With the largest middle class in the world, China is an attractive market for Western brands. However, brands face various challenges marketing in this dynamic and fast-changing market.
China has a unique digital landscape, consumers have distinctive purchasing behaviours and there’s intense competition between homegrown and foreign brands.
In this piece, I will talk about emerging trends and share tips for all Western brands who want to do marketing in China in 2018.
1. Consider China’s hottest cities
In order to enter and penetrate the market, it’s important to build a strong presence in first and second-tier cities. However, as internet use in the first-tier cities reaches saturation, brands may also begin reaching customers in the third- and fourth-tier cities.
According to Morgan Stanley, the smaller urban cities could become the larger driver of growth and consumer spending in the coming decade. Lower-tier cities will be bigger, wealthier and more eager to spend.
2. Mobile is the channel you can’t do without
According to the China Statistical Report on Internet Development published in August 2017, China has an online population of 751 million and over 95% are using mobile devices to access the internet.
Meanwhile, Chinese people spend an average of three hours a day on their smartphones, mainly for social media and ecommerce. For brands that are marketing to Chinese consumers, a strong mobile presence is crucial.
3. The twin pillars of China’s social media
Social commerce is one of the major driving forces of consumption in China. However, its social media landscape is complex and highly segmented. As a foreign brand, establishing a presence on the two major social media platforms – WeChat and Weibo – is a key step.
WeChat is a multi-purpose message platform developed by Tencent with 980 million monthly active users by Q3 2017. Weibo is a microblogging site (Alibaba is a major shareholder) with 376 million monthly active users as of Q3 2017.
These two platforms are both good channels to communicate with, acquire and retain Chinese customers.
4. Expand and diversify with emerging platforms
Apart from localizing on the BAT (Baidu, Alibaba and Tencent) platforms, which already dominate the market, brands should also pay attention to niche channels in order to capture fragmented users and include them as an integral part of their China digital marketing strategy.
The social media landscape in China is moves at a fast pace and new social platforms are constantly emerging. There are several rising platforms that are popular among the young, such as Kuaishou (a GIF-making and photo-sharing app) and Douyin (a music video social network app for video creation, messaging, and live broadcasting, similar to music.ly).
5. Content is king, but context is god
Content marketing is vital in China and the trend is expected to continue. As Chinese consumers are very much content driven, brands should not just translate their western content, but should focus on creating new content that emphasizes a brand story that sets it apart.
Communicating the right values and creating unique experiences are the best tactics to retain your followers and keep them engaged. The concept that “content is king, but context is god” applies to this market. In the past, emotional content tended to resonate more with users but now Chinese people are more interested in content that’s entertaining and fun.
6. Get good at short videos, you’ll need them
Videos, in particular short videos of six to 15 seconds, are rising quickly and will be more widely used on social media and ecommerce sites for marketing purposes. With short videos, brands can convey their brand messages and engage with an audience more easily.
In the past two years, Tencent, Alibaba and Toutiao have made a huge investment to support short video production. For example, Tencent invested in Kuaishou, while Alibaba has put billions into transforming Tudou into a short video community.
7. Score a hit on mobile video
Mobile video advertising is becoming more popular as it can be promoted on various mobile apps. As of Q3 2017, China’s mobile video advertising market reached 8.657 billion RMB, accounting for 64.4% of the total video advertising market.
Popular music video community Douyin demonstrated the importance of mobile when it launched “vertical screen” video ads. Brands such as Airbnb, Chevrolet, Harbin Beer have published short video ads on this platform. Each of the videos has accumulated over 5 million views and more than 30,000 likes.
8. KOLs are powerful
Key Opinion Leaders (KOL) have powerful promotional impact. In China, KOLs appear to have a stronger influence on society than in the West. Whether you’re localizing your brand, building awareness or driving sales, promotion with KOLs is always a good option.
During Alipay’s 12.12 “Shopping Holiday”, Taobao invited famous KOL Ms Yeah (办公室小野) to do a series of short video programs in which she interviewed eight different KOLs and recommended various products to the audience. The videos have been played more than 200 million times and the program’s hashtag on Weibo got mentioned more than 100 million times.
In recent years, micro-influencers have started entering the market. They have more niche audiences and usually have higher engagement with their followers. In addition to WeChat and Weibo, they can be found on platforms such as Xiaohongshu (小紅書), Bilibili (哔哩哔哩), Ximalaya FM (喜马拉雅FM). They are a good option for brands to amplify content without a huge promotion budget.
9. Live streaming and real-time interaction promotion
Since 2015, live streaming has grown rapidly and become a major trend in China. According to Deloitte’s TMT Predictions Report, China’s live-streaming market is estimated to reach $4.4 billion in revenue this year, up 32% over 2017.
Through live streaming with popular KOLs, brands can easily promote their products to target audience. Live streaming also facilitates e-commerce with the ‘See Now, Buy Now’ function.
Victoria’s Secret is one of the brands that took advantage of China’s live streaming culture to reach out to customers. The brand launched a live stream on Youku during its annual runway show in Shanghai. While users were watching the show, they could purchase the featured products in real-time by clicking the links to the brand’s e-commerce sites.
10. Stay on trend but be flexible
China has a fast-changing digital marketing landscape, so brands need to be flexible and adapt to new features and upcoming trends. For Western brands that are marketing in China, going digital is still one of the most effective approaches to reach out to and communicate with their target audience.
Through 2018 and beyond, marketers should pay attention to various areas, such as targeting audiences in lower-tier cities, establishing an all-round social media presence, emphasizing short video content creation, promoting with KOLs and launching live stream campaigns.
The new generation of Chinese digital consumers is presenting many opportunities. Western brands that understand how to enter this complex market will definitely have the advantage in winning Chinese hearts.