Chinese consumers are now adjusting to a “new normal” in response to evolving market conditions, prompting businesses to rethink their strategies. The 2025 China Consumer Survey by AlixPartners reveals a significant shift in spending priorities, reflecting changing consumer behaviors and economic dynamics. “China’s economy has entered a transformative phase of slower but more sustainable growth,” said Lisa Hu, partner and MD and Greater China lead for the consumer and r
d retail practice at AlixPartners.
“While consumers are generally more cautious with their spending, our survey reveals that perceptions of economic prospects vary significantly by geography, income, and age group – differences that have profound implications for their spending.”
Economic pressures and the realignment of consumer behavior
According to the report, China’s economic slowdown, coupled with a cooling real estate market and job market uncertainty, has led to more cautious consumer spending. However, this caution is not uniform across demographics. While residents in Tier 1 and New Tier 1 cities remain relatively optimistic, lower-tier city consumers are more pessimistic due to a lack of economic resilience and fewer opportunities.
Meanwhile, higher-income groups continue to drive spending in premium segments, whereas middle- and lower-income consumers are more affected by rising living costs and constrained disposable income.
Consumers over 45 years old express greater financial concerns, while younger consumers maintain slightly more optimism, especially in categories related to self-improvement and leisure.
Hu said businesses must go beyond a broad-based approach and demonstrate agility, innovation, and a sophisticated understanding of target customer behavior across categories.
The rise of experience, wellness, and value
Despite cautious sentiment, certain categories are witnessing renewed consumer confidence. AlixPartners unveiled five key consumer trends shaping spending in 2025 include:
Travel rebounds strongly: Experiential spending is a key priority, with “revenge travel” fueling demand for holidays, entertainment, and outdoor activities. Gen Z and middle- to high-income individuals in Tier 2 cities are leading this trend, reflecting a preference for creating memories over acquiring material goods.
Health and wellness take center stage: With 41 per cent of consumers planning to increase spending on health-related products, demand for supplements, traditional Chinese medicine, and fitness-related goods is surging.
Stability in essentials: Groceries, clothing, and home essentials maintain steady growth, indicating a prioritisation of practicality over discretionary indulgence.
Luxury faces a recalibration: While luxury remains aspirational, only 16 per cent of consumers plan to increase their spending in this segment. The focus is shifting toward quality, timeless value, and selective purchasing.
Selective discretionary spending: Categories such as consumer electronics, home refurbishment, and pet products are seeing cautious spending, with buyers prioritizing function over impulse-driven purchases.
In addition, brand loyalty is being redefined in China, with factors such as price sensitivity, peer recommendations, and product innovation playing pivotal roles in consumer decision-making.
“Understanding consumer behavior and preferences is crucial for brands aiming to build and maintain loyalty,” said Hu.
“To achieve this, brands must create a unique value proposition through superior quality, exclusive features, and exceptional service, while also building strong emotional connections with customers. Given the significant variation in consumer preferences across different channels, adopting a tailored approach is indispensable for success.”
Traditional e-commerce platforms retain dominance
According to AlixPartners, while emerging social commerce platforms are gaining traction, traditional e-commerce channels remain the preferred choice for most categories due to robust logistics, trust in product authenticity, and competitive promotions.
For clothing and beauty, traditional e-commerce platforms (Tmall, JD.com) lead due to convenience, competitive pricing, and extensive product variety. Meanwhile, dedicated apps like Ctrip and Fliggy dominate the travel sector as they offer ease of booking and seamless integration with user preferences.
For hybrid shopping behaviors, consumers rely on multiple touchpoints at content-driven platforms (Xiaohongshu, Douyin), offline retail stores, and brand official sites to research and validate purchases.
“China continues to set the global benchmark for e-commerce innovation thanks to its expansive ecosystem with an abundance of choices,” added Hu. “However, getting that choice right is pivotal to success. Retailers need to frequently and consistently monitor consumer behavior to navigate this complex landscape effectively.”
The report emphasized that success depends on aligning with modern Chinese consumer values. Companies that adapt their strategies to China’s distinct market dynamics while maintaining a culture of innovation can secure substantial opportunities in this thriving market.
Further reading: Navigating change: Insights into China’s luxury market trends for 2025