Marketing in post-pandemic China: leveraging new social consumption

As the summer of 2022 approaches, brands in China are still facing economic uncertainty and a rapidly changing consumer environment. It’s a challenging marketing landscape, requiring new approaches and in-depth societal knowledge. Nevertheless, some brands continued to shine. Michaela Zhu, marketing manager at Emerging Communications, looks at how Chinese brands are handling it.

Last April, Prada launched an online culture club on WeChat and Xiaohongshu, inviting influential creatives to recommend movies, books and songs. Chinese netizens have warmly welcomed the resulting dialogues and social connections, offering respite and reward during the months of lockdown.

Keeping the pioneering example of Prada in mind, we explore ways in which brands can maintain effective Chinese marketing in the post-pandemic era.

China Market Snapshot: Consumer Behavior

During the coronavirus outbreak, Chinese consumers have turned to online learning and education, a sector growing 15% year-over-year. Moreover, the entire online retail sector grew at the same rate until 2021, when it skyrocketed by more than 21%.

What can brands learn from it?

This demonstrates how Chinese consumers prioritize experiences and self-improvement, even in the midst of unprecedented global change. With the latest lockdowns, food storage was an initial phenomenon, but it gradually shifted to luxury care, hygiene products and fast food treats (life-enhancing items).

Even at home, purchase intent tied to online ad awareness remained incredibly strong. Therefore, brands need to maintain their “exposure” to stay at the forefront of consumers’ minds.

The rise of new social consumption

Brands are now turning to China’s latest social media trend of “new social consumption” to increase both exposure and market share.

Chinese social commerce reached $363 billion in 2021, up 36% from the previous year. This accounts for over 11% of all e-commerce sales in China.

During lockdowns, brands and consumers communicate more directly. Focus groups, KOLs (Key Opinion Leaders), and livestreamed events all deliver social entertainment and brand awareness – best exemplified by one platform: Little Red Book or Xiaohongshu.

The Evolution of an Icon: Xiaohongshu

Today, Little Red Book (or simply “Red”) is China’s most trusted social media shopping platform. From its humble beginnings in 2014, the app has grown into China’s leading fashion and luxury goods platform.

Amid discussions of luxury shopping and sneak peeks at high-end brands, users are posting product reviews, photos, and tips to their boards. Particularly popular with an affluent female Gen Z Chinese audience, it features a unique blend of user-generated content (UGC) and reviews, community advertising and social chat.

How International Brands Leverage Xiaohongshu

With over 100 million active users, many international brands are focusing on Red for their digital strategy in China.

The platform has certainly forged new forms of creative product presentation, recently launching the first “online fashion week”. Held from April 15-30, this event incorporated online launches by luxury fashion designers, with new collections appearing every three days. In conjunction with Shanghai Fashion Week, the platform unveiled 3,000 limited-edition virtual garments exclusively for Xiaohongshu users.

As debates rage over whether digital fashion is a one-off stunt or a game-changer in the industry, the commercial success is evident. When celebrity Beijing Olympics costume designer Cheng Peng’s virtual mermaid-inspired outfits were released (for $600 each), they sold out immediately.

It is a Chinese social media trend that has caught the attention of companies such as Louis Vuitton, Burberry and Gucci. Indeed, the three brands have recently created digital collaborations sold under the name NFT, and have found similar commercial success.

The art of creating new “opportunities” for consumption

Besides virtual fashion collections, Xiaohongshu guides Chinese consumers to “new occasions” to use, buy and think about products at home.

To master the art of the “new buying occasion,” instead of focusing on what your product is, think about what event it is being used for. For example, a weekend brunch, dinner party, or working lunch all require different shopping and planning processes. Understanding the occasions behind consumption is key to marketing in our post-pandemic reality.

For example, this month of April saw a two-week performance art by musician and artist Pang Kuan. Streamed live via WeChat and Weibo, he self-isolated with only a few personal items for company.

With over 3.7 million views and countless fun hashtags, it provided a source of fun and community connection during lockdown restrictions. But above all, Pang also often wore elegant designer ensembles…

He danced in Gucci suits, played with his Fendi phone accessories and worked out on his Dior exercise machine. Keen to find out which brands Pang has embraced, online searches for (and purchases of) these items have skyrocketed.

It has created a whole new “opportunity” for luxury fashion shopping, delivering unparalleled immediacy, artistic edge and a sense of connection for brands and consumers.

Innovative technologies and consumer communication have revolutionized Chinese marketing strategies in the post-pandemic era. To get started with Little Red Book and boost your brand strategy in China, download our guide to this unique social platform.

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