China: 6 trends that marketers must know

by bold-lichterman

Many people still consider China to be a country where inexpensive products are produced of lower quality than our European standards. We invite all Sino-skeptics to quickly review their judgment by spending a few weeks in the Middle Empire to discover the reality of a booming digital economy. And if you can’t make the trip, it’s still possible to attend local meetings and events about China.

The first European gathering of experts dedicated to Chinese market trends, the conference China Connect 2016, took place last March in Paris. This year, the two main topics were innovation and velocity. China has been integrating mobile Internet into its uses for several years and now has a good head start over other countries. For Google, “When you arrive in China, you immediately have the impression of stepping into the future“. It is probably for this reason that Apple has just injected $ 1 billion into Didi Chuxing, Uber’s Chinese rival.

Most Westerners have come to understand the importance of technology mobile in China, and many trends give companies valuable insight into how to best approach this market.

1. Beyond mobile technology, applications are fundamentally changing the game. In China, the most popular social platforms (WeChat, Line, Talk) are geared towards individualized communications, to the detriment of mass approaches like Facebook. For example, 75% of Chinese mobile users make purchases via WeChat. As a result, social marketing is generating enormous interest and is used to promote, connect, discuss, build trust through ambassadors, and engage individuals. As part of this strategy, promotional coupons are an essential tool, as are QR codes which are used everywhere.

2. Chinese brands are going global. Over the past two years, Chinese retailers have gone on the offensive in export markets like Russia and Europe, a trend that is expected to intensify in the coming years.

3. Internet control and blocking are not only accepted, but desired by most Chinese (80% of users think censorship is a good thing). The controls put in place in the internal market actually increase users’ confidence in the adoption of new technologies and encourage them to use applications validated by the public authorities. In other words, to do business in China, you need to follow the rules set by the Chinese authorities, obtain an Internet content provider license (ICP – Internet Content Provider), and host your services in mainland China.

4. WeChat is part of everyday Chinese life. Far from being a local ersatz Facebook or WhatsApp, WeChat is a real “ecosystem of life” based on communications. For companies, WeChat represents an important lever for engagement and customer relationship management (CRM). The service has over 700 million monthly active users, 6 times more than Weibo, the Chinese equivalent of Twitter. Almost all Chinese use it, so WeChat can replace brand apps and help them optimize their reach. For example, a brand like Auchan perfectly masters this approach and takes full advantage of the power of beacons installed in stores to maximize its loyalty program. The unified solution developed by WeChat makes it possible to reach, track and engage consumers without having to juggle multiple applications.

5. The travel industry is changing. Chinese consumers, and especially tourists, are more youth than you think. They are sensitive to digital technologies and want to have as much information as possible BEFORE embarking on a trip, which forces traders to deploy upstream an outreach strategy. A challenge, as Chinese consumers are so demanding on the speed and quality of the returns expected on social networks. As a general rule, a response time of between 1 and 10 minutes is considered satisfactory. An example of a successful strategy is available here with El Corte Ingles. The brand increased its presence on WeChat by more than 500% and significantly improved its brand image and reputation. As a result, its flagship store in Madrid is today a must-see and shopping place for Chinese tourists. From now on, brands must remove the traditional tools that have become ineffective (brochures, printed coupons, shopping lists, etc.), and collaborate with resellers to offer “online to offline” solutions, as Zurich airport has done with his project Engage Me.

6. Programmatic advertising is booming. This year, more than half of digital advertising in China will be programmatic. BATs, the three giants Baidu, Alibaba and Tencent, play in China the same role as GAFA (Google, Apple, Facebook, Amazon) in the United States and the United Kingdom. Alibaba is a juggernaut in the Chinese programmatic landscape, alone accounting for around 60% of programmatic advertising. In addition, the landscape of Chinese publishers is extremely fragmented with many private marketplaces (Ad-exchange). The programmatic sector for video and mobile advertising is booming (Mobile Programmatic Ads and Mobile Video Programmatic). With 120 really efficient ad formats and several thousand existing ones, the Big Data Programmatic Creative is widespread, offering unique functionalities that most Western professionals ignore (eg integration within a distance to store banner, etc.).

In China, the evolution of the digital market is progressing at an impressive pace, while being marked by specific local trends. The companies that will approach it like any other region are going straight into the wall. To invest effectively in this new El Dorado, the big brands must therefore stay in touch with new and emerging trends that make it a world apart.

cedric-vandervynckt-2Cedric Vandervynckt is currently Managing Director France and Southern Europe at Criteo. He started his career as a sales engineer at NetBooster, before joining the sales teams of Yahoo, then those of Espotting Media. He then worked for Microsoft, where he will progress to the position of sales director for agencies and key accounts, as well as for Google.

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