Chinese E-Commerce Archives

July 2, 2019 / By daphnemoyal / Chinese E-Commerce • Marketing in China/ 0 Comments

Live Streaming: How to Boost your E-commerce Strategy in China

ASI Solutions’ purpose has always been to open the doors of Chinese market to companies eager to expand their activity on the Chinese market. Even though our main expertise revolves around the logistics field, we acquired a strong knowledge of the marketing trends here in China, thanks to our 10-year experience.

Today we will introduce you to live streaming. It may not be a new concept for you: it has increased in popularity these last years, through video games or musical shows directly streamed on Youtube, Instagram or Twitch, the popular media for live streaming in Europe and the US. But in China, the scope of this trend exceeds what we know in the West. Live streaming has indeed overcome many traditional media. The “Entertainmerce”, the fusion between entertainment and e-commerce is hitting Chinese consumers hard, transforming their way of consuming.

Live streaming plays a big role, that any company targeting Chinese market should be aware of. Today ASI Solutions decrypts the phenomenon for you!

Live streaming had started with gaming but became more developed and opened to a variety of contents nowadays. It is not anymore only limited to pro-gamers, who earn their revenue from advertisement, sponsoring and number of views. Filming has shifted from backward to frontward camera, in a selfie live: you can watch popular streamers filming themselves singing, dancing, eating, or even driving. Viewers can send directly their comments, that the web celebrity can see in live and reply directly. The more they interact with their viewers, the more they will prompt to send them tip, in the shape of virtual gifts that the streamer can convert into real money. Popular among connected youngsters, these streamers are mostly millennials (born 1990s), as their viewers. Around 456 million of people had already watched a live streaming, which is more than a half of Chinese internet users.

But what is the most interesting is how e-commerce platforms have been engaged in China with live streamers, and are aiming at reaching consumers through them. Some live streamers, known as KOL (Key Opinion Leaders), are specialized in online selling. Through their live stream channel, they will introduce products to their fans – mostly fashion and cosmetic goods, while this practice is also developing in the food and services sectors - presenting their advantages and replying the viewers’ questions. Chinese consumers are demanding more transparency, sored of buying fake or goods which look nothing like the pictures. Live streaming enables them to better judge the product, avoiding bad surprise upon receiving it. They can ask questions in the live chat, which are answered instantly by the customer service. Moreover, a KOL with an important fan-base will inspire trust in her/his choices, even for new viewers, since appearing closer to the public.

These KOLs have been entertaining potential buyers, and these potentials became real customers: live shopping has a high conversion rate, sometimes up to 30% - even 50% as some platforms released. Live streaming offers interactive contents between the KOL and the viewers, but also between the viewers themselves. In one click, the viewer can add the good in his/her cart or be redirected to the shop page. When a viewer adds the product to his/her cart, it will appear on the screen where all the other viewer can see it. This strategy has considerably fostered impulse buying: people were not thinking about getting the product before watching the live, but the KOL show and viewer’s community convinced them.

First of all, the choice of the platform matters. If your main goal is to drive sales, streaming on e-commerce platform is accurate. If you are targeting brand awareness, other platforms might be more relevant, as they are hosting more creative contents.

You also need to care about your KOL’s fame level, as it will impact the number of viewers and potential sales. More importantly, it will impact the cost of your campaign. Some KOLs already are big celebrities: actors and actress, singers, etc. They thus already have an important fan-base, bringing you much more visibility. They will cost you millions of RMB per single campaign. Middle range KOLs are composed of Internet celebrity. Some of them have their own shop on e-commerce platforms, where they resell their stylish clothes on: half of the bestselling lady’s clothes shop on Taobao are held by fashion KOLs (FBIC, 2016).

Generally speaking, you would be better of choosing a KOL used to represent the kind of product you sell. Some KOLs are well-known for their face as visual, while some would have built their reputation thanks to their expertise in some fields. Even if 80% of the viewers are millennials, keep in mind that some streamer may have a more segmented audience. You will have to find a streamer that have a viewer-base that fits to your target. Plan the content of the live up ahead, thoroughly brief the streamer you are working with, and focus on providing content he/she can use to create a story involving your products as for the message to reach Chinese viewers better.

Forget what you know about marketing: you will need a new strategy that will drive your business according to the peculiarities of the Chinese market.

As your one-stop-shop in China, ASI Solutions can link you to the best marketing agencies based in Shanghai. We work hand in hand with Chinese e-commerce specialists, used to partnering with KOLs to drive brand awareness and sales, and able to provide you with the perfect e-commerce solution to reach your targets!

