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Younger generation to spur Chinese consumption

CHINESE consumers will spend US$1.8 trillion more by 2021, bolstered by consumption of younger generation and the usage of digital technology, according to a latest report by Alibaba Group’s research arm AliResearch and the Boston Consulting Group.

The consumer market size will add more than 50 percent from that of 2016 to a total value of US$6.1 trillion by 2021, according to the report.

Younger generation will also provide a strong boost to the consumer market with those aged between 18 to 35 years old expected to contribute US$2.6 trillion of consumer expenditure by 2021, rising from US$1.5 trillion in 2016.

“Digital technology is one of the underlying drivers that will continue to spur purchases,” said Jeff Walters, a partner at BCG.

The report suggest as many as 90 percent of all purchases in China would involve digital at some point in the shopping process, including browsing, comparing prices or actual purchasing, rising from 70 percent in 2016.

“We believe the rising trend of a seamless convergence between the online and offline worlds will become an important driving force for the growth of consumption going forward,” Gao Hongbing, Dean of AliResearch and Vice President of Alibaba Group.

Chinese shoppers are increasingly aware of environmental issues and sustainability with data from AliResearch shows that as many as 16.2 percent among the consumers on Alibaba’s China retail marketplaces have bought five or more green products in 2015, up from just 3.4 percent in 2011. Natural skin care products are also adding 2.5 times as fast as the industry average growth rate.


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