The rise of E-Commerce and Digital Marketing in China

 

China’s E-Commerce registered an average annual 71%-growth from 2009 to 2012, which is a very impressive performance, and the trend is expected to accelerate thanks to an increasing number of web users and a constant rise in purchasing power.

This successful democratization of online sales is due to pertinent and offensive marketing strategies set up by the main players on the market.

Although China’s population is recently converted to digital, a large population is already connected to the internet. China catches up with other countries: in 2013, online sales crossed the 300 billion dollars barrier, with a 61% growth from last year.

By comparison, France – whose results are positive – registered a 13,5% growth for the same periods. This China’s rise is not going to stop: China alone is expected to do better than the United States, Great Britain, Germany and France together by 2020. source

The big actors of the Chinese web redouble their efforts and use every possible means to gain market shares and increase average customer basket value.

What are the main successful marketing strategies?

Using social media as a sales channel

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Sina Weibo, “Chinese Twitter”, has grown steadily since its launch in 2009. Today, it has probably exceeded 500 million members. Thus, the micro blogging website is “the place to be” for individuals but also for celebrities and brands which want to increase their public in China.

At the end of 2012, the Xiaomi company – a Chinese phone manufacturer – called upon Sina Weibo for particular operation. Together, they organized a one-day “social trade” session. Xiaomi offered 50.000 of its lastest model “Xiaomi Mi2” for sale, with an elaborate staging: orders must be place in the form of “tweet” and payment directly on the micro-blogging website. Results were impressive: 1.3 million requests in less than 5 minutes.

Stores at the crossroads of virtual and physical universe

Altough Chinese consumers buy increasingly on the Internet, they prefer going to physical shopping centers to buy food, cleaning and hygiene products.

To accelerate the opposite trend, Yihaodian – an online grocer founded in 2008 by two Chinese frames from Dell Computers and now owned by Wall-Mart launched an innovative poster campaign on Shanghai subway platforms. The concept was as follows: people were able to buy products by scanning QR codes with their cellphone while they were waiting for subway train and were delivered within two hours.

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Another example of publicity stunt mixing augmented reality and geolocalisation. In 2012, thousands of virtual stores opened in China’s big cities. Informed about virtual stores localisation by their smartphone, people only needed to click to wander down the aisles, fill the cart and pay online or at delivery.

Unmarried’s Day: an unmissable event for E-Commerce

After years of one-child policy and cultural preference for boy children, China accounts a large and increasing number of single people nowadays: men, who have to be owner of their accommodation before hoping to find a wife; and women, highly selective, who would like to find the ideal man because of familial and social pressure.

Unmarried’s Day, created in the 1990s and celebrated each November 11, is a unique opportunity for Chinese E-Commerce companies.  The concept: single people, celebrate their solitude by offering a gift to themselves. In 2009, Alibaba – the Chinese E-Commerce platform – took the opportunity to launch communication and marketing campaign and grant exclusive promotions valid within 24 hours. It was a real success, so Alibaba repeat the operation every year. The first year, 6 million euros of products were sold within 24 hours and in 2013, the operation generated 4.29 billion euros.

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The western E-Commerce companies would dream of reaching these figures, all the more so at the end of 2013, China only accounted 618 million web users, barely up to 45% of global web user population, and this figure increases yearly.

 

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Olivier VEROT

Marketing China