Environmental policy in China is embedded into long-term planning cycles – most notably its Five-Year Plans – where emissions reduction, renewable energy, and what the Party call ecological civilisation, are treated as binding national priorities. At the same time, the global context has moved in China’s favour. It’s not surprising that in this context China is starting to look like the environment’s champion.  

Policy as industrial strategy 

China’s environmental push can easily be framed as rhetoric. But if we’re less cynical it can also be viewed as the design of a new system. Since the 2005 Renewable Energy Law, clean energy has been positioned as a strategic industry, supported by subsidies, financing mechanisms and mandatory grid integration. 

Out of that, we’ve seen a scaling. China now leads the world in solar deployment and manufacturing, holding more than a third of global installed solar capacity. It has also built dominance across adjacent sectors, including batteries and electric vehicles, turning climate policy into industrial policy. 

State-backed financing, domestic market scale and supply chain control have allowed China to compress costs and accelerate the rate of adoption. Over time, that scale has translated into real global impact: Chinese clean tech is now exported as infrastructure.  

The contrast with the United States has become pretty sharp under Donald Trump’s administration. Recent policy moves from the US – the world’s other pole for climate leadership – have included dismantling emissions regulations, reversing green industrial incentives and actively promoting fossil fuel development. Now, the energy sector is redirecting attention away from renewables toward fossil fuels, reinforcing a structural pivot in US energy policy.  

Climate leadership as geopolitical positioning 

Analysts have long argued that US withdrawal from climate commitments created a vacuum that China could fill. Their predictions have been proved right and that leadership is now materialising.  

China continues to expand renewable capacity at scale, with long-term plans to multiply wind and solar generation and reduce carbon intensity across its economy. Even where targets are criticised as conservative, they’re heading in a positive direction: one with more renewables, more electrification, more state coordination. 

China’s clean energy investment and manufacturing capacity now rival — and in some cases exceed — the combined efforts of the US and EU. Climate policy is now a playing field for international competition. It’s not just about emissions cuts or hitting green targets. They’re playing for who gets to produce the energy infrastructure we will likely rely on in the future.  

China’s climate strategy and the contradictions that remain 

None of this is without tension. China remains the world’s largest emitter in absolute terms, and coal still plays a significant role in its energy mix. Policy enforcement can be uneven, particularly at the local level where economic growth is still taken as top priority.  

But trajectory matters more than the baseline here. Emissions growth is slowing, renewable capacity is accelerating, and environmental policy is increasingly heading in a direction we could call positive.  

From catch-up to standard setter 

Grand reversals in reputation aren’t a surprise for anyone who’s been watching China for an extended time frame. That familiar strategic recalibration is at work here too. Particularly in the last Five-Year Plan.  

Climate policy in China has been reworked as an economic arrangement. Producing useful green tech that shapes industries, supply chains and global trade will bring in big money. Now Chinese EVs, solar panels and batteries are becoming the green tech of the future.  

That’s a new kind of leadership. Not moral, but material. Not driven by advocacy, but by capacity. As the US steps back, China is not just stepping in. It is redesigning the system around itself. 

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I guess it’s a hangover from the days of closed-door communism – North Korea and its regime’s stability is the only other subject where political talk lapses so effortlessly into speculation. Opaque government leaves much to be guessed. But we see it beyond politics too. In the construction bubble, the AI race, and, lately, in talk of China’s declining birth rate.  

In January it was announced that China’s birthrate hit a record low, the lowest, in fact, since the Communist Party took power in 1949. By the end of 2025 China’s population had dropped by 3.39 million to reach 1.4 billion. The news came with familiar tones of systemic collapse.  

China’s declining birth rate challenges

China’s chief problem isn’t that fewer babies are being born. It’s that it is happening before the country has fully developed. Traditionally, development follows a fairly straight path – one driven by the young. They lift themselves up, contribute to a strong tax base which in turn covers pensions and welfare. Then society ages and fertility falls.  

To China’s challenges, we can add youth disenfranchisement over long working hours and traditional career goals, a rising cost of housing – especially in megacities – and education. There’s also the question of immigration. China, for now at least, seems closed to the idea of importing workers from other parts of the world. 

