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Digital trends from China are going mainstream

TikTok isn’t the only disruption in social media and e-commerce to come out of China in 2020.

Other trends from Chinese e-commerce are now going mainstream.

China, the land of online marketplaces, is already home to 3 of the top 5 highest-grossing marketplaces in the world.

In many ways, e-commerce in China is still starkly different than what we’re used to.

Everything in China is app-driven and centralised to a handful of platforms.

The centre of growth is shifting and Asia is expected to represent 56% of global consumer demand by 2030.

Global brands are already using China as a blueprint for developing their e-commerce strategies for the next decade.

The two biggest e-commerce trends to come out of China this year are:

  1. Live e-commerce
  2. Social e-commerce

Amazon ran Amazon Live in the US on Prime Day.

And Facebook introduced ‘Live Shopping’ for both Facebook and Instagram.

Now all major social media apps – Pinterest, Snap Chat, YouTube and TikTok – offer shoppable content or integration with your Shopify store.

Influencer-driven ecommerce and live-streaming are excelling in China.

You’ve may have seen this video – “Creepy Social Media Influencer School in China” – floating around lately:

https://www.youtube.com/watch?v=TIXIkQqN9Nc

During a live-stream, customers can interact with each other and the influencer, discuss the product, ask questions and place an order – all at the same time.

On Singles’ Day this year, JD made $15m in a 6-second live-streaming session.

Brands are embracing influencer-driven e-commerce with open arms.

Because it offers a combination of entertainment, engaging with brands and meeting your favourite influencers.

Consumers in Asia skipped the credit card altogether.

They went straight from cash to e-wallets instead.

And the same is now true for new business models.

Mobile banking, robo-advisory services, and wealth management tools have all enabled a shift towards mobile-first e-commerce.

Consumers in Asia aren’t only open to these new technologies but actively embracing them.

And this is giving rise to a new type of business model – the super app.

For consumers, super apps offer a single point of contact into a vast ecosystem of services.

And for businesses, it brings down the cost of marketing and sales – furthering the benefits of building digital value networks.

What does this mean for you?

There are differences in regulation, consumer maturity and consumer preferences with China.

And you shouldn’t chase advancement for the sake of advancement itself.

But you should be focusing on finding new ways to serve your customers.

Focus on building digitally-enabled value chains, collaborative ecosystems for e-commerce and innovative go-to-market solutions.

The blueprint already exists.

Now you just have to make the most of it.

SMS marketing is blowing up

With search and social becoming ever more congested, churn rate going up and performance of email marketing flattening out, DTC marketers are branching out.

And SMS marketing is blowing up.

As a channel, it’s still nascent but it’s been growing steadily in the last 18 months.

In an interview with Digiday, Digishop Girl’s CEO told that 70% of their clients are already using SMS to find new ways to reach and engage customers.

In the same article, an investor and advisor to the DTC brand Judy explained that SMS campaigns are getting around 70% CTR and upwards of 25% Conversion Rate.

I gotta say that’s pretty impressive considering Mailchimp’s average open rate is 21% and CTR is less than 3% which isn’t too far from other industry benchmarks.

SMS can be a very personal and intimate communication channel.

I’m a bit torn, to be honest.

SMS and text messages are by far my favourite way to reach out to friends and family.

I was 28 when I finally gave in to talking to people on the phone and taught myself not to get anxious anytime my phone buzzed.

It seems that DTC marketers know how big a deal it is when someone signs up to receive as SMS and they’re being mindful of that when planning their campaigns.

You can check out many examples of SMS marketing in use here and here.

For the time being, it seems that SMS marketing is working for DTC brands but it remains to be seen if and to what extent other consumer brands can use it as well.

Past surveys have shown that people do want to receive service-related information such as an appointment reminder but will they like brands to bombarding them with SMS marketing. 

I have my doubts.

One thing is certain. There are new opportunities for brands that embrace empathy and offer personalised experiences as people continue to reward them with loyalty and engagement.

That said if you’re really serious about using SMS as a way to have ongoing conversations with your customers, you need to look for ways to prove the value of the service before you press send.

The battle for short-form video

I’ve been a little distracted by the political drama surrounding TikTok. 

But as entertaining as it is to see Trump’s antics and Microsoft rushing to meet the September 15th deadline, the bigger picture here isn’t just about the politics.

It’s about who will own short-form video – and with it the attention of today’s teens and twentysomethings.

As the experts put it, Gen Z’ers are not only trying to get their parents to buy them stuff, but mom and dad are listening to their opinions on what to buy for themselves. And these opinions are, in turn, influenced by YouTubers, Twitch streamers and TikTok creators.

The future of influencing is short-form video.

And everyone’s got their play.

Yesterday Facebook officially launched Reels in 50 countries.

Instagram’s Reels is TikTok in every way, except it only lets you make 15-second videos – so you know not exactly the same.

Facebook is no stranger to copying features from smaller apps. It’s not like they can buy them off, not with the antitrust authorities breathing down their necks.

Still, the timing of this launch couldn’t be perfect.

For a long time, nobody was quite sure what TikTok was all about. And just as advertisers were warming up to it, their troubles in the US started. 

Enter Instagram. It’s familiar, your fans are already there so, why not give Reels a go instead?

Instagram is quickly turning into Facebook’s super-clone-app. But I still like Instagram and as Sara Frier wrote in Bloomberg, Instagram has what Facebook does not, which makes it Zuckerberg’s best bet at staying relevant.

