Weekly China Review

January 4, 2022

Baidu unveils China’s first metaverse platform ‘Xi Rang’

Users can create avatars, connect with other players, and explore the virtual world of XiRang using Baidu’s new metaverse platform.

It is available in China and lets you create avatars, chat with other users, and even build your own place on the platform. Players can explore Creator City, XiRang’s first city, as well as the surrounding virtual natural landscapes and other traditional Chinese settings.

Unlike Meta’s ‘Horizon Worlds,’ which is only available to Oculus Quest 2 headset owners, XiRang may be accessed via a smartphone, a computer, or a virtual reality headset. Baidu hopes to encourage creators to develop new activities on its platform in a variety of areas, including gaming, entertainment, education, advertising, and events, by making it easily accessible.

Link: https://www.scmp.com/video/technology/3160931/baidu-unveils-chinas-first-metaverse-platform-xi-rang

What Will Travel Retail Look Like in 2022?

The Chinese Duty-Free Group’s priority in 2022 and beyond will be on finding new ways to deliver more commodities choices to travel retail shoppers.

The travel retail industry should focus on rising market prospects in newly opened duty-free zones including Qianhai Pilot Area, Henan Pilot Free Trade Zone, and Pudong New Area in 2022. To further its retail growth beyond the pandemic, China wants Hainan to become a key holiday destination for both Chinese and overseas visitors.

Link: https://jingdaily.com/china-travel-retail-trends-hainan-shanghai/

What is exactly a metaverse and why does it matter? Report

By the end of 2021, the term “metaverse” had become a buzzword that was all over the news. However, the concept might be perplexing, and different stakeholders will understand it differently. 

Mark Zuckerberg, for example, refers to it as the “embodied internet.”

Although the metaverse is still in its infancy, some existing technologies and platforms already provide many chances for businesses to exhibit themselves there, demonstrating their digital innovation and readiness to interact with users online. Building a 3D presence can also open new revenue streams.

Interoperability, or the seamless connectivity between digital experiences, is a key feature of the metaverse. Closed platforms, on the other hand, are the rule right now.

Link: https://media.monks.com/articles/report-make-sense-metaverse

Who are KOCs and how do you work with them?

KOCs means Key Opinion Customers. Compared to KOLs (Key Opinion Leaders) they are individuals with relatively strong influence over their peers, family, friends and group of potential followers.

Because they are not paid, they are more genuine, making KOC marketing a low-cost marketing method. This means fewer people will see your content, and you’ll have less control over it. You’ll also have less tracking.

 Platforms: Xiaohongshu, Dianping, WeChat, Douyin.
Methods: asking for feedback, personalization, product seeding, live streaming, focus groups. 

Link: https://mp.weixin.qq.com/s/u9IQ3gyL_tR0-COMeniOBw

2021 Top 4 trendy scenarios for brands

  1. Metaverse: As a result of the post-pandemic increased social virtualization, marketers sought out new scenarios to expand their commercial opportunities.

    Xirang (希壤)is the name of Baidu’s social metaverse app. In the app, users can make friends and trade. Xirang will become a major site for life, work, and recreation in the future due to its strategic location. The ambition of Baidu is to become the Metaverse’s infrastructure platform, providing AI, cloud computing, and other technical engines for Xirang and other Metaverse businesses. Xirang’s version number is currently – 6.0, which is still negative after more than a year of development and testing. It’s not ideal, and there’s still a lot of opportunity for improvement. Many brands, including Burberry, Oreo, and OPPO, have developed their own NFT variants.

  2. Outdoor camping: People are increasingly interested in outdoor activities as a result of the disease, and they want to get in touch with nature. According to Alibaba research, the number of reservations for tents and camping on their travel platform surged by more than 14 times month over month
    – CTI magazine worked with Milklad and Red to host a “City coffee camping season” offline event.
    – Adidas teamed up with Camplus, an outdoor lifestyle platform, to host an outdoor hike at the Great Wall’s base.

  3. New consumer brand stores (Concept store or crossover): This type of store helps communicate the brand’s distinct concept to a younger audience.

    – Ice cream brand Zhongxuegao collaborated with coffee shops
    – Coffee brand Saturnbird collaborated with lifestyle brands and organized a pop-up market. It will become a dancing party at night.

  4. Creative Livestream: The brands tried different formats like talk shows or created new formats to attract potential users.

    – Down jacket brand went to Tibet
    – Milk brand showed the audience the cattle on the grassland

Link: https://mp.weixin.qq.com/s/cfi9hkzjXVOs1rJpwMw9-g

Why don’t young people pay for the “internet celebrity brand” anymore?

Last year, an Internet celebrity brand Zhong Xuegao developed a “lixiangguo” dumpling brand. The price of a single dumpling was around 3 yuan, with the hopes of attracting customers’ attention through “high price,” however it had had little success.

Why don’t young people want to pay for the “internet celebrity brand” anymore?

  1. For internet celebrity products, most customers think that the products are expensive. Consumers will choose them because of their temporary popularity, and give them up because of the influence of product quality.
  2. In most cases, High-cost investment and huge risks make brands unbearable. They focus on Marketing which can bring a lot of traffic in the short term, so brands spend money on famous platforms like Douyin, they only pursue marketing and ignore products.
  3. Many internet celebrity products generally have a weak foundation, the team and products are not mature enough and will not be finely operated.

If a wanghong brand wants long-term development, it should pay attention to promoting product design;  it should also pay attention to user experience. Continue to innovate and create new value.

Link::https://mp.weixin.qq.com/s/-J95lxEC7zOS3b-wAI__2A 

 

 

 

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This Week’s China Roundup

December 21, 2021

Insights Report – Leverage China GenZ Consumption Behavior

How can Marketers use these trends?

