Dancing with the dragon: scale your business with digital marketing in China
When talking about digital marketing in China, you first have to consider the country as a whole. China’s digital landscape, home to over 989 million internet users, is a potent mix of opportunities and challenges. The nation boasts the world’s largest e-commerce market, which hit an astounding $2.1 trillion in 2020, and a digital economy valued at $5.13 trillion. This booming economy is fueled by the dramatic growth of mobile internet usage, with 99% of internet users accessing the web via mobile devices. The sheer scale, and consistent growth of China’s digital market and its unique, ecosystem-based platform mix are compelling for both domestic and international brands. Let’s take a closer look!
Digital marketing in China: an ecosystem-driven market
Tencent
Tencent is one of the biggest conglomerates on the Chinese digital market, with a plethora of websites, platforms and apps in their digital portfolio. The biggest of which is WeChat. The app has pretty much taken over the entire Chinese digital market, and takes center stage within the Tencent ecosystem. The multi-purpose messaging, social media and mobile payment app now even serves as a (video) calling and shopping platform.
These days, WeChat also includes a huge network of ‘Mini Programs’. These Mini Programs function as add-on sub-applications for WeChat, expanding its expansive reach and endless functionality even further. These programs include stuff like task management, branded stores ( that integrate platforms such as JD.com into the platform), Education apps like Zuoyebang, real estate platforms, and many more.
Furthermore, the Tencent empire includes platforms like JD.com, one of China’s biggest eCommerce platforms, and even includes an online-only bank, by the name of WeBank. Back in 2015, WeBank was China’s first fully digital bank.
In addition to all of this, Tencent’s Games division boasts a huge catalog of gaming studios like Epic Games, Riot Games and Supercell. All of these studios, and the huge games that they’ve created and are still publishing, make Tencent the biggest gaming company in the world.
Alibaba Group
The Alibaba Group ecosystem is one that’s probably pretty well known in the rest of the world as well. Alibaba offers their users an extensive full-scale ecosystem, with apps like Temu and Taobao, but also platforms like Youku, China’s equivalent for YouTube, and DingTalk, a platform that provides a fully mobile, digital workplace and productivity environment.
In addition to this, the Alibaba Group also created AliPay, to complete their shopping ecosystem, and keep people on-platform, even when they’re doing their payments.
They’ve put their focus on the enrichment of experience of the customer on their platform, opposed to simplicity and efficiency.
Baidu
Last but not least, the Baidu ecosystem. This one mainly got its name through the aptly named search engine: Baidu Search. This search engine is China’s domestic alternative for Google. With one key difference: it’s mainly dependent on PPC. Whereas with Google you gain your traffic mainly through building authority and scaling organic traffic, the Baidu engine heavily favors paid traffic. This makes for an interesting new dynamic for companies to deal with, when expanding their business to China, as this requires a strategic overhaul opposed to usual marketing strategies.
In addition to their flagship search engine, the Baidu ecosystem also sports an extensive library of apps, ranging from their own maps application (Baidu Maps), a video platform (iQiyi), and apps like Baidu Health and Baidu Music, that are pretty self-explanatory, as to what they bring to the table!
ByteDance
ByteDance is best-known for Douyin, or as you may know it, TikTok. Douyin has taken the local as well as the international market by storm, setting towering daily user records all across the globe. But their flagship platform, though absolutely the most well-known, isn’t the only platform within the ByteDance ecosystem. It also includes various apps like news apps (Toutiao), video streaming (Xigua Video) and even has their own productivity suite, similar to Google Workspace or Microsoft 365, called Feishu.
As you can probably imagine, ByteDance’s ecosystem is one of the most attractive ecosystems for company’s engaging in KOL/KOC marketing.
The interesting thing about all of these ecosystems is that they all compete with each other for a piece of the pie, by mirroring each other’s breakthroughs and expanding upon them. This results in a spectacular rat-race between the different ecosystems, and results for companies in a huge network of possible platforms to be visible on. The most important thing to keep in mind when choosing your specific channel mix for digital marketing in China is (as always) to keep an eye on where your target audience is at!
E-commerce: the cornerstone of digital success
E-commerce in China offers an unparalleled platform for success. Giants like Alibaba govern this sector, and innovative trends like live-streaming are redefining the shopping experience. Platforms like Taobao Live enable sellers, influencers, and consumers to interact in real-time, creating immersive, engaging shopping experiences. Live streaming alone witnessed an impressive 129% year-on-year increase in 2020, indicating the rapid evolution and immense potential of e-commerce in China.
The Future of E-commerce in China: Riding the Wave of Innovation
Moreover, the future of e-commerce in China continues to be shaped by innovative practices, adding another layer of opportunity for marketers. China’s ‘New Retail’ concept, a term coined by Alibaba’s Jack Ma, is blurring the lines between online and offline commerce. It offers a seamless integration between online shopping and physical stores, underpinned by a digitized and personalized shopping experience powered by big data and AI technologies. For instance, Alibaba’s Freshippo (Hema) stores allow customers to scan QR codes of products for more information and pay digitally, while simultaneously collecting valuable consumer behavior data.
Additionally, the rise of social commerce – buying and selling directly through social media platforms – is another transformative trend. Apps like Pinduoduo have integrated e-commerce and social networking, driving user engagement and fostering a more interactive shopping experience. This combination of technology, social interaction, and commerce makes China’s e-commerce landscape not only unique but also a fascinating field for marketers to explore and exploit.
Live streaming as a new-age marketing channel
Live streaming has taken over the world, but China in particular, spawning a wealth of applications for this new marketing channel, from ecommerce to branding. Let’s go through the main applications and what you stand to gain.
