Despite the economic shock of the coronavirus, analysts say China’s demand for luxury goods hasn’t waned much. On top of that the virus keeps Chinese from traveling, so several analysts expect them to buy more luxury products at home. As a result, luxury brands that have significant presences in Hong Kong are considering increasing their footprint in Mainland China. Last year, Chinese shoppers accounted for 35% of 281 billion euros ($317 billion) last year in global luxury spending, most of which has typically occurred overseas or in Hong Kong. A good chunk of that expenditure will be repatriated this year. Is your brand ready?

China Eastern Airlines, one of China’s three major state-owned air carriers, introduced a “flight pass” package for unlimited weekend travel to all of the airline’s domestic destinations. Customers who purchase the pass will be allowed to travel economy class with very few restrictions. Priced at 3,322 yuan ($470), the product can be used for unlimited trips within China through the end of the year. Previously, China’s largest online travel agent, Ctrip, had introduced pre-paid hotel packages that could be redeemed over 2020. That was a breakthrough for the domestic hotel industry, where 50% of room nights are booked on the day of stay. Are China’s consumers warming up to pre-paid vouchers? If so, what other areas might see business model changes outside travel?

NEIWAI, a Chinese lingerie brand, has built a DTC brand across online and offline channels. In this interview with Jing Daily, Xiaolu Liu, NEIWAI’s founder, talks about the brand’s efforts in China. One of the difficulties Xiaolu mentions is building a DTC brand in an environment where e-commerce marketplaces dominate. We’re working with a few brands on building DTC brands in WeChat. Contact us to find out more.

Effective January 1st, 2021, animal testing will be removed as a mandatory measure for imported cosmetics entering the Chinese market. The new regulations would mean that pre-market testing is no longer necessary for new products, though testing is still a possibility in post-market or in “special” products like hair dye. The law won’t be set in stone until it passes through a period of public review, but experts are confident. Are you a clean beauty brand that’s looking at China? Now may be the time to make your move!

An increased number of infant milk formula companies are adding follow-on nutrition products to extend their relationship with the shopper and increase customer lifetime value. Chinese mothers are warming to the idea of processed foods for follow-on nutrition, and this creates opportunities for companies that have the right ingredient profile, packaging and scope to adapt to local tastes and nutritional preferences. This segment is fast-growing and we’re actively looking for brand partners in this space who want to take their next steps in China. Reach out if you want to work with us!

Weibo is attempting to catch up in the KOC business. Earlier this month it launched a new hashtag #trynewmakeup (#开新妆) to recruit KOCs to work with makeup brands. Weibo also launched the first event with the Canadian beauty brand Papa Recipe to recruit KOCs to review their new products. At AgencyChina we have always been executing our product seeding campaigns in a similar manner, interested to know what we can do for your brand? Get in touch!

Cross-category marketing, where brands from two different industries team up for a special product or promotion, is a common phenomenon in China. HEYTEA 喜茶 and Perfect Diary, two domestic brands, have used this tactic to great success. But the practice isn’t limited to local brands. Luxury conglomerates LVMH and Kering have also engaged too. Younger consumers enjoy brands that build hype and awareness through exclusive lines and advertise collections or products through surprising or unexpected practices.

China saw around 78.79 million passenger trips during the three-day Dragon Boat Festival holiday that ended on the weekend, according to an estimate from China’s Ministry of Transport (MOT). That figure is a little over half the number of trips made this time last year, which how residual safety concerns and the rise of ‘staycations’ may affect the travel market going forward. Our analysts expect that the government will announce an extended National Holiday to prompt increased domestic tourism.