  • Social: Brands must broaden their brand influence to fulfil the needs of young people who enjoy socialising and building a stronger readiness to share, thus interactive innovative marketing is appropriate
  • Personalized: To better stimulate Gen Z’s attention and readiness to seed material, brands must integrate their interests and hobbies, which is ideal for vertical marketing that blends interests and hobbies.
  • Impulsive Micro-moment: Brands must leverage the power of a strong social chain and community to lead and expedite Generation Z’s purchasing decisions, which is ideal for precision marketing embedded in social occasions or private traffic via WeChat private groups.

Link: https://www.chinatradingdesk.com/post/insights-report-genz-consumption 

 

Could Sustainability Messages Sour Chinese Consumers on Your Brand?

For years, the fashion industry has associated Chinese customers with constant sales growth while also thinking them to be behind the trend in most global sustainability discussions. Luxury and fashion must avoid falling into the trap of “educating” China’s youthful, environmentally sensitive buyers from a condescending, Western-centric perspective.

To compete with the ruthless competition, brands must integrate sustainability messaging with outstanding aesthetics, competitive prices, and impeccable service. Sustainability alone will not be enough.

While 71% of those surveyed claimed they wished to support sustainable products, just 29% actually purchased them. When it came to sales conversions, buyers prioritised good design, long-lasting quality, and overall e-commerce experiences.

Link: https://jingdaily.com/chinese-sustainability-messages-greenwashing-everlane/ 

 

Brands are pursuing sustainability

According to Mckinsey research, over 80% of Chinese interviewees would pay for environmentally friendly packaging. Green buying is popular among Chinese shoppers. As the government promotes the concept of sustainable consumption, brands are paying more attention to it.

In fast fashion, the brands start from the fabric, using degradable materials:

  • Blue skylab (belong to car brand NIO): Used the remaining materials after the car production to make shoes.
  • Timberland: Built a pop-up shop by using the Sugar cane. The pop shop itself and the decorations in the shop were made of sugar cane. They use sustainable and recycled materials to create goods.
  • Adidas: Leveraged the recreation of the old clothes. They invited hundreds of designers and students from art colleges to join the campaign.

In the food and beverage industry:

  • Starbucks: Opened the world’s first environmental protection experimental store in September, the furniture was made by recyclable materials; in the shop, you can see the artworks created by the coffee grounds
  • Jindian (a Chinese famous milk brand): Did a 3 monthly live-stream in Bilibili and invited people to watch the grassland, 
  • Budweiser: Collaborated with the Bilibili’s KOLs and made artworks by grain waste 

Link: https://mp.weixin.qq.com/s/L1K7OHmCQ4vErU9k29mGnA


Douyin launches a graphic plan on the content!

Douyin launched official activities of the images and text. The activity rule is that the creator must release at least three photos with copywriting and include the topic’s hashtag. 

Only creators with less than 10,000 fans are eligible to participate. This is a great option for flat bloggers who don’t know how to make short films but want to show off their douyin skills.

Advantages:

  • It will make it easier for graphic bloggers than short video bloggers.
  • For those who are good at copywriting and pictures, it is very beneficial.

To improve the platform’s content ecology, Douyin wants to draw back some of the most unique and capable graphic KOL from red book. Douyin has also provided specific awards for graphic creators in order to encourage them to be more active. It can be identified and rewarded as long as the image is clear and normal, the text is rich, and the information communicated is useful.

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This Week’s China Roundup

December 16, 2021

Weibo MAU grew to 573 million in Q3 2021

Monthly active users (“MAUs”) on Weibo totalled 573 million in September 2021, an increase of 62 million people year over year. Mobile MAUs accounted for 94% of all MAUs.

In September 2021, the average daily active users (“DAUs”) were 248 million, an increase of 23 million users year over year.

Weibo’s overall net revenues for the third quarter of 2021 were $607.4 million, up 30% from $465.7 million in the same period the previous year.

Link: https://www.chinainternetwatch.com/31281/weibo-quarterly/

 

Top 5 Cross-Border Retail Trends to Watch That Are Captivating Chinese Consumers

No. 5 The ‘Fur Baby’ Boom: Pet owners in China are increasingly viewing their animals as family members. This shift in behaviour has spawned a thriving business that includes anything from luxury pet diets and “smart litter boxes” to cat and dog cosmetic products.

No. 4 Healthy Snacking: From edible cosmetic items to gummy vitamins and individualised dietary-supplement kits, young consumers are driving the growth of a new breed of health-and-wellness consumables.

No. 3 Haircare is the New Skincare: China is the second-largest market globally for the hair care industry after the United States. It will likely grow at a CAGR of 4.9% up to 2025, faster than the U.S. at 3.4%, according to market research company Euromonitor.

No. 2 Ingredient-based Beauty: China’s increasing community of skincare ingredient aficionados, or “skintellectuals,” has opened doors for developing beauty companies like Murad, Obagi, Kate Somerville, and The Ordinary, which focus on effective, high-performance ingredients.

No. 1 Vintage in Vogue: As homebound customers tidy and adopt sustainability, the pandemic has boosted the resale of luxury objects. If the 11.11 shopping festival and Black Friday are any clue, China’s shopping habit is picking up momentum. Since last year, Tmall Global has attracted a number of well-known Japanese luxury resale stores, including Brand Off, Reclo, Daikokuya, and Brandear.

Link: https://www.alizila.com/top-5-cross-border-retail-trends-to-watch-that-are-captivating-chinese-consumers/

 

KAWO 2022 Ultimate Guide to China Social Media

China’s internet penetration is still only 71.6%, compared to nearly 90% in Europe and North America, indicating that there is still room for improvement. The fastest-growing segments were rural users, who saw a 48% increase in internet penetration, and over-50-year-olds, who saw a 5.2% increase in internet prevalence since 2020, with 22 million joining in the last six months.

