Rebound in domestic and international travel
According to a report from Ctrip, one of China’s largest online travel agencies (OTAs), travel over the 2023 CNY period reached a three-year high. Overall travel bookings on the platform, including domestic and international bookings, increase four-fold in the 2023 CNY period from the same period in 2022.
Long-haul and outbound travel in particular saw major increases in bookings thanks to the lifting of COVID-19 restrictions, including the removal of the quarantine requirement for inbound travelers on January 8. According to Ctrip, overall overseas bookings during the CNY period increased by 640 percent year-on-year. Of this, both overseas hotel bookings and cross-border air tickets increased four-fold from the same period in 2022.
Southeast Asia was high on the list for Chinese travelers, with Bangkok, Singapore, Kuala Lumpur, Chiang Mai, Manila, and Bali being the most popular destinations for people traveling abroad.
Domestic travel has also increased from 2022, with long-haul and inter-provincial travel making a rebound. This marks a reversal of the trend of short-haul or surrounding travel that had become increasingly popular during the pandemic, as people looked to avoid the risk of getting stranded far from home under strict COVID prevention rules.
Ticket bookings for famous domestic scenic spots grew 3.2 times year-on-year. Non-first-tier cities with historical and cultural sites, such as Xi’an, Suzhou, Yangzhou, Luoyang, and Kaifeng, also saw an uptick in popularity.
A particularly popular form of tourism during the CNY period was group tours, or in the case of this year’s holiday, “reunion tours”. According to the Ctrip data, orders for group tours during this period were up 4.2 times from the previous year, with an average group size of at least three people. Over 80 percent of the group tour bookings were also for inter-provincial or long-haul travel.
Rise in services consumption
Online sales of goods and services during the 2023 CNY period also appear to have recovered from the pandemic years. According to a report from the online e-commerce platform JD.com, the number of orders placed on Chinese New Year’s eve jumped by 171 percent year-on-year.
In addition, hourly shopping sales increased by 90 percent year-on-year, with the so-called “immediate consumption” (where goods are delivered as soon as an order is placed) becoming an increasingly popular choice for shoppers.
This trend is partly also thanks to the expansion of delivery infrastructure, with JD.com delivering parcels even on new year’s eve and new year’s day, dates on which most businesses are closed.
Meanwhile, spending on gift boxes, which forms part of the tradition of gift-giving during the CNY period, grew 50 percent year-on-year.
The report provides interesting insight into how consumption habits are changing quickly as a result of the lifting of COVID-19 restrictions. As has been seen in other parts of the world following the pandemic, people are spending more on services and less on goods.
The turnover of so-called “lifestyle services” (a broad category of services that includes entertainment, sports, education, and medical services, as well as catering and domestic services) increased by 302 percent year-on-year. Other services that saw a jump in popularity included mobile phone guarantee services (up 296 percent year-on-year), home appliance repairs (up 83 percent), battery replacement services (57 percent), and computer installations (53 percent).
In terms of goods, health products proved particularly popular, with the transaction amounts for liquid amino acids, “nutritional wines”, and protein powder increasing by 215 percent, 86 percent, and 70 percent year-on-year respectively.
Jump in China box office sales
Total box office sales over the 2023 CNY holiday have jumped 9.2 percent from the same period in 2022, thus far.
According to data from Dengta Database (灯塔数据库), which tracks box office sales in real-time, box office sales (including presales) during the 2023 CNY holiday ( January 21 to 27) had reached RMB 6.6 billion (approx. US$972.9 million) as of 5:23 pm China time on January 27. This exceeded the RMB 6.04 billion (approx. RMB 890.4 billion) recorded over the entire CNY holiday in 2022 (January 31 to February 6).
This yearly increase remains more or less the same when including the weeks leading up to CNY. Box office sales from January 7 to 5:40 pm China time on January 27, 2023 totaled RMB 7.3 billion (approx. US$1.1 billion), versus RMB 6.7 billion (US$987.7 billion) in the same period in 2022 (January 17 to February 6).
The highest-grossing film so far over this period has been Zhang Yimou’s Man Jiang Hong, with box office sales reaching RMB 2.5 billion (US$368.5 billion) since being released on January 22.
The CNY period is a major movie-going season in China, with many films released at the beginning of the holiday to capitalize on people’s extra free time over the holiday period.
The strong start to the Year of the Rabbit a sign of more to come?
The increase in consumption seen across a wide range of industries over the 2023 CNY period is a positive sign that the tides are turning for China, suggesting that consumers are becoming more optimistic and confident. This is particularly good news for Chinese policymakers, who have struggled to stimulate sluggish consumption demand over the past few years. Previous tactics, such as issuing consumption vouchers, made little impact on overall spending.
The recovery of service consumption, as well as entertainment such as movie theaters, also suggests that fewer people are spending time indoors and relying solely on online deliveries and entertainment. At the same time, consumption has not completely recovered to pre-pandemic levels.
Looking at travel, we can see that many more people are still choosing to stay home over the holiday period than did in 2019. According to estimates from the Ministry of Culture and Tourism, there will be a total of 308 million trips over the 2023 CNY period. This is a year-on-year increase of 23.1 percent, but still only 88.6 percent of the total number of trips made in 2019.
China is still in a transition period, and with COVID-19 still prevalent and people still adjusting to living with the virus, it is only natural that a portion of the population will feel some trepidation in the first few months. This uncertainty should dissipate as the year goes on, as more of the population builds up immunity against COVID
