By ZH Sailing Research | March 2026
China’s domestic consumption market still holds significant untapped potential, and companies that offer differentiated products and services tailored to diverse consumer needs could play a key role in driving economic growth, according to Li Dongsheng, founder and chairman of TCL Technology Group Corp.
Speaking as a deputy to the National People’s Congress, Li said that while China’s market is vast, consumption advantages have not yet been fully realized, particularly in higher-quality services and innovative content offerings.
Challenges in China’s consumer market
Official data shows that in 2025, retail sales of consumer goods grew 3.7 percent, lagging behind China’s 5 percent GDP growth, reflecting relatively subdued consumer sentiment.
Li cited the television industry as an illustrative example:
China (population 1.4 billion): 32.895 million TVs sold, down 8.5%
United States (population 330 million): 49.9 million TVs sold
He noted that the decline in hardware sales is largely due to limited content services rather than the devices themselves. “TV programs are no longer attractive. Many consumers turn on their TVs only a few times a year,” Li said.
According to TCL estimates, the US audiovisual sector generates roughly 4.5 trillion yuan ($620 billion) annually, compared with 1.5 trillion yuan in China, suggesting significant room for growth in high-quality service content.
Differentiation as a driver of consumption
Li emphasized that stimulating domestic demand requires policies and business strategies that accommodate diverse market needs. While ensuring basic equality in public services is important, differentiated products and services are needed to satisfy higher-quality consumer expectations.
“Differentiation is an effective way to increase the overall scale of service consumption. Companies should provide products and services tailored to the varied needs of different consumer groups,” Li said.
By offering differentiated offerings, businesses can both capture unmet demand and inject new momentum into related industries, unlocking further potential in China’s domestic market.
Key Data
Retail sales growth (2025): 3.7%
China GDP growth (2025): 5%
TV sales in China (2025): 32.895 million units, -8.5%
TV sales in US (2025): 49.9 million units
Estimated US AV sector output: 4.5 trillion yuan
Estimated China AV sector output: 1.5 trillion yuan
Source: TCL Technology Group estimates and official statistics
Market Implications
1. Content services are critical for hardware consumption
Hardware sales alone are insufficient; content and service ecosystems must improve to stimulate demand.
2. Differentiated services can expand domestic consumption
Tailored products and premium offerings can meet diverse consumer needs and drive growth in emerging service sectors.
3. Policy and market alignment needed
Policymakers and companies must coordinate to unlock higher-value consumption, ensuring that public service equality is complemented by private-sector differentiation.
What Investors Should Watch
Growth in high-quality audiovisual content and services
New product launches emphasizing service integration and differentiation
Policies aimed at stimulating domestic demand
Emerging premium and niche consumption segments in China