At ASI Solutions, we are also used to working with e-commerce platforms and take care of your product from origin to your final customer’s doorstep!

Contact us to starting your business on the Chinese market.

Discover our full range of solutions!

February 13, 2019 / By ASI Solutions / Chinese E-Commerce • Doing Business in China/ 0 Comments

Looking Back at Chinese Market Trends Which Shaped 2018

As 2018 has reached its end, and the year of the pig has officially begun, it is time now to have a look back on what trends have shaped Chinese market over the past year, and thus what its future is. China’s market is evolving fast, with the government actively taking part in driving it as to meet the objectives of the 13th Five-Year-Plan. At the same time, it is important for foreign brands to understand what makes the Middle Kingdom so particular, compared to Western societies.

ASI Solutions has been helping brands exporting to and importing from China for more than 10 years, thus developing a strong knowledge in the field. We make the internationalization of the firms easier, from origin to destination.

Where can foreign brands can find opportunities of development in China? And why is so? These are the questions ASI Solutions will answer in the following article.

The main driver of China’s economic growth is its domestic consumption. According to EMIS Report, it contributed to 78.5% of the latter.

Why is so?

The government has decided to boost domestic consumption, encouraging retail trade development and, as we will explore in more depth later on, e-commerce in particular. This has been supported by measures such as standardization of the sector, ensuring healthy market operation and protect consumer rights. As China is switching from a manufacturing-based economy to a consumption-driven one, foreign companies are encouraged to take advantage of this new orientation.

Which consumers are the drivers of local consumption?

While big cities such as Shanghai or Beijing have been driving economic development for years, tier-two cities as well as rural areas are the new drivers of growth. The main element fostering this tendency is the development of e-commerce. Thanks to the latter, regions that were isolated now have access to a large panel of goods.

For Chinese consumers, e-commerce is the easiest way access goods (wherever and whenever one wants). As such it fosters higher consumer spendings. It is indeed one of the main elements behind China’s retail sector’s growth.

China is implementing the « New Retail » model or as Jack Ma, Alibaba’s founder, puts it:

« E-commerce is rapidly evolving into New Retail. The boundary between offline and online commerce disappears as we focus on fulfilling the personalized needs of each customers. »

To sum it up, e-commerce is becoming more and more consumer-centric where personalization plays a key part.

O2O is gaining weight and is now strongly supported by chain retailers. It combines and offline strategies: online for the marketing and purchasing, offline for the distribution channels such as pick-ups, after-sales services and traditional purchasing. It goes beyond with integrating mobiles into the equation and one can now use the term m-commerce to designate mobile commerce

Since 2011 China represents world’s greatest food and beverage market. The consumption itself changed as Chinese consumers are now demanding high quality products. Food safety has become one of government’s top priorities and population’s greatest concerns. Even though consumption of foreign food products is not outweighing the one of locals, it is believed that it will be world’s greatest consumer of imported products. The reason is that foreign products are believed to be more qualitative.

China is still a great importer (5th) and consumer (2nd) of Wine. Even though the market is more and more competitive, the demand is there, and indeed increasing.

January 22, 2019 / By ASI Solutions / Chinese E-Commerce • Get Your Business Started in China/ 0 Comments

Chinese Mobile Economy: The Place to Be

Reference: statista.com

ASI Solutions thus aims in this article at offering you an overview of China’s Mobile E-Commerce. The latter not only being a huge contributor to the economy, but also shaping the way Chinese consumers buy and behave. We are strong of a 10-year experience at accompanying foreign companies in their internationalization process, more specifically in China where our head office is located.

If a company is aiming at entering Chinese market successfully, it is essential to understand the peculiarities of consumption on-site and the trends that will be shaping it in the future.

In general, Chinese e-commerce is huge. Last November, on Chinese Singles’ Day or 11.11 (the country’s biggest online sales event), Taobao and Tmall generated more than USD 30.4 billion of sales, which is more than Black Friday and Cyber Monday combined.

According to QuestMobile’s report, China’s mobile economy grew by over 20% during the first half of 2018, and in 2017 general mobile internet usage exceeded desktop internet usage. Mobile payment is also much more popular in China than in the West. Smartphones has become an essential tool in China, from chatting with your friends, to ordering food, buying goods, renting a bike, or calling a cab. The interconnectedness of all services available makes it even easier for Chinese consumers to navigate and share their latest fancy without having to leave their phone, or even switch App. The degree to which Chinese people have integrated the use of smartphone in their daily life has been fostered by several elements inherent to their "psyche" as well as by exogenous elements.

