But here’s what I find even more fascinating than the movie itself: not everyone who watches it seems truly moved by it, and yet they return, ticket after ticket, filling theater seats over and over again. For what?

To push Nezha to the top of the charts and break world records.

This act of rallying behind Nezha is more than just national pride—it reflects a broader pattern in Chinese consumer culture, where spending is driven not just by personal preference, but by the need to validate and elevate symbols of identity. This same phenomenon plays out in luxury consumption.

In recent years, this collective enthusiasm for homegrown culture has only intensified. The pandemic cut Chinese consumers off from overseas luxury shopping, prompting them to turn inward. This shift in focus on domestic culture reached a high point when the Spring Festival was officially recognized as a UNESCO cultural heritage, further fueling a wave of cultural nationalism.

In a recent piece I wrote for Vogue Business in China, I explored how this has fueled an intangible cultural heritage (非遗) movement in China—not just as a marketing tool for luxury brands seeking to localize, but as a genuine shift among young Chinese consumers eager to engage with their own cultural roots.

This shift reminds me of a conversation I had recently about China’s luxury consumers—what compels them to spend?

Yes, for one thing, they have the money. Decades of rapid economic growth have produced a generation of consumers who are not only wealthy but financially literate in ways previous generations were not. They have been meticulously groomed by global marketing machines, seduced by aspirational branding, and conditioned to understand the notion of luxury—its history, its craftsmanship, its allure.

Chinese consumers did not always have this level of discernment. It was learned, accumulated through years of exposure to omnipresent messaging from brands that sought to educate as much as sell.

But there’s something deeper at play. Beneath the gloss of Hermès silk and the polished leather of a Birkin, beneath the meticulous rituals of skincare and the diamond-encrusted whispers of high jewelry, lies a fundamental human desire: the need to be recognized.

Luxury in China is not just about ownership—it’s about participation.

The way fans of Nezha buy tickets not necessarily for personal enjoyment but to elevate the movie’s status is strikingly similar to the way China’s luxury consumers engage with brands. The act of buying is not only transactional; it is a performance, a statement of allegiance. To buy luxury is to belong—to a class, to a narrative, to an imagined ideal of sophistication and global citizenship.

But there’s another layer to this evolving landscape: Chinese consumers have become hypersensitive to respect. Years of interacting with global brands have made them acutely aware of whether they are truly valued—not just in service quality but in cultural representation.

A dual-track strategy—one approach for China, another for the West—no longer works. Consumers now scrutinize how brands behave across different markets, monitoring inconsistencies between their messaging on Chinese and Western social media.

Take the Lunar New Year vs. Chinese New Year debate, for instance. On Xiaohongshu (also known as Red), users like @SugarNino dissected how luxury brands positioned the same campaign differently: Valentino was criticized for calling it Lunar New Year on its official website but using Chinese New Year elsewhere. Miu Miu, in contrast, subtly adjusted the phrasing based on different regional sites.

More recently, Fendi found itself under fire when it was accused of mislabeled the traditional Chinese knot as a Korean knot in an Instagram campaign. This kind of brand “fact-checking” has become increasingly common, and consumers are not afraid to call out double standards.

And yet, the Nezha phenomenon hints at a deeper cultural shift. The fact that consumers are rallying around a Chinese film—not purely for personal enjoyment but to elevate its status—mirrors the evolving dynamics of luxury consumption. For decades, luxury in China was about signaling wealth in its most literal sense. But today’s consumers are more nuanced.

They chase meaning as much as they chase price tags. They seek validation not just from their peers, but from the brands themselves. They want more than just exclusive products and premium services—they want brands to demonstrate a deep understanding of their culture, not just as a marketing tactic, but as a fundamental part of their strategy.

I mean, for sure, there is still room for international luxury brands to grow in China, particularly among high-net-worth individuals (HNWIs), who continue to value prestige, status, and exclusivity—even as homegrown brands gain traction. However, this may not hold true for the younger generation. They are increasingly skeptical, questioning the very foundation of luxury itself: Why should the West be the one to define what is luxurious and what is good?

Recognition, respect, acceptance—these have always been at the core of why we spend. The question is: as China’s luxury consumers evolve, will their spending power remain in service of external validation, or will they one day turn that energy inward, championing their own cultural capital the way they’ve rallied behind Nezha?

Hong Kong-based developer New World Development recently announced a loss of nearly HK$20 billion for fiscal year 2024, with former CEO Adrian Cheng stepping down. Cheng is also the CEO of K11, a high-end shopping mall chain in Hong Kong. K11 operates major malls like K11 Musea, K11 Art Mall, and 11 Skies in Hong Kong and has expanded to five mainland Chinese cities, with plans to reach 10 cities by 2026.

