LEADERS

The China E-commerce World: What Opportunities Does it Offer International Brands?

by

Laura Anne Danaraj

|

This is the featured image caption
Credit: This is the featured image credit

Ahead of the upcoming eTail Asia & ANZ Virtual Summit, keynote speaker Pablo Mauron shares more about the Chinese e-commerce landscape and how international brands can leverage it to the fullest.

Over the last decade, collaborations between luxury brands and contemporary artists have gone beyond mere artistic partnerships towards a new kind of luxury branding.

PARIS – Art and fashion have always developed side by side, for fashion, like art, often gives visual expression to the cultural zeitgeist. During the 1920s, Salvador Dalí created dresses for Coco Chanel and Elsa Schiapparelli. In the 1930s, Ferragamo’s shoes commissioned designs for advertisements from Futurist painter Lucio Venna, while Gianni Versace commissioned works from artists such as Alighiero Boetti and Roy Lichtenstein for the launch of his collections. Yves Saint Laurent’s vast art collection, recently auctioned at Christie’s in Paris, testified to his great love of art and revealed the influence of a variety of artists on his own designs.

In the 1980s, relationships between luxury brands and artists were advanced when Alain Dominique Perrin created the Fondation Cartier. In the Fondation Cartier pour l’Art Contemporain, a book marking the foundation’s 20th anniversary, Perrin says he makes “a connection between all the different sorts of arts, and luxury goods are a kind of art. Luxury goods are handicrafts of art, applied art.”

The Fondation Cartier pour l’Art Contemparain building in Paris

Ahead of the upcoming eTail Asia & ANZ Virtual Summit, keynote speaker Pablo Mauron shares more about the Chinese e-commerce landscape and how international brands can leverage it to the fullest.

China’s e-commerce market continues to grow at an exponential rate fueled by the massive demands and high purchasing power of Chinese consumers. Given the ubiquity of Chinese e-commerce platforms, brands are now able to reach consumers in fast growing lower-tier cities that they would otherwise not have access to.

With a plethora of brands (domestic and international) vying for consumer attention and market share, e-tail has become a diverse and competitive space. China, being one of the fastest expanding economies in the world has piqued the interest of international brands seeking to enter the e-commerce market. It is hard not to be looking forward to the future of this market where opportunities are endless.

In a prelude to his keynote session for the eTail Asia & ANZ Virtual Summit happening from 7 to 11 September 2020, Pablo Mauron, Partner and Managing Director China at DLG (Digital Luxury Group), shares his thoughts on how Chinese e-commerce giants are expanding their offerings and opportunities for international brands focused on tapping into China’s digital ecosystem.

Why should international brands partner with domestic e-commerce giants? What kind of access do they provide?

Domestic e-commerce giants have an advantage over international brands – huge amounts of traffic. In March 2020, the number of Monthly Active Users on Alibaba’s Taobao app hit 846 million, while Daily Active Users stood at 300 million. This is a massive volume of traffic that brands can never hope to achieve on their own, with their own .cn e-commerce sites. By working with domestic platforms and leveraging on its strong footprint, international luxury brands are able to reach a far larger group of consumers.

Secondly, Chinese consumers are more comfortable using platforms they are familiar with. Besides having a user interface they are used to, they have grown accustomed to standard shipping and returns policies (i.e. all products can be returned and refunded, no questions asked if the request is put in within 7 days). While brands might opt to do the same on their own ecommerce channels in China, they will still lack that trusted relationship that consumers have built up with these Chinese platforms over years.

What kind of resources does Tmall offer brands to help them build up their digital presence on the platform?

Tmall offers brands a wide range of resources including Brand Zone (which gives brands a flagship store of their own within the ecosystem), Taobao Live (for livestreaming), and Weitao (a content marketing hub). In addition, the platform also extends technologies like virtual showrooms and AR try-ons to those who are looking to better bridge the gap between their physical and online store experiences. There are also performance marketing tools to help brands maximise traffic acquisition, ranging from paid search to banner ads and affiliate marketing.

In addition, there are also the big-name shopping festivals (like Singles Day), brand-specific events (like Super Brand Day), category-specific events and a wide range of other promotions that Tmall hosts on its platform. These events help drive large amounts of traffic to brands’ stores on Tmall, building up their presence and generating sales.

There has been a renewed interest in livestreaming from brands especially with COVID-19 impacting the typical consumer journey. How can luxury brands approach it to drive e-commerce sales?

