Insight – E-commerce and live streaming remain strong in China
China’s second-biggest shopping festival of the year, 618, took place on 18 June. The e-commerce event produced sales records and surprising figures.
According to most reporting about the festival:
Tmall could only have delivered this quickly if it already had products in place. Having this amount of stock on-hand suggests faith from businesses that their products would sell.
More notable is what this event reveals about consumer confidence. With fast delivery times, the appeal of e-commerce has never been greater for many categories. National reporting records 24.7% year-on-year growth in online retail sales in May. This compares to 12.4% growth in overall retail sales. (Source: Xinhua, 16 June 2021, China’s retail sales up 12.4 pct in May)
Live streaming crucial to success
Live-stream transactions accounted for AUD$13.3 billion of sales. (Source: ChemLinked, 24 June 2021, 2021 China's 618 Shopping Festival Report) This should remind exporters that live streaming is no longer optional. Rather, it must be an assumed part of any China strategy in 2021.
However, live streaming is facing more scrutiny and regulation. Live streamers must take note of regulations and other expectations when producing live content.
Planning for the big festivals and beyond
China’s e-commerce platforms were highly active for the 618 shopping festival. Offers included:
- new membership systems
- curated product and brand areas
- themed mini-events
- rewards programs.
Building relationships with these platforms can open the door to new, exciting consumer initiatives.
However, foreign brands need to diversify their market investment outside of the big festivals. Growing competition makes it hard to generate a positive return on investment.
During big festivals, consumers have come to expect foreign brands to:
- load up stock
- spend heavily on directing shoppers to their listings
- offer big discounts that induce bulk buying.
These expectations are strongest in higher-value areas like skincare and infant formula.
Exporters should watch and learn how domestic brands succeed outside of the big shopping festivals. Foreign brands tend to gear their campaigns and effort towards the big shopping festivals. Domestic brands tend to remain more consistent in their marketing year-round.
About this insight
We commissioned this insight from China Skinny. China Skinny is a Shanghai-based market research consultancy.
How we can help you with e-commerce in China
Our specialists in China can help you with advice on:
- e-commerce market entry models
- how Chinese e-commerce is different from the rest of the world
- e-commerce operations in China
- the various business models in Chinese e-commerce.
Contact us online or call 13 28 78.