H1 Review: China’s Consumer Confidence is Holding Strong

And That’s Good News for Global Brands

Published on: June 24, 2025

Jacob Cooke

Co-founder & CEO

While headlines continue to focus on geopolitical headwinds—tariffs, trade tensions, and policy uncertainty—the story that unfolded in China’s consumer economy in the first half of 2025 is far more nuanced, and far more encouraging.

Against the backdrop of US-China trade tensions (which hopefully have reached a new equilibrium after the London framework deal), consumer sentiment in China has shown consistent signs of recovery. Month after month, we’ve seen improvements in both macro retail sales and platform-level e-commerce performance. Travel and tourism figures have posted record highs across major holidays, indicating that domestic consumers are confident enough to spend not just on essentials, but on experiences. The mid-year 618 shopping festival delivered historically high results, especially in categories tied to personal wellness and lifestyle.

At the same time, we’re witnessing important platform-level innovations—from Xiaohongshu’s (RedNote) seamless integration with Tmall and JD, to the rapid emergence of instant retail as a national fulfillment standard. All of these trends point to a Chinese consumer who is becoming more selective, more digital, more value-oriented and most importantly, wanting to increase their spend.

For global brands watching the market from the outside, the opportunity remains significant. The demand is there. The question is whether your strategy is aligned with how Chinese consumers are spending in 2025.

Here’s my full breakdown of the trends that shaped H1 below.

Overview:

Retail and Travel Spend See Major Uptick

Retail sales growth across the first five months of the year has been encouraging. According to China’s National Bureau of Statistics, retail sales were up 4.0% year-on-year in January–February (these months are counted together due to the Chinese New Year holiday), and then accelerating to 5.9% in March. That momentum held through spring, reaching 6.4% growth in May. China is the world’s largest e-commerce market by far, and online retail outpaced the broader market, with growth reaching 8.5% year-on-year last month.

China Retail & Online Retail Growth – 2025 YTD (Year-on-Year % Change)

Month	Retail Sales Growth	Online Retail Growth
Jan–Feb	+4.0%	+7.3%
March	+5.9%	+7.9%
April	+5.1%	+7.7%
May	+6.4%	+8.5%

This upswing aligns with a May 2025 McKinsey survey of 17,000 Chinese consumers, which found that 81% are feeling more confident about the economy. In a June memo, McKinsey notes that “intent to splurge continues to rise from already elevated levels.” It writes: “Despite ongoing uncertainty surrounding trade policies, Chinese consumers are increasingly optimistic about their economic prospects. In our work in the region, we’ve observed that many Chinese consumers view China’s trade position as favorable, and that consumption growth remains robust. This optimism is likely fueled by improving economic conditions.”

One of the clearest indicators of that resilience can be seen in travel and tourism. Major holiday periods in 2025 have seen record-breaking figures across both trip volume and consumer spend. Chinese citizens are moving, spending, and prioritizing experiences once again.

2025 Public Holiday Travel & Spending

Holiday	Trips (YoY Δ)	Spending (YoY Δ)
Lunar New Year	9.02B (+7%)	US$94.4B (+7%)
Qingming	126M (+6.3%)	US$8.1B (+6.7%)
Labor Day	314M (+6.4%)	US$25.1B (+8%)
Dragon Boat	119M (+5.7%)	US$5.9B (+5.9%)

Another Record-Breaking 618

This steady climb in discretionary travel is consistent with the performance we saw during this year’s 618 Shopping Festival. Data firm Syntun reported that total GMV during the festival hit US$119 billion—up 15.2% year-on-year and just ahead of WPIC’s forecast of 14.1%. That’s a record figure, and further evidence of a resilient consumer base. As I noted in a recent LinkedIn post, the extended campaign window helped smooth out demand. Shoppers are now engaging earlier and more steadily across the pre-sale and promotion cycle.

Additionally, it’s worth noting what exactly consumers were buying during 618—and what that tells us about shifting preferences in the market. Categories related to wellness, personal care, and self-expression saw strong growth. This year, I’m labelling the theme as “Look Good, Feel Good.”

Beauty, health, and fitness-related categories outperformed, and we continued to see demand tilt toward premium experiential brands over traditional luxury. For instance, Lululemon and Arc’teryx—both of which position themselves around performance and lifestyle rather than status alone—have become go-to names in their segments. Consumers are investing in their appearance, their health, and their sense of daily satisfaction. For many brands, this is the sweet spot: not necessarily mass, not necessarily ultra-luxury, but aspirational, functional, and experiential.

Content-Driven Commerce

The performance of the most popular digital platforms continues to reflect this evolution as well. Xiaohongshu’s growing partnerships with both Tmall and JD signal the increasing centrality of content-driven commerce. In 2025, the path to purchase increasingly begins with inspiration—not search. Social commerce ecosystems are maturing rapidly, and it’s no longer just about influencers—it’s about integrated discovery. A user scrolling Xiaohongshu can now buy directly from a Tmall or JD seller, with frictionless checkout and seamless cross-platform fulfillment. The lines between content and commerce are gone. That’s a trend we expect to deepen as platform integrations continue.

Another trend accelerating faster than expected is instant retail. Taobao Instant Commerce, in partnership with Ele.me, reported more than 60 million daily orders within two months of launch, up sharply from 40 million just weeks earlier. The on-time delivery rate is holding strong at 96%, and year-on-year growth in non-food retail orders has hit 179%. What we’re seeing here is a structural shift: for many Chinese consumers, the expectation is now not only fast—but immediate. Inventory localization and last-mile delivery are becoming strategic imperatives, especially for brands in health, beauty, and CPG categories. The brands that win in this space are those that meet demand with speed, reliability, and relevance.

Finding Growth in China

Taken together, the story for H1 2025 is clear: Chinese consumer confidence is growing, and demand is surging—but it looks different than before. Consumers are prioritizing value, wellness, convenience, and experience. That creates enormous opportunity for brands that are strategic and responsive to local signals.

To help brands understand where tariffs fit into all of this, WPIC has developed a new report—“Succeeding in a Time of Tariffs”—which lays out clear guidance on how global companies can tap into Chinese demand while navigating shifting trade dynamics. If you’re looking to engage or re-engage with China, this report is a good place to start.

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H1 Review: China’s Consumer Confidence is Holding Strong

Jacob Cooke

Overview:

Retail and Travel Spend See Major Uptick

China Retail & Online Retail Growth – 2025 YTD (Year-on-Year % Change)

2025 Public Holiday Travel & Spending

Another Record-Breaking 618

Content-Driven Commerce

Finding Growth in China

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