At the beginning of 2020, the consumer goods market experienced a round of reshuffle. As China enters the normal epidemic prevention and control, China's retail industry is showing positive signs of recovery under the stimulus of favorable policies. In the face of the new demands of consumers and the new normal of the market, how are China's FMCC and retail industries performing? Facing the new trend of consumer goods, how will the brand owners and retailers make the next development strategy?

"The epidemic has changed people's consumption habits and given rise to the stay-at-home economy, making dining at home, health management and leisure enjoyment a mainstream trend of life." Shen Juan, senior director of Nielsen's Consumer goods industry in China, said that despite the reopening of stores in April and the gradual recovery of consumption, demand for necessities such as rice, cooking oil and milk showed a trend of growth, but demand for non-necessities continued to decline. Clothing, jewelry, automobile and other industries, due to the outbreak of consumer demand, in the first quarter of a significant decline. This suggests that people's spending is picking up but is more rational. Although the recovery of offline sales is slow, the momentum of continuous growth of online sales is strong, and the sales of omni-channel consumer goods are recovering from the decline.

"Compared with 10 years ago, China today is more focused on consumer awareness, digital distribution and global demand." Shen Juan said that the International Monetary Fund (IMF) forecast China's economy to grow 1.2 percent in 2020, which is one of the few major economies in the world that is expected to be positive, so we should have some confidence in China's economy.

Wang Ling, director of Nielsen's Consumer goods industry in China, believes that brand owners should start from the market point of view and conduct channel conversion and store management at the city level. In terms of income expectation and consumption willingness, the recovery degree of low-level urban consumers is limited. The overall attitude of first-tier cities is relatively positive. Urban offline FMCG consumption showed negative growth, while rural offline channel consumption continued to grow. Key, provincial capital and prefecture-level city consumption shift to the online more obvious. Jobs, finances and health remained the top concerns for consumers in the second quarter. Compared with the same period last year, consumer psychology has produced a significant decline in expectations. Household spending has been cut, especially in second - and third-tier cities, with education and savings still topping the spending list in addition to basic living expenses. She believes that FMCG enterprises need to adopt different strategies in response to the above situation.

"During the epidemic, e-commerce has been developing at a very fast speed, with a 30 percent rapid growth in the first four months. After the peak of the epidemic, consumers will still keep their online shopping habits," he said. Wang said that manufacturers need to focus on how to distribute online as soon as possible, but the offline market should not be ignored. Hema has also accelerated the expansion of new stores, and jd and Tmall are also transforming the offline channels.

"There was a golden rule that 20 percent of stores accounted for 80 percent of sales, but during the epidemic, the ratio shifted and consumption became fragmented, with nearly 50 percent of stores accounting for 80 percent of sales." Wang said that stores were reshuffled during the epidemic, and the importance and resilience of the remaining stores in the channel are self-evident. Therefore, enterprises should grasp the key stores.

"Some people say there are early signs of a consumption downgrade, but it's really a consumption rating. Different consumer groups make different choices. The middle and high-end groups maintain their original consumption levels, while the affected groups downgrade their consumption of necessities and enjoyment products." Affordability has become the most important factor driving consumers to buy, wang said. Because small supermarkets and self-service grocery stores are close to residential communities, they can effectively supplement the lack of online consumption channels and avoid restrictions on online logistics, making them the preferred shopping destinations for many people.

Wang warned that the current breakdown in international supply chains and the flexibility and cost-effectiveness of local brands to meet consumer demand could trigger a shift in global sourcing in the future. The rise of local manufacturers and innovation iteration will become a new reality, which needs the attention of manufacturers. According to Nielsen's retail testing data, small enterprises and local food manufacturers are doing well under the outbreak, and both food and non-food categories are gaining market share, especially the former. Product innovation mainly includes health and nutrition, meal replacement, natural and green food, and food that enhances happiness and emotional health, which are closely related to the epidemic.

When it comes to the next stage of the layout of the leisure and Entertainment industry, Wang Ling gives Suggestions: omni-channel layout, adjusting city priorities, product mix and distribution strategy; Re-evaluate different levels of cities, focus on business growth and category management, adapt to the changing FMCG market. She warned that although the change may be short-term, but only timely understanding of the change can grasp the market pattern and consumers. The lifestyle in the post-epidemic era will continue, and the FMCG industry will also be reshaped while reshaping the consumption scene.