Where Does The Next Demand Explosion Point For New Consumption Come From?

Zhuo Xian, research fellow of the State Council Development Research Center. Data map

In the near future, attending the parents' meeting, the words of mathematics teacher are quite intriguing. In her teaching process, she found that today's children have obstacles in recognizing two things: one is the mechanical clock, because children's perception of the concept of time has transformed into digital smart watches, mobile phones and tablet computers; two is paper money, in addition to 100 yuan bills, children are more exposed to the process of currency circulation through digital payment. Why do children know hundreds of dollars? Because the children of lower grades do not have a cell phone, they can not receive WeChat red envelopes during the Spring Festival. They can only receive 100 yuan cash in red packets.

Digitalization is a great change to Chinese society.

Digitalization restores our life and consummate new consumption. Although technology is driving the world to change in a non-linear way, it is still meaningless to recall and imagine the development of new consumption when the new ten year is about to open.

The essence of new consumption is digitization. The proportion of China's digital economy in the overall economy increased from 15% in 2008 to 34% in 2018, and more than 1/3's economic activities were digitalized. Moreover, under the background of economic slowdown in recent years, the speed of economic digitalization remains at a high level. In the past ten years, the progress of digital technology has promoted the evolution of new consumption patterns, which can be roughly divided into six stages.

The first stage is the digitalization of supply information. This is the era of "PC computer + online shopping". The role of digitalization is mainly to solve the problem of asymmetric information of supply and demand. The new consumption of new consumption is mainly reflected in the interaction between new media and information search.

The second stage is the digitalization of payment means. Internet payment, especially the popularity of mobile phone payment, has greatly promoted the growth of consumption and the upgrading of consumption structure. Recent studies have found that mobile payment has increased household consumption by 16% in China, especially in rural areas, by 22%.

The third stage is the digitalization of the supply chain. At this stage, by introducing automation logistics equipment, intelligent logistics scheduling and Internet of things and other digital technology, the electricity supplier has improved the efficiency of the logistics industry in resource allocation, line optimization and information synchronization.

The fourth stage is the digitalization of credit. In the new consumption process, the information of consumers' capital flow and the logistics information and goodwill information of merchants are precipitated into digital credit, and the corresponding credit rating and Internet financial business are derived accordingly.

The fifth stage is the digitalization of demand. Many internal needs of consumers are explored, identified and analyzed by websites and APP. Artificial intelligence technology can see and explore potential demand from user big data, thus generating a diversified and personalized product feedback mechanism.

The sixth stage is the digitalization of the production process. This is the stage of the consumption Internet turning to the industrial Internet, which promotes the convergence of consumer demand and enterprise production capacity in time and space, and reduces the inventory and management cost of enterprises by flexible production mode of intelligent manufacturing.

After six overlapping phases, new consumption accounts for more than 20% of the physical consumption of goods in the society, and online shopping festivals also create astronomical records. But in recent years, the overall growth rate of retail sales of consumer goods has slowed down. So where does the next demand for new consumption come from?

From the development stage, the consumption of physical commodities has reached a peak, car sales have declined, home appliances market is almost saturated, and the upgrading of smart phones is also higher than that of western countries. The next growth point of new consumption should be service consumption. The judgement of this trend is in line with China's economic structure turning to service industry.

As more and more services can be digitalized, service consumption is more and more likely to be embedded in new consumption scenarios. At present, we should pay attention to the growth of new consumption of two groups. When the only child generation becomes a parent, when the university graduates begin to raise their children, the willingness to invest in family education is increasing. According to the survey of some organizations, the proportion of household education expenditure in China accounts for over 50% of daily consumption, accounting for about 20% of household income. In addition, the aging of the population poses a great challenge to China's development, and it also promotes the development of health care, pension and leisure industries. In recent years, some developed countries have also found that the consumption tendency of the elderly population will be stronger because most of the elderly do not have the pressure of mortgage loans.

Different from previous commodity consumption, service consumption pays more attention to professionalism, stability and trust, and the demand for consumer protection will be higher. From the current situation, whether it is pension, medical care or education, not only the supply is insufficient, the quality of supply is limited, but also restraining the growth of the consumption of service industry. To promote the development of the service industry under the new consumption mode, the traditional financial institutions should do something.

New consumption was originally an important runway for traditional financial institutions to upgrade their businesses. Once upon a time, financial institutions were sitting on the largest number of user data and the most widely used payment channels. The daily hits of some large bank websites even exceeded those of the world's largest Internet sites. However, in the process of new consumption promotion, the intermediary functions provided by financial institutions are often replaced by Internet platform companies.

Traditional financial institutions should seize the new opportunities for the development of service-oriented consumption. China has about two hundred thousand banking outlets and millions of bank tellers, but with the progress of technology, information and automation are replacing the functions of physical outlets. At present, some banks have launched "no teller sites", but if financial institutions do not speed up transformation, with the penetration of digital technology, some outlets may become "no customers' outlets". How should traditional financial institutions transform so as to continue to play an important role in the new round of service consumption growth?

Under the background of China's aging population, financial assets also show the characteristics of holders' aging. Financial institutions have always proposed to focus on customer needs. When the proportion of elderly clients in financial customers is increasing, should financial services change? Can we make such a bold assumption that some of the increasingly dilute outlets can take financial consumption as the core competitiveness to create a scenario that provides service consumption for the elderly group and online and offline integration, and become an important platform for high quality service oriented new consumption.

In 1990, there were six financial institutions in the world's largest ten companies, but by 2019 only two financial institutions were on the list, and seven technology companies were among them. If the traditional financial institutions should continue to assume the core role in the national economy, financial services must rely on the power of financial technology to subvert the original ideas, channels and scenes of the original financial services. Everything may start with a new consumption of support services.