HubSpot defines digital marketing as “encompassing all marketing efforts that use an electronic device or the internet.”
Why is this such a big part of marketing in China?
The recent China Internet Report put together by Abacus, 500 Startups and The South China Morning Post, shows some staggering numbers of just how many people are using electronic devices and by extension accessing the internet.
Although China’s internet penetration is almost 35% less than that in the United States, the number of people accessing the internet in China is 3 times the number of users in the United States (772 million), making the market massive.
The number of China’s rural internet users alone (209 million) has almost reached the total number of internet users in the United States (292 million), and it is growing at a steady rate.
Just how are nearly all 772 million internet users in China accessing the endless black hole we call the internet?
753 million are using a mobile device.
This makes it impossible for brands looking to succeed in China to ignore digital, and further, mobile.
So what do brands looking to succeed in China need to know about digital marketing?
I had the pleasure of hosting a panel discussion dedicated to discussing Digital Insights for the China market. Sat in the hot seat was Andrew Kuiler, CEO & Founder of The Silk Initiative, Jessica Miao, Founder of United Media Solutions, and Jerry Clode, Head of Digital and Social Insight at Resonance. The discussion was spirited, and there is obviously no single solution to digital marketing in China, but we did our best with the time allotted.
Thanks to a highly engaged audience, and the wide range of expertise on the panel, we were able to touch on several key topics that are important pieces of the China digital marketing puzzle.
Are websites dead?
With the emergence and popularity of WeChat and other apps in China, this is a valid question to raise. WeChat users are spending hours within the app, much longer than counterparts in the West spend on Facebook. This is due largely in part to the functionality of WeChat, not only is it a messaging app, but you can play games, read articles, pay your bills.. the list goes on. Now WeChat is ramping up it’s own search engine, edging the app even closer to owning up to the label “the app that does it all.”
While it was suggested that websites are becoming less important, the general consensus was that no, websites are not dead in China - especially for B2B.
Think of your website as another platform to tell your brand story, which can be especially useful for some B2C brands on ecommerce platforms such as Tmall, that don’t allow for much customized content. Having a website that people can search for and browse boosts your credibility and gives you control over how your brand is portrayed.
Different tiers = different consumers
Generalizing in China will get you into hot water quickly. As China’s economy grows, the differences in consumer behavior between tier one, tier two, tier three cities become more pronounced, ignoring this can be fatal to a brand.
Take social ecommerce app pinduoduo for example; this app focuses on group buying, users can score big on discounts, as long as they are able to get all their friends in on the deal too. The nature of the app appeals largely to lower-income individuals in more rural cities (65% of pinduoduo’s user base are in third tier cities or beyond). A higher end, foreign brand would likely see limited success on such an app, whereas they may be much more successful on Tmall, JD or their own WeChat storefront.
You may be promoting the same product across different tier cities, but you should be deploying content on different platforms depending on the city. This is where it comes down to not only being familiar with the functionality of different channels, but also to knowing your target audience and their buyers journey.
Get real, about your budget
Preeti Kumar, China Digital Strategy Consultant and Founder of Amplify Asia, brought up a very good question, “how to prepare brands for the cost of digital marketing in China?”
This is a common issue many agencies in China run into when working with international brands. The reality is that marketing in China is more expensive than many brands anticipate.
- Western Brands don’t understand the digital channels
- (and because of this) set unrealistic KPIs
The cost of working together with KOLs (influencers), buying WeChat and Weibo ads, or pulling in decent media outlets are all expensive tactics, and when you’re expecting thousands of WeChat followers overnight, you’ll be left blowing your budget with less-than-optimal results.
What can you do?
Start thinking about China as a sophisticated market with channels unlike (not inferior to) the West.
- Research your target audience
- Research the channels your target audience is on
- Look at what your competitors have done
- Speak with a local agency
- Be prepared to roll out your strategy in phases
- Learn, test and adjust
What strategy can brands with limited budget deploy? Community building, one of Jessica Miao’s Four C’s of China marketing, was an important point brought up during the panel.
If you look at many of the apps that have been successful in China, they all have a strong social/community aspect. Creating communities for a niche interest or specific purpose can help you build a reputation, foster brand evangelists and get first-hand access to your target audience.
Some tips for managing communities, courtesy of Jerry Clode:
- Have a specific topic
- Create a format for distributing content in the group, for example during the morning start a discussion on a specific topic, during lunchtime share a relevant case study, and in the evening share news updates from the day
Not all about Digital Platforms
I know at the beginning of this piece I whipped out some fancy data to “wow” you, but let’s take a step back - your digital game is not the whole pie. You’ll need to have your act together before you go blazing into WeChat or Xiaohongshu.
A popular case study was referenced by an audience member during the discussion and if you’ve been following China marketing you’ll know it too - KOL (influencer) Becky Li sold 100 MINI autos in 5 minutes.
Often people refer to this case as a testament to how powerful KOLs are, when in fact MINI had a powerful brand before this stunt - and the campaign was heavily promoted before the opening bell. You should not expect a KOL (influencer) to sell out your stock within minutes or hours, no matter how popular they are. You have to do the work to build your brand first.
Three very important things you can do:
- Have a good China brand name
- Re-position your brand for the China market
- Localize your messaging
Big thanks to AustCham Shanghai for hosting the event and to each of the panelists, Jerry, Jessica and Andrew for contributing to a lively discussion.
*Disclaimer - Digital Marketing in China is an extremely broad topic, and this piece, nor the panel discussion came close to covering it all. Check out our blog or our resource center for more in depth information.