Five Social Commerce Megatrends in China

Social commerce has deep roots in China, where it continues to demonstrate impressive growth as the rest of the world increasingly adopts its strategies. The recent Double 11 Shopping Festival—an annual consumer event held by China’s top e-commerce platforms—provides ample proof. Alibaba generated RMB 498 billion (USD $76.1 billion) in gross merchandise value with 26% year-over-year growth, while JD’s GMV topped RMB 271 billion (USD $41.4 billion) with 32% YoY growth.

Five Social Commerce Megatrends in China e-commerce - Prince Zhang

What was behind this growth, and what does it mean for brands engaging in social commerce in China and potentially beyond? Here are five mega-trends that build on insights from Double 11 (D11) and point to what we can expect more of in 2021, along with implications for marketers.

Live streaming is booming. During the festival, more than 30 live rooms generated more than RMB 100 million in sales. Online celebrities Weiya and Li Jiayi–the highest-ranked influencers of the event, with sales of RMB 8.35 billion and 5.79 billion respectively—are examples of the increasingly popular new types of influencers born in the era of live commerce. Big digital platforms like Alibaba, Douyin and Kuaishou each have exclusive streaming partnerships with top influencers to lock down their loyal fans, pull in new user growth and drive sales.

Implication for Marketers: Influencer collaborations in live commerce are a powerful way to present products, demonstrate features and engage target audiences. The Ketchum China team applied a live commerce strategy to support our client Continental Tires in an earlier shopping festival, where we partnered with celebrities, auto experts and brand ambassadors to host streaming promotion events linked to the Tmall, JD and Tuhu e-commerce platforms. Results were amazing, with 3 million visitors, more than 460K new followers and a No. 1 sales rank among all tire brands on both the Tmall and JD platforms.

Microinfluencers in niche categories are on the rise. This category of passionate product users can communicate greater authenticity despite having fewer followers. In addition, they are more willing to respond directly to the community.

Implication for Marketers: Celebrity and big key opinion leaders (KOLs) can be beneficial for raising awareness in the short term, while microinfluencers will bring more richness to your content and reinforce your brand equity. One great example is our recent “FEEL IT” case with Rado on RED, the leading social commerce platform in China. We successfully engaged 149 KOLs and 52 KOCs on RED and co-created 201 posts that generated 3.5 million impressions and 61K engagements.

Video is the key to driving traffic. With the rise of 5G, social media in China is now all about video. The rising platforms of Bilibili, Kuaishou and Red, as well as more traditional social platforms like Wechat and Weibo, have evolved their video functions, allowing influencers to transform from simple content developers to true creative producers.

Implication for Marketers: With Chinese e-commerce entering into a new chapter of “v-commerce,” it’s essential to form long-term partnerships with short video content creators to bring product placements and sell brand culture in a rich, vivid way. Brands should consider working with an experienced content agency help guarantee a steady stream of creative, on-message short video content.

New platforms are seizing more market share. The Big Two, Alibaba and JD, are seeing competition from all directions. Pingduoduo has been a big challenger to Taobao, with deep penetration into lower-tier markets and competitive offerings for small and medium merchants. Tencent joined D11 for the first time this year and optimized its social commerce shopping experience with a WeChat mini-program. And Douyin (the Chinese version of Tik Tok) closed the e-ommerce loop though the integration of a Douyin mini-store, while Kuaishou upgraded its e-commerce features with live streaming and partnerships with top e-commerce influencers.

Implication for Marketers: It’s time to diversify your e-commerce channel strategy. New e-commerce players like PDD, Douyin and Kuaishou are stealing market share, requiring a multi-platform strategy to drive topline growth and balance conversion costs. It was our great pleasure to help our client Haier successfully deliver live streaming events across 14 platforms including Haier Smart Home APP, Douyin and Toutiao, promoting six product categories. The total online viewership was over 120 million, with 15.7 million likes and over RMB 4 billion in sales.

Shopping entertainment is the new lifestyle of younger generations. Big e-commerce giants are breaking through the boundary of traditional e-commerce into pure entertainment content. For example, partnered with talk show celebrity Li Dan for a special episode of his live show to celebrate D11, which was a big hit with viewers.

Implication for Marketers: Revisit the scope of your contracts with your existing spokespeople, brand ambassadors, celebrities and influencers. For some categories, it could be smart to invite e-commerce influencers as your brand spokespeople instead. They can not only drive your brand reputation and social buzz volume but also contribute to a quick sales boost. In the e-commerce community, their influence is sometimes even bigger than that of tier-one celebrities.

If current trends continue, we can expect these trends to break out of China and start to develop in different variations across other global markets. Would you like to learn more about how Ketchum China’s social commerce capabilities can help your brand get out ahead of the competition in other geographies? Just reach out, and be sure to check out Ketchum’s 2021 Social, Influencer Marketing + Analytics Trends Report for more insights into digital trends to watch for the coming year.