Mark Tanner
Mark Tanner
12 September 2018 0 Comments

Here are this week’s news and highlights for China:

Overall Health & Beauty

Alibaba Launches Online Doctor Consultations, Round-the-Clock Medicine Delivery: Just weeks after Tencent launched its Doctorwork private health care network, Alibaba has launched a new service offering 24-7 medicine delivery and online medical consultation. Searching the term jiyongyao (“need medicine urgently”) on Taobao directs users to a page offering advice and over-the-counter medication delivered within 30 minutes during the day and an hour at night.

Leading Nip-Tuck App Becomes China’s Latest ‘Unicorn’: SoYoung, “China’s Facebook for plastic surgery,” received $70 million in its latest round of funding to take its value past the $1 billion mark. The social networking site allows users to share anything about plastic surgery — reviews, comments and treatment journals and before-and-after selfies. It offers a location-based search function for clinics, live-video consultations and payment services. More than 30 such apps burst onto the scene in 2015, but consolidation has seen SoYoung and Gengmei emerge as the top two players. Transactional revenues on its SoYoung grew 300% in 2017 to ¥2 billion ($292.5 million).

Lifestyle, Cleanliness and Hygiene in Cosmetics – What’s the Story?: Today, consumers are asking more questions about products and raw materials, resulting in heightened and ongoing interest in cleanliness and hygiene to suit consumer lifestyles. Stress, lack of sleep and other lifestyle factors are considered the leading cause of skin conditions​ among Chinese consumers according to Mintel.

Consumers, Chinese Consumers

Jack Ma to Hand Alibaba’s Helm to CEO Daniel Zhang Next Year: One of China’s most recognisable personalities has announced he’s stepping down from his role as executive chairman of Asia’s most valuable company to pursue work partly-inspired by Bill Gates.

Wealthy, Mobile and Elusive: Chasing China’s Consumers: Why brands go for the obvious markets in China, but why they aren’t always the best choice.

These Data Take the Pulse of Chinese Consumers Amid Trade Fears: Overall, Chinese consumers’ appetite for services remains robust, even if the growth rate for buying goods is slowing. But while sentiment is largely intact, employment and income data point to a gradual slowdown. Standout spending growth in the first half of the year came from fitness and athletic activities which surged 39% year-on-year, hotel and accommodation jumped 38% and household services rose 33%.

Alibaba’s LST Reaches for One Million Mom-and-Pop Stores in China: Alibaba has infiltrated one million of China’s six million ‘mom & pop’ stores with its Ling Shou Tong (LST) system. Alibaba statistics show that when a mom-and-pop store transforms itself into a Tmall Corner Store, its daily turnover increases by 30%, on average.

Chinese Celebrities Given Social Responsibility Rankings: Only nine of China’s 100 television and film personalities passed a “social responsibility assessment” based on their professional work, charitable work, and integrity. Xu Zheng, the star of this summer’s hit black comedy “Dying to Survive,” ranked No. 1 followed by boy band TFBoys. Fan Bingbing scored the lowest and Jackie Chan placed at 42.

Online: Digital China

Chinese Consumers’ Zeal for Apple’s New Gadgets Unaffected by Trade War: In spite of the escalating trade war between China and the US, Chinese consumers have a rational attitude toward one of the most iconic American products – Apple gadgets – and they have been waiting impatiently for new iPhone models released at an event in California today. The Global Times report cited numerous sources who believe “negative backlash” caused by the ongoing trade war isn’t having much impact on consumers when deciding whether to buy Apple or not.

Premium Food & Beverage

Tencent Signs Partnership Deal with Coffee Startup Luckin in Challenge to Alibaba-Starbucks Tie-Up: A little over a month since Alibaba’s deal partnership with Starbucks was announced, Tencent and Luckin Coffee have jumped into bed together, collaborating on WeChat Pay and leveraging WeChat mini-program intelligent marketing tools as well as developing a New Retail solution. Luckin has sold 27 million cups of coffee since launching 10 months ago. China’s coffee consumption grew 16% on average for the last ten years, significantly outpacing the world average of 2%. On Alibaba’s ecommerce platforms more than 18 million Chinese consumers bought ¥2.5 billion ($365 million) worth of coffee products in the past 12 months, up 18% year-on-year. Sales of coffee beans and grounds on the platforms grew 60% faster than instant coffee in the past 12 months, with coffee capsule sales increasing tenfold in the same period. In related news, Coca Cola’s recent acquisition of Costa Coffee could see the brand expand its current 450 cafe footprint in China and create more competition in the space.

African Swine Flu is Causing Alarm in China—and Beyond: 13 cases spanning 2,400km of China and 40,000 pigs culled so far isn’t helping the price of pork. The pig fever is stoking fears of inflation and the cost of pork has an inordinate effect on the consumer-price index. With a fifth of the world’s population, China consumes half its pork. The blue-ear pig-disease episode of 2007 provoked a rise of 87% in pork prices, and coupled with the rising price of soybean feed following the trade war prices are likely to rise. Inflation now is at its highest rate in four months. An editorial in Caixin last week said that Chinese history had taught “painful lessons about the dangers of inflation” and the government had “a rare time-window to prevent inflation from escalating”.

Overseas Chinese Tourists

Tourism New Zealand and Ctrip Sign Deal to Boost Chinese Visitor Numbers: Tourism New Zealand has signed an MOU with Ctrip to support the growth of customised travel, which is surging in China with queries on Ctrip increasing 120% in the first half of this year. New Zealand leads the trend with enquiries growing 150%. The partnership is expected to help to highlight the range of attractions and regions this country had to offer and provide accredited training to service providers. The main target customer groups for the project are family trips and honeymooners.

Safety, Seafood and Drinking Tap Water: What Attracts Chinese Tourists to Sydney: Chinese visitor numbers to Australia have grown by 13% in the past 12 months to 1.4 million tourists, spending more than A$8,000 ($5,700) on a trip compared to an average of A$5,000 ($3,550) by international visitors. Chinese arrivals in Europe in the first four months of 2018 were up 9.5% against the same period of last year, and up 7.9% for the May-August season.

Premium and Luxury

Influencer Marketing in 2018 for Luxury Brands: Celebrities with 40-60 million followers represent a “sweet spot” for consistently delivering outsized engagement to their luxury brand partners according to a report from L2. TF Boys are the most effective in generating outsized engagement, whereas Angelababy and Chris Lee have lost some of their appeal.

That’s the Skinny for the week! See previous newsletters here. Contact China Skinny for marketing strategy, research and digital advice and implementation.


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