The targeting choices on Chinese social media platforms are limited, and with China’s new privacy rules, you know even less about your audience. As a result, you may need to make sure that your content strategy includes a variety of information that is tailored to different types of users. Messages that appeal to a middle-class, college-educated city dweller are likely to differ significantly from those aimed to younger consumers in China’s rural areas. Consider building distinct social channels for each of your target audiences.

Virtual Property Tours – 35x increase in VR house tours between agents and prospective buyers on platform Beike VR. The U.S.-centric model of Boomer, Gen X and Gen Y are meaningless in China’s context. Instead, distinct generational groupings are defined with 后 (hòu). The character ‘后’ means “after”. So instead of “Baby Boomers” or “Millennials”, in China we typically talk about generations in decades e.g. “after 90’s”. You’ll even hear people discussing 95后 — or post 1995 — so rapid are the changes!

When you maintain your customers on one platform, their trip will always be easier. However, Taobao links may now be viewed within the WeChat environment, and Taobao has launched a Taobao Feed that can be synced with WeChat contacts to share purchases. 

Neither platform has yet added the ability to accept payment methods from their competitors. Brands in a hurry to avoid being left behind by ‘China Speed’ should remember that China has been a market for thousands of years, and while the channels may have changed, the fundamentals haven’t changed.

Link: https://kawo.com/en/ultimate-guide-to-china-social-media-marketing-2022/pdf-view

 

Opinion: The Digital Revolution, The Metaverse and The Quest For A Whole New Luxury

Online channels influence nearly 75% of all luxury purchases and big and small brands make announcements about diving into the metaverse on a daily basis. There is nothing more exciting to an industry willing to shape every single creative detail that follows a specific aesthetic vision than to be fully immersed into a wonderland of a virtual project, where democratic luxury can develop and expand and there are no limits posed by the rarity of raw materials and human savoir-faire.

The virtual environment offers the impression that every detail of an event can be managed and altered in accordance with the brand’s aims, and that everything can be designed exactly as planned and expected.

The term “Web3” refers to the third wave of internet innovation, which will undoubtedly have an impact on how people live, how brands work on brand awareness and appeal, and, last but not least, how consumers approach the purchasing process.

Link: https://www.luxurysociety.com/en/articles/2021/12/opinion-digital-revolution-metaverse-and-quest-whole-new-luxury?ueid=3a844b2001

 

Brands are pursuing sustainability

According to Mckinsey research, over 80% of Chinese interviewees would pay for environmentally friendly packaging. Green buying is popular among Chinese shoppers. As the government promotes the concept of sustainable consumption, brands are paying more attention to it.

In fast fashion, the brands start from the fabric, using degradable materials:

  • Blue skylab (belong to car brand NIO): Used the remaining materials after the car production to make shoes.
  • Timberland: Built a pop-up shop by using the Sugar cane. The pop shop itself and the decorations in the shop were made by sugar cane. They use sustainable and recycled materials to create goods.
  • Adidas: Leveraged the recreation of the old clothes. They invited hundreds of designers and students from art college to join the campaign.

In the food and beverage industry: 

  • Starbucks: Opened the world’s first environmental protection experimental store in September, the furniture was made by recyclable materials; in the shop, you can see the artworks created by the coffee grounds
  • Jindian (a Chinese famous milk brand): Did a 3 month live stream in bilibili and invited people to watch the grassland, 
  • Budweiser: Collaborated with the bilibili’s KOLs and made artworks by grain waste 

Link: https://mp.weixin.qq.com/s/L1K7OHmCQ4vErU9k29mGnA 

 

McDonald’s sells cat nests, pet economy has become a new traffic password

To receive a limited cat box, go to the McDonald’s app /elemev app and buy the specified set. Officials stated an hour after the event that many seats had been sold out.

There are more brands like McDonald’s that use cat and dog features in their marketing activities: Starbucks cat claw cups, perfect journal, and Li Jiaqi’s dog Never’s animal eye shadow, for example. Pet marketing has given the business a lot of attention.

Why do so many young people adore pets? “Meng” is the answer! According to the 3B concept, brand advertising uses beauty, beast, animal, and baby as methods of expression, which is in keeping with human nature of paying attention to life, making it simpler to attract consumers’ attention and love. 

According to iResearch consulting’s white paper on China’s pet consumption trend in 2021, the pet industry’s market will be close to 300 billion yuan in 2020 and will continue to develop gradually over the next three years.

One of the new features of this years double 11 is the pet economy. The turnover of tmall dog/cat staple food, cat treats, beauty and cleaning items, and other categories exceeded 100 million yuan, according to tmall pet. In this regard, the pet economy has progressively evolved into the mainstream.

Link: https://mp.weixin.qq.com/s/DCz8ryKj3HAiuVgOXocaHA

 

Top 10 online phrases of 2021

China’s language resources monitoring centre has announced the top 10 online phrases of the year 2021.

  • YYDS, the pinyin abbreviation of Chinese “永远滴神”
  • 破防 Something that has breached my defenses, or “this really got me!”
  • 元宇宙 Metaverse
  • 躺平 Lie flat
  • 觉醒年代 The Age of Awakening
  • 双减 Double reduction
  • 绝绝子 Awesome, marvelous, amazing, brilliant
  • 伤害性不高,侮辱性极强 Not harmful, but utterly embarrassing
  • 我看不懂,但我大受震撼 “I don’t understand it, but I was shocked.”
  • 强国有我 Young people are committed to building a stronger China

Link: https://mp.weixin.qq.com/s/bDFGlXuy–lJklXU–RUog

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China Happenings This Week

December 7, 2021

Why Online and Offline is a Must to Meet Chinese Consumers’ Retail Expectations

There is no opposition between Onlive VS Offline: most Chinese consumers do not make ‘either-or’ shopping decisions. They may shop online or go to the store, depending on their current needs. They do, however, desire a consistent and integrated experience regardless of where they are. More physical establishments are enhancing customer experiences with tech-driven services such as live streaming, as well as physical forms such as workshops and event spaces that are also connected to technology.

