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Winter economy booms amid big freeze

On a typical afternoon in January, Hu Yuan, operations manager at Beijing-based New World Department Store China Ltd, busily checked the showcase in the shop floor display area and nicely adjusted some coats and jackets, to make an impression on consumers visiting the shopping mall.

January happens to be the make-or-break month for sellers of winter products. Typically, consumers load up before the start of the Spring Festival holiday, and tend to steer clear of woolen wear and similar goods later.

For retailers in China, particularly those in Beijing, the winter economy ends around late February. Hu is intent on making the most of every shopping day until then, given recent new COVID-19 cases in Beijing and subsequent lockdowns in a couple of districts of the national capital.

“This winter has been extremely cold. The sales peak for coats arrived 45 days earlier than usual. Spring Festival is fast approaching, and so is the concern about epidemic prevention and control. As retailers, we’ve been fully prepared,” Hu said in January.

Data from the National Meteorological Center showed that on Jan 7, Beijing shivered at minus 19.6 C, the coldest temperature since 1966.

But retailers tended to see the brighter side of the story, which is the so-called winter economy, or the season’s consumption activities that span warm clothing, heating devices, hot food, and hot springs to soak feet in.

“At each garment store, we reserved the prime display area for down coats. Since the cold wave arrived in Beijing earlier than normal, consumer demand for coats surged. Therefore, we launched the winter catalog 45 days earlier than usual. The number of down coats we sold between Dec 22 and Jan 12 surged 20 percent year-on-year,” Hu said.

At Uniqlo outlets in Beijing, store displays of warm clothing are changed every week. Seamless down jackets, which prevent slippage of down feathers from inside the jacket, and polar fleece jackets, found pride of place for weeks in succession.

Uniqlo launched its “Heattech “series this winter. The warm clothing series incorporates its exclusive self-heating technology and comes in three versions: Heattech, Heattech Extra Warm, and Heattech Ultra Warm.

To keep consumers’ feet warm, US footwear maker Skechers launched the 4.0 version of its bestseller D’Lites series.

“The 4.0 version adopts ultra-thick soles, so that even on freezing cold days, its wearers can still stay warm,” said a shop assistant at a Skechers store in Beijing.

In freezing winters, consumers covered in warm clothing feet to head love to gorge on hot food like hot pot, especially when piercing, roaring winds are in their element outdoors, Hu said.

So, the supermarket at New World began sales of hot pot materials like vegetables, beef rolls, mutton rolls, and all kinds of meat balls in the run-up to Spring Festival. The hot pot set also contained sesame, soy sauce, chives, and edible flowers.

“The strong holiday atmosphere began around Jan 20. Owing to epidemic prevention and control measures, we prepared raw materials early so that people can eat hotpot at home. We also plan to launch a promotion program involving restaurants in New World, to offer semi-baked materials for consumers to cook during the Spring Festival holiday. For the seven-day holiday, we will offer a semi-finished dish for each day,” she said.

Sales of heating devices also rose during the winter. New World data showed that in the November-December period, the store’s offline sales of heating appliances like electric radiators and heating blower fans surged 10 percent year-on-year.

The rise in sales was noticed across the country, not just in North China. According to Alibaba’s procurement platform, in November, sales of radiators in China’s southern cities surged 300 percent on a yearly basis. Sales revenue relating to heating appliances rose 200 percent year-on-year.

“Among the heating appliances, heating pads, table warming pads and garment dryers are the bestsellers,” said Wang Jie, a shop assistant at the No 1 Shopping Center in Shanghai.

According to Manmanbuy, a Hangzhou-based, e-commerce-focused data analytics platform, 34,000 heating devices were purchased from JD in September. The figure surged 20 times in October, and rose a further 37 percent in November, quickly surpassing 1 million units, with sales revenue reaching 220 million yuan ($33.6 million).

Hu Chuncai, founder and general manager of Shanghai-based consulting firm UI Sharing, said: “China is experiencing consumption upgrade. In the past, people only wore new clothes at the beginning of a year and ate good food during holidays. Now, with people’s rising living standards, tremendous changes took place. The public now pursue personalized clothes and healthy food.”

To grasp the opportunities presented by the winter economy, retailers should track seasonal shopping trends and offer diversified choices to consumers, He said.

“Five to 10 years ago, merchants just needed to observe which products made money and follow the lead. However, now, consumption is highly diversified and personalized. Enterprises should think about new ideas and look to develop products with distinct features.

“As sporadic COVID-19 cases rise, offline stores should also consider epidemic prevention and control while selling products.”

Agree Hu from New World. “We intensified disinfection measures. Stores in the mall now conduct disinfection twice a day, and every product sold at stores here is disinfected first.”
Source: China Daily