year growth exceeding 50%.

Meanwhile, enthusiasm for winter tourism continues to rise. Harbin, a top winter destination, recorded a 50% year-over-year surge in hotel bookings in November 2024. The average winter temperature in Harbin, around -15°C to -20°C, makes it necessary for these tourists to invest in winter apparel, even if only worn once. Nearly 80% of travelers planning ice and snow trips to Northeast China this winter are from southern China.

Growing demand for a blizzard of winter apparel choices

Chinese consumers are showing interest in a wider range of product categories and higher levels of sophistication. In addition to down jackets, thermal underwear and thick pajamas have become staples. They are not only prioritizing functionality, such as comfort and warmth, but also seeking more fashionable designs. Unlike the northwest locals, southern tourists buy warm apparel with distinct styles. Xiaohongshu travel posts reveal that while locals prefer practical black jackets and durable shoes, tourists favor light-colored down jackets, stylish boots, and fluffy hats that look cute in pictures.

Thermal underwear is no longer old-fashioned

Once regarded as an essential yet outdated household item for staying warm, thermal underwear—form-fitting, long-sleeved—was dismissed as old-fashioned by Chinese young people for years. However, as thermal sets have undergone significant innovation in both functionality and design, younger generations are now embracing them. During the 2024 Double 11 shopping festival, thermal underwear sets sales saw a robust increase by over 100% year-over-year.

Even though many are new to winter sports, renting apparel and equipment is not a popular choice

Even though many are still new to winter sports, Chinese consumers choose to purchase their own clothing and equipment instead of renting them. Rental gear at many ski resorts, for example, tends to be outdated and poorly maintained. Also, as people do winter sports more often, owning personal gear has become a more practical choice.

“New Year Battle Outfits”: Winning with new clothes in the new year

Wearing new clothes during the Chinese New Year, a tradition dating back to the Han Dynasty, symbolizes a fresh start. The term “New Year Battle Outfits” (新年战袍), coined on social media, describes the clothes people wear for New Year social occasions, such as family reunions and reunions with old classmates.

Compared to their everyday attire, Chinese people pay more attention to high-quality and luxury clothing in their New Years attire. Some seek clothes that look more expensive (显贵), while others prefer well-known brands. At the end of the day, it’s about showing “face” (面子). They want outfits that are not only stylish but also representative of their achievements. Designer brands, premium materials, and custom-made pieces, as well down jackets, cashmere coats, and fur, are sought. Also, when it comes to the color, red is an extra touch for good luck, but it’s not a must-have.

The MaMian skirt (马面裙) , one of most popular items of new Chinese style, has become a top choice for “New Year battle outfits.” Rising Guochao (国潮) has reignited interest in the “new Chinese style” (新中式), which combines traditional Chinese aesthetics with modern fashion, among the Gen Z in China. In January 2024, sales of MaMian skirts on JD.com increased by 300% year-over-year.

“Dopamine ski wear” (多巴胺色系雪服): bright colors for a bright winter sports experience

The dopamine dressing trend, which involves using bright and bold colors, extends to ski apparel. To add more emotional value to their winter sports experiences, people are wearing clothes that make them feel positive emotions, such as joy and relaxation. They also coordinate their outfits with their friends, wearing matching or complementary colors for a shared exciting experience. During the year-end shopping season (“双旦”礼遇季), from December 15^th to December 25^th, 2024, dopamine-colored ski wear brand ISEE MIGGA’s sales increased by over 500%.

Wearing pajamas outdoors and outdoor clothes indoors

China’s Qinling-Huaihe line divides regions with and without centralized heating, leaving southern areas to face bone-chilling winters without it. To stay warm, people wear thick coats indoors. In the southern province of Hunan, many locals are often seen wearing cotton pajamas both at home and even outside. This widespread practice has even earned them the nickname “Hunan Provincial Uniform (湖南省服)” on social media.

During COVID-19, as people spent more time at home and ran quick errands they sought more versatile clothing. Bananain, originally known for basic underwear, started in 2022 to introduce winter loungewear suitable for outdoor wear, focusing on both warmth and fashion.

China’s millennial retro fur-fashion based on Hong Kong’s pop culture

China’s millennial retro fashion incorporates classic symbols of Hong Kong pop culture, reflecting a longing for the “golden era” of economic prosperity and cultural confidence. Drawing from the urban aesthetics of the 1980s and 1990s, this style highlights items like fur, fur-collared coats, plaid wool suits, gloves, berets, and scarves.