Retailers are successful if they 1. make it more entertaining, 2. make it more pleasurable, 3. make it more reliable, or 4. take away the agony.” It used to be enough to be the best in one of the four quadrants. However, as the retail industry has gotten more competitive, retailers must now cover all four quadrants. Alibaba, for example, not only addresses the problems (like Amazon does), but it also adds a lot to make purchasing enjoyable.

Consumers now regard shopping as a pastime or a form of entertainment, with the goal of not just getting goods but also being entertained and learning new things. And making some purchases along the way.” Consumers, on the other hand, have high expectations for the entire customer journey. They are looking for something more than just a transaction. Consumers expect experiences that are enjoyable, meaningful, and connected to their values. It doesn’t have to be a high-tech augmented reality game all of the time.

Link: https://www.chinaskinny.com/blog/chinese-retail-expectations/

 

Why China’s Idol Economy is at its Turning Point

With a few significant scandals and strengthened controls and actions by the Chinese Cyberspace Administration, 2021 was a year full of changes for Chinese influencers and KOLs. Following the “227 Event,” which involved actor and singer Xiao Zhan and his adoring followers and resulted in the entire suspension of a website in China due to its widespread reporting, a barrage of criticism erupted.

Furthermore, many followers will go to any length to support their idol. To stimulate irrational consumption, brands exploited this mentality by linking their products to their idols’ “reputation.”

The “Qinglang Campaign” is a broad crackdown in China against “fan culture.” To begin with, Chinese authorities have stated unequivocally that they “do not support” unreasonable fan behaviour. Because of this stern stance, brands were forced to reconsider their cooperation with Chinese idols. The old idol economy model, which is based on the purchasing power of fans, would plainly put companies in danger. 

Finally, numerous fan organisations have been subjected to direct limitations on Chinese social media platforms. On Weibo, certain well-known musicians’ online fan groups were banned for a month. As a result, nearly all fan groups are now attempting to find ways to avoid the storm. They’re altering their social media accounts usernames and advising their fans to keep a low profile.

The current state of the idol economy does not imply that idols will vanish in China; fans still adore their idols, but extreme forms of fandom have been prohibited. When possible, fans can still find fresh ways to show their support for their favourites.

Link: https://daxueconsulting.com/china-idol-economy/

 

5 Emerging Cities in China Luxury Brands Cannot Overlook

When it comes to marketing, global luxury companies concentrate on first-tier cities, yet brand strategies in emerging markets must be distinct from those in Tier-1 cities. Young shoppers in lower-tier cities are less concerned about living costs and saving challenges than those in top-tier cities. As a result, they have more money to spend.

The 11/11 Shopping Festival confirmed that China’s lower-tier cities are a promising market for luxury products. Between November 1 and 3, when Tmall began selling luxury items, the number of luxury customers in smaller cities increased by about 50%. Tmall’s Luxury Pavilion received orders from YOY and shoppers from nearly 400 different cities.

In emerging nations, the “invisible rich person” has become a critical consumer category. 5 non-top-tier cities with a high concentration of high-net-worth individuals: Ningbo, Suzhou, Xi’an, Shenyang, and Wuhan are all cities in China.

Link: https://jingdaily.com/lower-tier-cities-high-net-worth-luxury-ningbo-wuhan/

 

Baidu App launched the first metahuman based on celebrity 

GONG Jun, the first star in the metaverse with a metahuman IP, has joined the Baidu app as an AI explorer. This metahuman is distinct from other virtual idols in that he can interact with app users. You can talk to him and ask him questions, and he will appear when you call his name and answer your inquiries.

Baidu used Text To Speech to make the metahuman’s speech sound as real as possible. Users can allow him to read the news during his commute. A metahuman IP might give celebrities more options and set them apart from the competition. It can also be used in a variety of situations, such as customer service, tutoring, and so on.

Link: https://mp.weixin.qq.com/s/NZGaFUjT1PWRBsAA3m9ZwQ

 

WeChat external links regulation

In a private message, the users can send the external links they want.In the group chat, the users can share the eshop(Taobao, JD etc) links and open them directly (test stage). It plans to let the users manage the external links in their WeChat.

Link: https://mp.weixin.qq.com/s/7zxqex8DuuWj8cFfDhz2bw

 

Why do luxury brands like marketing crossover?

  • Ferrari held its first fashion show by inviting Armani’s creative director to design clothes. 
  • LV opened its first coffee shop in Japan at the beginning of the year. The high-value design attracted many people. Although the price of LV coffee is higher than the market price of other coffee, the price is very cost-effective for the luxury brand image left by Lv to users.
  • Hermes opened a gym in Chengdu this year. Hermes has grasped the concept of an active and healthy life of people, sending the positive life spirit of the brand in addition to fitness.
  • Prada opened a vegetable store in the centre of Shanghai and covered the whole vegetable market with logos. The highlight is to provide Prada packaging bags for offline consumers.

The purpose of luxury play cross-border marketing is to pursue freshness and use “small money to get large traffic flow”. In addition to taking care of their own consumer groups, brand culture can be extended to life.

Cross border marketing not only retains the luxury temperament of the brand but also provides users with different luxury product experiences. Compared with sports cars, clothing can also expand the range of consumers. It injects interest into the brand and allows users to understand the value point and culture of the brand in an all-round way

In fact, every cross-border brand has insight into the current popular life and combines the tonality of the brand with marketing to form a higher degree of discussion, but also seize more consumer groups.

Link:https://mp.weixin.qq.com/s/vqBhla4FeAkX62gwVMg09g

 

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Weekly China Oversight

November 30, 2021

WeChat’s latest update signals support to China’s first personal information legislation

Tencent’s WeChat received a fresh update for its 8.0.16 version recently. Users can now discover a new page in the settings menu called “Personal Information and Authorizations” by going to Settings -> Privacy.

