China’s Service Economy Is Becoming More Digital, Personal and Experience-Driven

Technology does not create demand by itself. But it can make services easier to find, compare, book and share—and can help providers turn a single purchase into a broader experience.

What the growth figures reveal

The latest figures point to services becoming a relatively stronger part of China’s consumption mix. Service retail sales rose 5.3% in the first half of 2026, compared with 1.1% growth in goods retail sales. Tourism, consulting and leasing services, and cultural, sports and leisure services were among the faster-growing categories.

Online service consumption grew 22% in 2025, according to Ministry of Commerce data cited by the State Council Information Office. Online sales of sports event tickets rose 63.3%, tourism products increased 40.6%, and dining services grew 23.7% during the same period.

These numbers do not prove that AI, mobile platforms or immersive technology caused the growth. They do show that digitally enabled services are becoming an important channel for demand, particularly in categories built around travel, participation, entertainment and local experiences.

Performing arts demonstrate the spillover effect

The performing arts sector illustrates how a service purchase can generate an entire consumption ecosystem. In 2025, large-scale commercial performances produced more than 30 billion yuan in box-office revenue and drove over 220 billion yuan in related cultural and tourism spending, according to data from the China Association of Performing Arts.

That wider spending can include transportation, accommodation, dining, shopping and tourism. Digital ticketing and content discovery help audiences find events, while mobile booking and local-service platforms can coordinate the surrounding trip. Fan communities and social sharing can also amplify interest beyond the original audience.

The lesson for providers is that the value of an experience may extend well beyond its primary transaction. A ticket can be the starting point for a weekend trip, a city itinerary or a group activity.

Policy is pushing AI deeper into consumption

China’s Ministry of Commerce and seven other government departments released an implementation guideline in June 2026 containing 17 measures across five areas to promote deeper integration between AI and consumer markets. The measures include expanding smart-product consumption, empowering services and creating new consumption scenarios.

The policy direction supports a broader transition: AI is being positioned not only as a back-office business tool, but also as part of everyday products, services and commercial settings. That may accelerate experimentation in areas such as intelligent retail, personalized services and AI-enabled consumer experiences.

Policy support, however, does not remove the need for product discipline. AI recommendations must be accurate enough to be useful, transparent enough to be trusted and easy to override when a consumer wants human assistance.

Platform data is revealing overlooked demand

Consumer data can challenge assumptions about who participates in digital service markets. Meituan’s research arm reports that online consumption among people over 50 is growing rapidly and that this group’s share of bookings for four-star-and-above hotels is significantly above average.

The implication is important for providers: older consumers should not be treated simply as a low-adoption segment. They may represent valuable demand when digital services are accessible, reliable and easy to use. Clear interfaces, trustworthy reviews, flexible support and straightforward booking processes can matter as much as sophisticated personalization.

The next opportunity is solving practical consumer problems

The strongest digital products will not be the ones with the most features. They will be the ones that remove difficult decisions and reduce avoidable risk.

• Hotel selection: Compare total trip cost, genuine location convenience, accessibility, cancellation conditions and review reliability—not only star ratings.
• Transfers: Coordinate arrival times, baggage requirements, delays, pickup verification and accessible transport.
• Affordable dining: Show transparent prices, distance, queue times, group suitability, dietary information and value for money, rather than relying only on paid visibility.
• Complex itineraries: Connect transport, accommodation, tickets, meals and support in a way that remains easy to change when plans shift.

These use cases also expose the risks of poorly designed personalization. Consumers need clear consent, privacy protection, explainable recommendations, dependable reviews and an easy route to human help. Without those safeguards, recommendation systems can become manipulative, inaccurate or overwhelming.

What the shift means for service providers

Consumers are increasingly choosing preferred experiences, not merely purchasing functional products. That creates room for providers to use responsibly governed, aggregated data to identify unmet needs, develop new scenarios and build communities around tourism, culture, sports, leisure and local life.

The strategic goal is not automated selling for its own sake. It is a shorter, clearer path from “I might enjoy this” to a trusted, affordable and satisfying experience. Providers that combine relevant discovery, coordinated booking, meaningful personalization and reliable service will be better placed to benefit as China’s consumption growth becomes more experience-led.