While livestreaming might still be nascent in many parts of the world, it has been a part of the digital landscape in China for quite some time. As such, most livestreaming channels are seamlessly integrated with e-commerce platforms, allowing for instantaneous shopping. Livestreaming hosts also tend to come across as relatable, candid and authentic, often creating a stronger impact on users compared to polished brand content.

There are two ways to go about livestreaming in China. When done on a large scale with the help of relevant KOLs and sufficient media budget, livestreaming serves in helping to generate exposure and awareness for products. This often happens on either large livestreaming platforms like YiZhiBo or Taobao/Tmall’s integrated Taobao Live solution. Some viewers might be discovering the brand and its products for the first time through such livestreams, and would only be in the early stages of the consumer journey. As such, conversion rates for such sessions tend to be moderate.

The other approach to livestreaming is far more targeted, and see brands invite their existing clients and prospects to smaller sessions typically done via WeChat. Sessions like these do not feature big-name hosts, and are more focused on the selling aspect as opposed to brand storytelling. Given the fact that the audience tends to be made up of people who are already familiar with the brand, the reach is naturally smaller but conversion rates tend to be higher compared to large-scale livestreams.

What are some of the most important touch points that brands should pay attention to on Tmall?

Apart from the obvious transactional and fulfillment touch points, other important touch points that brands need to consider investing more on Tmall are content-related. The average Tmall user opens the app eight times a day –Tmall is not just an e-commerce platform, but a place where consumers go to discover new brands, find out on new product launches and compare prices of items to physical stores. Tmall is a repository of all shopping-related information for consumers, and brands should think about building up their content offering to address this consumer behaviour.

When a consumer enters the platform, he or she will encounter brands and products through banner ads on the homepage, item listings on their suggestion feed, searching directly for a brand or item, or through the platform’s content marketing hub Weitao. While all the former options are largely leveraged by brands with performance marketing resources provided by Tmall (paid keyword or brand searches, etc.), the latter is something that brands tend to utilise less. This area can be further developed, posing an opportunity for brands to provide value to the audience in their purchase decision.

Tmall also offers insights with its Brand Databank, which allows for the analysis of user behaviours across the whole Taobao/Tmall ecosystem. This helps in the identification of key consumer segments and user profiles, which can then shape future brand communications and product strategies.

Given the proliferation of mobile commerce, are there new technologies brands can take advantage of to better reach Chinese consumers?

New technologies aside, I think what needs to be considered most is the Chinese consumer’s approach to personal data and how this can be leveraged to improve the mobile shopping experience. Chinese shoppers are very willing to give up transactional and behavioural data in exchange for a better and more tailored e-commerce experience – something that would prove difficult in the West or other countries with stricter privacy laws. Marketplaces like Tmall have made use of this well, personalising content and experiences around all sorts of user data. This data, however, largely belongs to the platform and brands have limited visibility on these data indicators.

With the convergence of social and e-commerce platforms in China, brands are able to leverage social channels to influence purchase behaviours. WeChat (with its commerce functions) is one such channel. Unlike third-party e-commerce marketplaces, it offers brands the opportunity to own and build up their own trove of customer data. Coupled with the fact that many brands tend to host their loyalty programmes on WeChat, it allows for the creation of even richer consumer profiles as well. As a result, brands are able to better customise their communications, marketing and even target selling efforts. To scale up these efforts, brands can also consider investing in social CRM and clienteling solutions like WeChat Work, which will help their sales force to efficiently manage such tasks while offering additional automation and behavioural alerts.

In a Nutshell

The China e-commerce market is brimming with opportunities, but it is not an easy one to navigate. Brands need to be equipped with the right information, tools and partners to make their e-commerce venture in China a successful one – especially given the high standards of Chinese consumers and the market’s fast-evolving luxury landscape.

Discover more at the eTail Asia & ANZ Virtual Summit happening next month from 7 to 11 September 2020. Accelerate your digital transformation with proven strategies from leading retailers, adapt e-commerce, digital marketing and e-delivery capabilities for COVID-19, and discover how the latest strategies, tools and technologies are being leveraged.

Catch Pablo Mauron’s session on The Tmall Transformation of Luxury Brands – Leveraging E-commerce Marketplaces in China on Thursday, 10 September at 3pm (UTC +8) for more insights on the Chinese e-commerce market.

Save Your Seat at the eTail Asia & ANZ Virtual Summit
7 to 11 September

Laura Anne Danaraj
Laura Anne Danaraj

Head of WBR Insights Marketing, Worldwide Business Research (WBR)

A skilled marketing and content specialist, Laura manages and delivers content and multi-channel campaigns for both partners and the community for Worldwide Business Research (WBR) Asia events.

