Unlocking county-level consumption niche

China's economic expansion is increasingly being shaped beyond its biggest cities, as county-level markets become a critical source of consumer growth and a testing ground for companies seeking the next wave of demand, industry reports said.

Consumption remained the largest contributor to the country's growth momentum in the first half, with final consumption expenditure adding 2.1 percentage points to GDP growth, according to the Ministry of Commerce.

The ministry said continued upgrades in technology, product supply and consumer services would help unlock additional spending potential, particularly among county-level markets and demographic groups such as the elderly, younger consumers and families with infants.

Among the biggest opportunities are China's counties and townships, where rising incomes and changing lifestyles are reshaping consumption patterns. Data from Meituan showed that active consumers in county-level markets increased by more than 15 percent year-on-year in 2025, while order volumes climbed by over 20 percent, significantly faster than growth in major urban markets.

The shift marks a strategic turning point for companies that have traditionally focused on China's largest cities. Consulting firm McKinsey estimates that by 2030, around two-thirds of incremental personal consumption growth in China will come from lower-tier cities, counties and townships.

For consumer brands, the opportunity is already visible. In 2025, Mixue Group's brands operated 32,000 stores in tier-3 and below cities, representing about 58 percent of their network in the country.

Yet the county opportunity is not as simple as opening more stores or offering lower prices.

A recent report about consumption in counties from NielsenIQ, also known as NIQ, highlights a growing disconnect between economic development and brand performance.

China's wealthier counties are expanding rapidly. According to the National Bureau of Statistics, the number of counties with a GDP exceeding 100 billion yuan ($14.83 billion) rose to 77 in 2025. The country's top 100 counties accounted for 10.2 percent of national GDP, with combined economic growth of 6.3 percent year-on-year, above the national average of 5 percent.

Many consumer companies have failed to capture that growth. Among the 20 leading fast-moving consumer goods manufacturers tracked by NIQ, only four recorded sales increases in county markets, while 16 saw declines.

The message for companies is clear: consumers in counties are becoming richer, but their preferences are changing faster than many brands' strategies.