French department store Galeries Lafayette opened its first store in Shanghai's Pudong district in October 2019. File photo

In recent years, new business models have emerged in Shanghai, such as specialty shops, boutiques, shops opening at night and duty-free shops, indicating that the city has made strides in consumption upgrading.

The CNSC downtown duty-free store in Shanghai's bustling Jing'an district is the only one of its kind open to Chinese consumers. This year, the store's turnover has increased by more than 20 percent, and consumer traffic exceeded one million.

In addition to providing high-end and luxury products, the CNSC duty-free store also sells daily necessities guided by a sales differentiation strategy.

"Shanghai boasts a high level of opening up, offering its residents a wider variety of goods to choose from. Therefore, Shanghai consumers pay more attention to their real needs and the value of the products," said Yu Mingyang with Shanghai Jiaotong University.

Shanghai is home to about 55 percent of the world's retail businesses, ranking second globally to Dubai in terms of capacity.

In the first ten months of the year, the sales volume of stores on Shanghai's Nanjing West Road grew by 19.1 percent, and that of the Little Lujiazui area increased by more than 10 percent.

The night economy is now prospering in Shanghai. This winter, a night street fair became a hit among pedestrians on Anyi Road, Jing'an district. The market offers a wide selection of holiday merchandise, great food and drinks, and street art shows.

Shanghai has rolled out supporting policies to facilitate the healthy development of the retail sector. For instance, the Pudong district took the initiative by issuing standards on the night economy, to improve the overall quality and image of the night economy.

Jiading district has revised guidelines on supporting the modern service industry, allowing more benefits to e-commerce companies in terms of buying or renting houses, tax reduction and exemption, the introduction of corporation headquarters, and network services.