Chongqing- "The era of global warming has ended; the era of global boiling has arrived," recently said United Nations Secretary-General António Guterres when releasing new data from the European Union and the World Meteorological Organization. Guterres declared that July is set to be the hottest month on record.
This unprecedented shift towards a 'cooling-centric' economic model offers an alternative perspective on how climate change influences our consumer landscape.
Tourists take selfies at a camp in Pengshui County, Chongqing. (Photo/ Zhao Yong)
Transforming traditional consumer behavior, the market dynamics have been invigorated from purchasing fans and air conditioners to frequenting cooler mountainous regions and forests, from flocking to malls and night markets for a cold drink to even adapting to a predominantly nocturnal lifestyle.
The gap between promise and delivery
Liao Chenglin, a professor at the School of Economics and Business Administration at Chongqing University, defines the "cool economy" as a unique business form originating from climatic and temperature fluctuations.
Becoming the new pivot for consumption trends and shaping our behaviors, preferences, and spending habits, data from e-commerce giants like Taobao mirrors this sentiment, with a staggering year-on-year growth for products catering to the cooling demand.
Search data of cooling commodities from Taobao in July 2023. (Photo/ Zheng Ran)
In Yiwu, the "world's supermarket," statistics from the local e-commerce platform showcase the increased demand for summer-centric products. For instance, sunscreen clothing orders saw an approximately 7-fold increase in turnover compared to last year.
Tourism, too, is reveling in this cool wave. China's summer tourism market is booming, with the overall willingness to travel in traditional hot cities at 94.6%.
Even urban lifestyles are transforming. Chongqing Municipality and Jiangsu Province are embracing the nighttime economy with extended museum hours and vibrant night markets as people seek cooler nocturnal environments.
However, the cool economy is full of challenges. A significant roadblock is the awareness and understanding of its breadth. Many restrict it to just the summer season, overlooking the potential of the cooler autumn months.
While the sector largely hinges on service, there's an evident gap between promise and delivery. Many consumers, seeking solace from the heat, often return disappointed due to subpar products and lackluster service. Businesses need a broader vision, where a myopic approach that doesn't prioritize innovation or extend the industrial chain hampers the consumer experience.
1℃ shift in temperature alters sales trajectories
Interestingly, meteorological economics shed light on the immense opportunities within the "one-degree effect," where a mere 1℃ shift in temperature can drastically alter sales trajectories.
Liao believes a successful cool economy strategy revolves around a robust product supply, an extended industrial chain, and adaptability, which means a departure from merely "selling products" to "selling emotions," catering to the ever-evolving, diverse, multi-layered, and personalized consumer demands.
Businesses need to pivot from a homogenized approach to offering unique experiences, capitalizing on the emotive aspect of selling. Incorporating more immersive consumption scenarios and enriched experiences and leveraging modern marketing methods using major IPs and traffic is also pivotal.
This comes when the National Development and Reform Commission is championing initiatives like staggered vacations and extended opening hours for cultural centers to boost the cool economy.
In an era where attention is the new currency, the cool economy is not merely about offering lower temperatures but also top-notch services, an extended industrial chain, and innovative consumption scenarios. As the world grapples with the challenges of climate change, the cool economy presents an exciting realm of possibilities, infusing a refreshing zest into our lives while driving economic growth.