And the opportunities 

Since scrapping the one-child policy, the Chinese government has been throwing curveballs at the problem. A few years back they cracked down on extra-curricular schooling to try and keep costs of educating a child within reasonable limits. At the start of this year, they introduced a condom tax to the dismay of many Chinese. Also, to much dismay, a policy was rolled out in Beijing that allowed pensioners to reimburse the costs of prenatal exams… 

Nudging the over 60s to pick up the slack in birth-rates is nuts, but it does say something about China’s strengths. It is still at an early stage of decline, and it has the power to shift policy in ways that, say, South Korea or Japan – the poster children for declining birth rates – don’t.  

If Beijing has the smarts to treat this as a cost-of-living problem, or one of work life balance, or even gender equity, there’s no reason they can’t pull the right levers to make child-bearing conditions more favourable.  

If they don’t, they’re sitting on the brink of a revolution in robotics that might be able to pick up some of the slack. In which case, Beijing should probably not be asking how do we get back to 2.1 children? But how do we run a modern economy where 1.0 is the norm?  

How this all matters 

China’s falling birth rate is real, and it comes with real consequences. What remains speculative is the leap from demographic pressure to societal collapse. That leap says less about China than it does about a long western habit of treating opaque systems as blank pages for dramatic forecasting, and in its darkest form perhaps even wishful thinking.  

Low fertility does not predict revolution, implosion, or decline on a fixed timetable. It predicts constraint and narrowing margins for error. China will be forced into trade-offs, but its future isn’t pinned to the number of babies born each year. The mistake here isn’t concern over demographics but mistaking them for destiny.  

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When AI stopped assisting and started acting 

The most striking example came from artificial intelligence. Much of the global conversation still frames AI as a tool: something that assists, recommends, or accelerates human work. China, by contrast, began shipping products that treated AI as an actor. 

The agentic smartphone developed through a partnership involving ByteDance (字节跳动) collapsed everyday phone use into approvals rather than actions, with AI navigating apps end to end like a human. It was an audacious leap – and one that triggered an equally rapid rollback. The technology worked. The governance did not. What Dao captured was not a failed product launch, but the first real-world stress test of what happens when autonomy outruns trust. 

From subsidies to mindshare in consumer platforms 

On the business side, China’s consumer giants told a parallel story of recalibration. For years, growth was fuelled by subsidies, discounts, and aggressive user acquisition. In 2025, Dao documented a pivot toward something less visible but more durable: mindshare. 

Meituan (美团) began emphasising delivery certainty and service guarantees over pure price competition. It’s rivals in Alibaba Group (阿里巴巴) rolled Taobao (淘宝), Ele.me (饿了么) and several other facets of its business into one umbrella platform now called Taobao Flash Sale (淘宝闪购). The signals from China biggest local-life platforms are clear. No longer will the competition be won on slashed prices. Instead, quality of service and all-encompassing app ecosystems are the name of game going forward.  

The end of universal playbooks for China in 2025

Another recurring theme was the quiet collapse of one-size-fits-all China strategies for global brands. Dao’s coverage of sportswear, luxury, and lifestyle retail consistently showed companies discovering that China no longer compensates for strategic shortcuts. Flagships became cultural spaces rather than sales floors. Pricing logic tightened. Storytelling grew more local, more restrained, and more precise. The market began demanding fluency instead of ambition. 

Regulation moves from permissive to directive – and strategic 

Regulation did not simply tighten this year – it became strategic. China’s newest Five-Year Plan signalled a shift away from open-ended experimentation toward managed deployment aligned with national priorities. The focus has moved from whether technologies can scale to where and how they should scale, with clearer links to national security, resilience, and productivity. 

Under that framework, technology is no longer treated as an end in itself. It is expected to serve national interests – strengthening self-reliance in critical systems, reducing external dependencies, and reinforcing China’s capacity to withstand geopolitical and supply-chain shocks. 

Execution as China’s enduring advantage 

Finally, there was China’s distinctive approach to deep tech execution. While many countries remain stuck at pilot scale, Dao tracked how China continued pushing toward industrialisation – from commercially viable humanoid robots to autonomous vehicles.   