This modification is in reaction to the publication of China’s first Personal Information Protection Law, which requires businesses to process personal data publicly and accurately. 

WeChat’s latest update gives users four alternatives for swiftly viewing and changing the personal information they’ve submitted to the app and other third-party platforms:

  • System Permissions
  • Authorisations
  • Personalised Ads
  • View and Export My Information

Link: https://daoinsights.com/news/wechats-latest-update-signals-support-to-chinas-first-personal-information-legislation/

 

Should Brands Distance Themselves From ‘Controversial’ Celebrities?

Apart from extreme cases like Kris Wu should brands be quick to cut ties with their brand ambassadors?

“In the digital era, people who agree do not speak as loud as those that disagree, but those who disagree may not be the brand’s actual consumers”

As a result, companies can only get an accurate answer through surveys and research. Luxury firms are selecting many ambassadors for their ranges to limit risk, with Dior leading the way with 14 spokesmen and numerous house friends.

With increasing calls for diversity and inclusion in China, local customers are demanding a more diverse cast of brand ambassadors. The local market has shown signs of fatigue towards pretty ambassadors, now preferring more intriguing backstories and deeper connections with their brands.

Link: https://jingdaily.com/luxury-brands-distance-controversial-kols/

 

Five consumption trends in China in the next 10 years (by Mckinsey)

China’s emerging consumer class has become the growth engine of many global consumer goods: in the next decade, middle and high-class consumers may become the main force to promote China’s consumption growth. 

Non-first-tier cities may become a source of power: cities are expected to account for over 90% of China’s future consumption growth. Different urban consumer marketplaces have significant disparities. The rise of Chinese local brands is fueled by a shift in consumer attitudes: Chinese consumers’ brand preferences are shifting, and consumer support for local brands has aided the rise of some local businesses. Chinese brands are gaining market share in domestic consumer goods and electronic devices, with a market share of more than 50%.

More than 70% of Chinese digital customers consume both online and offline, resulting in large data pools. Consumption data is exploding thanks to the burgeoning digital economy. A new market consumption curve is emerging: the consumption curve in the Chinese market is shifting as a result of the confluence of variables such as business model innovation, technology-driven unit cost reduction, and new purchasing behaviour. Chinese technology companies are at the forefront of the global curve shift.

Link: https://mp.weixin.qq.com/s/XjHKuMtKKb7zEOb4rcY5Cw

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This Week’s China Learning

November 9, 2021

2021 Beauty Industry White Paper

Although this white paper focuses on China’s cosmetics industry, many of the conclusions are applicable to China’s other industries.

Main takeaways:

  • A content-focused strategy is becoming increasingly important, rather than a price-focused strategy.
  • Brand building has been a priority for both foreign and domestic brands. They are increasingly focusing on long-term brand equity/notoriety rather than short-term ROI.
  • In China, young internet customers remain the most significant market for most brands. Women under the age of 40 account for approximately 70% of the global cosmetics market, significantly outnumbering their demographic share.
  • As the appeal for transactional techniques fades and becomes increasingly unsustainable, younger consumers are more affected by brands and content that resonate on an emotional level and match with their value system. As a result, marketing is far smarter and more fascinating now than it was in the days when all you had to do was decrease the price.

Link: https://www.kantarworldpanel.com/cn-en/news/2021-Beauty-Industry-White-Paper?utm_source=news_chinaskinny_com&utm_medium=email&utm_content=The+Weekly+China+Skinny&utm_campaign=20211102_m165346214_20211102+-+1&utm_term=2021+Beauty+Industry+White+Paper

 

B2B Marketing in the Post-LinkedIn Reality

Maimai 脈脈 is a homegrown social-networking platform for professionals to create business connections, the Chinese equivalent of Linkedin. It now has more than 80 million high-value real name users with more than monthly active users of 30 million.

Through Maimai, marketers can convey their advertising message into different types of Ad formats including Splash Ad, Native Ad, and instant message, etc. Additionally, marketers could target the audiences in different positioning based on their geographic location, gender, career position (C Levels/ Directors / Managers grade), job industry (Business / Legal / Finance/ Design/ IT, etc), and even their specific company.

Link: https://www.xinergy.global/maimai-the-chinese-linkedin/

 

The older Chinese consumers turning silver into e-commerce gold

A few months ago, the Chinese government was encouraging the biggest Chinese apps to prepare elderly-friendly versions. More than 264 million people, or 18.7% of China’s population, are aged over 60 in a country that is ageing rapidly, according to census results published in May.

COVID-19 forced many Chinese 60+ online making for an expanding population of “silver-haired” internet users who have made the move to online shopping in China in the past year, nudged by the coronavirus pandemic, government policy and e-commerce giants. JD reports that retirees living in major cities, with money to spend and plenty of time, were some of the most prolific shoppers since the pandemic, with over half of the goods catering to the elderly bought by users themselves this year.

In the first three quarters of this year, purchases by the silver-haired demographic grew almost fivefold year on year, with users focusing on leisure purchases, such as gardening supplies and package tours. To really tap this market, online vendors need to simplify their designs or offer user-friendly guides for their apps or websites.

Link: https://www.scmp.com/news/china/article/3153456/older-chinese-consumers-turning-silver-e-commerce-gold

 

GUCCI– burst game

For its product burst, Gucci, a worldwide luxury brand, devised an innovative H5 game that allows users to engage, comprehend items, and expose brands by avoiding obstacles in the tunnel.

Burst’s shoes “gallop” in a 3D three-dimensional colour tunnel. At the 8m position, there are two operation guide arrows. Users can use the up and down arrows to directly drag bursts around the tunnel to escape impending obstacles by clicking and dragging it. There are timers and score reminders in the game. If you run into any barriers, the game will automatically finish and the game results page will appear.

