09/02/17 10:31 BST
by Hot Pot Digital

Need to Know: 5 China Trends for 2017

As China returns to work and the Year of the Rooster gets into full swing, Hot Pot Digital outlines key trends every China marketing specialist should know.

 

1. The Rise of WeChat Mini Apps

 

Currently there are 846 million monthly active WeChat users, of which 90% are daily active users. Past experience has demonstrated that Chinese mobile consumers are extremely open to change within technology – take the boom in live streaming as a recent example – and WeChat Mini Apps are predicted to perpetuate this trend.

WeChat Mini Apps – announced in early 2016 – are apps that run within the WeChat environment and are accessible on-the-go. No separate downloads or installs. Mini Apps are therefore designed to make the user experience seamless and more cohesive within the WeChat platform. As with previous WeChat evolutions, Tencent have a razor-like focus on delivering ease and convenience to end users.

For brands and services that leverage this functionality, the additional convenience should equate to an increase in sales and happier, stickier customers. Additionally, Mini Apps will prove beneficial by reducing time and development costs associated with standalone apps. It is also good news for developers because it removes the challenge of navigating the block on Google Play, which had in the past made it extremely expensive to gain Android installs.

Hot Pot Verdict: Early adopter brands with a clear UX strategy for WeChat Mini Apps are likely to reap the benefit of significant additional engagement . Stay tuned to see the WeChat Mini App landscape and regular user behaviour evolve significantly over the coming 6-12 months.

2. WeChat Groups: Closed, but Powerful Vehicles of WOM

 

Groups are one of WeChat’s least discussed functions because they are organically driven and closed community environments.

Set up by individuals, group themes can be anything from restaurant recommendations, to dog walking to crochet. As an example, mother and baby groups are particularly prevalent, and typically have a “baby expert” on call who is able to solve queries. The groups represent engaged digital communities that recommend the best baby products, give caring tips and provide a support network for other mothers.

WeChat groups tend to coalesce organically through word of mouth and personal invites and have a maximum user base of 500. After 100 participants, new entrants are asked to link their credit card details for identity verification purposes. Some groups are extremely in demand, and when one participant leaves the group, the vacancy is rapidly filled by another user who has been on standby.

Hot Pot Verdict: While WeChat’s closed environment can prove a struggle for marketers who are used to the openness and virality of Weibo, WeChat groups represent an opportunity to drive valuable WOM with smaller, targeted audiences. Brand involvement should come through the creation of authentic advocates to chair or participate in group discussion.

 

3. The Dawn of the Globalised Chinese eCommerce Shopper

 

As evidenced by the launches of TMall Global in 2014 and JD Worldwide the following year, Chinese netizens have become increasingly comfortable with buying cross border.

In addition to Chinese marketplaces’ international offerings this also includes a significant uptick in purchases directly from brands’ international .com sites. A recent report has found that 38% of shoppers in Tier 1 cities and 27% in Tier 2 have made cross border purchases online. By 2020, it is predicted that 60% all of global e-commerce will be generated by Chinese consumers.

In a quest for authenticity and originality, many consumers in China perceive overseas goods to be more trustworthy, high quality or on-trend. These factors, coupled with increased credit card penetration and comfort navigating global .com sites are reducing reliance on marketplace intermediaries like TMall Global.

Consequently the bar is lowered for global brands looking to take an initial step to selling to Chinese consumers.

Hot Pot Verdict: Increasingly for new entrants to China, the lowest-cost route to selling to Chinese consumers comes through optimisation of an existing .com site. Improving load speeds, implementing Chinese payment platforms and re-skinning navigation in simplified Chinese all add up to an improved user experience and greater conversions.

Get in touch with Hot Pot Digital to discuss consulting for your China eCommerce strategy.

4. Chinese Travel is Every Brand’s Business

 

The number of Chinese travelling abroad has been rising consistently in recent years. The Communist Party has set a target of 150 million overseas travellers by 2020 in their Five Year Plan, which is a firm indication of intent, backed up by signficant year-on-year growth since 2010.

Chinese travellers are becoming more adventurous in their travelling choices, due in part to a decrease in visa restrictions. This means that Iceland, Berlin and Dubai are just as likely to see benefits as more well-worn paths like London, New York and the Maldives. As France experiences a dip in the wake of terror attacks, Spain, the UK and Italy are all predicted to see significant gains in 2017.

Family travel – i.e., multi-generation trips – are the fastest growing group of travellers outbound from China, constituting 51% of outbound travel during Chinese New Year, with an 18% increase from a year ago.

Hot Pot Verdict: Global destinations have only seen the tip of the iceberg in terms of Chinese visitor numbers. A robust China strategy with online and offline campaigns covering peak travel seasons such as Golden Week will be crucial to capturing maximum benefit from this increased footfall – not only for hotels and travel brands, but also retail, fashion, luxury, beauty and beyond.

 

5. Fitness: China Works up a Sweat

 

An increase in dietary consciousness and mounting rates of adult and child obesity have resulted in an overwhelming interest in health and fitness that borders on mania.

A lifestyle shift is underway – particularly in Tier 1 and 2 cities – seen not only through the uptake for sports and “athleisure” wear but also in soaring demand for fresh juices and organic products. Parents are seeking products with a clean ingredient list and are demanding higher product standards, leaving an opportunity gap that has yet to be completely filled by domestic brands.

As well as trying to eat more healthily, Chinese consumers are partaking in more physical activities and are keen to use technology to monitor and improve their health. Health and wellness apps have increased significantly as a result. In 2013, only 3% of smartphone users had health-focused apps installed, whereas a survey in 2015 saw a rise to 22%. Many of these users claim they are some of their most frequently used apps.

The market for fitness-related wearable tech has also boomed in recent years. Seeking to capitalise on the trend, domestic Chinese smartphone manufacturer Xiaomi launched a wearable fitness tracker followed by smart trainers that featured a Bluetooth fitness tracker in the heel.

Hot Pot Verdict: The boom in health and fitness is a key indicator that there is no longer a lag in terms of China adopting global trends. We expect to see class-leading fitness tech emerging from China that combines with the power of WeChat to give an enriched health/lifestyle experience to end users.

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Interested to hear more on the above topics?  Get in touch with the Hot Pot Digital team on our contact page or via the form below to find out how we can accelerate your China growth in 2017 and beyond.