China’s retail landscape is undergoing a profound transformation, shifting from mere transactional buying to the pursuit of emotional fulfillment, a core trend positioning domestic spending as a crucial force for economic growth. As the nation seeks to bolster internal demand, the strategic evolution of commercial spaces—integrating technology, culture, and social connectivity—underscores a pivotal new direction in consumer behavior and market strategy, particularly within its bustling shopping centers.
Malls Become Social Destinations
Shopping malls across major Chinese cities are actively repositioning themselves, moving beyond traditional retail blueprints to become multifaceted social destinations, or the “third space” outside of home and work. This strategic shift is epitomized by the elevation of trendy intellectual property (IP) brands, often centered on stress relief, companionship, or self-care, into prime retail locations.
In Shanghai, for example, the high-end Grand Gateway 66 integrated Pop Mart Collection, a leader in collectible figurines, and its first jewelry store, Popop, onto the first floor alongside established luxury jewelers. Nicholas Poon, general manager of Grand Gateway 66, confirmed that the accessories concept stood out, and Popop’s initial sales significantly outperformed expectations.
“Brands that master emotional value have seen a rise in popularity,” Poon noted. He highlighted that these IP-driven consumer experiences effectively draw younger clientele and boost foot traffic for adjacent businesses, such as catering tenants.
This transformation focuses on curated ambiance and immersive experiences rather than just product mix. Jacky Zhu, head of retail research for China at JLL, explained that this competition is now centered on providing emotional connections. By refining public areas, incorporating interactive zones, and hosting thematic markets, malls create environments conducive to socializing and self-renewal, thereby prolonging customer stays.
Integrating Culture and Technology
The shift is particularly visible in successful redevelopment projects. In Hangzhou, Zhejiang Province, the Gonglian City Center near West Lake—once a simple clothes market—has been reinvented as a modern center spotlighting popular IP products and unique entertainment scenarios.
“Our brand curation is far more flexible and aligned with the cultural pulse,” said Wang Yongqiang, the mall’s deputy general manager. By championing innovative brands and designing engaging social spaces, the center generates an atmosphere that resonates deeply with visitors. This strategy is proving lucrative, with the Gonglian City Center projected to report retail sales of approximately one billion yuan (about $141.09 million) this year, marking an average annual growth of 20% since 2019.
Customers acknowledge the drawing power of the overall atmosphere. “We come here mainly to hang out and maybe pick up a few fun things,” commented Miao Zhiyue and Shao Wei, emphasizing their willingness to spend on goods that offer genuine emotional benefit.
The integration of technology further enriches this experience. Leveraging Hangzhou’s status as a tech hub, the Gonglian City Center offers cultural services like immersive VR experiences. One popular offering, provided by Times Light Field, transports users into the world of the animated blockbuster “Chang An,” allowing interaction with legendary Chinese poets. Chow Cheng, manager of the VR provider, observed that the experience often acts as a sales driver, prompting customers to purchase related cultural products afterward.
Policy and Future Outlook
Experts view this trend as aligning with China’s broader shift toward services and experiences. Zhang Linshan, a researcher at the Academy of Macroeconomic Research, stated that emotional consumption fulfills primary psychological needs and redirects spending toward personal well-being. Emerging sectors, including AI companionship and emotional support services, are creating new consumption scenarios through cultural and technological fusion.
As the government seeks to expand domestic demand, analysts anticipate stronger policies to stimulate this consumption trend. The Communist Party of China Central Committee’s recommendations for the upcoming 15th Five-Year Plan (2026-2030) call for a notable increase in the GDP share of household consumption and strengthened inclusive policies benefiting consumers. To fully harness this potential, a coordinated strategy encompassing diversified market supply and institutional safeguards will be essential, ensuring that the pursuit of emotional fulfillment continues to unlock China’s vast consumer capacity.