 

Luxury brands are ditching KOLs for virtual influencers in China: how Alexander McQueen, Dior and Prada are turning to digital avatars and AI idols to woo millennials

Making their way from music to fashion, virtual idols are paving the way for mixed reality initiatives, increasingly appealing to younger, digitally native consumers.

As more consumers move online, they will increasingly demand compelling narratives like Maie’s from their virtual idols. It seems, every luxury consumer will be able to hatch their own virtual idols in the future.

Link: https://www.scmp.com/magazines/style/luxury/article/3153210/luxury-brands-are-ditching-kols-virtual-influencers-china

 

 

 

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What’s New in China This Week?

November 2, 2021

How Chinese Retailers Are Reinventing the Customer Journey

China’s retail sector is both enormous and rapidly developing, with an estimated value of $5 trillion by 2020. It is also heavily computerised. And, as a result of the epidemic, digital has become a strategic priority for all retailers.

The authors draw from their research on Chinese retailers to explain five lessons that Western companies can learn from China as they develop their own digital market offerings:

  1. Create single entry points where customers can access all their potential purchases.
  2. Embed digital evaluation in the customer journey.
  3. Don’t think of sales as isolated events.
  4. Rethink the logistical fundamentals.
  5. Always stay close to the customer.

Link: https://hbr.org/2021/09/how-chinese-retailers-are-reinventing-the-customer-journey 

 

Luxury Brands and 11/11

Alibaba is actively promoting innovative digital retail solutions for luxury brands and is gradually expanding its virtual services and experiences. While the majority of luxury purchasing still takes place in physical stores, online and omnichannel expansion has constantly expanded – according to Bain & Co, China’s luxury internet penetration will increase to 23% in 2020, up from 12% the previous year.

Gucci, Vacheron Constantin, and Maison Margiela, for example, recently teamed with Tmall Luxury Pavilion to expand services previously only available in physical stores, such as membership benefits, sales associate consultations, and after-sales services.

This year’s 11.11 Global Shopping Festival, the world’s greatest retail extravaganza by sales, has over 200 luxury businesses offering a variety of services ranging from bespoke engraving to cleaning and repair services. Other highlights include a digital exhibition, an art presentation by a virtual influencer, Chopard and Cartier showcasing their items in 3D, AR try-on, and top executives joining firms’ live streams.

Link: https://www.alizila.com/alibaba-janet-wang-china-luxury-innovation-1111-shopping-festival/ 

 

China Brands Go Global

Report selected 100 Chinese brands present abroad and analyzed them. The purpose of the top 100 Chinese brands list was to look at consumer brands that have the most direct impact on global consumers – both in terms of sales and (more significantly) in terms of brand/audience impact and potential.

While many of the enterprises have their own websites, the vast majority of sales are made via ecommerce sites such as Amazon and AliExpress. While most brands have official accounts on three or more channels, social media is used more to enhance performance, such as digital advertisements (CPC), rather than to cultivate customer affinity. Brand content and organic growth are underserved because the focus is solely on advertising. Most brands have a small number of followers and a poor level of engagement.

Big event sponsorships: While these high-profile, high-budget endeavours are remarkable, they are often premature vanity projects for brands that have yet to gain traction in the market. These approaches are hoped to be fast-tracks to brand equity.

Link: https://www.talktototem.com/china-insights/china-brands-going-global 

 

WeChat Brand Channel

It’s a partnership between WeChat Pay and Channels; with this step, traffic from offline channels/mini programmes will be sent to WeChat Channels. There are five major benefits of using the Brand Channel.

  1. Turn to Channel’s video after offline payment: When users complete the payment, they will see the Brand Channel button and watch the videos
  2. Reserve the live stream after payment: The brands can add this feature to the payment page, so the users can make a live stream reservation during their payment
  3. Brand hongbao: The brands can send hongbao by QR code, when the users scan the QR code, they will receive the hongbao and use it when they pay the bill. On the receipt page, the users can get in the brands’ channels and explore the dedicated video
  4. Turn to Channel’s video after mini-program payment: The brands can add the Channels’ content in the mini-program page, so when the users browse the page, they can see the video amongst the products
  5. Coupons: The brands can combine the video to the coupon, so the users can watch the video when they get and use the coupon

Link: https://mp.weixin.qq.com/s/ZtJ5Pji6KwcPTMwS51PNEQ 

 

WeChat update version 8.0.16 supports one-click to close personalized advertising

WeChat version 8.0.16 shows an updated pop-up window with revised privacy protection guidelines to advise users of changes to privacy guidelines and information sharing disclosure.

The “personal information and permissions” entry has been added to the bottom of the “WeChat – I – Settings – Privacy” interface.

You can now turn off “personalised advertising” with a single click in WeChat’s “personalised advertising management” and set the switch to “closed.”

It’s important to note that turning off “personalised advertising” does not imply that you’ll never see advertisements on WeChat again. Instead, you will turn off the display of ads that are relevant to you, but you will continue to get broad commercials.

Link: https://mp.weixin.qq.com/s/fV5k4jVUCtvpzjO3UGFVXA

 

One mobile phone number can register multiple WeChat ID

A new function appears in WeChat version 8.0.15, which allows users to quickly register another WeChat signal without an additional mobile phone number.

You must also carry out real-name authentication of WeChat payment if you need to transfer, send, and receive red envelopes and other operations in WeChat without binding your mobile phone number. You are not required to bind your mobile phone number if you need to transfer, send, and receive red envelopes and other operations in WeChat without binding your mobile phone number.

Link: https://mp.weixin.qq.com/s/h5Tlo2NIsfVLlZMpISRbFg

 

Meta’s chief of Metaverse tells us what the future holds for the former Facebook

Meta aims to build solutions to social media problems that have yet to be solved in the future.

