As China’s Market Shifts Inward, Brands Turn to Online Education

Compared to just a few years ago, luxury’s future in China now seems much murkier. Amid rising economic uncertainty, which has been exacerbated by the ongoing U.S.-China trade dispute, a weakening yuan, and this summer’s Hong Kong protests, brands have seen a Chinese spending shift away from overseas consumption and towards the country’s domestic market. Rather than continue to lean on tourist spending, brands have little choice but to turn their focus to Chinese consumers shopping at home.

This, however, presents Western brand managers with a daunting challenge that’s only been complicated by the proliferation of Chinese social platforms and KOL culture in China. In turn, this has led to a massive demand for executive education that will help brand marketers better understand China’s online landscape and how to use it to drive domestic sales and brand awareness. Because of this, the online education market in China has been booming — reaching 29 billion RMB in 2017 — yet it has almost entirely been focused on the domestic market thus far. Some universities, such as Beijing’s Tsinghua, offer courses for non-Chinese-speakers, but these tend to focus more on specialized fields like Psychology and Xi Jinping Thought (neither of which will readily help a luxury brand’s bottom line in China.)

Aimed instead at marketers who urgently need to understand China’s social landscape, the business consultancy Singing Grass Communications and online training company Circus Street’s “Social in China” videos help brands understand how to market and sell online in the era of WeChat and TikTok/Douyin. As Alicia Liu, founder and director of Singing Grass, told Jing Daily, the problem with most marketing education designed for Western branding and marketing professionals is that it mostly focuses on the big picture rather than the practical use of social media for reaching and influencing potential shoppers. “It’s not enough just to understand how the different platforms work,” said Liu, “it’s also important to produce tailored content to engage a digitally savvy and sophisticated Chinese audience.”

Currently, most brands — with a few high-profile exceptions — see social media in China as a digital billboard. Some brands like Coach, Stuart Weitzman, Kate Spade, Burberry, Givenchy, Hugo Boss, La Mer, Maserati, and more are planting their flag on Tmall’s new Luxury Pavilion and plugging into Alibaba’s online network, while others like Cartier and Bvlgari are more focused on WeChat as a one-stop marketing and sales channel. Some are even starting to dip their toe into short video platforms like TikTok/Douyin. According to Liu, the “Social in China” videos address a crucial-yet-missing link for brands that help them understand how to win the “hearts, minds, and pockets” of Chinese consumers with social commerce. As Liu sees it, sales and marketing opportunities on domestic Chinese platforms are “huge and remain relatively unexploited” by Western brands, due to the country’s unique online ecosystem.

While brands with a decades-long footprint in the market or digitally-native newcomers have done a good job of understanding and adapting to the changing Chinese market since the BBS era, those just entering the market or those refocusing their efforts on domestic consumers are in dire need of education. Therefore, we can expect to see the number of courses catering to this information-hungry demographic to rise steadily in over coming months and years.

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