The lesson was familiar but newly reinforced: China is now both a source of frontier invention and one of the world’s most effective engines for turning those inventions into manufacturable systems, compressing the distance between breakthrough and deployment. 

China in 2025: The bigger picture 

Taken together, Dao’s 2025 coverage showed China not as a market chasing global trends, but as one increasingly setting them. AI moved from assistance to agency, platforms from subsidies to systems, and regulation from permissive oversight to strategic direction. These were not reactive moves, but signals of a market confident enough to define its own rules. 

As China matures, the centre of gravity has shifted. The country is no longer primarily adapting technologies, business models, or consumer strategies pioneered elsewhere. It is generating its own reference points – in platform design, AI deployment, industrial scale-up, and regulatory architecture – and forcing global players to respond. Speed still matters, but discernment now matters more. In 2025, China began behaving less like an emerging market in search of momentum, and more like a mature one deciding what kind of technological and commercial power it wants to project. 

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Come 2025, and the logic has collapsed. In the post-Covid market slowdown, conditions are becoming unforgiving. Any brands that think they can win with the old playbook need to think again.

The old China playbook: blunt strategies

Coming out of Covid, the average Chinese consumer – if there is such a thing – is more cautious and much harder to impress. They take a better look when comparing brands, they sit on decisions longer, and are less happy-go-lucky with their cash.

At the same time, recent years have seen China’s soft power star rise. With it has come a peak in pride around domestic products that is driving stiffer competition, especially in markets like EVs and luxury. Here, a foreign logo alone no longer does the work. Something extra is required before people commit to buying.

The reality has made that one-size-fits-all strategy feel blunt. Betting on your brand to win everywhere looks like folly. So what are businesses to do?

The new China playbook: localisation

What we’re seeing instead is a more demanding form of localisation. Not cosmetic tweaks, but structural choices about where and how to show up. Louis Vuitton’s Chengdu pop-up focused on the city’s cultural and creative confidence, not vague regional symbolism.

On’s tennis court refurbishment in Shanghai embedded the brand in an existing urban routine rather than staging a momentary spectacle. Nike and Heinz’s National Games ads landed because they spoke to shared experiences local audiences already recognised.

These weren’t attempts to speak to all of China at once. They were deliberate local plays, designed to resonate first and scale second – if at all.

For domestic brands, this approach is not new. Many build growth through city-level activations, local-life platforms, festival calendars and tightly targeted product tests. Some experiments are explicitly not built to scale nationally, and that’s the point.

The objective is relevance, not replication. A pop-up that works in one city can be considered a success even if it never travels. An idea that resonates locally still builds brand equity, even without national reach.

People, culture and platforms are drifting apart

It’s important to remember that your audience may not be where you expect. It’s common for foreign brands to default to Shanghai as a starting point, but, say, Gen Z consumers in lower-tier cities can offer something different: more time, comparable or even stronger spending power in some categories, and fewer competing brand messages. Less saturation often means more willingness to engage.

To get to these segments you might need to think deeper about what platforms are going to get you there. While Rednote and Douyin might be popular in tier one cities, consumers in other parts of China may be more Kaishuo-focussed. What’s more, they may not be responding to the same cultural cues as their Shanghainese counterparts. So how are you going to resonate with this group once you find them?

If you know, you know

In 2025, there is no such thing as ‘winning China’ with a single strategy. There are only portfolios of local bets – some big, some small, some that quietly disappear.  For foreign brands, deep localisation is now the most credible route into the market. It is also the most demanding. It requires proximity, patience and a tolerance for ideas that don’t scale neatly.

Drop your Chengdu panda associations. Kill off your Great Wall imagery. Chinese consumers are looking for something deeper. The brands that will succeed in this environment are the ones that understand China not as one market, but as many.  

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China’s soft power rise: the moments

Labubu

Labubu (拉布布), the snaggle-toothed forest creature dreamed up by Hong Kong artist Kasing Lung and made famous by China’s Pop Mart (泡泡玛特), has become a white-hot soft-power export. What began as a vinyl toy craze has turned into a global aesthetic – equal parts creepy, cute and collectable.

