Lesson 7 // Content and Commerce
Ecosystems engage users with content to drive sales
China model combines brand building and immediate results
China has developed a unique model for combining the content necessary for long-term brand building with the activation mechanisms that produce immediate sales results.
Unlike online behavior in most of the world, where people constantly shift among multiple apps, Chinese conduct their daily activities primarily on one or two ubiquitous ecosystems—WeChat or Alipay—using their mobile phones to seamlessly view and share content, shop, purchase, and pay.
This integration of content and commerce is the digital incarnation of traditional Chinese communal life, where neighbors congregate in the yard or alley to converse and share their daily chores and shopping.
In less than a decade, these cultural rhythms have been replicated in an online landscape of e-commerce, social commerce, and content commerce where brands deeply understand their customers and respond quickly to their needs.
Understanding and adapting to the particularities of this Chinese interplay of communication and commerce—and the complicated media possibilities beyond mass advertising—opens tremendous opportunity for brands in China and those planning to enter China.
For example, using a WeChat Mini Program (an app equivalent embedded in WeChat), brands can access consumer data, derive insights, and create relevant ads with click-to-purchase activation and seamless payment.
The Bytedance-owned short video site Douyin (TikTok outside of China) uses algorithms to build audiences around narrow interests and match them with consumer-generated videos. The target audiences receive brand content relevant to their interests, with the possibility of linking to an e-commerce site. Similarly, Bytedance’s Toutiao attracts people interested in news.
Brand success in China requires understanding this unique model of content and commerce. In addition, it is likely that this model will be exported to other regions of the world that share cultural and market affinities with China. Ultimately, global brand builders will need to be facile in at least two different ways of going to market—Chinese and Western.
Key Takeaways // Content and Commerce
Brand Building for Future Growth
- Start with the basics
The basics of building business and brands do not change in China. The lessons learned in other markets are transferrable with modification. Invest in being meaningfully different and salient. That simply means providing consumers with a product or service that they perceive as relevant to their lives because it meets their needs in ways that the competition does not. Do not keep that accomplishment a secret. Using the media mix that most effectively matches the targeted audiences get the word out, make the brand salient, make it come easily to mind at the moment the consumer is in purchase mode.
- Adapt the basics
The basics work in China, but they work somewhat differently, which requires gaining deep insight about the market. Members of China’s two rapidly expanding demographic groups—seniors and young people—may have mirror image perceptions of the same product, for example. In the personal care category, an older women might consider a skincare product meaningfully different because it offers good value for money. Conversely, a younger woman might believe that the premium price of a skincare product connotes higher quality and prestige and makes the product meaningfully different. Similarly, in the West salience might be achieved with a creative ad campaign. Creative advertising is critical in China, too. But a campaign often also needs to involve the exact right KOL across the most appropriate online platforms. Online, the content that establishes a brand’s meaningful difference can be just a click away from converting interest to sales.
- Select the right platforms
Because of the advanced state of O2O in China, selecting the right platforms is more critical there than in any other country market. But selecting the right platforms— with optimal demographics, reach, and data—can be like playing three-dimensional chess. With Tencent, brands can open online stores called WeChat Mini Programs, on the social messaging app where people spend much of their day. And brands on Tencent are in a high-traffic ecosystem for music, news, games, and myriad other needs and diversions. With Alibaba, brands can set up a flagship store on Tmall and be on AliExpress for access to overseas markets. Transactions are seamless because so many people use Alipay for ease of checkout, showing their personal QR code or relying on facial recognition, where possible. JD.com has a particularly good reputation for logistics and was among the first to experiment with drones for delivery. Pinduoduo, a more recent rival, began lower tier markets where it remains particularly strong. Choosing among these multiple partners can be complicated. Advice from experienced market experts can save time and money.
- Tell emotional stories
In It is important to communicate with stories that define the brand and connect emotionally with consumers. This much is true in most markets. The difference in China is that brands have more opportunities to connect emotionally for both long-term brand building and short-term sales conversion. Young people, in particular, spend a lot of time on content- and social commerce, where brands have an opportunity to create an emotional bond with viewers and link them to e-commerce. An important caveat, however, which again demonstrates the complicated nature of China’s media market: a straightforward brand message will seem intrusive on sites that people visit to look at content; in contrast, people networking on core social media sites will be more open to brand messaging.