Ready to crack the Chinese market in 2020? China is now a focal hotspot for ambitious Western businesses, with Chinese customers continuing to increase their spending on desireable and high-quality Western products and services. With its growth market, rapidly evolving digital infrastructure and growing demand for outbound tourism and luxury goods, it’s important to anticipate the biggest trends for successful marketing in China 2020.

But let’s start first with a few interesting facts that put the scope and growth of this vast market into fresh context as we transition into the new decade.

Key facts about the Chinese market in 2020

1. China has 600 cities, and 20 of them have over 5 million inhabitants. 140 of them have more than a million citizens.
2. Urbanisation across the country is expected to hit 60% this coming year – with the associated growth in consumption.
3. China is positioning itself to become a world leader in AI, with tech giants such as Alibaba, Tencent and Baidu hiring AI, data and research specialists at an incredible rate – and one that certainly rivals Google, Facebook and Western equivalents.
4. According to McKinsey estimates, Chinese online retail hit $1.5 trillion at the end of last year, which makes it a larger single market than the next ten largest markets combined.
5. Content consumption and social media account for two-thirds of the time spent online in China. In a market where 1 out of 3 online customers have accidentally bought counterfeit products, Western brands who can develop strong, consistent and trusted brands have a growing opportunity to build market share and a loyal base of Chinese customers.

So let’s have a look at the big trends to know for Chinese marketing in 2020:

1. KOLs will evolve to KOCs

Key Opinion Leaders, or KOLs, have dominated the Chinese social media landscape for some time. However, as their sponsorship fees have risen, so have queries about their authenticity. With this in mind, some brands are looking to invest in Key Opinion Consumers, or KOCs. Western brands can expect to see competitors investing in influencer strategies which use both types of online influencer to spread brand awareness and to maximise returns. KOC communities are being created via private chat groups on social platforms, along with incentivised referrals and product reviews. Key platforms for these activities are likely to be WeChat, Little Red Book, Weibo and Tmall.

2. Vlogging will grow

Vlogging is growing fast in China! Estimations suggest that vlog views in China almost doubled last year, making vlogs a powerful new channel for online influencers alongside livesteaming and short videos. Bilibili, the Generation Z focused vlogging platform, saw its ad revenue grow by 80% in Q4 of last year. Longer video formats were also seen in greater use across other platforms such as WeChat and Weibo, with key celebrity Chinese influencers such as Mr Bags turning to vlogs to engage with their audiences.

3. Livestream Commerce will go mainstream

The feature to livestream commercial activity has been available on Chinese social media platforms such as Taobao and Tmall for some years, but it really came to the fore in 2019. For example, L’Oréal used it on Singles Day, with a 17-hour livestream to deliver a 700% sales growth. This was supported by the ‘See Now, Buy Now’ facility for instant purchasing via mobile phones in particular. This year, the facility will be added to Little Red Book, and brands are expected to use the livestream facility on WeChat Mini Programs.

4. Lower-tier cities will become a focal point

Chinese consumer power has been largely held in its Tier 1 cities until now (Beijing, Shanghai, Shenzhen and Guangzhou). However, lower-tiered cities are now growing in prominence, along with the spending power of their citizens. Opportunities for Western etailers are looking especially good in locations where global brands have a minimal physical retail presence. Alibaba focused on these emerging cities in Singles Day 2019, hosting a kickoff event in Harbin, alongside its regular celebrity gala event in Shanghai. Bloomberg reported that 70% of Alibaba’s new active customers had come from these lower-tier cities in 2019. As a Western brand, it’s easy to dismiss the idea of a ‘small’ tier 3 or 4 city, but the reality is that it will often have over a million inhabitants and a high proportion of smart, informed and wealthy young buyers, driven by rapid urbanisation.

5. Experiences will become smarter

For Western marketers, the Chinese market is incredibly sophisticated and becoming all the more so. Consider, for example, the fact that 69% of clothing buyers in China will use their mobile phones to research a product, whilst they stand in the retail store itself. Think about the trend for multi-screen engagement; for example, Chinese customers will watch China’s Got Talent on TV, whilst engaging with bonus content on social media channels using their tablets, and sending branded show stickers to friends via their phones, along with their predictions via online forums! Lifestyle and experience will continue to drive Chinese customer conversions, but the technologies used to create innovative marketing and advertising campaigns will become hugely sophisticated and often more so than in the West. Gamification, AI, location-based services, hyper-personalisation… all these things are essential to consider.

Other trends for Western marketers to know about for marketing in China 2020 include co-branding (also known as partnership branding), O2O – or ‘Online to Offline Marketing’, and social marketing, as brands seek to engage with an informed Chinese audience with a social, globalised conscience and a desire to do good – as well as to enjoy their luxury brands!

The help that you need

In a market this vast, this complex and sophisticated and this fragmented, it takes real knowledge and insight to launch a successful marketing campaign and to build a Western brand within the China market. A Chinese marketing agency can assist you, offering flexible and expert resources that help your brand strategy to be successful, and your campaigns to see the necessary ROI.

Whether your Western brand operates in Chinese outbound tourism, luxury e-commerce, HE, real estate, tech or B2B markets, the team of Chinese marketing experts at Market Me China can help you to enjoy success with your marketing in China 2020. Please contact us for a no-obligation chat about your needs.