The Rising of Single Economy Spurs New Consumption
11:38:00, May. 20, 2020
As China's consumption market continues to diversify, how to capture the emerging consumer groups and better grasp the future growth momentum of consumption has become a primary problem faced by brands and retailers. Nielsen released report on the Rising of China Single Economy. The report finds that as the number of single people continues to grow, their consumption power cannot be underestimated, which spurs new consumption.
Justin Sargent, president of Nielsen China, said: “The rise of the single economy is being driven by single people's active consumption choices and their aspirations for a high quality life.”
The singles’ consumption power cannot be underestimated, and they may emerge as an important force in the future
Data from the Ministry of Civil Affairs showed since 2014, the marriage rate in China has been declining, while the number of single people has been growing. Nielsen data showed that only about one percent of the singles are under pressure to care for their families and educate their children, so they show stronger willingness to consume.
The Nielsen report showed that more people in the group make their own choice to lead a single life rather than being forced to do so, and most of them still have their parents' protection and are more willing to have immediate consumption. Nielsen data showed the top five reasons the group choose a single life: single is good/ do not worry about relationship (28%), no time and energy to have relationship (22%), the social network is limited(21%), passive/ don’t like social (12%), relationship will bring financial burden (8%).
In the meantime, 83 percent of the singles choose to live with their parents, while only 5 percent of those who are in a relationship do so. Compared with those who are in a relationship, the singles’ consumption motivation is basically to meet their own demand. They have more freedom to make the spending plans based on their own needs, so in terms of investment wealth management and risk awareness, 40 percent of the single people said they have not purchased any financial products, far exceeding the 22-percent of non-singles.
Figure 1. Top 5 Reasons for Single | 2019Q4
Being single is an attitude, but the group also has an emotional demand. The Nielsen report showed that within the upcoming year, 31 percent of the singles will still choose to lead a single life, while 59 percent of them said if they meet the right person, they are open to start the relationship. Only 10 percent of them are eager to be in love as soon as possible. The singles are keen to “Ke CP (Coupling)” – which means they desperately hope a leading actor to love or even marry an actress that they are fond of, or wish a real couple to stay together forever. That makes a variety of shows themed on dating provoke heated discussion on Weibo, a twitter-like Chinese social media.
The single economy gains momentum and boosts new consumption
The singles spend to please themselves, and are more willing to purchase high-quality products. The Nielsen report showed 42 percent of the singles consume to please themselves, compared with 27 percent of non-singles.
In the upcoming 12 months, 75 percent of the singles have plans to buy cloths, higher than the 65-percent of non-singles. Among the surveyed singles, 35 percent said they will buy quality cloths in relatively high price, while only 25 percent of non-singles will make such a choice.
In the upcoming year, 41 percent of the singles plan to purchase consumer electronics, higher than the 28-percent of non-singles. Half of the singles are willing to buy the products of high quality though the price is relatively high, and the percentage is higher than the 43-percent of non-single consumers.
Figure 2. Single Vs Non-single Consumers
The single people make their life more convenient. The Nielsen report showed 52 percent of the singles consume out of convenience and timesaving, higher than the 39-percent of non-singles. In 2018, 30 percent of the consumers shopping at convenience stores were single people, while the portion increased to 39 percent in 2019. In terms of online consumption, convenience has become an important factor for the singles to choose online shopping. Specifically, 97 percent of the singles will shop online and 62 percent of them prefer to order take-outs through online platforms. The singles that love online shopping are more easily influenced by KOL (key opinion leaders). Forty-eight percent of the single people show recognition to the sales led by KOL to some extent, the Nielsen report said.
The single people are more focused on investing in themselves. The Nielsen data showed the single people have higher expectations for life and self-development. Within the coming year, 22 percent of the singles said they expect to spend more time reading, 18 percent to learn new skills, 17 percent to foster new interests. The figures are higher than those of non-singles (13%, 11%, 14% respectively). At the same time, 16 percent of the singles have more willingness to consume on the purpose of improving themselves, and 14 percent of them are more willing to spend on exercise and fitness.
Figure 3. Single People Are More Focused on Self-investments
The single people need someone else’s company, so they have a strong demand for socializing and pets. The Nielsen data showed 28 percent of the singles spend their savings on eating outside, compared to 20 percent of non-singles. Twenty-six percent of the singles are willing to pay for outdoor activities, higher than 23 percent of the non-singles. In the meanwhile, the single people consume to find comfort, transferring the emotions to their pets. The Nielsen data showed 40 percent of pet owners were born in the 85/90s, and 57 percent of pet owners are not married yet. The pet economy represents the singles’ consumption.
In addition, Nielsen's research found that single people are night owls. Eleven percent of the singles usually have cultural and recreational activities from 11 o'clock in the evening to late night, compared with only 6 percent of non-singles. At the same time, data released by the Ministry of Commerce showed that 60 percent of China's consumption occurs at night, and the night economy has become a new growth driver. Single consumers who shop online or order take-outs at night will, to a certain extent, promote the night economy.
Justin said: “As the single group continues to grow, the single economy will generate new opportunities for brands and retailers. To win the group who has extremely strong purchasing power and great consumption potential, it is of vital importance to stay close to the lifestyle of singles, respond to their unique consumption needs and listen to their voices.”