How China Is Leading the Way in Social Commerce

Quickly becoming the new norm in China for brands and savvy marketers, social commerce makes shopping a one click away social experience. Let’s delve with Lea Wang, Marketing Strategy expert at Fabernovel into the key archetypes of social commerce in China with a panorama of best practices and marketing insights.

As a trailblazer in the realm of social commerce for years, China’s market continues to accelerate as $363 billion are expected in sales in China by the end of the year according to the Emarketer report. But what does the anatomy of social commerce look like? In fact, social commerce is evolving around content, retail and sharing, to make shopping an all-in-one social experience to discover, search and buy products online.

Influencer collaboration & liveshopping, booming drivers for the social content commerce

In China, brands are teaming up with groups of influencers to create original content remains a strong trend. These collaborations go as far as having the influencer participate in the design of products. And it doesn’t stop here. Liveshopping is a new phenomenon that is literally exploding in the Middle Empire, reinventing home shopping for the younger generation.

Young Chinese consumers are indeed heavily dependent on influencers. Indeed, the creator-driving culture is very strong in the country: influencers provide a suite of impactful content solutions to create social word-of-mouth. A windfall for brands that are teaming up with a portfolio of influencers from mega key opinion leaders (KOLs) to nano creators, building brand awareness and driving social fission through professionally created content.

NEIWAI, collaboration with KOL @SavisLook

In April, Chinese lingerie brand NEIWAI announced its collaboration with fashion mega KOL @SavisLook, who has over 4 million followers on Weibo and RED. This collaboration features a vacation capsule collection including dresses, lingeries and accessories, aiming to provide consumers with an “alternative normal” during the time of pandemic. SavisLook participated in the entire production process from designing to shooting. The collection sold out very soon after it went online. 

As for livestreaming, a booming model that will represent 15 billion dollars by 2023 with an annual growth of 12% according to the report conducted by EqualOcean, allows almost anyone, from KOCs (Key Opinion Consumers) to celebrities, to sell products via video streaming platforms.

Livestreaming shopping delivers an interactive experience for consumers from which they can see demonstrations of the products and ask questions in real time. As of December 2020, the livestreaming audience in China has reached a whopping 617 million according to the 47th statistical report on the development of Internet in China. And celebrities are also jumping onto the livestreaming in collaboration with brands to rev up the e-sales.  Last summer, top luxury brand Piaget teamed up with top livestreamer Austin Li, reaching a third of its annual sales in 1 hour with over 4 million views and 6 million engagement for a total of 1021 diamonds!

Piaget boosts e-sales with livestreamer Austin Li

During Double 11 2020, the biggest worldwide sales festival, Cartier curated its high jewelry exhibition that used to be VIP only on the platform Tmall in livestream for the release of their SUR NATUREL collection. The livestreaming was hosted by celebrities including its brand ambassadors Song Qian and Li Xian, as well as other jewelry experts, which gained over 770k views and made Cartier one of the first luxury brands to reach a $15 million transaction milestone during the event.

But, creativity in social content goes even one step further with Intellectual Property collaboration between brands to create social excitement. Luxury and beauty brands like Louis Vuitton, Gucci, Givenchy and M.A.C are already capitalizing on the enraptured e-sports and gaming crowd as a new experiment to target GEN Z consumers.

Huaxizi, collaboration with online role-playing game

Recently, Huaxizi, a Chinese beauty brand which produces natural cosmetics inspired by flowers and nature, collaborated with a famous Chinese online role-playing game, Jianwang3, to launch a custom carved lipstick during Chinese Valentine’s Day. Huaxizi invited several influencers to create looks for different clans in the game. Besides, they jointly launched a campaign called “Collection of traditional Chinese makeup looks” to encourage consumers to share traditional Chinese makeup looks. The campaign gained over 70 million views and 25 thousand discussions on Weibo alone and created huge social fission on omni-channels like Weibo, RED and Douyin.

Retailtainment & private traffic, the future now of social commerce

With roughly 1.2 billion active monthly users, WeChat has become the leading platform for social commerce. The superapp is heavily investing its e-commerce ambitions on mini-programs to attract a myriad of brands, which is disrupting and reshaping the e-commerce and retail landscape, aiming to adapt to the tech-savvy consumers.

Burberry’s first social retail store on WeChat mini program

Burberry is a perfect example of this new future “retailtainment” that snags Tencent to power its first social retail store with Shenzhen shopping mall connected with social worlds in a digitally immersive experience. Customers can unlock exclusive content and personalized phygital experience as well as share it with their communities through a dedicated WeChat Mini Program.

In China, platform-led e-commerce usually accounts for the lion share of a brand’s online sales while direct brand-to-consumer e-commerce is struggling to gain traction. This situation forced the brands to react giving birth to a new form of commerce to generate private traffic based on QR codes and Mini Programs allows brands to turn any medium into an online store. More importantly, it allows them to transact directly with private communities of customers, most often within WeChat groups, bypassing pay-to-play e-commerce gatekeepers. Also known as private traffic marketing, these marketing techniques reduce media buying costs, improve conversion rates, and reduce the dependency on platforms.

The miraculous rise of Pinduoduo with social sharing model

Besides the content and retail social widely adopted by brands and influencers, we observe also other societal trends : the Social sharing commerce, which is a unique business model that drives transactions mainly through user sharing on social media. And Pinduoduo, which surpassed Alibaba last March by the number of its annual active users, has led the way of this new model. The platform encourages users to share products with their friends and families on WeChat to secure heavy discounts as a group. With its powerful consumer-to-manufacturer (C2M) model, the cost per customer acquisition on this platform is much lower than that of other social commerce platforms.

In the new normal created by a global pandemic, brands are experimenting with social commerce as a future-proof solution. Shoptainment will become the future of shopping in China for the younger generation. Brands that are nimble to pivot and adapt to new technologies and platforms will be likely to survive and thrive in this digital evolution, offering immersive and fluid experience of entertainment, commerce and content.

This piece is written by Lea Wang, Marketing Strategist, Fabernovel China

Lea Wang, Marketing Strategist, Fabernovel China, joined Fabernovel as the marketing strategist with extensive experience across market entry and acceleration strategy. Prior to joining Fabernovel, Lea worked at Fred & Farid, Publicis Groupe and Accenture Interactive with key expertises in social commerce, leading a plethora of projects with luxury, fashion and beauty clients to drive brand growth with tangible business impacts.


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