Know your audience
The first question that you’ll have to ask, as with all new marketing channels, is if your target audience fits the regular demographic for live streams. Streaming channels have a particular pull on people in their 20s and 30s, which means that if your usual audience is way above that age, you’ll have to do a lot of work to get them to interact with you on this platform.
One of those ways could be by enlisting a very specific KOL. The authority that such a personality brings, could very well have the convincing power to get your audience to venture to this for them still very much uncharted territory. The devil is always in the details when setting up your channel strategy, and for live streaming this is more true than ever.
The various pros of streaming platforms
Now let’s go through some reason that live streaming might be the perfect addition to your marketing channel strategy.
- Huge potential reach: Opposed to more traditional marketing channels like TV, live streaming has a way bigger, multi-device audience that is very much willing to tune in from any and all locations, be it on the subway or at home from the comfort of their couch. As of 2020, a whopping 560 people engage with live streams every year, a number that is very much projected to skyrocket even further.
- KOLs as social proof: The Chinese audience is way more likely to engage with your product or company when they trust you. We really can’t emphasize the importance of building trust enough. And what is the oldest trust-building trick in every marketer’s playbook? Yes! Social proof. Que China’s upcoming KOL-marketing scene. Back in 2021, more than 50% of Chinese consumers were already using KOLs as their main source of information when researching products or services.
- eCommerce integrations: live streams have become one of the primary channels for social commerce. With KOLs and KOCs running selling-streams and spotlighting products on a timeslot basis. Platforms like Taobao Live are raking in billions of dollars every year through these selling streams. One of the main reasons for this is, again, social proof! Quality assurance is just as important as branding when it comes to live streaming.
Pioneering: innovation in the health & payments market
China is a unique market, especially so when it comes to digital pioneering and innovation. As we’ve learned by now, the Chinese digital-behemoths are always looking for new ways to integrate more and more portions from external digital platforms, as well as real-life interactions into their digital ecosystems. Let’s take a look at a few of those!
Payment apps
The two biggest players are, as they are in most sections of the digital landscape, Alibaba Group and Tencent. With their respective apps, Alipay and WeChat Pay, they’ve both brought significant innovation to the way people use payment apps in China.
Alipay
Alipay, launched back in 2004, is Alibaba’s answer to the question how people should pay for everything in their lives, in app as well as locally. It functions as a standalone app, making it possible for users to make payments through QR codes, on websites, when buying products in stores, but also through person-to-person money transfers. They can even use it to pay their bills! Now for the real thing that sets Alipay apart from the rest; Alibaba Group’s payment app also offers a comprehensive suite of financial services, including wealth management products, loans, and even insurance.
WeChat Pay
Now for Tencent’s 2013 answer to Alipay: WeChat Pay. Now it shouldn’t come as a huge surprise that this one isn’t a standalone app at all. On the contrary: WeChat Pay functions as a digital wallet and is seamlessly integrated into Tencent’s flagship app and ecosystem. It allows its users to… hold onto your seats for this one: transfer money, get subscriptions, buy products from (web)stores, hail taxis, buy movie tickets, order food, and honestly a list endless other things! In short: WeChat Pay brings their users one main thing: limitless convenience through integrations.
Health apps
Now this is an interesting one! As the pharmaceutical industry has always heavily relied on in-person consultations and purchasing of drugs. Now get this: China is leading a digitization revolution in the healthcare industry. With as one the frontrunners, you guessed it, the Alibaba Group. AliHealth is one of the first, and surely one of the biggest digital health apps in China. AliHealth provides options for people to have remote consultations with their doctors, connects patients, hospitals, pharmacies and doctors, and even functions as a place for them to manage their prescriptions. The app even features an extensive store, boasting health and wellness products, over-the-counter medications, and prescription drugs.
Through apps like this, China is aiming to cut down on in-person consultations and double down on convenience, by making all of these services available through the Chinese public’s favorite tool: their smartphone.
Emerging growth niches in China’s digital landscape
China’s evolving digital landscape is continuously giving birth to new growth niches, providing unique opportunities for marketers. The green or eco-friendly industry stands as one such promising area. With the country’s middle class becoming more environmentally conscious, demand for sustainable and eco-friendly products and services is on the rise. Brands that position themselves in alignment with these values can access this growing and lucrative market segment.
Another sector experiencing a significant surge is health and wellness. Factors like increased health awareness, an aging population, and a governmental push towards a healthier nation are driving this trend. Products and services that cater to fitness, healthy eating, mental well-being, and preventive healthcare are witnessing a spike in demand. Concurrently, the “Silver Economy,” catering to China’s rapidly growing elderly population, is becoming an essential sector. With the over-60 demographic expected to reach nearly 500 million by 2050, brands that offer tailored products and services, ranging from healthcare to technology and leisure, have a unique opportunity to tap into this burgeoning market.
Lastly, let’s dive into the self-owned eCommerce market. This refers exactly to what you’d think: a business owning their own eCommerce platform, opposed to only selling their products on huge marketplaces like JD.com or Taobao. This gives a brand a few huge wins, like more control over their brand image, full ownership of the data they collect during the purchase process that their clients go through, and an opportunity to maintain way better profit margins on their products. There are some caveats though, like logistics and the ability to actually get people to your shop. Which means that self-owned eCommerce requires a whole different kind of marketing strategy.
These burgeoning niches, in conjunction with China’s dynamic digital landscape and flourishing e-commerce sector, offer immense potential for brands that understand and cater to these emerging markets. At Seeders, we’re here to assist you in navigating these growth niches and maximize the potential of your digital marketing initiatives in China.