What Happened: China’s lottery economy is winning this summer. The latest data released by China’s Ministry of Finance reveals that nationwide lottery sales reached a total of $6.73 billion (48.9 billion RMB) this July, up 55.9 percent compared to the same period last year. Lottery sales this year totalled $44.4 billion (322.8 billion RMB), a year-on-year increase of 51.2 percent.
Social media platforms have picked up on this unprecedented surge in lottery sales in the world’s most populous country. Presently, the hashtag “lottery” has amassed a staggering 230 million views on the Xiaohongshu platform.
Consequently, lottery ticket booths and small stores have popped up this year all over major cities like Shanghai and Beijing.
Meanwhile, data from Douyin shows that as of July this year, the average search index for the term “lottery” grew by a whopping 1,233.57 percent compared with last year. Notably, the luck of the draw has captivated the young, and the proportion of searches from individuals aged 18 to 30 soared from around one-third to 48 percent.
The Jing Take: “Purchasing lottery tickets is not necessarily about striking it rich overnight, but more about buying a dose of anticipation for myself,” Chilin Yao, a 24-year-old, Shanghai-based lottery enthusiast told Jing Daily. This sentiment resonates widely among the young generation. The 2022 Sports Lottery Customer Research Report revealed that 72 percent of lottery customers purchase tickets not just with the intent of winning, but also for entertainment and relaxation.
Compared with spending on high-risk, potentially high-reward venture like stock market speculation, the youth in China prefer lotteries, which are perceived as a low-risk, low-reward investment. By spending $1.4 (10 RMB), people can feel a short-lived sense of happiness and fun with the added allure of possibly reaping substantial rewards – even as much as a thousandfold return – should luck favor them.
Huang Zhenxing, a professor from Shanghai University of Finance and Economics, argued in an interview with Caijing Magazine that this trend signifies a lack of confidence in the prevailing economic climate.
China’s economic recovery has lagged market expactations. In the first half of this year, China’s GDP grew 5.5 percent. While this figure surpasses the average annual growth rate of 4.5 percent observed during the three years of COVID-19, it still falls short of expectations.
In July, the year-on-year increase in total retail sales of consumer goods saw a small rise of 2.5 percent, a contraction of 0.6 percentage points from June. This all implies that despite consumption over the summer, the year-on-year growth rate in total consumer retail sales declined for the third consecutive month. Chinese property giant Evergrande’s collapse has only compounded the country’s economic woes, with smaller companies falling, too. As long as events like these keep denting consumer confidence, more people are likely to turn towards lottery tickets and the spiritual economy to keep their spirits up amid uncertain times.
The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.