Fans from Seoul to Paris queue for blind boxes, while resale prices soar online. More than merchandise, Labubu represents a shift in perception: Chinese design no longer imitates global trends – it creates them. By exporting a home-grown pop icon with genuine emotional pull, Pop Mart has shown that cultural influence can flow east to west.

Black Myth: Wukong

The same is true of Black Myth: Wukong (黑神话: 悟空), the release that put China’s big-budget video game industry on the map. Players from around the world found much to love about the title’s cinematic fights, poetic landscapes and folkloric detail.

The appreciation signified a shift in the eyes of players: one that frames China as a country that can produce great entertainment, and entertainment accessible to all. But perhaps most importantly, the game is unapologetically Chinese. It’s based on a great work of Chinese literature. It doesn’t water down its aesthetic for foreign markets. It takes pride in itself as work of – you could argue – art. Few moments have showcased China’s creative self-assurance as vividly as this.

Innovation and influence

This year’s World Artificial Intelligence Conference in Shanghai saw Chinese robots kickboxing, racing and generally blowing minds. DeepSeek’s undercutting of western GPT models had a similar effect and it isn’t limited to AI.

The innovation taking place in Chinese business has seen an explosion of brands out of the Middle Kingdom. Heytea and Chagee are now regular sights abroad. Chinese luxury brands like Songmont and Judydoll are now influencing taste in foreign markets, not following it. The message is clear: China’s innovation isn’t catching up anymore, it’s setting the pace.

The Rednote Migration

When TikTok’s (抖音) future in the U.S. was thrown into doubt, millions of users crossed the digital border to Rednote (小红书). What they found wasn’t propaganda, it was people: Neon-dripped street scenes in Chongqing, cafe culture in Beijing, couples posing with milk tea.

For many western users, it was a first unfiltered glimpse of everyday China. And importantly, a relatable one. The migration became an accidental act of soft power. Casual posts and human stories reshaped perceptions. China, it turned out, wasn’t a distant regime – it was a scrollable, familiar world that shares much in common with one westerners would recognise as home.

IShowSpeed’s China trip

When American streamer IShowSpeed landed in China, few expected it to become a soft power moment. But Speed’s wide-eyed livestreams from Chengdu’s street-snack stands to Beijing’s basketball courts made China feel real, funny, and alive. Speed’s unfiltered enthusiasm drew millions of global viewers, flipping stereotypes into scenes of warmth and curiosity. He wasn’t guided by state media or brand deals, just genuine fascination. Much like the Rednote migration, these candid moments presented a country that looked nothing like the headlines.

China’s soft power rise: a new kind of influence

You could add to this article the overseas rise in popularity of Chinese online literature, the success of Ne Zha 2 (哪吒之魔童闹海), and numerous other cases. The common thread here is a largely organic change in perception. No longer is China the factory of the world. It’s a rising cultural powerhouse. To match the likes of America however, China will have to do a lot more. It’s clear that one of the hallmarks of a strong soft power nation is there though: self-confidence, and a healthy dose of interest from the outside world.

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Earlier this year, much-loved celebrity diver Quan Hongchan (全红婵) was seen on the internet promoting free-range-eggs produced on her family’s farm. By the time the video was exposed as a deepfake, 47,000 people had already parted with their money. In another high-profile case, an employee at a Hong Kong-based company sent HKD 200m (about US$ 25.7million) to a fraudster’s account after receiving orders from a deepfake mimicking her boss. These cases are two in many.  

China’s lack of transparency around crime figures makes the extent of the problem very hard to pin down, but what’s certain is that deepfake scamming has made the country’s rapid adoption of technology both a blessing and a curse. 

Where convenience invites crime 

Anyone who’s spent serious time in China will tell you of Chinese people’s affection for convenience. Ask a local what’s best about living in Shanghai or Beijing and their answer likely won’t be world-class restaurants or cyberpunk aesthetics. They’ll probably say: ‘It’s so convenient.’  

