A pickup in lifestyle services shows that life is returning to normal in China as cases of Covid-19 level off, and that consumption is increasingly digital, according to data from Chinese payment giant Alipay.

Why it matters: China, once the center of the Covid-19 outbreak, is showing signs of recovering from widespread economic fallout from the Covid-19 across sectors including search queries, offline retail, travel, restaurants to manufacturing.

  • Alipay accelerated an expansion into digital lifestyle services this March, renewing its rivalry with Meituan’s all-purpose app. 

Read more: Meituan faces challenge from Alipay on its home turf

Details: An increasing number of businesses are trying to digitalize their operations following the Covid-19 outbreak, pushing Chinese consumers online.

  • Food and entertainment companies, such as groceries, bubble tea shops, and movie theaters, saw different degrees of business recovery.
  • Almost 72% of small-to-medium-sized enterprises have resumed work as of March 24, according to China’s Ministry of Industry and Information
  • Residents in major cities across China have been spending more on health and beauty services after citywide lockdowns were lifted, according to the report. Online sales for dental and cosmetic medical services rocketed 3,000% from March 18 to 27 compared with the previous 10 days, it said.
  • Local governments in eastern Chinese cities including Hangzhou, Nanjing, and Qingdao are distributing coupons via platforms such as Alipay and Tencent’s WeChat in a move to stimulate domestic consumption and help consumers and businesses in need. 

Context: Alipay noted that consumer demand for digitalized services on its platform was expanding rapidly even before the epidemic. In 2019 alone, the number of searches for lifestyle services within the Alipay app increased 300% compared with 2018.

  • Meituan also signaled that business was picking up during a call with analysts for its fourth quarter earnings report.

Emma Lee (Li Xin) was TechNode's e-commerce and new retail reporter until June 2022, when she moved to Sixth Tone to cover technology and consumption. Get in touch with her via lixin@sixthtone.com or Twitter.