Meta has big aspirations for the metaverse. On Instagram, there’s a huge universe of artists, and there are a lot of people creating stuff on Facebook. Virtual commodities will undoubtedly play a significant role in Meta’s metaverse.

Link: https://www.cnet.com/tech/computing/metas-chief-of-metaverse-tells-us-what-the-future-holds-for-the-former-facebook/ 

 

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China’s Weekly Overview

October 26, 2021

Does Your Brand Need a Weibo Profile?

Many international companies begin their Chinese social media presence with a WeChat official account, but having a Weibo account can also help them gain awareness.

Weibo posts are visible to more users and non-followers than WeChat posts because of a distinct feed structure. However, as Weibo is one of China’s oldest social media sites, new platforms are appearing all the time. It’s best to assess target audience behaviour and then invest funds and effort into the most relevant combination of social media, depending on the target demographic.

Link: https://mp.weixin.qq.com/s/VGp5wjodQJ_tDkHhgelQFQ 

 

Bilibili Marketing Guide: E-commerce, KOL Promotion & Ads

Bilibili, a famous youth-oriented video streaming and sharing network, is thought to be the most similar to Youtube. However, Bilibili’s distinguishing characteristics and distinct community culture set it apart from its western equivalents.

The bullet comments mechanism, which displays all incoming comments on the screen, is one of Bilbili’s most noticeable features. Chinese viewers prefer watching films with live comments because it gives them a greater sense of belonging and sharing. This sense of belonging contributes to the platform’s growth: Bilibili is used by one out of every two young people in China. Young individuals under the age of 35 make up 86% of the 202 million Monthly Active Users on the network.

Engagement rates also benefit from this feeling of community: users spend more than 80 min per day on the platform, generating 4.7 billion interactions per month. Bilbili now offers official KOL collaboration, e-commerce integration and ads solutions.

Link: https://mp.weixin.qq.com/s/QFI34y5qjRJ7OiPK22rLgA 

 

Brands invest in Metaverse 

From Bloomberg, the scale of Metaverse will be 800 billion USD in 2023. In this double 11, there are not just real products, we also meet some new friends from Metaverse. Small holds an online exhibition called the Metaverse Art show, users can search in Tmall the keyword and then enter in the Show. 

For example, Burberry launched a digital elfin, which is unique and in limited edition, you can buy this and get a limited scarf. Tmall also collaborated with the other 9 brands and released Musical Instruments. One brand created just one instrument and the users can buy it.

All these NFT products were made by the Ant Chain, the Alibaba blockchain supplier. They design, produce digital products for the brands, and also provide the cochain and distribution. 

Link: https://mp.weixin.qq.com/s/JMCsZPs61DmGYA6gD3pP-g 

 

Kuaishou brand advertising multi-form help live marketing

  • Eye-show: Excellent exposure drainage — Open screen Eyemax straight to the broadcast room. Eye-show is mainly suitable for strong brand promotion, new product launch and other scenarios. In the past, high-quality entry data was favoured by advertisers.
  • Feeds – show: Video streaming native scene – a single column of information flow straight to the broadcast room. The product form can meet the marketing demands of the brand-customer information flow directly to the live broadcast room. At the same time, based on the basic ability of the brand information flow, the material can be saved to the customer’s personal home page for a rich promotion, laying a foundation for the subsequent content marketing.
  • Simple broadcast room: Fully immersive live streaming experience –A single column of information flows straight to the studio and then escalates. Brand information flow new live fully immersive style — advertising style simple studio and through the show live broadcast real-time images in a single stream, achieve the purpose of life for heating, the real-time image lead to the recommended flow, further shorten the user to watch live path, native display optimization experience, and expand the clickable region into the air.

Link: https://wemp.app/posts/b7ea071a-ed55-457e-96fe-f9aa69b7d1a0 

 

 

 

 

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What Happened in China This Week?

October 19, 2021

Chanel Takes on the Resale Market With One Bag per Person per Year Policy

Chanel limits the number of purchases for its most popular handbags to one of each per customer per year. The move is aimed at preserving the uniqueness of luxury goods, since the resale market has exploded in recent years, with proxy purchasers buying out stocks and diluting the brand experience when reselling to their own clients. Furthermore, China’s second-hand market is expanding.

China is well-known for its vast resale grey market, which is overseen by plenty of daigous. According to BCG estimates, Chinese consumers will spend $35 billion in the global luxury market in 2020, with $28 billion (80%) paid through the usage of a daigou service.

Link: https://jingdaily.com/chanel-limit-purchases-handbags-resale/?utm_source=Jing+Daily+Subscriber+List&utm_campaign=b5b170f8dd-EMAIL_CAMPAIGN_2020_03_12_06_39_COPY_01&utm_medium=email&utm_term=0_8dec01cd8d-b5b170f8dd-408268421 

 

Taobao launches a new feature to embrace Double 11 shopping festival

Taobao launched a new feature called “Planting Grass Machine” 种草机 where users can browse product recommendation reviews that are posted by other users. It’s supposed to help consumers make better consumer decisions based on peer recommendation and it’s supposed to offer more variety of content and reviews than just KOL endorsements.

Any keyword typed in the “Plant Grass Machine” will take the user to a page of relevant lifestyle-sharing content.

Link: https://daoinsights.com/news/taobao-launches-a-new-feature-to-embrace-double-11-shopping-festival/ 

 

Double 11 x KOL’s reality show

In China, Livestream shopping has become a new trend, with more and more firms using it to market their products. This year, Austin, a well-known KOL, debuted a reality show called the Girls’ Offer. We can watch the show on Weibo, the Red and Douyin. During the show, we can see how he negotiates the price with the brands (most of them are cosmetics brands) and how the brands react to the challenges.