Much of modern Chinese life’s convenience resides on the screen of your smartphone. In a thumb’s tap you can order dinner, call a taxi home, even pay your rent. Technology has integrated with the actions of daily life far more than it has in the west. The speed at which Chinese people have taken to this way of life is admirable but makes them especially vulnerable to online scams. High volumes of online transactions and a massive digital economy only adds to the problem.  

What’s to be done? The past couple of years have seen the roll out and enforcement of a series of laws designed to tackle the issue of AI deepfakes. Now all AI-generated images, audio and video must carry identifiers. These can be embedded in the image or in the genetics of the content’s metadata.  

Streaming services like Bilibili (哔哩哔哩), Kuaishou (快手) and Douyin (抖音 – TikTok) have all moved to comply. Douyin even said it would add its own markers to content if creators didn’t do it themselves. However, the future of deepfake fraud prevention isn’t as simple as that.  

Fraud faster than detection 

Deepfake technology is moving at a staggering pace. In many cases, the legislation laid out to protect citizens from it will be obsolete a few years down the line. Algorithms capable of generating hyper-realistic images, videos and audio are improving so quickly that even experts struggle to distinguish deepfakes from reality.

Another problematic reality is that criminal networks often operate internationally, making it very hard for governments, Chinese or otherwise, to track them down and bring them to justice.  

The risk to China is that continued exposure to deepfake scamming erodes the trust in technology that’s been such a large part of the country’s development. Artificial intelligence and its applications represent a huge opportunity for China’s future. The market is currently valued at RMB 700 billion (about US$97.5 billion) and predicted to grow by 34% before 2033.  

Ultimately, the challenge is not just technical or legal, but also social. As deepfake technology continues to advance, the country faces a delicate balancing act – embracing the benefits of AI while protecting individuals and businesses from its misuse. Only by addressing both the technological and human dimensions of this threat can China ensure that its digital future remains both innovative and secure. 

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Some pundits see it as an extension of the earlier sub-cultural trend “Chinese dreamcore”, which blends an early digital, psychedelic aesthetic with childhood nostalgia for the 1990s and 2000s, often involving dreams of time travel. But as the name suggests, it is more of a grown-up sentiment among young professionals towards that era. After all, those who grew up in those years weren’t old enough to understand what the economic upswing meant until after the fact.

Rose-tinted spectacles

Since earlier this year, especially in early summer, a viral trend on social platforms such as Rednote and WeChat introduced the phrase to many. The trend itself centres on how great “your mum’s wardrobe” was 20 years ago. The phrase “beauty of economic upswing” began circulating, usually to describe outfits or old photos, often street snaps. It partially coincides with the Y2K resurgence and broader nostalgia trends of recent years, but with a distinctly Chinese background.

Quickly, the concept of the phrase expanded, since beauty is rarely used to describe just visual attraction. The “beauty” of the era has been elevated to capture the spirit of a hopeful society, one that had joined the World Trade Organisation, won the bid for the Olympic Games, and was finding its place on the world stage at the start of the new century. Some suggest it was a time when people firmly believed that tomorrow would be better than today, and that hard work would pay off.

The golden age fallacy

Commentators quickly pointed out that China is not the only one looking back on its most recent heyday. Japan is also revisiting the 80s and early 90s “bubble economy” era. From the revival of the 1980s “city pop” genre of R&B music to the growing interest in “Shōwa nostalgia”, young people in Japan are reflecting on a time when the country was looking ahead during an economic boom. Similarly, Hollywood often looks back on the United States’ various “golden ages” throughout the post-war period. For today’s generation, the 90s and Y2K era is likely the last “golden age” remembered, despite the 911 tragedy that shifted the grand narrative away from endless progress.

For the same reason, the 1990s and Y2K fashion have been featured heavily in today’s mainstream designs, providing the backdrop for the Chinese version to thrive. From “you wake up one afternoon in 2006” (which garnered over 8 million views on Rednote) to waves of content showcasing late 1990s and 2000s toys and stationery, the post-80s and post-90s generations are revisiting the culture they grew up with.

