O2O is one of the most cost effective and engaging marketing strategies brands can adopt in China. Most aspirational brands selling in China have a strong O2O component in their marketing mix, yet many foreign brands have been falling behind in implementing O2O initiatives in China.
Online-to-Offline (O2O) is one of the most used buzzwords in China today, and with good reason. In Western markets, O2O refers to ‘click-and-collect’ items – goods bought online and picked up at a bricks & mortar store. Whilst retailers such as Ikea and Walmart are dabbling with it in China, cheap delivery and low car ownership rates mean that click-and-collect hasn’t taken off here like other countries. Nevertheless, China is pioneering in the O2O category.
WeChat or Wei Xin (微信 or wēixìn), the wonder kid of Chinese apps, is a major part of the ever-evolving app and social media landscape inside Mainland China. WeChat is now seen as one of the dominant ways to reach and interact with Chinese consumers, particularly on a personal level. A WeChat strategy is a vital part of an overall China marketing plan.
International Accounts vs. Mainland China Accounts
WeChat is not only a China phenomenon – it is aiming to become as ubiquitous worldwide as it is in China. In an effort to internationalize, WeChat now allows foreign companies to submit a proposal to apply for an Official WeChat account. The submitted proposal should outline how the company intends to use the official account. There is a big catch though: an Official WeChat account set up outside of Mainland China is only viewable to International WeChat users and is not viewable to WeChat users in Mainland China.
For foreign companies, setting up an Official WeChat account outside of China means that their account won’t be seen inside China. If any group of the changing and diversifying Chinese consumers are your target market then setting up an Official WeChat account outside of China won’t do. To reach your target market you must be where they are.
Both International and Mainland China WeChat users can view official WeChat accounts set up inside Mainland China. This is another heads up for Chinese brands who are strengthening their brands and experiencing a growing acceptance from Chinese consumers.
Applying for an Official WeChat Account in Mainland China
To apply for an Official WeChat account inside of Mainland China one must first have a legal Chinese entity such as a Wholly Foreign Owned Enterprise (WOFE) or work with a trusted partner who has a Chinese entity and is willing to apply for an official WeChat account on your behalf. Once the Chinese entity or WOFE is settled the initial step to getting an official account requires business documentation and a Chinese staff ID, among a number of other items.
Setting up an Official WeChat account inside Mainland China is just the first step. Deciding whether to use a subscription or service account, creating shareable content that portrays your brand’s message without shouting, developing dialogue and interaction among your fan base and possible customers, and creating a seamless online and offline experience are among a number factors to take into account after you have set up.
A well thought out strategy on how WeChat can fit into your overall China marketing and sales is necessary. If you’re interested in how China Skinny can help you develop a great China strategy including the essential Chinese social media for your company, be in touch.
China Skinny wishes you a happy 2015; we hope you saw it in with a bang! The beginning of the year is often a time to plan ahead for the following 12-months. Whether you are already in China, or entering this year, here are a few points to keep in mind:
1. Strive to Understand Chinese Consumers
Understand who your consumers are. Where do they shop? What will catch their attention? How have businesses been successful with similar products and target markets? In addition to the answers to these questions, understand that Chinese consumers are becoming more sophisticated and diverse each day. Just because a foreign business is present in China does not mean they will succeed, especially with the growing competition – not only from foreign brands but also from homegrown brands
2. Be Bold
Entering China with an online-only strategy has worked nicely for some but it is not going to work for everyone, especially those with low to moderate brand recognition. How are you going to make a splash and get noticed? Chinese consumers are not limited in their options as more imported goods and services attempt to attract their wallets. How will you stand out? Not every organisation or company may have the means to open a store, but how about a pop-up store? Or can you join a road show to exhibit your goods? Combining offline efforts with digital efforts is one way to smartly and efficiently capitalise on opportunities in China. There are ways to make a buzz beyond store openings, one just has to be smart about it.
3. Venture Out
First and second tier cities are fun and exciting, with their bright lights and big malls, but they’re becoming very crowded. Is there a place for your goods or services outside of the major cities – the most landlocked province in China was the number one seller of bikinis online per capita! Provinces in China differ enormously so trying to tackle a population as large as China’s with a single countrywide strategy can be difficult, if not impossible. Geographical differentiation needs to be taken into account and regional strategies should to be considered to maximise available opportunities and provide consumers with relevant products, services and messaging.
