CHINA

The Initial Outbreak of COVID- Infections Has Peaked in China,

but Not in the US and Europe
100
Increased lock-down of cities Survey
in field China
Italy
Confirmed coronavirus cases

Reporting standard Hubei (except Wuhan) lifts travel ban;

updated: clinically Interprovincial Wuhan set to lift its ban April 8 US
diagnosed cases counted transit transit
(thousands)

as confirmed cases resumes in 85%

50 National lockdown in
of provinces
France; EU closes borders

Chinese New Year;

schools and Italy imposes
France
companies closed Lockdowns begin in other cities; national lockdown
for holiday Beijing, Shanghai, and others limit UK
in-and-out for residential areas
0
8 20 22 24 26 28 30 2 4 6 8 10 12 14 16 18 20 22 24 26 28 2 4 6 8 10 12 14 16 18 20 22 24 26
Dec Jan Feb Mar
Schools to
First case remain closed until Work resumption policy First UK death US-Europe US-Canada
reported in further notice announced, to encourage travel ban border closed; first
Wuhan business to reopen No new confirmed announced stay-at-home orders
Wuhan locked down; cases outside Hubei
construction of specialty Construction of additional Italy’s death toll
hospitals begins makeshift hospitals for mild New cases overseas surpasses China’s
patients begins exceed new cases in
Human-to-human transmission China for first time
confirmed; China State Council
announced outbreak Positive milestones

Sources: World Health Organization Situation Reports; press release from China State Council, National Health Commission of the PRC, Chinese Provincial Government; media reports; BCG analysis.
CHINA

The Chinese Economy Is Beginning to Show Signs of Recovery

MACROECONOMIC INDICATORS …AS HAVE CONSUMER

HAVE BEGUN TO RECOVER… SPENDING PATTERNS

~99% Businesses
~85%
Recovery of
135%
Growth of restaurant
70%
Recovery of average daily sales
resumed1 coal consumption transactions of a leading apparel company
(as of March 17) (as of March 27) (March 2–10 vs. February 2–10) (March 1–15 vs. same period last year)

~50%
Recovery of
~90%
Recovery of
7x
Growth of Shanghai beauty
2x
Overall e-commerce sales
metro passengers property transactions salon transactions during sales promotion
(as of March 26) (as of March 25) (March 2–8 vs. February 24–March 1) (March 8 promotion period vs.
same period last year)

Sources: Wind; National Development and Reform Commission.

Note: Recovery is gauged by year-on-year daily consumption in  vs. , using the same weekdays relative to Chinese New Year. Particular statistics in this exhibit were drawn from the following
sources: businesses resumed, National Development and Reform Commission; recovery in coal consumption, metro passengers, and property transactions, Wind; growth in restaurant transactions,
Weechat payment data; apparel sales recovery, public release by the company; growth in Shanghai beauty salon transactions, Xinhua Net; and e-commerce daily sales, Alibaba.

Industrial enterprises with annual revenue above  million RMB.
CHINA

Travel, Retail, and Service Businesses in China Are Reopening

TRAVEL DINING

80%
Hotels across the country
73%
Restaurants across the country (including dine-in
reopened as of February 271 and off-premises) reopened as of March 182

GROCERY SHOPPING MALLS

99%
Supermarkets/hypermarkets in
100%
Major shopping malls in Shanghai
Shanghai reopened as of March 193 reopened as of March 193

Source: BCG analysis.


Ctrip data.

Meituan Research Institute.

Based on , supermarkets/hypermarkets,  shopping malls, and , convenience stores monitored by the Shanghai Ministry of Commerce.
GLOBAL – WAVE 2 – MARCH 13–16, 2020

Consumer Optimism Seems to Be Growing in China

Chinese consumers are still concerned …but they also express more optimism about the
about COVID-19… crisis than consumers in other countries

93% 43%

Spread
Try to avoid public Think where they live is
Fast

Mortality
safer from the virus than
Italy Outdoor
spaces as much Fear Zhong Nanshan

Mask Lockdown of city

as possible the rest of the world

Wash hands (US/EU: 8%–21%)

The United States
87%
Changed their daily
Pneumonia
China Outbreak Isolation
Epidemic

Global
lifestyle as a result

Infect
Serious

38%
of the virus Cheer up
Coronary Concern
Country
Large scale
77% Economy Protection
Death Wuhan
Economy Believe the worst of the
virus is over
Human-to-human transmission (US/EU: 4%–7%)
Believe there will
be a recession Top words that come to mind when Chinese think about the
virus (free response, unaided associations)