“Colorful mountain” style: meeting the demand for versatile outdoor apparel

Consumers are incorporating outdoor clothing into their daily wear, with lightweight outdoor apparel appearing in scenarios such as commuting, going to school, and social gatherings. The sales of lightweight outdoor clothing on JD.com during the 23/24 autumn/winter season increased by 42% year-over-year.

The “colorful mountain” (多彩山系) style blends the functionality of outdoor gear and the sophisticated aesthetics of urban fashion. It features nature-inspired neutral tones, such as as khaki and brown, allowing the clothes to “blend” with the natural surrounding. It can also be combined with vibrant tones, like orange and pink, to make it stand out. Made from technical materials, it offers breathability, water resistance, and durability, making it suitable for urban and outdoor wear.

The winning winterwear branding strategies in China

Bosideng: The fashionable “down jacket expert”

Bosideng, recognizing the serious issue of brand aging, is committed to becoming a “down jacket expert.” Targeting the mid-to-high-end market, the brand creates unique, hard-to-copy products with its expertise in premium down jackets and strives overturn the notion of not being “fashionable”.

Whether partnering with the former creative director of Hermès, Jean-Paul Gaultier, to introduce an exclusive limited-edition series, or collaborating with the Chinese Antarctic Expedition Team to highlight the exceptional cold-resistant features of its products, Bosideng’s ultimate goal is to become the preferred choice for young local shoppers in the luxury segment.

Arc’teryx: A sports luxury leader redefining retail spaces

In early 2024, Arc’teryx unveiled a 2,400-square-meter eco-experience space—the Arc’teryx Museum in Shanghai–marking a pioneering step in immersive retail models. In December 2024, it launched an exhibition titled “Arc’teryx Genesis and Evolution Exhibition” at this museum. Co-curated with the Chinese Academy of Sciences, the exhibition recreates the excavation process of the “Berlin Specimen,” the most complete Archaeopteryx fossil. By merging the narrative of natural evolution with its own brand evolution, Arc’teryx gives consumers a deeper appreciation of its heritage and innovation.

Outdoor down jackets go sexy: The North Face x SKIMS collaboration

Once having wide presence in China’s down jacket market, The North Face has experienced limited growth in recent years. In China, its 1996 edition down jacket, popular among male college students, earned the nickname “male college student uniform” (男大校服) due to its ubiquity. To counter this stereotype, the brand is now expanding into the female consumer market. In December 2024, The North Face and SKIMS collaboration, was launched and became an internet sensation. The collaboration series includes 56 items, such as down jackets, bodysuits, and gloves, which cater to both the fashion needs of snow sports gear and SKIMS’ signature high-end, sexy style.

The partnership represents a reshuffling of target demographics: SKIMS aims to tap into the outdoor market, while The North Face appeals to SKIMS’ female consumer base. It also serves as a trial run for SKIMS in the Chinese market, where the brand has yet to establish official stores. This co-branding effort was a success. The collection sold out on launch day despite being available in only two offline stores with limited quantities.

China’s winter apparel market is becoming more mature as winter sports and travel continue to develop

• The growing popularity of winter tourism and sports is injecting new momentum into China’s winter apparel market. People in the wet and cold south are traveling to the snowy and cold north for snow and ice experiences, increasing the demand for winter clothing.
• Winter apparel is diversifying, with rising demand for down jackets, thermal underwear, and thick pajamas, among other items. China’s millennial retro fashion style, incorporating Hong Kong’s cultural influences and featuring fur, is making a comeback.
• Chinese consumers are also seeking more versatile clothing, such as pajamas that can be worn outdoors for quick errands and the “colorful mountain” style, which blends outdoor functionality with aesthetics.
• The Chinese New Year is a time to showcase winter fashion. In 2025, the MaMian skirt was a top choice, reflecting the growing desire to incorporate traditional elements into modern styles.

Download the full report on China’s summer sports market by daxue consulting here: https://daxueconsulting.com/china-summer-sports-market-report/

This article China’s winter apparel market: What Chinese wore for their “New Year Battle Outfits” (新年战袍) is the first one to appear on Daxue Consulting - Market Research and Consulting China.

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Key consumers of the lipstick market in China

People aged from 25 to 34 have become the main consumer groups in the lipstick market in China. They account for about 58.8% of the total population, of which females are the main consumers. On average, a middle-class female consumer in China buys at least 5 lipsticks every year. 

