The Online Shopping Landscape in China Drives New Challenges For Companies
It is not a secret to anyone that Chinese consumers are searching to buy quality goods at higher prices and use social media to gather product information. According to a new report by The American Chamber of Commerce in Shanghai (AmCham Shanghai), in Tier-1 and Tier-2 cities, an increasing number of consumers are relying on consistency and integrity in their purchasing choices, a large change from a previously price driven market. This change signals greatly required alterations by both Chinese and International consumer brands with regard to the marketing channels they use and most importantly the content they drive in China. As a result of this the report details that with the increased usage of e-commerce and social media, the second most significant trend detailed in the report stated that both multinational and Chinese companies recognize the importance of developing digital marketing and sales channels. However, most companies declared that they are yet to be adequately prepared to convert growing online interactions to a sales advantage. The report, however, noted that leaders in this area demonstrate the benefits of strategic use of data derived from online viewing and purchasing habits and from this have displayed desirable results through alignment of digital activities with their corporate strategies and across organizational functions. For many large companies in their current situation this gives them the opportunity to build products and brands that can deliver great value. Experts are confident that this trend will increase brand loyalty among consumers focused on value which means that they will pay higher prices for quality products and services. Still to get to the sales conversion point consumer companies face large challenges in online retailing in this dynamic market.
Source: Retail In Asia
Baidu Acquires Nuomi
Baidu has struck up an agreement with Renren to buy, in its entirety, the e-commerce site Nuomi. China’s number 1 search engine will become the platform’s exclusive investor and only shareholder. Baidu has made this move because it feels good about China’s massive local service industry market.
Source: Want China Times
Baidu has Invested $15 million in a U.S. E-commerce Luxury Site
1stdibs, a New York-based retailer for upscale interior design, decoration, and fashion, has just received $15 million in series C funding from Alibaba. One-third of the platform’s business comes from outside the U.S., and will help Alibaba better serve China’s quickly-growing consumer market for luxury goods.
Source: Tech In Asia
Mobile Advertising Spending Lags Behind that of Other Media Types
China’s population is rapidly expanding into the mobile world, and advertisers have yet to sufficiently keep up. Though more Chinese people are spending copious amounts of time on their mobile phones in comparison to other channels, mobile advertising is not growing at the same rate. Total ad spend for mobile advertising was at about 1% in 2012, and is predicted to reach just 3% in 2014. What are the factors accounting for this lag? It is probably the long download times and lack of reliable tracking data. The mobile audience, however, has become much too big for marketers to ignore. A little over half of China’s population uses the internet, with 81% of it accessing the Web from their smart phones. M-commerce is becoming more commonplace as well, with 55% of Chinese Internet users having bought something using their mobiles in the last quarter of 2012, compared with 37% in South Korea and 10% in the U.S. In lower-tier cities, e-commerce is very popular, what with local malls being quite bland.
Alibaba Aids Mainland Tourists in Hong Kong with Alipay Wallet Integration in Major Stores
Alibaba will provide offline payment services to three major retailers in Hong Kong. The Internet company has partnered up with Circle K, Bonjour, and Giordano so users can purchase goods by simply presenting their apps at the till and having barcodes scanned. This service is intended to help users pay for goods easily and avoid the hassle of exchanging RMB to HKD. Alibaba hopes to roll out similar services in other countries, and would be a big stepping stone to international expansion.
Source: Tech In Asia
WeChat Creates Social Game for Giving New Year Money
Users of WeChat Payment can now send digital lucky red envelopes of money to anyone they wish. The “game” aspect in all of this is that the sender can choose to divvy up a set amount of money they wish to give away and will randomly give away different amounts of that money to users. In order to receive the money, however, users must have a WeChat payment account. This game is quite an ingenious move in getting more and more users to sign up for WeChat payment accounts.
Source: Tech Node