Source: BCG COVID- Consumer Sentiment Survey, March –,  (N = ,, unweighted; representative within ±% of China national demographics).
Note: Question text: “You mentioned that you are aware of a global virus outbreak. What comes to mind when you think about the virus? Please list – words or phrases.” and “How much do you
agree with each of the following statements about the coronavirus?” Similar responses are categorized together for visual simplicity.
GLOBAL – WAVE 2 – MARCH 13–16, 2020

Chinese Consumers Expect to Spend More in the Next Six Months

in a Larger Number of Categories Than US Consumers Do
WINNERS More than % of respondents plan to spend more
China US
Preventive health care Travel Savings
Vitamins/supplements Packaged food and beverages Preventive health care
Childcare Toys and games Fresh and organic foods
Fresh and organic produce Pet supplies and services Household care products
Household care products Baby/children’s food Vitamins/supplements
Insurance Home electronics and applicances Education
Education Alcohol

5x
Savings Women’s clothing More than
Mobile electronics Men’s clothing
Cosmetics and skin care Outerwear
Athletic equipment and clothing Restuarants
Children’s clothing Home décor China
Utilities Cars/automobiles as many winner
Entertainment Luxury/fashion categories in China
Public transportation Shoes/footwear as in the US
US
Personal care Tobacco/smoking
Medical prodedures Mortgage/rent/renovation

Source: BCG COVID- Consumer Sentiment Survey, March –,  (N = , China; , US), unweighted; representative within ±% of China and US national demographics.
Note: Question text: “How do you expect your spend to change in the next  months across the following areas?" Excludes categories with N < ~ in any country.
 GLOBAL – WAVE 2 – MARCH 13–16, 2020

Chinese Consumers Are More Likely to Increase Their Spending

Than US or European Consumers

0% Only small changes Plan to increase Consumers in China plan to China

planned spending (net) increase spending to a greater extent US
France
than consumers in other countries
Italy
UK

20%
Plan to spend less

Non-Chinese consumers plan more

substantial spending decreases
40% across categories than substantial
spending increases

Plan to decrease Consumer spending

spending (net) expectations mixed
60%
0% 20% 40% 60%
Plan to spend more

Source: BCG COVID- Consumer Sentiment Survey, March –,  (N = , China; , US; , UK; , France; , Italy), unweighted; representative within ±% of census/national demographics.
Note: Question text: “How do you expect your spend to change in the next  months across the following areas?" Excludes categories with N <~.
GLOBAL – WAVE 2 – MARCH 13–16, 2020

Many of the Top Categories Where Consumers Expect to Spend More

Are Similar Across Countries...
TOP WINNERS Top categories where respondents are likely to spend more in next six months
China Italy US UK France
Preventive healthcare

Vitamins/supplements

Fresh and organic foods Utilities

Household care Cars/automobiles

Insurance

Education

Savings Medical procedures

Mobile electronics Packaged food

and beverages
Cosmetics Entertainment

Source: BCG COVID- Consumer Sentiment Survey, March –,  (N = , China; , US; , UK; , France; , Italy), unweighted; representative within ±% of census/national demographics.
Note: Question text: “How do you expect your spend to change in the next  months across the following areas?" Excludes categories with N <~.

Winners and losers were defined as up to the top  categories in which % or more of respondents plan either to increase or to reduce their spending over the next six months.

Includes leisure travel (%) and business travel (%).
GLOBAL – WAVE 2 – MARCH 13–16, 2020

...As Are Many of the Top Categories Where Consumers Expect

to Spend Less
TOP LOSERS Top categories where respondents are likely to spend less in next six months
China Italy US UK France
Restaurants Gambling

Travel

Tobacco/smoking

Luxury/fashion Outerwear

Home electronics/
Alcohol appliances

Public transportation Home décor

Athletic equipment

Toys and games

Entertainment

Cars/automobiles Women’s clothing

Source: BCG COVID- Consumer Sentiment Survey, March –,  (N = , China; , US; , UK; , France; , Italy), unweighted; representative within ±% of census/national demographics.
Note: Question text: “How do you expect your spend to change in the next  months across the following areas?" Excludes categories with N <~.

Winners and losers were defined as up to the top  categories in which % or more of respondents plan either to increase or to reduce their spending over the next six months.

Includes leisure travel (%) and business travel (%).