However, women are no longer the only important consumer group for the lipstick market in China. The men’s beauty market in China has shown remarkable growth, contributing to an overall value of RMB 18.9 billion in 2023. The local skincare market continues its upward trajectory, with projections to reach RMB 21.3 billion by 2025. Recent data indicates a surge in lipstick consumption by men, with a remarkable growth rate of 278%. Notable influencers like Li Jiaqi, famously dubbed the “Lipstick King,” play a significant role. Li Jiaqi’s social media presence, featuring videos of him testing and recommending different lipsticks, has not only popularized male cosmetics but also normalized their use.

Many cosmetics companies have specially developed men’s facial skincare kits, cleansers, lotion creams, special masks, BB creams, CC creams, and lipsticks for male consumers. 

New trends in the lipstick market in China

Lip glosses lead the lipstick market in China

Lip makeup has several sectors: lipsticks, lip glosses, and lip glazes. From the perspective of market distribution, lip gloss, and lip glaze are the largest segment of the lipstick industry in China, accounting for about 53% of the lipstick market, followed by lipsticks, accounting for about 46%, and lip liners taking third place. 

The domestic lipstick market in China is booming

Driven by the rise of the beauty economy, increasing consumer demand for innovative and affordable makeup, and the growing influence of local brands, the Chinese lipstick market is experiencing remarkable growth. According to iiMedia Research, the size of China’s lip cosmetics market reached RMB 26.28 billion in 2023, representing a year-on-year growth of 13.0%, and is projected to grow further to 379.5 billion RMB by 2028. E-commerce platforms like Xiaohongshu (Little Red Book) and Douyin (China’s TikTok) account for a significant share of sales across the entire lipstick market in China.

Livestreaming and social interaction: Drivers of lip makeup growth in China

E-commerce platforms like Xiaohongshu (Little Red Book) and Douyin (China’s TikTok) play a pivotal role in driving this growth. These platforms go beyond being mere sales channels—they shape consumer preferences through personalized recommendations and livestreaming. For example, Xiaohongshu fosters a sense of community by enabling users to post shopping hauls and makeup tutorials and share honest reviews via comments. This creates a consumer-driven content economy that builds trust and drives sales.

What’s particularly unique to China is the seamless integration of social interaction and commerce on these platforms. Livestreaming sessions on Douyin are not just about selling products but also immersive events where brands engage consumers in real-time with limited-time discounts and interactive Q&A sessions. This real-time interactivity, combined with gamified shopping experiences and cultural nuances like “gift-giving culture” during festivals, creates a highly dynamic market environment. In the first half of 2024, Chinese brands such as INTO YOU, Perfect Diary, and Judydoll ranked among the top sellers on Douyin, collectively achieving over RMB 44.84 billion in sales.

In addition, the trend towards  “妆养合一”(makeup and care integration） has also contributed to the diversification and refinement of the lipstick market. Products such as hybrid lipsticks with skincare benefits, lip serums, and multifunctional lip tints are becoming increasingly popular. For example, Perfect Diary’s Biolip technology combines the effects of lipstick, lip balm, and lip masks, aligning with the growing consumer preference for health-focused, multi-purpose beauty products.

Foreign lipstick brands’ influence in China

Foreign brands, while still significant players in China’s lipstick market, are facing challenges as they adapt to shifting consumer preferences and increased competition from domestic brands. Historically, luxury brands like Yves Saint Laurent, Dior, Givenchy, Chanel, Estee Lauder, and Giorgio Armani dominated the market, leveraging their prestigious reputations and strong brand images. These brands have long been associated with reputation, quality, and marketing strategies that appeal to Chinese consumers seeking premium products.

For years, owning a foreign luxury lipstick symbolized social status and international cosmopolitanism. The appeal was further amplified by their ability to market themselves as purveyors of “true luxury,” emphasizing craftsmanship and exclusivity. The perception of quality played a crucial role. Foreign brands were widely regarded as offering superior products, especially when compared to the emerging local brands of the time, which were still developing their formulas. The association of “Made in France” or “Made in Italy” with luxury and trustworthiness allows foreign brands to gain popularity.

Foreign brands also excelled in marketing, creating emotional connections through collaborations with Chinese celebrities and global stars. For instance, Guerlain partnered with famous celebrities like Fan Bingbing to appeal to Chinese consumers who are fans of these celebrities.

However, the influence of these foreign brands has started to wane. French brands, in particular, remain prominent exporters of lipsticks to China, with France accounting for a significant share of the imported beauty market. Even so, their dominance is no longer unchallenged.