These are the good old days

Hashtags such as “retro” (古早, lit. means ancient), “2000s”, “millennium”, and “Chinese dreamcore” have gone viral on platforms such as Douyin, with hundreds of millions of views. Influencers not only try on their mother’s wardrobe but also recreate iconic looks from the 1980s to the 2000s, inspired by pop culture.

As with its global counterpart, Chinese Y2K nostalgia is born out of economic uncertainty and young people’s lack of optimism. Much of the “beauty of economic upswing” comes from the bold fashion, use of colour and designs that contrast with today’s “quiet luxury” or minimal aesthetic. For this reason, many young people dress in the Y2K style to give themselves motivation and confidence, just like the young people walking the streets of Beijing in 2008.

For this very reason, I argue that the trend is not a reactive or escapist sentiment. A report from Goofish shows that young people today are still fighting for a better future by taking on second jobs. On the platform, 9.45 million people are working second jobs, with 40.8% from the post-00 generation. Goofish also sees the “emotional value” of certain hobbies and interests as “therapeutic”, such as pet-keeping, which was a 300 billion RMB (41,94 billion USD) business in 2024 and designer toys, a 60 billion RMB (8.39 billion USD) business; together, they have been healing over 1 billion people in China. Each generation has its own way of dealing with the world. As long as young people today are still working towards a better tomorrow, who says that when they look back in 10 or 15 years, these won’t be the good old days they miss?

Need to boost your China strategy? Dao Pro delivers bespoke insights on marketing, innovation, and digital trends, direct from Chinese sources. Find out more from our Dao Strategy Team here.

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From group livestream

We discussed the rise of group livestreams on the platform and how they take a leaf out of the idol group playbook. However, the “wild west” growth of group livestreams has raised many concerns for platforms, including not paying employees properly or having risqué content. For this reason, Douyin, TikTok’s Chinese sister app, has announced new regulations and summoned several group streaming agencies for talks. Some commentators see this as a return to form for livestreams, like in the mid-2010s when it was all about dancers and livestream sales were in their infancy.

Against this backdrop of viral popularity and closer platform scrutiny, the next dance craze on Chinese social media was born out of group livestreams. A group called “Xiyue-X” (喜悦-X, lit. Joy-X), first debuted the later-nicknamed “leg sweep” dance in a 7-hour livestream in collaboration with another influencer. The dance is set to music by K-pop star Rain, and the moves also bear some resemblance. However, with a low-angle and slow action of sweeping their feet on the floor, the Xiyue-X version is clearly designed to show off the boy band members’ long and slender legs. The livestream had 11.99 million views in total, with peak simultaneous viewers reaching 300,000.

Via celebs

The mesmerising dance, like many group livestream dance moves, was designed to capture the “female gaze”, which other group streamers quickly caught on to. The dance quickly moved beyond the group streaming niche into the mainstream streaming world. Mainstream top streamers such as the “Cantonese Husband and Wife” team (广东夫妇) also performed a version of this dance.

But what followed really pushed the dance from its livestreaming roots into the “real mainstream”. Actor Ding Yuxi posted a video of himself, accompanied by four other equally tall and handsome backing dancers, performing the dance in a red-themed, professionally lit studio, adding atmosphere to the video and making it look once again, like a dance sequence from a music video. On Weibo, China’s Twitter equivalent, the topic “Ding Yuxi leg sweep dance” (#丁禹兮扫腿舞#) ranked number 4 on the Hot Search list with 49.94 million views.

The video propelled the dance to become a fad that every celeb must try, like the “peel-apart” film earlier this year. From former EXO singer Lu Han (鹿晗), to Ding Chengxin (丁程鑫) of TNT (时代少年团, Teens in Times) and actor Xia Zhiguang (夏之光), all the way to Korean K-pop veteran Kim Jae-joong, all have performed the dance in recent days.

To brands

With the dance firmly established in mainstream pop culture, brands are moving in to leverage its viral popularity. Taobao started with a male model in a Tao Xiaobao, the Taobao mascot, mask, performing the leg sweep dance, with a twist where his shirt unbuttons as the light switches to red. What followed were brand mascots, especially those trying to build their own IPs, such as Snow King from Mixue, Lucky from Luckin Coffee and his new bride, Duo from Duolingo, all tried their hands, or rather, legs, at the dance.