As the double 11 is coming, this show is like a teaser. The brands can get exposure before the big event, Austin will enhance his image and bring more traffic to his Livestream thanks to his professionality, the consumers can know in advance which brands will have the best offer for them.

Link: https://video.weibo.com/show?fid=1034:4690150597525601 

 

Tencent’s WeChat to stop routinely accessing photos after a tech influencer publicized the behaviour on Weibo

WeChat’s background scanning for new photos was said to run every few hours and found using Apple’s new “Record App Activity” feature in iOS 15. The company said the behaviour will be removed from the app in a future update, but other apps have been found to do the same thing

Background scanning for new photos “will be cancelled in the new version”, a company representative said. 

In recent years, China’s big tech businesses have been under increasing pressure to address privacy concerns. In 2019, the Ministry of Industry and Information Technology began checking apps for privacy issues on a regular basis. To date, it has identified over 1,300 apps for having too many permissions, illegally gathering user data, and misrepresenting customers.

Link: https://www.scmp.com/tech/big-tech/article/3151762/tencents-wechat-stop-routine-scans-photos-after-tech-influencer 

 

LinkedIn’s China retreat stems from regulatory and competitive pressures as local recruitment platforms prosper

The decision comes only two weeks before China’s Personal Information Privacy Law, which is one of the strongest data protection laws in the world, goes into force. In China, where job seekers and professional networkers have a variety of options, LinkedIn had only made a limited impact.

LinkedIn first entered China in 2014, and with its partial exit, it has become the final big US social media company to leave the nation.

Link: https://www.scmp.com/tech/tech-war/article/3152526/linkedins-china-retreat-stems-regulatory-and-competitive-pressures  

 

Why Brands Need WeChat Index

Based on the official explanation from WeChat Index, there are two main ways:

  • Brands can create related content on WeChat, such as WeChat articles, videos, or advertisements, to increase their exposure.
  • Brands can improve the quality of content that is related to the keyword.

Brands may assess their level of popularity on WeChat and so determine whether they are top-of-mind for Chinese customers by watching the WeChat Index. Brands may also determine the return on investment of marketing campaigns by comparing their WeChat index records to the campaign dates and determining which days have the highest search volume.

Link: https://www.luxurysociety.com/en/articles/2021/04/wechat-luxury-index-2021-social-commerce 

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Your Weekly China Roundup

September 13, 2021

Growing Significance of Private Traffic

In China, a growing number of industries are incorporating private traffic into their digital strategy. Meituan, a food delivery app similar to Uber that has 450 MAUs, is one of them. Bonus fandom groups, where businesses may communicate directly with customers, are the newest additions to Meituan. Customers can find group access directly from the shop’s main page & u users are encouraged to join such organisations by CTAs implying that they will receive further coupons and offers.

At the same time, groups give users a place to express their comments and merchants a place to change their products. Meituan just implemented a new social feature: customers can now share their restaurant orders with their friends to enhance company awareness.

 

Link: https://mp.weixin.qq.com/s/btw5G7GQvwOyNqgQQGbn3w 

 

Bilibili and Luxury Brands?

Bilibili, which began as an anime and comics platform, has evolved into a crucial platform for Chinese Gen Z, focused primarily on mid and long videos, and is currently China’s third largest video platform.

Beauty brands such as Shiseido and Lancome have already begun to experiment with Bilibli in order to reach Gen Z, but will luxury brands follow suit?

Bilibili is still relatively unproven in the luxury market, having only attracted a few early adopters such as Dior, Fendi, and Gucci to yet. The major disadvantage is the average age of a Bilbili user, which is still quite young. Bilibili has been actively pushing its e-commerce capabilities to its more than 62.7 million DAUs over the last two years.

Link: https://jingdaily.com/will-a-red-hot-bilibili-become-irresistible-to-luxury-brands-in-2022/?utm_source=CCI&utm_campaign=bca9179477-EMAIL_CAMPAIGN_2020_03_12_06_39_COPY_01&utm_medium=email&utm_term=0_f85454f2c4-bca9179477-408382229 

 

Why Chinese Brands’ Strategies are Important to Brands Everywhere


Chinese businesses differ structurally from those in other countries in that they place a greater emphasis on revenue growth and customer acquisition rather than profit, as most western brands do. As a result, they devote a considerably higher portion of their revenue to marketing and concentrate on hot platforms and key opinion leaders.

Since China has become the world’s factory, Chinese brands can swiftly imitate and improve what is being produced. Because most Chinese businesses do not have heritage brands to protect, they are less risk-averse than established western companies and are willing to attempt a lot more things. This lean startup, come-as-you-are strategy has now been embedded in the DNA of many Chinese brands. Everyone who has grown up in China has only experienced constant change, which has made them extremely adaptive and quick-thinking, especially in business.

Understanding how Chinese competitors operate is critical for brands in China. However, with Chinese businesses like SHEIN becoming more likely to compete in western markets, marketers and strategists working in other nations, including their own local markets, must understand how they operate.

 

Link: https://www.chinaskinny.com/blog/chinese-brand-strategies-to-watch/

 

AMX X Ayayi – the first Metahuman in China

AMX, a yogurt company, teamed up with Ayayi, the first Chinese Metahuman, to produce a digital yogurt based on user data. This digital yogurt is comparable to NFT, a one-of-a-kind cryptocurrency token that serves as a digital asset representation.

AMX gained more scientific and technological features as a result of this collaboration, which set it apart from the competition. AMX will use Xiaohongshu and Weibo to promote the idea that “Yogurt brands may also be popular and fashionable” in order to raise the brand’s visibility. AMX wishes to usher the company into the digital era.

On September 8th, Ayayi started working for Alibaba as the proprietor of Tmall Super Brand. She had her own ID card and launched the first NFT digital mooncake for the Mid-Autumn Festival.

 

Link: https://mp.weixin.qq.com/s/TuX2Tv6d8sgReFQw2bRIfQ 

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