Domestic brands use traditional Chinese elements to attract customers

Considering the rise of cultural confidence in China, cosmetics using traditional Chinese aesthetics to risen in popularity. Some cosmetics brands that focus on Chinese designs cater to the consumption trend of modern young consumers. For example, Run Baiyan’s Forbidden City lipstick which is part of a Forbidden City cosmetic range includes lipsticks, eye shadows, blushes, nail polishes, and other makeup products. The most prominent are the six Forbidden City lipsticks, namely Langyao Red, Bean Paste Red, Rose Purple, Maple Leaf Red, Tourmaline, and Mermaid Ji. 

The color of the Forbidden City lipstick paste comes from the red national treasures in the Palace Museum. The appearance design of the lipstick tube is inspired by the costumes of the imperial concubine of the Qing Dynasty. The Forbidden City lipstick also uses 3D multilayer printing technology to print traditional patterns on the lipstick tube, highlighting the texture of the fabric and the three-dimensional sense of embroidery.

As a creative product developer, the Forbidden City has always developed many popular cosmetic products. With the support of fans, the Forbidden City lipstick marketing has received a lot of attention with its eye-catching design and colors.

Foreign lipstick brands also ride the wave of Chinese culture-themed designs

At the same time, many international brands also include Chinese cultural elements or regularly launch festival-limited products. However, some foreign brands have a relatively superficial understanding of Chinese culture. Most of the festive and New Year limited editions just add the Chinese zodiac of the year to the packaging.

Pharmaceutical companies enter the lipstick market in China

Currently, not only ordinary cosmetics companies but also pharmaceutical companies have entered the lipstick market one after another. Drug makers suffering from deteriorating earnings have chosen the lipstick market as a new growth driver.

For example, Ma Yinglong, which was focusing on hemorrhoid ointment, launched lipstick products recently. According to the Ma Yinglong Babao flagship store news, the lipsticks launched this time are Ma Yinglong’s brand Ma Yinglong Babao, which are magenta matte velvet cream, Champs Elysées matte velvet cream and first love color blemish water lip balm. The three lipsticks cost RMB 138, and the three-color set costs RMB 399.

Key takeaways about the lipstick market in China

• Lipstick is one of the most promising industries in the Chinese cosmetic market: it has a wide range of products both in luxury and low-end categories
• Men’s cosmetics are contributing significantly to the lipstick market, driven by increased demand and the influence of male beauty influencers.
• Lip glazes lead the market in popularity, followed by lipsticks and lip glosses, while hybrid lip products combining makeup and skincare are rising in demand.
• Domestic brands like INTO YOU, Perfect Diary, and Judydoll are gaining prominence due to affordability and innovation, challenging the dominance of foreign luxury brands.
• The integration of e-commerce platforms like Xiaohongshu and Douyin has revolutionized consumer engagement, blending social interaction with commerce through personalized recommendations, livestreaming, and gamified shopping experiences.
• Both domestic and foreign brands are leveraging Chinese cultural elements in their designs that appeal to many consumers.
• Pharmaceutical companies are entering the lipstick market, introducing health-focused products as a new growth strategy.

This article Men’s rising influence in the lipstick market in China is the first one to appear on Daxue Consulting - Market Research and Consulting China.

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Reclassified and the innovation of the “light salon”

Reclassified (RE调香室) is a luxury perfume brand born in 2013 in Shanghai. The brand started as a “salon perfume” seller and continues this philosophy to this day. Indeed, since its creation, Reclassified in China introduced the concept of “light salon” (轻沙龙), meaning that the perfume shall not be only something that an individual uses exclusively for himself, but needs to open up, so that as many people as possible can experience the fragrance. Furthermore, the brand refers to “salon perfume” to underline that they are a niche luxury brand that is not concentrated on appearance, but on the actual scent. Therefore, the refinement of bottles and packaging is left behind to give more space to the quality of their ingredients.

As of 2022, the brand counts more than 100 stores across almost 60 Chinese cities. In the same year, Reclassified was in the top 15 most appreciated perfumes in the country along with other famous brands such as Scent Library (气味图书馆) and the men’s perfume brand “SOLEHE” (和风雨). Another strength of the brand lies in its wide variety of products. Indeed, apart from selling perfumes, Reclassified also specializes in body lotions, creams, and candles.

