Mark Tanner
20 January 2021 0 Comments

This week’s China market and marketing news:

Consumers,  Chinese Consumers

China’s Growth Beats Estimates as Economy Powers Out of Covid: China’s economy roared back to pre-pandemic growth rates of 6.5% in the fourth quarter as its industrial engines fired up to meet surging demand for exports. GDP grew 2.3% for the full year. Demand for medical equipment and work-from-home devices drove exports that saw China ship 224 billion masks from March through December – almost 40 for every man, woman and child on the planet outside of China.

China’s Economy Surges, and So Does Its Currency: The US dollar is sitting at around 6.47 renminbi, compared with 7.16 renminbi in late May and close to its strongest level in two and half years. The stronger renminbi means Chinese consumers can more ably buy imported goods and Chinese exports become more expensive, however it has done little to dampen appetite for Chinese goods with China’s share of world exports growing to 14.3% in September.

Navigating China’s Advertising Regulations in 2021: All eyes may be on China’s regulation of the big tech companies over recent weeks, but it’s not just Alibaba and Tencent that are being pulled in line with China’s laws. Many companies have been hit with fines and tarnished reputations for advertising claims that are okay in most countries, but not in China.

Controversial Ad for Make-Up Wipe Pulled in China After Backlash Over Alleged Victim-Blaming: A controversial advertisement for Purcotton make-up removal wipes has been pulled from the internet in China, after it prompted widespread backlash on social media over claims it “demonised” victims of sexual assault.

Online: Digital China

Why China Faces Handicaps in Antitrust War With Tech Titans: Policymakers now face the test of seeking balance between protecting internet business growth and preventing anti-competitive practices. Alibaba and other internet giants have raced to hire retired judges and regulators, and China’s antitrust enforcement faces a major challenge in a lack of manpower, with the SAMR’s antitrust unit only having about 50 employees, compared to thousands at its EU and US counterparts.

Future Tech China: How Taobao Turned Product Listings Into Entertainment: Content formats range from regular product listings, livestreams, store recommendations, user-generated content (mostly short videos), professionally created content, and more. The content users see depends on age, purchasing power, geographic location, purchase history, category preferences, and other factors. Back in 2017, Alibaba noted a 20% higher conversion rate on personalised landing pages compared with non-personalized pages. Their data and personalisation has improved since then. Brands should think less of their product listing as informational and more of it as entertainment.

Why China Is A Decade Ahead In Social-Driven Sales: Social commerce makes up 11.6% of retail e-commerce sales, having totalled $186.04 billion (1.285 trillion RMB) in 2019 versus $19.42 billion in the US. Chinese millennials crave and demand entertaining experiences and immediate satisfaction. They prefer social-driven purchases because the platforms are more engaging than traditional shopping experiences.

IPO-Prospect Kuaishou Has a Big Issue – How to Bag a Profit From the 300 Million Who Use its Short Video App: One-in-three online Chinese use short-video and livestreaming service Kuaishou at least once a day. Yet ahead of its imminent IPO, the Kuaishou’s reputation has been marred by fake products sold by KOL Xinba who accounted for over a fifth of the total value of goods sold on the platform in 2019.

Premium Food & Beverage

Its 53% Alcohol and Tastes Like Fire. Here’s How This Liquor Brand Took Over China: Valued at ¥2.7 trillion ($417 billion) Kweichow Moutai is the most valuable beverage brand on the planet, and worth more than China’s biggest banks, Toyota, Nike and Disney. Yet outside of China, the brand is barely known, with 97% of sales coming from China. Limited-edition bottles can sell for more than $40,000. Moutai has one unmistakable advantage: the drink is China’s national spirit, used by China’s leaders from Chairman Mao to Xi Jinping to welcome foreign leaders. At a state dinner in 1974, US Secretary of State Henry Kissinger told Deng Xiaoping, the future Chinese leader: “I think if we drink enough Moutai, we can solve anything.” During the Red Army’s “Long March” in China in the 1930s, soldiers used to pour Moutai on their feet to help disinfect wounds. Legend has it that members of the Red Army even used to turn to the drink to knock themselves out before surgery. Being part of so many major public events in China really set the brand in the national consciousness. The brand has found a way to be “approachable for a lot of regular consumers, at least for special occasions”

Parents and Kids

Chinese Police Probe Cream That Might Cause Babies to Have Huge Heads: Chinese police are investigating a baby cream containing an illegal hormone that has been accused of causing infants to develop overly large heads, authorities in southeastern Fujian province said today. A five-month-old baby developed a hairy forehead, facial swelling and suffered developmental setbacks after using an antibacterial cream produced by Fujian Ouai Baby Health Care Products.

Overall Beauty

Stock Up On Beauty Buys in Canada Rather than China If You Want to Save Money: British cosmetics comparison website Cosmetify has compared the cost of five iconic beauty products in 50 different countries worldwide. The price of a lipstick can vary – sometimes even double – depending on which country you buy it from. Canada was the cheapest country to purchase the bundle of cosmetics, with China being the most-expensive, costing 60% more.

Will China Become Hooked On CBD Beauty Products?: Touted for its anti-inflammatory and immunity-restorative properties, Cannabidiol is now a star ingredient of the broader wellness beauty movement. On social media, CBD product shopping hauls are becoming a content staple for beauty and fashion bloggers. Off social media, daigou have been actively sourcing favoured CBD beauty products to resell to homeland consumers who identify as sophisticated, international, and cosmopolitan. Although the psychoactive substance of marijuana, THC, remains strictly prohibited in China, after legalising the use of hemp leaf extract (containing CBD ingredients) in a 2015 cosmetics security law, the CBD beauty trend has come alive. In 2019, there were 433 requests submitted to the China Food and Drug Administration to use Cannabis Sativa leaf extract as a product ingredient. In 2020, that number rose to 880.

Overseas Chinese Tourists

Chinese Authorities Ask People to Cut Down on Travel as Covid Rises Again: China reported the highest daily tally of Covid-19 cases in 10 months – 144 – last Thursday, as authorities appealed to citizens to cut down on non-essential travel during the upcoming Chinese New Year holidays when hundreds of millions visit their home towns. Pre-sale of railway tickets before the Spring Festival has dropped by nearly 60% compared with the same period in the previous year.

Chinese sport Sport

Houston Rockets Return to China Screens, 15 Months After Hong Kong Tweet Ignited NBA Controversy: 15 months after the controversial tweet by Houston Rocket’s then GM Daryl Morey supporting Hong Kong’s protesters, the team has been broadcast on Tencent, losing to the NBA champion Los Angeles Lakers. Philadelphia 76ers, who hired Morey in November, remain on streaming blacklist.

Jordan Slam Dunks on Copycat Chinese Sportswear Brand Forcing Them to Change Their Name: Having used Michael Jordan’s Chinese name and 23 jersey number for more than two decades, Chinese sportswear maker Qiaodan Sports has finally lost its 8+ year court battle against the basketball legend. The company has had 78 trademarks revoked, paid Jordan a fine of ¥300,000 ($46,400) for emotional damage and issued a public apology. Last week, it officially changed its name to Zhongqiao Sports.