Over half of Chinese eCommerce takes place via mobile. We take a look at the reasons for mobile’s cultural dominance and how you can make the most of it.
Mobile commerce, or mCommerce, is a rapidly growing phenomenon in China. In 2016, 55% of all eCommerce retail sales took place via mobile, totalling $505 billion. This figure is expected to grow exponentially, multiplying to $1.4 trillion by 2019 – a quarter of all Chinese retail spending. This remarkable growth stems from China’s recent technological history, and the key to unlocking its future potential lies in understanding how it has impacted Chinese society.
THE DEVELOPMENT OF MCOMMERCE IN CHINA
For decades, China was a manufacturing-based economy, with “Made in China” appearing on everything from toys to tea towels. However, in recent years, it has shifted towards consumption. This slowed economic growth, but has left the wealthy Chinese middle class with money to burn – money they are willing to spend online.
China missed the early years of eCommerce, but its appearance on the scene coincided with the invention of the smartphone. As 70% of online shoppers are aged between 16 and 34 (source: East West Bank), the desire to keep up with the latest trends inspired many to leapfrog traditional technology and eCommerce in favour of its mobile alternative. In China, now the world’s leading smartphone market, mobile is the primary way of getting online, with 95.1% of users accessing the internet through their phone (source: We Are Social).
The development of mCommerce was greatly aided by China’s heavy investment in telecoms infrastructure and 4G, which brought millions more people onto the web and gave rise to rural commerce. Although eastern and southern coastal regions, such as Shanghai and Beijing, are more affluent and are key targets for online retailers, western and central regions are increasingly participating in mCommerce, giving companies access to millions more people than ever before.
mCommerce’s rise in popularity has changed the way Chinese society operates. The traditional 9-to-5 shopping hours have been abandoned as users shop online during their commute and after work, expecting immediate customer service at any time of day. Mobile use also punctuates the day. Almost 100% of people aged between 14 and 47 own a smartphone, and half of these access the internet about 25 times throughout the day. Chinese millennials spend on average 27 hours per week online, compared to 21.7 hours from their American counterparts (source: Qihoo360, GGV Capital).
Smartphones have contributed to the rise of zhai (homebody) culture, where Chinese millennials spend the majority of their leisure time at home online. This is made increasingly possible by the sophistication of mobile apps. For example, WeChat is a lifestyle app that allows users to pay bills, order takeaway, buy theatre tickets and chat to friends all in the same place. It is now perfectly possible to live your life through your mobile screen, and increasing numbers of people are choosing to do so. As a result of this increasing amount of time, Chinese millennials have a far more global outlook than previous generations and a desire to see and engage with the world.
This homebody culture is partially brought about by the lack of offline entertainment and intense pace of life in China’s urban hubs. The ironic result is that as people spend more and more time online, physical stores are being replaced by virtual malls, where companies set up shop online to do business directly with customers. As China’s mCommerce develops, users are increasingly buying products from overseas. In four years, 25% of the population will be shopping on cross-border sites (source: eMarketer).
With more people than ever before going online and looking abroad for quality products, there’s never been a better time for overseas companies to get involved in mCommerce. However, before charging up your phone and getting ready for business, there are a few things you need to know.
FIVE THINGS YOU NEED TO KNOW ABOUT CHINESE MCOMMERCE
1. Ditch the iPhone
74.44% of Chinese mobiles run on an Android operating system (source: Statista), so to succeed, you’ll need to make sure your content is Android-friendly. While we’re on the subject, apps are overwhelmingly more popular than mobile-optimized websites, due to their streamlined design, ease of use and user-friendly look.
2. Think big, talk small
With the vast numbers of potential customers on offer in China, it can be easy to turn people into statistics. However, for your marketing to succeed, it needs to be individually adapted to users’ tastes and needs. This task is made easier by the huge digital footprint left by each user. Analytics tools on WeChat and Weibo, among others, allow you to work out exactly what your users want and how to give it to them.
3. Explore the real world
One of the best ways of expanding your customer base is by marrying the online and offline worlds, and this is made easier by smartphones. QR codes are much more developed in China than in the West, and can be used as effective marketing tools. German pharmacist company Bodyguard Apotheke came up with an offer on offline banners and posters that could be redeemed by scanning a QR code and following the company on WeChat. The promotion was responsible for 18.8% of total sales during the campaign, making it a huge success (source: Azoya Group).
4. Pay as you go
The ability to pay using your phone is what turned mCommerce into the powerful force it is today. WeChat users can create an online wallet linked to a bank or credit card for online payments, while QR codes can be used for offline purchases. Some 364 million people shop using their mobile, and there are predictions that three quarters of all online retail transactions will take place via mobile in 2018, so it really does pay to make mobile payments a priority (source: Azoya Group).
5. Engage your audience
The average WeChat user spends over 90 minutes on the app daily, but this is split into lots of micro-moments throughout the day (source: Webcertain). As a result, to get someone’s attention, you’ll need to craft engaging and easily-digestible content they will remember. Engaging customers with interactive games or funny videos they can share is the best way to get their attention, spread your message, and live on in their memory even after they’ve put down the phone.
The emergence of a two-way dialogue between brand and consumer creates an opportunity to utilise the data and insights from these interactions and deliver ever-more personalised messaging.
Brands have the chance to really listen, as customers can communicate what a brand means to them and show how they express themselves with the company’s offerings. The customer is essentially showing the brand “this is me expressing myself through your voice.”
And so the question arises: with this detailed segmentation, how far should your brand deviate from its core voice?
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