Source: Reclassified.com, other products shown on the Reclassified shop

Consumer experience is the basis of Reclassified success

The company behind the success of Reclassified in China is the Shanghai Xiangmao Trading Co. (上海翔贸机电), a trading and investment company that founded the brand in 2013.  Although it was an already affirmed brand in the Chinese perfume market, in January 2021, the investment company CITIC holding (中信资本) stipulated an investment agreement with Shanghai Xiangmao, with the objective of further developing the beauty and perfume industry in China and giving the possibility to a wider range of people to get in touch with the Reclassified brand.

Apart from the external investments, one of the main features of the perfume company lies in prioritizing the consumer experience. Since 2016, Re Classified in China has allowed personalizing their own perfumes to its consumers. Consumers can find a section in their website which is completely dedicated to creating their own perfumes by mixing the fragrances.

Source: reclassified.com, process of a DIY perfume, from choosing the fragrances to its bottling 

Reclassified on social media: immense share compensates the few followers

Despite the scarce popularity of Reclassified on Chinese social media, with its Douyin official account (RE调香室) counting roughly 2200 followers and its Weibo account (RECLASSIFIED调香室) only 91,000, the brand relies a lot on users’ threads. Indeed, Reclassified can boast a high number of shares in its official Weibo hashtag (#RE调香室#), which has more than 11.2 million views. This is partially due to the fact that, in recent years, Gen Z has gained progressive interest in niche luxury products, such as Reclassified perfumes.

The hashtag is also used by many influencers and key opinion leaders to share their reviews about their products. As an example, on April 22^nd, 2024, the Weibo beauty influencer 变美你冲不冲 (The beauty you can’t rush), whose profile has more than 420,000 followers, positively reviewed Reclassified freshly launched bergamot fragrance. Furthermore, car fresheners are another product that is vastly appreciated by social media users both for the quality of fragrances and for the elegance of the product itself.

The continuous search for refined ingredients: Reclassified x Dominique Ropion collaboration

Apart from classical products, Reclassified in China recently launched an important collaboration to create new fragrances. In March 2024, the Chinese perfume brand partnered with Dominique Ropion, a world’s famous French master perfumer, and launched a series called “Masters of light” (逐光大师系列). The collaboration explores the combination of different fragrances of natural and refined ingredients such as pine needles, cashmere, and black tea. The collaboration was announced through a video posted on Weibo which, as of May 2024, has more than 15,000 views. The bottles are sold in two different measures: 50ml and 15ml, and have a price ranging from RMB 346 (USD 84) to RMB 614 (USD 85).

Source: reclassified.cn, Reclassified x Dominique Ropion official collaboration banner

Reclassified in China: from niche luxury perfume to an internationally famous brand

• With the increasing popularity of the Chinese perfume market and the constant growth of inland players, Reclassified is seen as one of the most famous luxury fragrance brands in China.
• Founded in Shanghai in 2013, Reclassified immediately revolutionized the perfume market introducing the concept of “light salon”. According to the brand’s philosophy, a perfume is not about visual appearance, but its ingredients. Therefore, the brand constantly searches for more refined and natural fragrances to add to their products, including perfumes, body lotions and candles.
• After the investments of CITIC holding, reclassified has the possibility to get known to more consumers. However, the brand was already famous for its DIY formula which, since 2016, allows consumers to create their own fragrance.
• Social media are another important factor for Reclassified success in China, having many trending hashtags and letting KOLs give their opinions about the brand’s products.
• Recently, Reclassified further developed its search for refined ingredients. In March 2024, the Chinese brand collaborated with Dominique Ropion, an important French master perfumer, and launched the series “Masters of light”, whose promotional video reached 15,000 views on Weibo.

Strategic insights for the Chinese perfume market: collaborate with Daxue Consulting

As Reclassified continues to shape the luxury fragrance market in China with its innovative “light salon” approach and dedication to natural, refined ingredients, staying ahead in this dynamic sector is crucial. Daxue Consulting offers deep consumer insights and market research tailored to the unique characteristics of China’s perfume industry. Our expertise can help you understand the evolving preferences and trends that influence consumer behavior, enhancing your strategy and positioning. Whether you’re looking to explore new market segments or optimize your product offerings, our consulting services provide the necessary tools to thrive. Contact us today to learn how we can assist in elevating your presence in the competitive Chinese perfume market.

This article The hidden gem of the luxury perfume market: the case of Reclassified in China is the first one to appear on Daxue Consulting - Market Research and Consulting China.