Snap Chat’s attempt at giving uncertain TikTok users a new home.

Last week Snap Chat introduced a new feature that, just like TikTok, allows users to add music to their snaps. 

I’m excited to say that they didn’t stop there. As TechCrunch reported, users will be able to swipe up to view the ‘album art’ and even listen to the whole song on their favourite streaming app.

See, Zuck, it’s really not that hard.

Before TikTok came along, Snap Chat was the app for teenagers. Although they have a large userbase outside the US, they reach more teenagers and twentysomethings in the US than Facebook, Messenger and Instagram combined.

“Snapchat says its music feature, however, will allow fans to form deeper connections with artists and music. It also spoke to its strength in being a tool for close friends, which gives it more influence — largely because of how its younger user base values friend-to-friend recommendations.” –  Sarah Perez, TechCrunch

Have you heard of Quibi?

There isn’t much to say about it since not much has happened since it’s launch earlier this year. Quibi is a short-form original content streaming app that offers original content in ‘10-minute or less’ chunks. 

It’s still early days and there’s some controversy around how successful its launch has been. 

You know, I do like the idea of original content that’s designed to entertain me in 10-minutes or less but I don’t know if I’ll pay for it. At the moment the future looks uncertain for an app designed for commuters and launched at the worst time possible for commuting.

And then there’s Microsoft

I know they don’t own TikTok yet but their play for its US business is worth mentioning.

While they do own Xbox, Bing and LinkedIn, for the most part, they’re a business-to-business company. And we all know how it turned the last time when they went into video streaming business.

To be honest, when I first read the news I was all ‘hold on a minute, they wanna do what now?’

But after reading Tim Peterson’s explanation, I think it might just be the right move for Microsoft.

This purchase is going to be costly and their expenses won’t end there. But TikTok will bring Microsoft closer to Gen Z and give it proper legs to stand on against the Facebook-Google duopoly.

Singapore’s virtual island getaway is bloody brilliant

After getting hit by COVID restrictions, Singapore’s Sentosa island resort and BBH created (read: hacked together) a virtual version of the famous island getaway in Nintendo’s Animal Crossing.

In an interview with The Drum, the BBH explained:

“[We] created over 50 custom-made designs for the island, which represented individual brands and attractions on the island, such as restaurants and clubs.”

NintendoSoup described the virtual resort as:

“Beach bars, nature trails, the Skyline Luge, the Shangri-La and Capella hotels, and a spot for yoga by the beach, all recreated within Animal Crossing: New Horizons.”

This is a whole new level of creativity in advertising and brand activation.

Why should you care?

Video games are now mainstream.

Several times a week thousands of people choose to spend their free time playing games like Fortnite and Animal Crossing.

As Owen Williams wrote on his blog:

“Not only is Fortnite the new hangout spot, replacing the mall, Starbucks or just loitering in the city, it’s become the coveted ‘third place’ for millions of people around the world.”

With fewer young people watching TV (and even when they do it’s often an ad-free streaming service) brand activation needs to go where people are instead.

As BBH Singapore’s Chief Creative Officer told The Drum:

“We‘re living in times where our audience literally is paying money to avoid seeing our work. We really need to work a lot harder to provide value. A shortcut to that are those cultural moments… because they immediately make you relevant and interesting. It‘s really important that we leave this bubble of the hip, Netflix-watching ad men and women and really look out to see what the majority of people really care about.”

These are still early days.

And many brands are still building their approach to gaming. You can go the influencer route or run strategic campaigns like Samsung

But no matter the road you take, you need to start talking about your approach to gaming with your team. Now.

Newzoo’s Remer Rietkerk has relevant advice for any brand manager looking to define their approach to gaming:

“Brand activation in games can take many different forms. Fortnite is a trailblazer for in-game activations, making it a perfect case study. Travis Scott performed an in-game virtual concert, a collaboration with Nike which generated 27 million unique virtual attendees. This was only the latest in a series of events Epic Games launched in its Fortnite game world, with previous examples including Marvel, Batman, and Star Wars.”

He also advises sticking to these key principles:

  • Any collaboration must make sense in the game‘s universe; it shouldn‘t feel forced.
  • It needs to feel authentic, resonating with the community the promotion is servicing.
  • Promotions cannot interfere with gameplay, especially in big-budget games

Video e-commerce expands outside China

Live video and e-commerce were born to be together.

There’s an online sales revolution in the works. It’s already huge in China.

Shopping channel QVC is going digital with a stoppable app built around video e-comm.

Amazon Live launched quietly in 2019. Their live streams are similar to the shopping channels where celebrities and influencers sell products from Amazon vendors.

Facebook and YouTube are also launching in this area. Their biggest shortcoming is the lack of integration with their native e-comm solutions.

While Facebook and YouTube drag their feet, brands are getting their feet wet with things like Livescale and Bambuser that offer live-streaming that can be integrated into the brand’s own e-comm site.

There’s been more cynicism lately towards influencer marketing, but maybe video e-commerce will create a new generation of influencers. Such as China’s Live Stream Queen who can supposedly sell anything.

Video e-comm isn’t a fad.

And it needs to be a part of any e-comm brands digital strategy.

Even if going full-scale QVS isn’t your cup of tea, now’s the time to start taking baby steps into video e-commerce.

If you get in now, you’ll get a leg up by getting in before it turns mainstream and gets saturated.

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