Vol. 5 China's thriving and cutthroat "sweet economy" and more

Wedding service issue

Chinese newlyweds have had a busy year, as the Year of the Rabbit appears to be auspicious for tying the knot, according to the Chinese lunar calendar. A variety of wedding service providers in China, ranging from wedding planners and photographers to hotels and tourist attractions, have been flourishing. Despite the declining number of couples getting married each year, Generation Z seems eager to use their purchasing power for personalizing weddings and enhancing their experience. In this edition, we’ve analyzed the distribution of wedding services, the breakdown of wedding expenses, and a key wedding destination in an increasingly competitive market.

Chart of the month

On the Micro Connect Daily Cash Index (MDCI, footnote1), the busiest day for wedding service providers was Dec. 2, a lucky day for marriages. (e.g. The son of Taiwanese actress-director Sylvia Chang, Oscar Wang, tied the knot on that day. ) The second popular day for weddings was Oct. 1, the first day of this year’s Golden Week Holiday. The wedding service market, as known as “sweet economy” in Chinese, is experiencing a seller's advantage this year, partially due to the loosening of the pandemic restrictions and, perhaps in no small part, attributed to the Chinese people's fondness for superstition.

Many Chinese believe in the concept of a "widow year" or "blind year," which occurs when there is no lichun (立春) marking the beginning of spring. This theory suggests that marrying during a "blind year" may lead to divorce in the following year. According to the Chinese lunar calendar, 2024 is considered a "blind year," potentially causing the recent shortage of wedding services. However, historical official data also showed that the number of registered marriages in a “blind year” didn’t fall too much compared to normal years — maybe, just a little low-profile.

Industry insight (curated charts, data, etc.)

Profile of newlyweds

Officially, the number of marriages registered annually in China peaked in 2013 and has decreased since. Meanwhile, the divorce rate had steadily risen until 2020, when the Chinese law introduced a 30-day cooling-off period for divorce. However, this year, the marriage rate may pick up, as the number of new couples increased by 245,000 in the first three quarters from a year earlier.

The latest census data also reveals that the average age of first marriage in China has been delayed by 3.78 years from 2010 to 2020, indicating a shift in young people’s mindset. Last year, the number of Chinese couples aged 30 to 34 seeking marriage certificates surged to over 20%, while that of couples aged 20 to 24 fall to 15%.

Crowded marketplace

Despite a decline in marriage rates in China, the wedding services industry has undergone rapid growth in the last 3 years, coinciding with the pandemic. Publicly available data reveals that the number of wedding service providers has surpassed 178,000 (footnote2). Records from third-party corporate registries indicate that 80% of these enterprises were established within the past five years.

Gen Z spending is one notable driving force behind the growth of this market. Young couples prefer bespoke, personalized, one-on-one wedding services, creating a thriving market for small wedding studios. According to a report from hunliji, a Chinese wedding planning platform, couples spent an average of RMB250,000 (USD39,000) on their wedding in 2021, a 3.8-fold increase in just five years. By comparison, the average cost of weddings in US was USD30,000.

Regional divergence

Not surprisingly, there is a clear connection between where wedding services are supplied and where married couples reside. The most populated provinces, including Shandong, Jiangsu, Henan, and Guangdong, are also the top regions for wedding service suppliers, according to our provincial ranking. Additionally, these areas also rank high in annual charts for new couples and newborns, according to official data.

The math of marriage

Chines couples spent more than RMB84 billion on weddings in 2021, up 20% from a year earlier. The chart above displays the usual expenses for a wedding, with almost half devoted to the banquet.

Recent user data from Meituan, the leading Chinese shopping and delivery platform, suggests that the top three expenditures for weddings in China are banquets, rings, and wedding attire photoshoots. Moreover, according to Meituan, young couples in particular tend to purchase new services such as engagement or proposal planning, with a preference for smaller, more exquisite, ceremonial atmospheres.

Destination wedding: The case of “China’s Hawaii”

In the post-pandemic era, destination wedding has never been more appealing. According to Research and Markets' 2023 Destination Wedding Global Market Report, the destination wedding industry generated USD 28 billion, USD 7 billion more than last year. The popularity of destination weddings is influenced by several factors, including the resumption of global travel and an increasing emphasis on experiences, which aligns with many young couples’ wedding preferences.

Sanya, a tropical city in the southernmost Hainan province of China, is taking notice. The Sanya government published a 170-page policy document in March outlining an ambitious plan to establish the complete wedding service supply chain in order to compete with globally favored wedding destinations like the Maldives. In 2021, the wedding industry in Sanya catered to 4% of married couples in China, generating RMB 10 billion from wedding-related tourism - nearly one-fourth of the total tourism income. The government anticipates the revenue from weddings to touch RMB18 billion by 2025.

1. Micro Connect invests in individual small stores through a daily revenue sharing model, meaning that an invested store shares an agreed upon percentage of its daily cash flows with us throughout the investment period. Thanks to China’s digitized economy, we can automatically capture shared revenues every day. Based on our investment pool of more than 10,000 stores, Micro Connect Daily Cash Index (MDCI) tracks how much return we receive every day per one thousand RMB investment (e.g. if the index is 1.5 today, it means we receive RMB 1.5 in return for every RMB 1,000 investment). This gives us a glimpse into how these small shops are performing on a daily basis. In a word, we follow the money.
2. This number is only for reference, as it may be different from other estimates due to the source of data.