Mark Tanner
Mark Tanner
6 September 2017 0 Comments

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

Banking & Payments

Chinese Innovation QR Code Mobile Payment Wants To Conquer The World: A summary of the investments and partnerships Alipay has made over the past few years to reach 120,000 overseas merchants. Alipay saw a compound growth rate of 118.6% from 2014 to 2016, however its market share has dropped from 80% in 2014 to just over 50% in Q1 of this year, with WeChat Pay closing in at 40% -growing 326.9% over the same period.

Alipay Launches ‘Smile to Pay’ for Commercial Use in China: Not long ago heading out to eat without your wallet was a disaster. At KFC’s new, healthy-food concept restaurant KPRO in Hangzhou, you don’t even need a smartphone. Alipay’s new facial-recognition payments technology launched for commercial use with self-service kiosks – expect to see more of this tech creeping into Chinese life.

As Luxury Brands Connect With China’s Young, the Dangers of Debt Loom Large: Consumers born after 1995 are 60% more likely to make impulse purchases compared to the generation just before according to Accenture. Nearly 60% of college students had either used or were willing to use payment installments, and 10% would choose credit services when in need of money.

Consumers,  Chinese Consumers

Alibaba Wants to Bring Big Data to 1 Million Mom-and-Pop Stores: Alibaba aims to venture further offline by bringing 1 million ‘mom-and-pop’ stores to its Alibaba Distribution Platform (ADP). The retailer management system offers marketing, logistics and training services to independent shop owners and also collects and provides data to help them predict customer demand and keep up with consumer tastes. It hopes 10,000 stores will rebrand with the Tmall name.

Cute  Pets

Pet Fair Asia 2017 at a Glance: Last weekend saw hundreds of thousands descend upon a Shanghai exhibition centre with pets in tow, ready to sample and experience what the booming industry has to offer. China Skinny was there to see the trends and general quirkiness of China’s pet industry.

Online: Digital China

5 Reasons Why China’s Online Retail is Insanely Successful: During the first six months of 2017, China’s online retail sales of goods and services grew 33.4% year-on-year growth to ¥3.1 trillion ($470 billion) due to personalization, platform integrations allowing seamless sales, powerful content marketing such as livestreaming, C2B innovation and agility, flexibility, and speed.

Amazon is Struggling to Find its Place in China: Amazon only managed a 1.3% market share in China’s B2C market last year, down from 2% in 2011 due to stiff competition from domestic players and a bland and bare mobile app. Amazon Prime struggles to differentiate as local platforms match or surpass fast and free delivery and discounts, Chinese are wary of membership programs due to previous scandals involving beauty chains and health clubs, and censorship means it is without its video component.

China’s Gen Z Relies on Social Media for Shopping: 70% of Chinese consumers born after 1995 say they prefer to buy products directly via social media compared to a global average of 44%, according to Accenture. 58% of Chinese born between 1990-1995 think the same. 40% of Chinese born after 1995 prefer to search information directly from brands’ own websites rather than third-party platforms – a significantly higher percentage than millennials.

An Open Letter to WeChat: 6 (New) Suggestions From an Advertiser: Introduce more reliable metrics that can’t be faked, make sharing easier, provide more insights, keep improving ad-tools including targeting, don’t distract us with objects that are expensive to create for and don’t get a lot of coverage, and find a new high ground such as data security are a few ways WeChat could improve for advertisers.

Premium Food & Beverage

Making the Most Out of the Situation: The foreign sauces segment is estimated to grow 11.9% annually between 2016 and 2021. Salad dressing will grow the fastest while ketchup will enjoy the highest penetration according to Mintel. 48% of 20-49 year olds said they have tried to limit their salt and sauce intake in 2016.

China’s Trendiest Hotpot Chain is Winning Praise For Admitting it Ran a Rat-Infested Kitchen: The same popular hotpot chain Haidilao that offers big soft toys to lonely diners was exposed as having a rat infestation crawling on counters and basins in one of its Beijing restaurants. Within seven hours of the news, the chain acknowledged the problems in a statement on its Weibo account with seven-point action plan, two restaurant closures monitoring upgrades and the names of the staffers in charge of following through. It received 18,000 likes and widespread praise.

Overseas Chinese Tourists

KLM Becomes Among the First Non-Chinese Airlines to Accept WeChat Pay: Dutch airline KLM has begun allowing Chinese passengers to use WeChat Pay to buy airfare. Within a few days, the airline estimated 20-30% of its Chinese customers used WeChat Pay for their airfare. Since Finnair started accepting Alipay for onboard sales on China flights, including duty free, sales had increased 200%.

China’s Newest Answer to Disneyland is a Mish-Mash of Eastern and Western Myth and Fantasy: China’s aspirations to beat Disneyland took a hit with Wanda’s exit from theme parks but has been quickly filled by property developer Evergrande who is opening 15 parks across China each aiming to attract more than 15 million visitors and generate around $3 billion in revenue. The ‘Children’s World’ parks revealed to cost $7 billion a pop, tie in Chinese mythological characters with Western themes such as Greek gods, Alice in Wonderland and Cinderella. Each park will host 33 large-scale rides, compared to Disney’s 18 to 22 and will be the world’s first “all-indoor, all-weather, all-season” large-scale theme parks.

Schooling and Education

Education Is Now the Biggest Incentive Driving China’s U.S. Investment: Children’s education has become the top incentive for Chinese investing overseas with 91 of 120 agents surveyed citing it, versus capital gains listed by 83 agents and migration by 82.

Autos and Cars

Women Snap Up Luxury Cars in China: 40% of Maserati buyers in China are women versus less than 5% in other markets. Similarly, 40% of Chinese Porsche buyers were women in 2015 and Ferrari has noted that Chinese women are four times more likely to buy one of its models than women in the West as a symbol of their newfound wealth and status within Chinese society.

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

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