In click-tap age, startups exploit 'she-economy'

By Zheng Xin | China Daily | Updated: 2017-01-04 07:44

In click-tap age, startups exploit 'she-economy'

A customer shops in a department store.[Photo/China Daily]

The popularity of online shopping among women has provided plenty of business opportunities for Chinese startups.

Zhang Fan, a 34-year-old bank clerk in Beijing, said she spends almost 4,000 yuan ($575.5) each month online, including shopping for clothes, groceries, electronic appliances and cosmetics.

"A click of mouse, and you get what you want," she said.

As Chinese women's spending power increases, Beijing-based Huadian Shijian has come up with an online florist service, delivering a bouquet each week starting at 99 yuan ($15) a month.

Consumers can pay 99 yuan to 598 yuan and can have a bouquet of flowers delivered at a designated time each week. The deal enables customers to get four bunches of hand-picked fresh flowers throughout the month, according to Zhu Yueyi, founder and chief executive officer of Huadian Shijian.

Once picked from West China's Yunnan province, the company's production base, they are packed and flown to the firm's various branches throughout the country within 24 hours.

Since the flowers are booked in advance based on customer demand, the three tons of blooms the florist brings in barely generate any waste and so costs are minimized.

Similar services are becoming increasingly popular in China's first-tier cities including Beijing and Shanghai, taking orders over chat app WeChat as well as other internet channels.

roseonly, a luxury flowers store targeting the gift market, EasyFlower, a B2B platform linking flower growers and stores, and Floral & Life, an e-commerce platform for flowers, are all rolling out their services online, tapping the potential of the 'she-economy'.

According to Pu Yi, the founder and chief executive of roseonly, the company has virtual stores on Taobao, Tmall and like many Chinese online merchants, and that's where most of the flowers are sold/bought.

Zhu said: "WeChat has enabled us to reduce the cost when we started the business, helping us with promotion and sales among our targeted female customers."

Almost 80 percent of Huadian Shijian's current users are female, and the florist said it has seen a rapid growth of users since it went online in July 2015.

Its turnover had surged by 10 times to the end of April, mostly thanks to word-of-mouth, Zhu said.

According to management consulting firm Bain, luxury spending among Chinese consumers has begun to flatline due to changing consumer tastes.

A report by global management consulting firm McKinsey also reveals that generational change and the rising prosperity of inland cities will power consumption for years to come.

The explosive growth of China's emerging middle class has brought sweeping economic change and social transformation, and by 2022, McKinsey's research suggests that more than 75 percent of China's urban consumers will earn 60,000 yuan to 229,000 yuan ($9,000 to $34,000) a year.

The upper middle class is poised to become the principal engine of consumer spending in the next decade, it said.

The florist business is just another new opportunity for startups targeting China's rising middle class. In October 2015, China's middle class numbered 109 million, the largest in the world, according to research by Credit Suisse.

Zhu said: "Chinese people's consumption patterns are upgrading. Now they are willing to spend more on consumer discretionary products and services with their rising disposable income. We are rapidly realizing that so-called 'useless things' are starting to bring us so much happiness."

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