LEADERS

The China E-commerce World: What Opportunities Does it Offer International Brands?

by

Laura Anne Danaraj

|

This is the featured image caption
Credit : This is the featured image credit

Ahead of the upcoming eTail Asia & ANZ Virtual Summit, keynote speaker Pablo Mauron shares more about the Chinese e-commerce landscape and how international brands can leverage it to the fullest.

Over the last decade, collaborations between luxury brands and contemporary artists have gone beyond mere artistic partnerships towards a new kind of luxury branding.

PARIS – Art and fashion have always developed side by side, for fashion, like art, often gives visual expression to the cultural zeitgeist. During the 1920s, Salvador Dalí created dresses for Coco Chanel and Elsa Schiapparelli. In the 1930s, Ferragamo’s shoes commissioned designs for advertisements from Futurist painter Lucio Venna, while Gianni Versace commissioned works from artists such as Alighiero Boetti and Roy Lichtenstein for the launch of his collections. Yves Saint Laurent’s vast art collection, recently auctioned at Christie’s in Paris, testified to his great love of art and revealed the influence of a variety of artists on his own designs.

In the 1980s, relationships between luxury brands and artists were advanced when Alain Dominique Perrin created the Fondation Cartier. In the Fondation Cartier pour l’Art Contemporain, a book marking the foundation’s 20th anniversary, Perrin says he makes “a connection between all the different sorts of arts, and luxury goods are a kind of art. Luxury goods are handicrafts of art, applied art.”

The Fondation Cartier pour l’Art Contemparain building in Paris

Ahead of the upcoming eTail Asia & ANZ Virtual Summit, keynote speaker Pablo Mauron shares more about the Chinese e-commerce landscape and how international brands can leverage it to the fullest.

China’s e-commerce market continues to grow at an exponential rate fueled by the massive demands and high purchasing power of Chinese consumers. Given the ubiquity of Chinese e-commerce platforms, brands are now able to reach consumers in fast growing lower-tier cities that they would otherwise not have access to.

With a plethora of brands (domestic and international) vying for consumer attention and market share, e-tail has become a diverse and competitive space. China, being one of the fastest expanding economies in the world has piqued the interest of international brands seeking to enter the e-commerce market. It is hard not to be looking forward to the future of this market where opportunities are endless.

In a prelude to his keynote session for the eTail Asia & ANZ Virtual Summit happening from 7 to 11 September 2020, Pablo Mauron, Partner and Managing Director China at DLG (Digital Luxury Group), shares his thoughts on how Chinese e-commerce giants are expanding their offerings and opportunities for international brands focused on tapping into China’s digital ecosystem.

Why should international brands partner with domestic e-commerce giants? What kind of access do they provide?

Domestic e-commerce giants have an advantage over international brands – huge amounts of traffic. In March 2020, the number of Monthly Active Users on Alibaba’s Taobao app hit 846 million, while Daily Active Users stood at 300 million. This is a massive volume of traffic that brands can never hope to achieve on their own, with their own .cn e-commerce sites. By working with domestic platforms and leveraging on its strong footprint, international luxury brands are able to reach a far larger group of consumers.

Secondly, Chinese consumers are more comfortable using platforms they are familiar with. Besides having a user interface they are used to, they have grown accustomed to standard shipping and returns policies (i.e. all products can be returned and refunded, no questions asked if the request is put in within 7 days). While brands might opt to do the same on their own ecommerce channels in China, they will still lack that trusted relationship that consumers have built up with these Chinese platforms over years.

What kind of resources does Tmall offer brands to help them build up their digital presence on the platform?

Tmall offers brands a wide range of resources including Brand Zone (which gives brands a flagship store of their own within the ecosystem), Taobao Live (for livestreaming), and Weitao (a content marketing hub). In addition, the platform also extends technologies like virtual showrooms and AR try-ons to those who are looking to better bridge the gap between their physical and online store experiences. There are also performance marketing tools to help brands maximise traffic acquisition, ranging from paid search to banner ads and affiliate marketing.

In addition, there are also the big-name shopping festivals (like Singles Day), brand-specific events (like Super Brand Day), category-specific events and a wide range of other promotions that Tmall hosts on its platform. These events help drive large amounts of traffic to brands’ stores on Tmall, building up their presence and generating sales.

There has been a renewed interest in livestreaming from brands especially with COVID-19 impacting the typical consumer journey. How can luxury brands approach it to drive e-commerce sales?