As such, taking advantage of this evolution of Chinese people consuming behavior represents a great opportunity for foreign brands eager to expand their scope of distribution.

Chinese government is nourishing this trend, especially considering the « Internet Plus » strategy it initiated. This plan aims at boosting Chinese economy by « diminishing its reliance on manufacturing and export in favor of a knowledge-based economy driven by services and the tech sector » (Kalin Hristov « Internet plus policy: A study on how China can achieve economic growth through the internet of things », Emerald Insight, 11 March 2017), in accordance with Made in China 2020.

Apart from the government advocating and actually acting in favor e-commerce, characteristics specific to Chinese population explain the importance mobile economy:

While there is a general preference for e-commerce among Chinese people, general public is more open to integrate mobile usage into one’s daily life as it more practical for one to do so. This is particularly true in China where it actually improves people’s lifestyle by reducing the gap between the buyers and vendors. Actually, mobile payment is more popular in China’s underdeveloped regions, where the lack of commercial infrastructures offers a fertile ground for e-commerce. For people living in these regions, mobile economy is an opportunity to access products that were not that easily available before.
China has the technology to foster mobile consumption, and innovation is booming. It is then interesting to note that competition is then very vivid.
The large population fosters network effect: when an App or a given consuming behavior becomes popular, it spreads rapidly.
Chinese netizens are globally younger than in the West (average being below 30 years old). This population is more prone to use mobile economy.
E-consumption is also driven by Chinese people’s taste for entertainment. As we will explore in more depth later on, live stream is one of the best example of this tendency.

How to Sell: Mobile Entertainment

Producing entertainment content is now key for brands and platforms that want to make it China. This is particularly true for mobile e-commerce, many companies even producing dedicated content to attract and interact with consumers. Online literature, video streaming, TV programs (such as Alibaba’s 24h live stream for 11.11 event) and games are examples of the content they create. Short videos are especially popular. For this reason, successful firms are getting closer and closer to also being media companies.

The Good Offer Should be Based on Innovation

As stated before, China has now become a pool for innovation, this tendency has been fueled by government’s incentives as part of Made In China 2020 program. The competition is now fierce, and your offer should be customer focused, predict people’s needs accurately while providing cheaper goods and/or services (cutting the middleman now being a huge tendency).

Selective App Usage: Making Sure to Launch an App that Will Stay on Your Customers’ Phone

The QuestMobile’s report we mentioned earlier also shows that people tend to reduce the number of Apps installed on their phone (down to 35 on average). If you are planning on launching yours, focusing on concepts should not be central anymore. User experience should be emphasized i.e. making sure the design works well for the user and improving the performance of the App itself.

Entering Chinese e-commerce field can represent a great growth opportunity for a well-prepared company, especially if the latter is focusing on mobile e-commerce.

Taking advantage of the booming of China’s mobile e-commerce as a foreign brands means understanding Chinese consumption’s specificities. As mentioned, entertainment content is now essential for brands eager to build brand-awareness and engage effectively with potential customers and those who already purchased your product/service as to build a loyal customer-base. On the other hand, marketing and communication are only part of the strategy and one should pay attention to not take Chinese market for granted. Innovating and being attentive to customers’ experience is key.

At ASI Solutions, we help you exporting your brand and product in simplicity. From origin to destination, we take care of every step on your behalf as to make your internationalization a success.

Learn More About our Solutions Dedicated to E-Commerce

November 13, 2018 / By Group ASI / Chinese E-Commerce/ 0 Comments

Chinese Singles’ Day : What Foreign Brands Need to Know About World’s Biggest Shopping Day

On November 11, China lived at the rhythm of the 10^th Singles’ Day Celebration (光棍节 - Guānggùn Jié), the world’s biggest online and offline shopping day. That day, more transactions have been operated than during America’s Black Friday and Cyber Monday together. For brands eager to expand their activities into China, the so-called "Double 11" is the event to look after, not only for the opportunities it brings along, but also for the challenges companies face while trying to take full advantage of it.

For decades, China has been seen and treated as the manufacturer of the world. With the increase in education, and the rise of wages, the situation has already changed. Nowadays, brands have interest in considering its population as a market with high potential. Many companies have already taken the leap, paving the path for newcomers.

However, "making it in China" requires efforts from the brand's part: culture, habits, and consumption mechanisms are different from the ones in the West. At ASI Solutions, we are dedicated to making your Chinese expansion easy, providing you the solutions and support you need.

