Livestream and Social Selling: How China’s Retailers Adapted to Coronavirus

It has actually now been 2 months since the coronavirus initially appeared in China. After a nationwide lockdown the situation is returning to normal. Restaurants, bars, and also retailers are opening up throughout China as well as people are going back to work. The vast majority of fitness centers, theater as well as various other home entertainment places nevertheless stay shut.

Due to the coronavirus crisis, the near-shutdown of offline retail in China has forced companies to turn to innovative methods to keep their businesses afloat. Although China retail has had a strong focus on e-commerce for quite some time now, this was the first time for many businesses to shift all of their resources towards online selling.

Let’s look at how China’s digital community enabled retailers and brands to endure throughout this difficult time and also what Western players can do to learn up from them.

Livestreaming E-Commerce Keeps Consumers Entertained

Livestreaming has actually already experienced a big boom in 2019. It therefore does not come as a surprise that numerous merchants have counted on livestreaming to keep their businesses alive. Such livestreaming sessions usually occur on Taobao, China’s eBay-like C2C industry platform, with more than 600 million individuals. Sellers can either host the session under their own store channel or collaborate with a well-known influencer to do it on their Taobao channel, enabling them to target the influencer’s existing fan base.

How does a livestreaming session work: Typically, a host will present the brand, as well as often incorporate a raffle or sweepstakes video game to entertain his/ her audience. After that, he/she go on to go over certain products, usually trying them on as well as showing them to the audience from different angles. Customers can at any time click a small web link to buy, which is made it possible for with a pop-up order home window and also Alibaba’s mobile repayments platform Alipay.

Additionally, the video sessions are interactive. Each session looks like a digital chat room; any participant can type comments as well as ask the host to try out various products or raise concerns regarding fit, color, size, and so on. Livestreaming allows the consumer to obtain a much better sense of what the item looks and feels like in reality.

During the coronavirus, especially fashion brands relied on livestreaming to compensate closed stores. Dior as well as Chanel have livestreamed their fashion shows and used celebrity ambassadors to advertise them on WeChat and Weibo, China’s prominent social media sites systems. However not just fashion brands were using livestreaming. Swedish furniture brands Ikea began a live-streaming session to draw attention to its Tmall launch, attracting 27,000 viewers within the first ten minutes and peaking at 300,000 viewers. Ikea’s launch on Tmall was the very first time the company has partnered with a third-party system to sell its products. Historically, furniture retailers such as Ikea have actually counted greatly on its showrooms and offline stores to drive sales, yet when faced with the present crisis, it is now realizing how important e-commerce channels are.

Livestreaming has also entered completely new territories: Car or truck service center, farmers, real estate agents, and more turn to livestreaming to attract customers and also drive sales. In February, over 5,000 real estate agents from 100 Chinese cities used Taobao Live to present homes to buyers.

Other than Taobao/Alibaba, rivals such as JD.com, social commerce platform Xiaohongshu, and also China’s super-app WeChat also adopted livestreaming. With every person being stuck at home over the last two months, the coronavirus crisis has actually offered livestreaming ecommerce an opportunity to truly set this tool in everyone’s minds.

WeChat Private Traffic helps Retailers to Reach in Quarantined Consumers

Private traffic via private WeChat Groups is another digital tool that has helped companies to spread discounts and other promotions for loyal customers. Brands and retailers will usually set up private 500-person WeChat groups that are not visible to the open public which gives its members a sense and exclusiveness. In the Western markets, retailers would use e-mail marketing for the same purpose. As e-mail is less frequent and people prefer more instantaneous messaging channels such as WeChat, private WeChat Groups work well.

Private Traffic also enables retailers to build a stronger sense of community with local customers, as oftentimes people hosting these WeChat groups are local store managers at department stores and other retail outlets. Private traffic has turned employees into mini influencers who seek to provide a greater degree of service for customers looking for advice.

One prominent example is China’s largest sportswear brand Anta Sports. The company has given 30,000 employees and distributor partners individualized QR codes on WeChat that they can share with potential customers. The QR codes, which direct customers to the brand’s e-commerce store on WeChat, track how many sales each employee can make and gives them a percentage cut of each transaction.

Department store chains in both Hangzhou and the coastal city of Xiamen have also adopted private WeChat traffic methods to encourage consumption online. Even global luxury brands have started to do it.

Will these tactics also take off in the Western world? The retail ecosystem in China is very different from any other country in the world. In China, content is already much more connected to e-commerce, very often on the same platform. Furthermore, mobile payments are not just a payment tool but a way of life in China. Making an online purchase is very easy – just a few taps of the finger and a six-digit pin code on WeChat Pay/Alipay and the payment is done. The West has yet to eliminate the use of cash and clunky credit cards with their 16-digit numbers and security codes are still required to make online purchases.

However, as the coronavirus crisis makes its way across Europe and millions of small retail merchants are forced to shutter their doors, they may have to try out digital tools to keep their businesses alive. Looking at how Chinese retailers and brands have handled the crisis is definitely worthwhile.

Elena Gatti, Managing Director of Azoya EU

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