How to reshape the relationship between brands and consumers when consumer logic shifts towards emotional connections and inner identification? Nielsen IQ's "Towards 2026: Top 10 Key Trends in China's Consumer Retail Market" (hereinafter referred to as the "Report") released on January 8th pointed out that the Chinese retail market is entering a critical period of reshaping, and the key to growth in 2026 will no longer be competing for foot traffic, channel coverage, or price subsidies, but whether it can accurately meet consumers' "relevant" product and emotional needs.

The report shows that Chinese consumers are gradually adapting to the current economic environment and generally have optimistic expectations for the future, but their behavior is pragmatic and cautious. Their consumption logic has shifted towards "related to me", and while making careful decisions, they are willing to pay for truly "worthwhile" experiences, functions, and emotional value. This change is profoundly reshaping the relationship between brands, consumers, channels, and products.

From the perspective of consumers, in 2026, the trend is shifting from "buying goods" to "buying life", from "cheap" to "worth it", and experience will become a new growth driver for the retail industry in 2026. The report shows that consumers are no longer satisfied with just "buying goods", but want to "buy life". 68% of respondents value atmosphere in physical stores, 61% value service, and 54% are willing to pay a premium for quality. The retail channel has undergone a fundamental transformation, with its value gradually shifting from selling goods to creating life. All business formats need to find a path to carry consumers' lifestyle and emotional value. For example, small business formats need to upgrade from "convenience" to "surprise" and enhance their attractiveness by testing the waters with high-frequency new products.

In addition, from "pleasing others" to "pleasing oneself", the core of emotional consumption has shifted towards self-worth. Driven by consumption related to me, consumers hope to find self-worth, identity confirmation, and emotional placement in their consumption. The single economy, pet consumption, and silver hair economy have become the three high potential growth exports for "pleasing oneself". With the empowerment of AI, intelligent product functions are moving towards "emotional resonance". Brands must move from symbols and gimmicks to substantive value and emotional resonance, and need to help consumers find the meaning of 'relevant to me'.

The report emphasizes that consumers are also more cautious and rational, and can buy high-value goods, but not expensive ones. Consumers are more willing to pay a premium for genuine efficacy, continuous innovation, and meeting new needs, rather than blindly following brand reputation. The competition in the future is no longer about 'who is cheaper', but 'who is more worth it'. Real growth comes from winning the value recognition in the minds of consumers, making them feel both cost-effective and value for money.

In 2026, there will be significant changes in the channels of the consumer market. The report points out that channels also need to meet both rational and emotional needs of consumers.

Firstly, supermarkets are transforming from "buying and selling shelves" to "living spaces". The proportion of fast-moving consumer goods sales in hypermarkets and supermarkets in the first half of 2025 is about 3.2% and 7.6%, respectively, a year-on-year decrease of 19% and 5%. Supermarkets hope to create immersive scenes and high-quality differentiated supply through "adjustment and reform", thereby activating customer flow and leveraging sales, strengthening supply chain competitiveness, sustained high standardization operations, and unique brand value, which are the key to the success of supermarket adjustment and reform.

Secondly, private brands have rapidly risen from "low price attraction" to "value recognition". 69% of Chinese consumers believe that private brands are more cost-effective. With a confident and pragmatic consumption mentality, the sales growth rate of private brands reached 12.9%, while the sales growth rate of manufacturer brands during the same period was only 0.1%; Private brands need to continuously understand and meet consumers' pursuit of "quality price ratio", adhere to long-term strategic determination, and continuously nourish the brand value of retailers with "good products" in order to gain consumer recognition.

In addition, the combination of cost-effectiveness and quality price ratio has made membership stores and discount stores popular. As of June 2025, the sales of member storage stores and snack stores have increased by 25% and 20% respectively year-on-year. Through measures such as vertical supply chain construction to reduce costs, direct cooperation with brand partners to ensure quality, and shaping the image of unique and self owned products, consumers can enjoy a shopping experience of "quality" and "price reduction" with higher efficiency.

The report points out that in 2026, retailers and brand owners need to shift from competition to cooperation, jointly develop products, optimize pricing, and continuously improve category growth. For example, retailers of various formats can attract consumers back offline through scene reshaping and social marketing, while collaborating with top brands to develop customized products and shape quality differentiation. Only by providing consumers with rich and high-quality product experiences can both parties achieve a win-win situation.

In 2026, the growth momentum of China's retail consumer market will mainly be reflected in sinking, X-generation, going global, and instant retail.

According to the report analysis, the downward trend of retail consumption will become more apparent, with increasing certainty in the offline market. The combined effects of policy support, logistics improvement, and consumption upgrading will make the offline market an important pivot for future growth. The future opportunity for the sinking market lies in switching from a "unified approach" that relies on distributors to distribute goods to personalized outreach using big data and diversified retail channels. Only by leveraging policies, benefiting people's livelihoods, and making differences can potential be transformed into certainty.

The value based growth momentum of Generation X (44-59 years old), with stable income, mature judgment, and responsibility for household consumption, is the key incremental population for the next five years. Generation X is willing to spend money on 'right values', and products should be based on hardcore values, moved by family scenes, and resonated with mature tastes.

For Chinese brands that are widely concerned about going global, the report believes that by 2026, Chinese brands will shift from "selling goods" to "thinking" and achieve localization breakthroughs: the Southeast Asian market has a large capacity and high channel density, making it the first choice for scale expansion; Japan, South Korea, and Singapore have strong consumer power and are anchor points for brand premium and image. Fast moving consumer goods brands need to resonate with culture and taste, while durable consumer goods brands must have the ability to adapt to policies, supply chains, and compliance systems.

In addition, the real-time reconstruction of retail also echoes consumers' increasingly strong demand for "self satisfaction", allowing consumers to meet their needs in the "here and now". Consumption is shifting from "planned" to "real-time", and retail is moving towards a more intelligent stage. The real value is not speed, but making consumers feel understood.

Zhou Lingqing, Managing Director of Nielsen IQ China, stated that the top ten core key trends in the Chinese consumer retail market in 2026 do not reveal short-term trends. Against the backdrop of consumer return to self and retail return to experience, Chinese retail has undergone three transitions from "near field" to "far field" to "on-site". AI and data are ushering in the fourth stage of "smart field" transformation. Retailers and brand owners need to actively fulfill their "relevant" consumer commitments at every appropriate moment and scene. The key to winning lies in who can participate more deeply in consumers' lives and resonate with them.