Hong Kong vs. Mainland China Powerhouses

In China’s luxury mall landscape, there are two main players:

• the Hong Kong-based group, including K11 (New World Development), Plaza 66 (Hang Lung Properties), IFS (The Wharf Holdings), IFC (Sun Hung Kai), and Taikoo Li (Swire Properties);

• and the mainland-backed players such as SKP, MixC, Deji, and Wushang.

In terms of numbers, Hong Kong-backed malls still lead. Hang Lung’s Plaza 66 has over nine locations in mainland China, IFS has five, and Taikoo Li has four. However, mainland malls like SKP, MixC, and Hangzhou Tower are catching up in sales.

Last year, Beijing SKP retained its title as the top-selling mall in China, with sales reaching 26.5 billion RMB, continuing a five-year streak. Since surpassing Hangzhou Tower in 2011, SKP has consistently held the top spot for single-store sales in China. Other malls, like Nanjing Deji Plaza, also continue to perform well, with 2023 sales reaching 23.9 billion RMB, a 13.8% year-on-year increase. Beijing's China World Mall also surpassed 20 billion RMB in sales in 2022.

In the top 10 luxury malls in China by sales for 2023, seven are mainland shopping malls. Among Hong Kong-backed malls, only Shanghai Plaza 66, Chengdu Taikoo Li, and Chengdu IFS made the list. None of the K11 malls reached 10 billion RMB in annual sales.

Price War, Government Backing, VIP Services: How Mainland Luxury Malls Outperform

Mainland Chinese luxury malls have become formidable competitors to their Hong Kong counterparts, and here are key factors explaining why they are winning the battle.

1. Government Support
   Local government backing plays a decisive role in the success of mainland luxury malls. For example, Wuhan Wushang Mall and Hangzhou Tower are owned by state-run companies, Wushang Group and Hangzhou Jiebai Group respectively. These malls enjoy local protection policies, securing the best locations and controlling significant market share before foreign or Hong Kong-invested malls can enter the scene.

2. Aggressive Price Wars
   Mainland malls are able to engage in aggressive price wars thanks to their strong capital backing. A prime example occurred when SKP entered Wuhan, sparking a luxury price war. Wuhan Wushang Mall offered the steepest discounts, leveraging its financial strength to attract more consumers and defend its market position.

3. Consumer-Centric Strategy
   Mainland luxury malls have a deeper understanding of Chinese consumers compared to Hong Kong-invested malls, which tend to stick to a more traditional approach. For instance, SKP uses a buyer-driven model to carefully curate products, offering exclusive items and requiring uniform signage for luxury stores. SKP also leverages a VIP membership system, encouraging repeat business and offering personalized services that keep loyal customers coming back.

4. Expansion and Innovation
   Mainland malls, particularly those owned by conglomerates like China Resources (which operates MixC malls), are rapidly expanding and introducing innovative mall formats. For example, MixC malls are developed as mixed-use complexes that combine retail with entertainment and cultural spaces, providing a unique shopping experience. This flexibility and adaptability allow them to appeal to a broader range of consumers.

While Hong Kong malls like Swire Properties' Taikoo Li pioneered the "block street" format—seen in successful developments like Sanlitun and Chengdu Taikoo Li—mainland malls are proving more agile in responding to shifting market trends and consumer preferences. Their localized strategies, strong financial backing, and government support continue to set them apart in the increasingly competitive luxury retail landscape.

During the Qingming Festival, places like Tai’an, Zibo, Tianshui, Kaifeng, and Jingdezhen all saw their tourist numbers jump by over 50%. These cities either have deep historical roots or have gone viral on social media platforms like Xiaohongshu and Douyin. For instance, Zibo is famous for its BBQ, while Tianshui gained attention for its spicy hotpot (Malatang).

As this trend continues to grow, a key question arises: What opportunities does this present for the luxury market?

Where Is the Small City Travel Boom Heading?

During the May Day holiday, hotel bookings in county-level areas jumped by 47%, and supermarket orders rose by 55%. Since September, cultural and tourism bookings in Yichun (a small city in Jiangxi Province) during the Mid-Autumn Festival surged 326.9% year-on-year. Likewise, searches for Huizhou (a small city in Guangdong, near Shenzhen) skyrocketed by 227.2%, and hotel bookings during the Mid-Autumn Festival rose by 229.9%, with more than half of those bookings made by people aged 20-30.

Why Are Small Cities Becoming Popular?

