As China continues to lead the way in customer experience and tech, R/GA Shanghai’s Yuliana Safari and Connie Ho share the key trends that western brands can learn from.
Recent years have seen China evolve from imitator to trend-setter. For years it was playing catch-up, piggybacking on western technological advances. Today, Chinese brands have become global front-runners in customer experience and technology, going back to its innovative roots that have brought the world products like paper, printing and the compass.
With so much emphasis placed on experience in the digital economy, disappointing a new customer can have significant consequences. Here is what marketers can learn from the Chinese success story to cater to an increasingly digital-savvy ecosystem
The pursuit of the next best self
Much of modern marketing has everything to do with appealing to people’s emotions and what they want – not necessarily what they need.
Unlike their western counterparts, Chinese brands are pursuing an understanding of people’s goals to learn how their products can enhance their lives – a trend sparked by a generational shift where Chinese millennials increasingly want to be recognized as individuals. Whether someone wants to learn chess, become a better parent or learn to meditate, Chinese brands are increasingly looking to provide people a pathway to achieving their goals.
Personalization is paramount, but it’s time to see personalization as a way to help enhance people’s lives rather than a never-ending promotion cycle.
The emergence of the super-app ecosystem
China’s unique and hyper-connected super-apps like WeChat and TaoBao have made it a lot easier to create seamless experiences and reward people’s behaviors – building robust profiles of customers from one click to the next.
Chinese brands are able to identify fans and build an intimate understanding of their needs from activities including joining a WeChat group, co-creation, social engagement, and purchase. Brands such as NetEase Music and TaoBao profile users’ music and shopping preferences to personalize recommendations for customers in an ongoing manner. Every click helps optimize the next recommendation, gradually making rewards feel like it’s ‘curated just for you’.
Interestingly super-apps are not part of the western landscape today and there are serious doubts that they ever will be, thanks to the diversified internet ecosystem.
But the metaverse is an area with the potential to offer an information ecosystem. While we are years from a fully integrated virtual world, the metaverse already spans many companies, and may one day evolve to become a universal digital platform for personal and commercial interactions becoming a source of valuable data.
The rise of micro-communities
Chinese brands are nurturing smaller membership groups in response to consumer shifts away from large, open online spaces. This community-building is generally housed within third-party platforms like WeChat, Weibo and Red and giving its members the feeling of an exclusive club.
In addition to creating a sense of community by bringing people together around a shared purpose and building better products through co-creation, Chinese brands see micro-communities as a source of consumer information beyond demographics – all of which translate to more sales in the long-run.
Micro-communities are a powerful way to build positive brand relationships and create better products and services. While a few luxury and beauty brands have embraced micro-communities, brands in relatively few categories have tapped into this opportunity.
Rethinking loyalty programs
Loyalty programs are, for the most part, transactional programs designed to nudge the customer into becoming a repeat buyer rather than building real affinity for a brand. Perhaps ‘rewards programs’ would be a better name.
Recognizing that most loyalty programs fail to drive actual loyalty, Chinese brands have fused loyal sign-ups into mandatory steps in WeChat, with the option to unsubscribe of course. They’ve shifted focus from signup to nurturing people with recommendations that match their preferences and behaviors. Their perspective is that by rewarding people with things that actually matter to them, loyalty will naturally follow.
Lessons for western markets
When it comes to western markets, a staggering 13% of people actually join the loyalty programs post-purchase. And unlike their eastern counterparts, western brands have data-privacy and GDPR laws that will prevent mandatory sign-ups. So how can western brands improve loyalty signups?
The answer may lie in making customers feel valued immediately post-purchase by signposting how you will propel them towards their goals. So someone who has just purchased a beginner’s camera and poked around a few how-to guides will be asked to join a loyalty program where they’ll receive exclusive content and rewards to help enhance their skills – a forging of programmatic data with human-behavioral analysis to learn what matters to people.
Yuliana Safari is global marketing director and Connie Ho is head of strategy at R/GA Shanghai.