The event started in 1993 in Nanjing as a celebration organized by and for students without a romantic partner. The number 1 resembling a person alone, the date 11.11 was meaningful for these young adults eager to counterbalance Valentine's Day.

Alibaba, the famous Chinese e-commerce platform founded by the no-less famous Jack Ma and which can be compared to Amazon, chose this date and symbol to organize large online sales on both its platforms Tmall (B2C) and Taobao (largely C2C).

However, if one wants to truly comprehend and take advantage of China’s Singles’ Day, the key is to look beyond the 24-hour online sales: its preparation begins way before, the strategies required are way different from the ones in the West, and the outcomes – both positive and negative – happen at a larger scale.

Even if the event is not limited to online shopping, E-commerce platforms are the place to be on that day.

On November 11^th, 2018, the combined sales on Taobao and Tmall (Alibaba Group Holding Ltd.) broke once again the world’s record: $30.8 billion have been spent online by Chinese consumers. In just one minute and a half, Chinese consumers placed orders worth $1 billion, their purchases reaching $10 billion in one hour. Last year’s record was surpassed in less that 18 hours.

Alibaba's direct competitor, JD.com, also broke its own sales record: going from $19.1 billion in 2017, to $23 billion in 2018's Singles' Day Campaign (which runs from 1-12 November). The company surprised the public with this year's figure, becoming a real challenger for the giant Alibaba.

Understanding the Scope of This Event (Alibaba)

Late October, the "See Now, Buy Now" show is broadcasted on 2 TV channels and Chinese equivalents of Youtube. Consumers can see and pre-order the items that will be on-sale on the D-day, before the payment is processed on November 11^th. Alibaba claimed that the video has been seen more than 50 million times.

From November 1^st until November 10^th, retailers will run new sales on their online stores as to encourage consumers to continue adding products to their baskets.

A 24-hour-gala is also organized on November 11^thby the E-Commerce giant, featuring international stars and the appearance of Jack Ma. Brands can participate in the event, the opportunities ranging from having their logo appear on screen, to presentation of their products on stage.

Expanding Its Scope

Alibaba’s subsidiary Lazada is aimed at internationalizing Chinese Singles’ Day: operating in Southeast Asia, it promoted the event in 6 countries (Singapore, Malaysia, Thailand, Indonesia, the Philippines, and Vietnam). Such an initiative accounts for the company's will to increase the scope of event to other countries.
Alibaba is promoting another orientation (not only for Chinese Singles’ Day, but more generally for its all activity): “new retail”. Comparable to an O2O strategy, it aims at bringing together the online and offline parts of Alibaba's business, involving physical stores and local services.

There is a noticeable shift in China toward quality over price, which we see in the growing number of consumers who are willing to pay more for branded & branded imported products

Lei Xu, JD.com CMO

The impressive GMV (Gross Merchandise Value) circulating on that day should not fool foreign brands into thinking that making the most out of the "Double 11" requires no effort from their part. Most of the ones already on the market argue they started preparing 2018’s 11.11 on 12.11.2017. Effective logistics and marketing require preparing well in advance.

You will need visibility, and the means to achieve it should be in accordance with Chinese consumption habits. Note that Chinese consumers are essentially buying mobile phone users. Successful campaigns are thus run on Chinese social media and platforms:
- WeChat (an equivalent of WhatsApp with a feed similar to Facebook);
- Weibo (equivalent of Twitter);
- Youku (equivalent of Youtube);
- Tudou (equivalent of Youtube);
- And even Alipay (Alibaba’s payment platform) or TuNiu (online travel booking platform);
- One can obviously use Alimama services (for running ads on Alibaba’s platforms).

Experts advise brands to run dynamic campaigns (especially interactive ones enabling the customers to involve) and create video content. On WeChat, brands have their own Official Account (to publish articles and interact with customers) and can run advertisement campaigns. On the other medias and platforms, banner ads and native contents is the way to go.

Understand the mechanisms e.g. prices usually drop by at least 50%, which is quite unusual in Europe or the US; and Chinese consumers rarely use queries, making only relying on a .cn website for your sales difficult (the example of ASOS and the failure of its website is a case study one should pay attention to before entering the market). Capitalize on mobile users and adapt your strategy accordingly.

Target young Chinese consumers, the population for which the Singles’ Day has been created in the first place.

Focus on the right products: the most sold products during the first hours were dresses, wool coats, pants and hoodies, while Xiaomi, Apple and Dyson products were top 3 in early sales. In general, clothing, cosmetics and infants products are lucrative.