Several factors explain this rise in popularity:

• Younger travelers are increasingly looking for unique, off-the-beaten-path experiences.

• China’s unique holiday schedule and limited annual leave mean that many people travel during peak times, leading to overcrowding in major cities. This has prompted travelers, particularly younger ones, to seek alternatives.

• The economic slowdown has also played a role, making local trips more attractive due to their affordability. In smaller cities, it’s even possible to stay in five-star hotels at much lower prices than in big cities.

How Are Small Cities Attracting Tourists?

• Cafes and Digital Nomads: Some villages in Anji County, Zhejiang, old bamboo processing facotires have been transformed into digital nomad communities. Anji, a small mountainous county with fewer than 600,000 residents, is now home to over 300 cafes. Some of these cafes report daily revenues exceeding 300,000 RMB.

• Highlighting Local Culture: Quzhou, a lesser-known city in Zhejiang, has capitalized on this trend by highlighting its rich cultural heritage, including unique performances such as Longyou’s “hard-headed lion,” Jiangshan Wu Opera, and Qujiang Opera. This has drawn increasing numbers of visitors to this culturally vibrant city located at the crossroads of four provinces.

• Going Viral on Social Media: Earlier this year, Tianshui, a small city in Gansu province, became a tourist sensation thanks to its renowned Malatang (spicy hotpot). The trend was sparked by a vlogger whose videos showcased the affordability and variety of Tianshui’s Malatang, drawing young tourists to the area. According to Trip.com, from March 1 to 16, tourism bookings for Tianshui increased by 40% year-on-year, with hotel bookings up by more than 60%. Notably, 49% of the tourists were from outside the province.

What Are the Opportunities?

• A huge market

With over 2,800 county-level administrative regions in China, the potential for growth is significant. According to Qunar, the average cost of a Tianshui Malatang meal is around 30 RMB, but it can drive 650 RMB in related local spending.

Similarly, a 40 RMB high-speed rail ticket to see the "blue tears" phenomenon in Pingtan can lead to an additional 700 RMB spent locally. A report on county-level tourism in 2024 found that, in 2023, the average tourism revenue across 1,866 counties was 4.295 billion RMB, with an average of 5.0827 million visitors per county.

• Potential opportunities for luxury hospitality

This Mid-Autumn Festival, many young people chose to stay in county-level destinations, where they could enjoy five-star hotel services at lower costs.

Bookings for five-star/luxury hotels in county-level cities grew by 1,400%. According to Meituan, in the first week of September, the most popular county-level destinations for travelers under 30 were Changli County in Hebei, Huidong County in Guangdong, Chun’an and Changxing Counties in Zhejiang, Lingshui County in Hainan, and Wuyuan County in Jiangxi. Other lesser-known counties are also seeing growth. For example, Changting County in Fujian saw a 1,400% increase in five-star hotel bookings, Fengxin County in Jiangxi saw a 1,200% rise, and Zhongmu County in Henan experienced a 1,150% surge.

Luxury hotels in smaller cities are catching travelers’ attention by offering "high quality at reasonable prices." According to Trip.com, the average price for a five-star hotel in fourth- and fifth-tier cities was about 10% lower than in first- and new first-tier cities during the lead-up to the Mid-Autumn Festival.

• Pop-up events on the hotspots

Fashion and luxury brands previously leveraged the rising ski trend by launching pop-up stores in cities like Harbin. This strategy could be replicated amid the current small city travel boom by selecting culturally rich destinations. Such an approach would deepen localization efforts and better resonate with China’s younger generation.

Which Small Cities Are Popular This Year?

According to Meituan’s recent 2024 Young People’s County-Level Travel Report, the top county-level destinations for young travelers this summer were Dali, Pingtan, Rongcheng, Dunhuang, and Yanji.

What is the impact of the “Yeconomy”?

Beyond ticket sales, Ye’s listening party had a significant impact on the local economy. On the day of the event (the 15th), Haikou’s citywide hotel occupancy rate averaged 83.42%, a 41.82% year-on-year increase and a 10.44% rise month-on-month. Among 23 key hotels tracked, the average occupancy rate was 88.3%, with 53 tourist hotels reporting occupancy above 90%. This surge in hotel bookings is estimated to have brought in over 45 million yuan in revenue.

Additionally, major scenic spots and rural tourist destinations in the city attracted 73,900 visitors. Sales at Haikou’s duty-free shops hit 56 million yuan, reflecting a 4.5% year-on-year increase and a 21.5% jump from the previous month.