But unlike the pure physical appeal of the original dance, the often short-legged cartoon mascots mostly show humour with their clumsy attempts at the boy band moves. Lucky’s slightly “greasy” (油腻) dance also draws jokey pokes at the “taste of married men”. Duo promptly came out to support his new groom (Globally, Duo is referred to with male pronouns).

The trend is similar to how Snow King launched the “swing over a lake” viral trend, which was followed by nearly every brand mascot active on social media.

Pundits believe this reflects how brands are now leveraging the “crazy” and “abstract” humour that plays on the surreal and post-modern. This content style tends to resonate widely among younger generations in China and also brings official accounts closer to users. While for higher-positioned brands it might seem like they’re simply following a trend, brands meant for everyday use, such as e-commerce platforms and coffee shops, joining the fun might be the way to become “one of us” among the post-00 generation.

Need to boost your China strategy? Dao Pro delivers bespoke insights on marketing, innovation, and digital trends, direct from Chinese sources. Find out more from our Dao Strategy Team here.

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Data shows that there are over 44,000 rural coffee shops and cafés in China. The provinces with the most “village coffee shops” are Yunnan, Guangdong, Anhui, Henan and Zhejiang. The top two provinces, Yunnan and Guangdong, have 11,915 and 7,786 rural coffee places, respectively. This is thought to be because they are the two major origins of coffee beans in China.

Business or Pleasure

Many of the coffee consumers in these rural regions are, in fact, travellers. For many small towns and rural areas, coffee shops are an extension of B&Bs and “cultural tourism”. For travellers, this type of tour is a “lighter” version of camping, living in rural houses built during the Qing era and washing down local cuisine with a nice cup of coffee.

This business model, however, relied heavily on in-province travel and was especially popular during the pandemic. But with travel restrictions lifted, many travellers have shifted back to longer-distance travel, both domestically and internationally. As the trend of “lighter” lifestyle also reached tourism, a steady niche of visitors still prefer small towns close to the cities where they work or within the same province.

Local governments also see this as an opportunity to boost both travel and help small businesses, with Zhongshan, Guangdong, providing rent subsidies and Zhejiang helping entrepreneurs with taxes. However, this has also led to a sense of saturation, with competition from large chains, new entrepreneurs, and even hotel lobbies pushing the market into a state of “involution” (内卷, fruitless competition).

After the initial wave of “check-in” (打卡), caused mostly by the novelty of having coffee shops in small towns, many of these rural and small-town coffee places are now evolving into concept cafés or themed coffee shops, providing immersive local experiences of the culture, be it a traditional or rustic lifestyle or, should the region permit, ethnic minority cultures. Providing hot food, either pizza to go with the Western theme of coffee or local delicacies, is another sphere of competition.  

Digital Nomadland

Earlier this year, the rent increase in Dali, Yunnan, a favourite of digital nomads seeking the pastoral “poetry and elsewhere” (诗和远方), caused many to reconsider where they roam. In light of new developments in small towns, many decided to return to their hometowns to continue their digital nomad work out of local coffee shops.

In fact, during Chinese New Year earlier this year, a trend became something of a hit meme: urban young professionals, “Lily” and “Kevin”, returned home only to become “Cuihua” (翠花) and “Dazhu” (大柱) in their hometowns during the festival. Coffee shops, be they large chains like Luckin Coffee or independent and craft coffee places, offered them both a continuation of their urban lifestyle and a space for socialising.

Now, many have relocated back to their hometowns for their remote jobs. Coffee shops, in this case, play a similar role to what they do in larger cities, but with fewer distractions as they are away from busy shopping areas. Many people, both visitors and residents, seek “songchigan” (松弛感, sense of looseness, chillax) in small-town life, and find that these coffee shops embody almost everything they’re looking for.

