Mark Tanner
14 August 2020 0 Comments

This week’s China market and marketing news:

Consumers,  Chinese Consumers

How Many Eggs, in How Many Baskets? An Update on NZ-China Trade Patterns: An interesting report commissioned by the NZ China Council exploring comparative data on New Zealand’s export and import exposure at a country level and by industry and product. China has accounted for over 60% of New Zealand’s goods’ export growth in the past decade, yet exports have diversified recently, largely due to rapid growth in a range of products over the past five years.

China’s Share of Australian Exports Hits 48.8%, an All-Time High: Australia’s exports to China in the June quarter reached a record high of A$14.6 billion ($10.5 billion) largely on the back of iron ore. Goods exports to China now account for around 8.5% of Australia’s GDP [paywall].

American Firms Take Refuge in China: In earnings calls for the quarter, senior executives from some of America’s best-known brands singled out China for salvaging what otherwise was a rough three months. Sketcher’s global income dropped 42% in the June quarter but grew 12% in China, with its COO noting “China offered a model of recovery, stabilization and then growth.” The gulf between China and the rest of the world was widest in the luxury sector, with LVMH global revenue falling 38% in Q2, but growing 65% in China; Kerring grew 40% in China against a 43% drop globally. Though consumption has rebounded, headwinds remain in China, with three categories still in decline: restaurants and cafes, autos, and clothing and footwear, down 15.2%, 8.2% and 0.1%, respectively. US businesses continue to bet on China, they are just localising more.

A Creative Way to Reach Consumers: How brands such as Alibaba and Mi’s Jun Lei are using auto-tune remix-themed content to connect with consumers.

China’s New Hit Drama ‘Nothing But Thirty’ Thrives in the “She Era”: With over 20 billion views on its hashtag page, the 43-episode drama following the challenges of three different women who have reached the age of thirty is one of China’s most popular shows this season. Nothing But Thirty showcases the sheer diversity of experiences for women above thirty: you don’t have to be married, you don’t have to be super-capable, and you don’t have to be thinking about having children. By telling a story that is relatable and touches on relevant social issues, namely on expectations of women in society, the show was able to achieve widespread popularity and is adding another notch on the trend of China’s ta shidai (‘she’ era) dramas.

Citizens from These European Countries Can Now Return to China: Citizens from 36 European countries who hold relevant Chinese resident permits may apply for a visa to China for free. South Korea was given the green light last week as China looks to be slowly opening up again.

Online: Digital China

Importance of Offline and Online in a Post-COVID ‘New Normal’ as Reflected by Alibaba’s Taobao Maker Festival 2020: Intime department store is a testament to the rise of livestreaming. Although foot traffic is just 70% of pre-Covid levels, sales are almost back to what they were due to thousands of its mall staff who are now an army of livestreamers, and its app reinforcing the importance of o2o retailing in China.

TikTok, WeChat Targeted for US Ban With Trump’s Latest Executive Orders: The Trump administration announced executive orders late last week, banning “any transaction” with TikTok owner ByteDance, or WeChat, “by any person, or with respect to any property, subject to the jurisdiction of the United States.” Although the specifics are still murky, the ban may have an impact on anything from US brands promoting their wares to Chinese consumers on WeChat or Douyin, to Apple listing WeChat and Douyin on its app store in China. Chinese tourists and students in the US may even be impacted.

Douyin is Pushing Douyin Stores and Starts to Softly Break Ties with Taobao: Douyin is now a cornerstone marketing channel for many brands, but without a seamless ecommerce experience within the platform, its potential remains unfulfilled. Signals of an ecommerce overhaul and removal of external linking could cause significant shifts in certain consumers’ purchase journeys, and worth monitoring for all western brands.

Premium Food & Beverage

How Cute Rabbit Ears Are On the Frontline in Fight Between Delivery Firms: Delivery platforms have struggled during Covid-19, as takeaway services have been curtailed by lockdown restrictions. Meituan has bounced back by distributing floppy kangaroo ears which have gone viral. Ele.me has opted to give Doraemon-style propellers to takeaway riders. “Selling cuteness” doesn’t seem to get old in China with all ages and provides a way for big companies seeking to draw consumers closer in tough times.

China Expands Burger King Probe to Other US Chains: Following an exposé on CCTV’s consumer watchdog show 315, Chinese authorities investigating allegations of expired food sold at Burger King have broadened their probe nationwide and are looking into other US fast-food chains as diplomatic tensions rise.

Beijing Artisan Cheese Maker Finds New Growth on Taobao: After his business supplying local restaurants and hotels dried up, Beijing-based entrepreneur Liu Yang ramped up his online focus like many other businesses during the time. Informed by feedback on ecommerce that showed how new customers wanted to be able to try different products to begin with, Le Fromager de Pekin created a sample platter featuring five of his signature cheeses with different maturity levels and textures. The platter was an instant success, selling more than 300 on the first day of launching and now becoming a regular bestseller on the Taobao store. Other popular products include ones inspired by traditional Chinese ingredients, such as soybean juice and Chinese rice wine.

Video & Entertainment

Trending in China: Popcorn or Cheaper Tickets – What Would Make You Return to the Cinema?: Although most of China’s cinemas were allowed to reopen on July 24 after a six-month closure, they had to follow numerous restrictions due to public health concerns, such as operating at below 30% capacity, banning food or drinks, and showing movies that last no more than two hours. There hasn’t been a big return to the silver screen with some cinemas selling tickets as low as 1 yuan ($0.14) to attract patrons.

Schooling and Education

Nanjing’s Top High School Goes Back to Emphasis on Testing After Parents Protest About Low Exam Scores: Nanjing No. 1 high school is a prestigious institution that accepts only the highest-performing students in the city. About a decade ago, the school decided to gradually move away from the classic Chinese education model, which has long been criticized for putting too much emphasis on highly competitive and rigorous testing. In the years that followed, rather than assigning excessive homework and conducting endless exams, the school encouraged its students to participate in extracurricular activities and explore their interests. The school called off its all-rounded education this month following a demonstration by students’ parents who said that their children fell short in this year’s college entrance exam because of the school’s “ineffective” teaching methods.

Autos and Cars

Elon Musk Says ‘China Rocks’ While the US is Full of ‘Complacency and Entitlement’: Elon Musk lamented the “entitled” and “complacent” character of people in the United States, and lauded the “smart” and “hard working people” of China, in an Automotive News podcast. China now accounts for nearly one-quarter of Telsa revenue up from 11% a year ago, with June quarter earnings climbing 103% year-on-year to $1.4 billion.