Trends in Digital Marketing in China

Digital marketing trends in China move so fast now, it’s been hard for Western brands to keep up. Livestreaming is here to stay and will only gain in quality and quantity. Chinese companies have innovative new ways to engage with consumers that Western brands should pick up on — fast. Every year, retail executives try to respond to the market’s latest requests by incorporating new wrinkles into their digital marketing strategies. This is especially true in China — a country that quickly developed a fiercely competitive digital ecosystem that led to a booming and hyper-efficient economy. But in a country that’s innovating faster than anyone imagined, planning an impactful marketing or product campaign is a complicated affair, and constant revisions are needed. Because of the sheer speed with which China’s market changes, Western marketers are often overwhelmed by its “orientation” or country-specific requirements, so they often get cut out of big growth opportunities. For example, Western marketers understand the importance of videos for Chinese consumers, but viewers’ shifting preferences have driven video-sharing platforms to make drastic alterations. And since Chinese consumers must move back and forth between multiple video sharing platforms, their attention spans have gotten shorter, and they now expect engaging content jammed into 8 seconds of video. Therefore, creating relevant content for the Chinese market is no easy task, and the Harvard Business Review highlights that Western marketers “may underestimate the power of China’s new competencies,” while also adding that Western “firms are particularly quick to export their media and ad strategies to developing markets, where advertising and media are more recent developments.” But a strategy like this is doomed to fail in China. Major international brands like Dolce & Gabbana and Versace have learned the hard way that you can’t be arrogant, misinformed, or offensive in your China marketing, and their costly mistakes have tarnished their brands’ reputations and damaged the image of European luxury as a whole. But even brands that steer clear of controversy find it particularly hard to stay up-to-date on China’s changing consumer habits. This is not surprising, considering that the country has many strong and distinctive consumer groups — each interacting with brands differently. Many marketers, for instance, place a lot of emphasis on younger luxury buyers while neglecting traditional demographics that could be quite beneficial to some brands. Only recently have we seen a change in trajectories where established brands are starting to focus on older consumer groups. Volkswagen is one example. They recently launched a Beetle ad campaign featuring elderly Chinese citizens imitating cool youngsters and doing crazy things. Additionally, more brands have started partnering with over-50 influencers and models like the 83-year-old Wang Deshun and the 76-year-old Huang Yanzhen. These campaigns are changing the way consumers approach brands, but when it comes to transformation in China, digital marketing is the real game-changer. Let’s have a look at some country-specific trends in digital marketing and see how emerging technologies, automated data collection, and blockchain are reshaping the future of marketing in China: Livestreaming is becoming the most profitable form of marketing According to WalktheChat, Taobao livestreaming by daily active users increased by 130 percent to 41.33 million during this past Single’s Day. Indeed, livestreaming is breaking viewership records and helping to bring in a lot of money. But according to Tingyi Chen, a co-founder of the software platform WalktheChat, “most of the livestreaming campaigns today are simply sales pitches. Content quality is not too different from the most traditional TV infomercial.” Chen foresees a change coming to the industry where brands will partner with important local KOLs who offer high-quality content and engaging experiences to their users. She also predicts that livestreaming will see a major reboot in 2020, as charismatic idols and personalities take the place of regular livestreamers while the livestreaming experience becomes more personalized and high-quality. Chatbots and artificial intelligence (AI) Alibaba is redesigning the shopping experience for global consumers, as artificial intelligence (AI) and virtual assistant chatbots move to the forefront of the Group’s new digital marketing strategy. According to Alizila, these improvements redefine and simplify the “customer’s journey” and create a highly-tailored experience where shoppers can get “uncannily precise” product search results as well as goods and services that “consumers might not have even realized they wanted.” In an oversaturated online arena where consumers no longer have the patience to browse magazines or read flashy advertorials, AI offers a unique solution — one that’s perfectly tailored to consumers’ needs while taking their peculiarities and preferences into consideration. Xiaohongshu/Little Red Book Xiaohongshu remains the most innovative luxury crowdsourcing app since it’s an ideal community for brands who want to engage with young, affluent urbanites. Nevertheless, we anticipate it going through some significant changes. First, Xiaohongshu will move further away from its “community mindset” and will become more of an e-commerce hybrid where user-generated content is encouraged. But, the site will keep its communication-based content flowing via product review tutorials, blog posts, livestreaming sessions, and other innovative ways to boost online user numbers. This will allow Xiaohongshu the opportunity to tap into a consumer segment that’s eager to buy products that the app is advertising. Second, their viral marketing campaigns will be readjusted, as they’ve fallen short in the past by failing to capture the experiences of younger buyers. Miranda Cui Fan stated that the Xiaohongshu community is getting younger and younger, with 70 percent of its users having been born after 1995. Additionally, the app’s number of female users climbed to 88 percent. In this ever-changing landscape where parameters are constantly being redefined, marketing campaigns can’t be rigid and must always be recalibrated. Virtual reality (VR) and augmented reality (AR) Alibaba is already resorting to more disruptive technologies (VR, AR) to help them build closer relationships with users. Instead of crafting a boring marketing message, Alibaba creates a singular consumer experience that’s convenient, innovative, and entertaining. For instance, VR Scout highlights that Alibaba’s Taobao Buy is “an AR-infused shopping experience that reimagines how you shop online with an interactive experience that looks and feels futuristic but is also easy to use.” Sci-Fi shopping is going to be the new norm, and 3-D holograms of products are something that will soon become a requirement for every retailer. Even more engaging is the perspective presented by Forbes that shows a world where, for about 15 cents, Alibaba’s Buy+ lets users buy a cardboard VR headset that connects to their smartphones and allows them to browse various garments and accessories and “even have virtual models showcase the apparel and accessories on a catwalk.” Brands who want success in China need to keep a close eye on the local retail giants who have registered tremendous growth thanks to their approach to innovation and their ability to remain in synch with their consumers’ needs. This agility has propelled companies like Alibaba to the forefront of digital marketing as it envisions a retail universe that begins to fully blur the physical and virtual worlds.

Trends in Digital Marketing in China

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Published January 21, 2020

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Trends in Digital Marketing in China