While livestreaming might still be nascent in many parts of the world, it has been a part of the digital landscape in China for quite some time. As such, most livestreaming channels are seamlessly integrated with e-commerce platforms, allowing for instantaneous shopping. Livestreaming hosts also tend to come across as relatable, candid and authentic, often creating a stronger impact on users compared to polished brand content.

There are two ways to go about livestreaming in China. When done on a large scale with the help of relevant KOLs and sufficient media budget, livestreaming serves in helping to generate exposure and awareness for products. This often happens on either large livestreaming platforms like YiZhiBo or Taobao/Tmall’s integrated Taobao Live solution. Some viewers might be discovering the brand and its products for the first time through such livestreams, and would only be in the early stages of the consumer journey. As such, conversion rates for such sessions tend to be moderate.

The other approach to livestreaming is far more targeted, and see brands invite their existing clients and prospects to smaller sessions typically done via WeChat. Sessions like these do not feature big-name hosts, and are more focused on the selling aspect as opposed to brand storytelling. Given the fact that the audience tends to be made up of people who are already familiar with the brand, the reach is naturally smaller but conversion rates tend to be higher compared to large-scale livestreams.

What are some of the most important touch points that brands should pay attention to on Tmall?

Apart from the obvious transactional and fulfillment touch points, other important touch points that brands need to consider investing more on Tmall are content-related. The average Tmall user opens the app eight times a day –Tmall is not just an e-commerce platform, but a place where consumers go to discover new brands, find out on new product launches and compare prices of items to physical stores. Tmall is a repository of all shopping-related information for consumers, and brands should think about building up their content offering to address this consumer behaviour.

When a consumer enters the platform, he or she will encounter brands and products through banner ads on the homepage, item listings on their suggestion feed, searching directly for a brand or item, or through the platform’s content marketing hub Weitao. While all the former options are largely leveraged by brands with performance marketing resources provided by Tmall (paid keyword or brand searches, etc.), the latter is something that brands tend to utilise less. This area can be further developed, posing an opportunity for brands to provide value to the audience in their purchase decision.

Tmall also offers insights with its Brand Databank, which allows for the analysis of user behaviours across the whole Taobao/Tmall ecosystem. This helps in the identification of key consumer segments and user profiles, which can then shape future brand communications and product strategies.

Given the proliferation of mobile commerce, are there new technologies brands can take advantage of to better reach Chinese consumers?

New technologies aside, I think what needs to be considered most is the Chinese consumer’s approach to personal data and how this can be leveraged to improve the mobile shopping experience. Chinese shoppers are very willing to give up transactional and behavioural data in exchange for a better and more tailored e-commerce experience – something that would prove difficult in the West or other countries with stricter privacy laws. Marketplaces like Tmall have made use of this well, personalising content and experiences around all sorts of user data. This data, however, largely belongs to the platform and brands have limited visibility on these data indicators.

With the convergence of social and e-commerce platforms in China, brands are able to leverage social channels to influence purchase behaviours. WeChat (with its commerce functions) is one such channel. Unlike third-party e-commerce marketplaces, it offers brands the opportunity to own and build up their own trove of customer data. Coupled with the fact that many brands tend to host their loyalty programmes on WeChat, it allows for the creation of even richer consumer profiles as well. As a result, brands are able to better customise their communications, marketing and even target selling efforts. To scale up these efforts, brands can also consider investing in social CRM and clienteling solutions like WeChat Work, which will help their sales force to efficiently manage such tasks while offering additional automation and behavioural alerts.

In a Nutshell

The China e-commerce market is brimming with opportunities, but it is not an easy one to navigate. Brands need to be equipped with the right information, tools and partners to make their e-commerce venture in China a successful one – especially given the high standards of Chinese consumers and the market’s fast-evolving luxury landscape.

Discover more at the eTail Asia & ANZ Virtual Summit happening next month from 7 to 11 September 2020. Accelerate your digital transformation with proven strategies from leading retailers, adapt e-commerce, digital marketing and e-delivery capabilities for COVID-19, and discover how the latest strategies, tools and technologies are being leveraged.

Catch Pablo Mauron’s session on The Tmall Transformation of Luxury Brands – Leveraging E-commerce Marketplaces in China on Thursday, 10 September at 3pm (UTC +8) for more insights on the Chinese e-commerce market.

Save Your Seat at the eTail Asia & ANZ Virtual Summit
7 to 11 September

Laura Anne Danaraj
Laura Anne Danaraj

Head of WBR Insights Marketing, Worldwide Business Research (WBR)

A skilled marketing and content specialist, Laura manages and delivers content and multi-channel campaigns for both partners and the community for Worldwide Business Research (WBR) Asia events.

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