Some Xiaohongshu users reported spending more than 10,000 yuan on their Haikou trip, including flights. The listening party also coincided with the start of the Mid-Autumn Festival holiday, leading many of Ye’s fans to stay in the city throughout the holiday period. According to the Haikou Municipal Bureau of Tourism, Culture, Radio, Television, and Sports, Haikou attracted over 426,700 tourists during this time, contributing more than 748 million yuan to the local economy.

How did Haikou promote the event?

Haikou offered Ye's fans far more than just a listening party—it was a comprehensive consumer experience. To welcome the fans, the city's hotels, attractions, tourist goods, dining establishments, duty-free shops, and retail outlets all coordinated to provide over 100 exclusive fan discounts. This created a variety of entertainment and shopping options for both residents and tourists, further amplifying the economic benefits of the event.

In a unique touch, the Haikou government even requested that taxi drivers play Ye’s music exclusively during this period.

How did retail sector react to it?

CDF Haikou offered special discounts, vouchers, and 10x loyalty points for concert ticket holders. The Haikou Global Premium Duty-Free City provided exclusive deals, gifts, spa experiences, and more. The Sanya Duty-Free Haikou Mission Hills store offered discount coupons and beauty and liquor experience vouchers. More than 11 shopping malls across the city also participated, providing discounts and vouchers to enhance the shopping experience for concert-goers.

Is Hainan becoming China’s concert event capital?

The Haikou government is signaling plans to bring in more international stars (rumors include Charlie Puth and Lady Gaga), aiming to integrate further with the global entertainment scene. According to Wang Ke, Party Secretary and Director of Haikou’s Bureau of Tourism, Culture, Radio, Television, and Sports, the city’s openness and business-friendly environment—supported by the Free Trade Port’s policies—were key to the success of recent events.

Additionally, Hainan offers visa-free entry to tourists from 59 countries, part of the island’s strategy to attract international visitors and build its reputation as a world-class destination. Hosting international concerts is a key part of Hainan’s plan to position itself as a global duty-free shopping and tourism hotspot. By 2025, Hainan will close its customs borders and implement duty-free policies island-wide, creating a more open and business-friendly environment to attract global talent and investment. This aligns with Hainan’s broader vision of becoming a world-class free trade hub, solidifying its position as an attractive destination for tourism and international commerce.

Meanwhile, Hainan’s duty-free business has been struggling due to the continued drop in the yen’s exchange rate and the increase in outbound travel by Chinese tourists. According to Haikou Customs, duty-free sales totaled 20.132 billion yuan from January to July 2024, down 30.4% year-on-year. However, transforming Hainan into a global performing arts center could help revive consumer interest.

But why? When two French giant flagships under the world’s biggest luxury group LVMH, both bet big in China’s financial hub(once Asia’s luxury hub), it must have some agenda to set and logic to find.

The significant and the most obvious one is the China factor. Even during the pandemic, Louis Vuitton’s parent company LVMH invested a lot in the Chinese market. Right before the show started, Pharrell Williams, the creative mind behind the brand opened his official Xiaohongshu account (China’s biggest lifestyle content platform) to promote the show. His first post now reached over 7,000 likes.

As the CEO Pietro Beccari and the Creative Director Pharrell Williams both put it, Hong Kong is a special place that links to China. During the show, celebrities and VIP clients from mainland China, Hong Kong, Korea and Southeast Asia all attended the event, shining a starlight to celebrate.

During the summer, LVMH CEO Bernard Arnault also spent a high-profile trip to China, a sign that the region plays big for the group. The data proves it, in LVMH’s first nine months of this year, 32% of the income came from Asia(excluding Japan), and the majority of which was from China.

Then, the city itself as a core luxury spending destination was another major factor. As Euromonitor reported, Hong Kong again climbed to the first place as the highest per capita spending on luxury goods. Even after suffering a huge brain drain and capital outflow, Hong Kong still remains the world’s premier city for ultra high net worth individuals with 12,615 ahead of New York’s 11,845.

Also, Hong Kong is one of the markets in Asia that established luxury retail stores very early (Louis Vuitton opened its first store in the region in 1979, just after the brand’s two stores in Japan). That being said, Hong Kong people have a tradition for luxury spending, and the majority of its super-rich still live here to spend. Needless to say, the personal ties between Williams and local entrepreneurs (specifically Adrian Cheng, the CEO of K11’s parent company New World Development) also play a vital role.

A broad picture behind the decisions is Hong Kong’s global influence on the Greater China market(including Taiwan, Macau and Mainland China), South Korea, Japan and Thailand, which no other Asian cities have yet to reach.