4. Be Committed and Flexible
China changes fast. Entering China and getting setting up is only the first step to tackling China. To succeed in China you must not only be committed but also informed on the constant changes that happen in China. A long-term strategy that is flexible is fundamental when entering China.
5. Keep it Real!
Stay true to your brand. In a low-trust society such as China it is vital to stick to your foundation. Attempting to change your brand to satisfy someone’s notion of what appeals to Chinese shoppers often backfires in the medium term. Understand your market, the available opportunities, and how your products or services best fit into that market. There are ways to localise and appeal to Chinese consumers while still remaining true to your brand. Presenting your brand as authentic and retaining your roots while taking a China-fied approach has a more sustainable chance of success than changing your brand’s identity.
China isn’t easy by any measure, but keeping these five points in mind will ensure your business is well placed to maximise the opportunities that China presents. All the best for 2015 in China!
“Be agile, adapt and redefined to the change that is China marketing” says Adil Zaim, CEO of Carat China.
There are an abundance of stories about how difficult the China market is to tap into. Yes, it is complex, yes it changes constantly and yes consumers are becoming more educated and harder to please, and there is the constant reminder of those big companies that failed. So, how have some companies managed to conquer the mainland and succeeded in marketing successfully to Chinese consumers?
China Skinny utilises numerous insights and techniques to assist its clients in winning the hearts of Chinese consumers, but it’s always good to see how others are doing it. China Skinny’s Founder and Managing Director, Mark Tanner, interviewed Adil Zaim the CEO of Carat China to find out his views on how companies can use effective marketing strategies to crack the Chinese market.
Don’t replicate a foreign model
“It’s well known that China is unlike any other market and many large multinationals have struggled to replicate their overseas success here in the Mainland. How has Carat approached the China market differently from other markets?”
Adil: “Normally when you go into a new market as a multinational, you just bring in everything from another market and try and replicate that model. In China, because of the complexity of the market itself, that doesn’t usually work.”
“We invest a lot in local talent to understand the market very well and have the right insights and really know how to engage with local clients. And then we bring in our global best practices and processes, the tools and the systems. This combination really allows us to have a very different approach in China as compared with some of the other markets where Carat operates.”
Use social media insights over pre-conceived trends
“Web and social media have become some of the most effective channels to reach and influence Chinese consumers. However, it’s not just a case of buying advertising, online influence often needs to be earned. Can you give an example of earned media and how it’s worked really well for your client?”
Adil:“It was for the Mondelēz client for one of their products, Chips Ahoy. We took advantage of the April Fool’s Day which most of the people would normally not think is a big thing in China, but actually if you go into the social media space it does resonate. So, we took advantage of that insight and we deliberately developed a campaign built entirely on the social part.”
“So what we did was essentially took advantage of the April Fool’s Day buzz on social media, produced content, seeded it in the media itself and then amplified it with some bought media around those social media platforms. So that’s a very good example it was very successful both in generating buzz as well as generating sales for Chips Ahoy.”
Send the right message to the right person
“China has become one of the most competitive markets in the world. The average Shanghai consumer is bombarded by three times as much advertising as their British equivalent. How does Carat best ensure that their solutions break through the clutter?”
Adil:“Our strategy is built on two solutions. One is what we call performance marketing; all about delivering the right message to the right person. So, instead of delivering a mass message to a mass audience you essentially select and filter the right message for the right target audience.”
“The other one is called branded content or content strategy [which] essentially allows the brand message or the product message to be inside the content that the consumer is consuming.”
More for your money on social media
“The majority of Western businesses here in China aren’t those deep pocketed multinational corporations; there are a lot of small medium businesses just trying to win some hearts of Chinese consumers. Can you give an example of one of your clients that may not have had such a large budget that’s actually achieved quite a lot with that?”
Adil:“We actually do work with a lot of clients who don’t necessarily have very large budgets. I can think of a campaign that we did recently for a client with a relatively smaller budget. For this client, we just used social media only. The only budget required for that campaign was just a production budget, there was no mass media or any kind of bought media support for it.”
“The campaign itself ran for 4 weeks on Sina Weibo and I think the last 3 weeks it was a top trending topic, both the product itself as well as the topic, within the buzz index on Sina Weibo.”
“Could you quantify that?”
Adil:“The budget given to us by the client was almost 10 million RMB.”
Well there you have it. It’s always great to see how other market leaders are approaching marketing in China. Not all budgets need to be in the millions to be effective and China Skinny would welcome the opportunity to discuss how we can work within yours to achieve your objectives.