However, the business of “village coffee” is not all fun and games. Not only has the aforementioned saturation led to fierce competition, but it has also caused homogeneity, as not every coffee shop can afford to find its own unique selling proposition. For example, a checked tablecloth, a bamboo wicker basket and an “Instagram-style” presentation are what many call the “big three” elements of a rustic coffee place. With cafés having similar aesthetics, some are pointing out that they are starting to look just like the ones in the cities, with the same interior design. Items like rice-flavoured coffee are also being copied and pasted onto nearly every menu.

At the same time, the cost of opening a coffee shop in a small town or in a village can still be high, especially if you need to restore an old building to get the rustic feel you want. With water and power being essential, renovating a “village café” can set you back anywhere between 400,000 RMB (55,912.76 USD) and 1 million RMB (139,781.90 USD). However, with 2,053 new coffee shop openings across the country, albeit mostly chains, in June alone, the coffee boom is far from over. The question is whether “village coffee” can continue to exist in its current form.

Need to boost your China strategy? Dao Pro delivers bespoke insights on marketing, innovation, and digital trends, direct from Chinese sources. Find out more from our Dao Strategy Team here.

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First, short-form dramas. According to the 2024 China Short-Form Drama Industry Report, the market has grown to 50.5 billion RMB (about 6.95 billion USD), surpassing the country’s annual box office.
Second, Xiaomi launched its first SUV, the YU7, priced at 253,500 RMB (about 34,900 USD). Within just three minutes, over two hundred thousand units were preordered.
Third, Labubu toys have gone viral, with resale prices topping 10,000 RMB (about 1,380 USD) and still climbing.

The center of all three is female consumers. The so-called “sheconomy” isn’t just a buzzword, but becoming a dominant force reshaping how and what China buys.

Win Her, Win the Market

Brands that tap into women’s emotional needs and buying behavior are reaping the rewards. Pop Mart reports that 75% of its customer base is female. Its blind boxes—built around themes like “cute,” “surprise,” and “collectibility”—have triggered waves of repeat purchases.

Xiaomi’s CEO Lei Jun summed it up best: “Men might do the research, but it’s usually the woman who decides. If she’s not on board, the car doesn’t get bought.” The surge in short-form dramas on platforms like Douyin is also powered by female viewers. Genres like “revenge romance” and “sweet romance” dominate the charts, offering emotional release and comfort.

These trends signal a deeper shift together: women are now the most influential consumer group in China’s evolving economy.

Sheconomy = Power

This isn’t just about women buying more—it’s about women shaping what gets bought and how brands operate.

According to 58.com’s 2024 Women & Homeownership Survey, the share of women leading homebuying decisions jumped from 65.2% in 2018 to 85.7% in 2024. They focus on layout, safety, comfort, and a sense of home—not just ROI. Kantar Worldpanel also found that women aged 18–45 drive 71% of Fast-Moving Consumer Goods (FMCG) spending, 68% of beauty purchases, and 63% of education-related consumption.

Women are no longer passive shoppers—they’re calling the shots. Brands that want to win need to understand how women live, what they care about, and how they make decisions.

Sell the Feeling, Not Just the Function

Features aren’t enough anymore. Women want more than utility. They’ll happily spend on “cute” (Labubu), ritual (flowers, home fragrances), or emotional comfort (short-form dramas).

So the bestsellers all share a woman-first aesthetic and emotional resonance. Xiaomi’s SUV launch, for example, highlighted a “comfortable ride for women” and a “rear-seat vanity mirror.”

Winning today means shifting from selling features to sparking feelings—from offering products to inspiring dreams. In a world of lookalike functions, how something makes her feel is what makes it worth buying.

She’s Setting the Rules

Women have grown into the key decision-makers and aesthetic leaders of the entire consumer ecosystem. That’s why more brands and media are moving away from the “male gaze” and embracing themes like self-worth and living on one’s own terms.

The real question now is: if women hold the buying power, are brands still stuck using old rules? Sheconomy is the foundation of the next consumer era. In a crowded, hyper-competitive market, whoever earns her attention—and keeps it—wins.

Need to boost your China strategy? Dao Pro delivers bespoke insights on marketing, innovation, and digital trends, direct from Chinese sources. Find out more from our Dao Strategy Team here.

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