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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.

Finally, an actual use case for AR

You probably weren’t expecting to read about luggage this summer. Neither was I.

Until I read about how an online retailer of bags, eBags, got 112% increase in mobile conversions AND a drop in customer returns all because of using AR (Augmented Reality).

Pokemon Go started the AR craze but the reality of it, so far, hasn’t quite lived up to the hype.

Many brands have been playing around with the tech but everyday use is still lacklustre.

In the meantime, it’s nice to see what we can expect from AR in e-commerce.

Google’s 3D ad-format is coming out of beta.

And it’ll be available to everyone.

Not to mention that the greater influence of Amazon in e-commerce isn’t leaving brands much choice other than to set up shop in the marketplace.

More Amazon, though, means smaller margins. Plus putting all your eggs in one basket isn’t strategic.

Creative solutions are how you can make your own ecommerce site attractive to customers.

And AR makes it easier for customers to experience the product in a more complete way – as they would in a physical store – which is never a bad idea.

Contactless car retail is here

Wouldn’t it be nice if we could buy a car the same way we buy shoes from Zalando?

Sure it’s possible but for the most part, buying or selling a car is built around in-person interactions.

A business model put under stress during the pandemic.

According to an analysis by BCG, at the peak of the pandemic in April car sales in the EU were 80% lower vs April 2019. And just last month the European Automobile Manufacturer’s Association revised its 2020 forecast down to -25% growth in new car registrations.

Things may look bleak right now but there’s light at the end of the tunnel for the more ambitious dealerships.

For one more Europeans believe that using a car is the safest mode of travel after the lockdown is lifted. And as Google’s trend analysis pointed out, people are willing to buy a car sooner if they could complete the purchase online.

A car dealership from NJ seems to have acted on this advice.

Patch wrote about how Bezel-Busch partnered with Looney to create a seamless and contactless process for people to purchase cars during the pandemic.

So what did this transformation include?

According to the article, “Looney created conceptual videos for Benzel-Busch’s new COVID-19 resources, including “Express Buying,” allowing customers to virtually select/customize vehicles of their choice, as well as “Complimentary Valet Service” and the industry’s first “360 Sanitize,” a deep clean that lasts up to three to six months and kills 99.9% of germs/bacteria/viruses.”

And what of the results? 

“new users increased by 180%, while website sessions soared by 159%. Direct site traffic also rose 51% and impressions increased from 365,000 to more than 96 million. Overall, Benzel-Busch had one of its best sales years in history in 2019.”

Devastating as it is, COVID also turned out to be the mother of many new inventions. I hope that more car dealerships will offer a better, seamless and contactless way to purchase new cars for introverts like me.

Facebook strengthens social e-commerce with Shops

Facebook Shops

Facebook recently announced a new feature to support small businesses called Facebook Shops. Shops will give businesses the ability to display and sell products directly on Facebook.

While most sellers will still need to drive buyers to their e-commerce store from Shops, Facebook is testing an invite-only Checkout program for which it will charge an undisclosed fee for each transaction.

Unlike the existing Marketplace, which offers peer-to-peer selling, Shops is a free-to-use social e-commerce solution available through Facebook and Instagram.

With Shops, ability to handle customer support through Messenger and eventual plans to sell products directly through chat, Facebook is making omnichannel e-commerce possible for the 90 million small businesses using Facebook.

Facebook is also planning to offer shopping through Live Stream videos same as shopping channels.

Zoom out

For some time now Facebook has been working on connecting its app (Facebook, Messenger, Instagram and WhatsApp) into an ecosystem.

Shops bring Facebook one step closer to building a social e-commerce ecosystem similar to WeChat. In addition to Shops, Facebook has also introduced a string of new features including the ability to connect loyalty programs to Facebook accounts.

Facebook has big plans for revolutionising online retail. With social e-commerce from Instagram poised to bring $10 billion in revenue by 2021, Facebook is putting its weight behind making social commerce available to business of all sizes.

What now

This move alone may not be enough to replace Amazon but for some small businesses, Shops could become a compliment or even a substitute to Etsy.

According to Zuckerberg, Facebook isn’t positioning itself to become an e-commerce platform. Instead, more data on how, where, when and what we purchase will allow Facebook to improve its ads revenue.

Here’s a word of advice for anyone interested in giving Shops a shot, social e-commerce is ‘social’ and might require a significantly different approach than what most e-comm retailers are used to.

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