Criteo, a commerce media company, has unveiled insights from the 2022 Chinese New Year (CNY) to help retailers anticipate consumer demand and leverage similar trends in 2023.

Starting in January 2022, retail sales surpassed typical levels (based on the average between December 18th and 31st, 2021) until a week prior to CNY 2022 (February 1st), indicating a strong consumer appetite for purchasing. In Southeast Asia (SEA), retail sales hit a peak of 27% on January 25th, a week before CNY. This suggests that consumers in the region continue to shop for festive necessities close to the holiday and expect retailers to accommodate last-minute needs. Retail sales in the Greater China Region (GCR) saw a 40% rise compared to the final two weeks of December 2021.

The pandemic normalized e-commerce, and this growth signifies consumers’ comfort in diversifying their purchasing methods. CNY 2022 saw SEA consumers embracing various platforms beyond traditional physical stores for their holiday shopping. In the GCR, in-app sales significantly increased two weeks before the event, while SEA experienced double-digit growth across all site types, with desktop sales seeing the most substantial rise.

In SEA, desktop sales jumped by 58%, app sales increased by 29%, and mobile web sales rose by 30%. The GCR witnessed a 50% increase in desktop sales, a 120% surge in app sales, and a 57% growth in mobile web sales.

Mobile transactions slightly outperformed the baseline during the week leading up to CNY 2022, with a 12% increase in SEA, 9% in Singapore, 10% in GCR, and 19% in Vietnam.

Various retail categories experienced improved sales performance in 2022:

Fashion sales exceeded the baseline in the lead-up to CNY 2022. SEA saw a 24% increase, GCR experienced a 34% rise, Singapore recorded a 37% increase, and Vietnam witnessed a 41% jump.

The food and groceries category doubled in sales before CNY 2022, demonstrating a significant increase compared to the average during the last two weeks of December 2021. The most substantial increases happened two weeks before the event, with GCR at 103% and SEA at 86%.

The health and beauty category experienced an 86% rise in SEA and a 103% increase in GCR. Electronics sales climbed by 30% in SEA and 60% in Vietnam. Lastly, items within the home and garden category witnessed a 94% surge in GCR.

“Chinese New Year is expected to drive a surge in consumer spending, and retailers need to be ready to capitalize on this opportunity. Brands and retailers have witnessed firsthand the shifts in consumer behavior and needs over the past few years and are well-positioned to act on these insights,” shared Taranjeet Singh, Criteo’s Managing Director for Southeast Asia and India.

“As we approach this festive season, it’s crucial for brands and retailers to consider refreshing their advertising strategies to maximize their reach to target audiences across different platforms."

Criteo highlighted that consumers are wary of inflation and the rising cost of living in 2023, leading to the emergence of the savvy shopper who actively seeks the best value for their money. The company identified five key trends for retailers to consider:

• Despite the revival of in-store shopping, consumers are going online to hunt for the best deals. Criteo’s research suggests that consumers are adopting a hybrid approach to shopping, desiring the benefits of both online and offline experiences. While they are returning to physical stores, they still rely on retailer websites and mobile apps to complement their shopping journey. Four out of five consumers report a significant or noticeable improvement when searching online for products they intend to purchase. This indicates that consumers value relevant and personalized advertising, ultimately expanding the reach for both new and existing customers.

• Consumers are still investing in items they desire. While consumers face unavoidable increases in essential expenses like mortgages and food, a majority are still purchasing desired goods and experiences.

• Consumers are now planning ahead and considering bulk purchases to stretch their budgets and maximize savings.

• Consumers believe that affordability shouldn’t compromise quality. Even though saving money is a priority, shoppers still seek high-quality, durable products.

• Consumers expect more from brands than just discounts. Alignment with brand values and enticing loyalty programs are strong motivators for shoppers making purchases.

With these insights in mind, retailers should implement these best practices to maximize consumer engagement for CNY 2023:

• Commerce media is emerging as the fourth wave of digital advertising, possessing the potential to reach and engage consumers actively browsing and buying. Consequently, evolving environments like retail media are expected to gain further traction in 2023.

While retail media refers to advertising placed on a retailer’s e-commerce platform or app by brands to influence customers at the point of purchase, commerce media encompasses a broader scope, incorporating elements of retail media, performance marketing, and brand marketing.

• Savvy retailers recognize the need to continuously expand their media offerings to control the entire customer journey, and marketers will persist in investing in retail media due to its effectiveness.

• Retailers must provide a seamless hybrid shopping experience to foster customer loyalty and trust. This includes implementing innovative and practical customer services, such as BORIS (buy online, return in-store). This hassle-free return policy is a primary factor influencing consumers’ online purchasing decisions.

• Retailers must effectively target ads to their intended audiences. By optimizing data and analytics on their websites and apps, retailers can deliver targeted advertising at the point of purchase, directly influencing online sales and expanding their reach to both new and existing customers.