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Luxury in the digital age: the challenge of balancing “slow time” and “fast time”

At Luxe Pack Shanghai 2017 held in April, Ifop CEO Stephane Truchi and Luxurynsight CEO Jonathan Siboni shared their views on how luxury brands should adapt to the digital era in a conference entitled “The Digital Transformation of Luxury”.  

While 50% of Chinese domestic luxury consumption will be generated online by 2020, it is of the utmost importance that luxury brands remain abreast of digital innovations and place them at the very heart of their development strategies.

Although luxury brands are forever more accessible and time has speeded up subsequently to the development of digital technologies, Stephane Truchi places emphasis on how important it is for luxury brands to maintain their focus on the traditional values of luxury which include one to one relationships with clients, a physical point of sale, sensoriality and paying close attention to clients’ needs in particular through advice and direct contact.

In this way, the challenge facing brands today is to bring these two worlds together and create a balance between “slow time” and “fast time”, while preserving the essential dimensions of luxury such as mystery, rarity, excellence, expertise and occasionally keeping a distance from the digital universe by focusing on interaction, dialogue and ephemeral actions.

Finally, Stephane Truchi closed the conference by outlining three key strategies to ensure that luxury brands maintain their exclusivity in a digital world accessible to everyone:

  • Create an irresistible desire – brands need to expand their range of visual, written and video materials with remarkable content, thereby revealing unknown facets to clients, fostering intimacy with new generations (millennials), and opening new channels via influencers.
  • Deliver a unique experience via new technologies and initiatives to ascertain a seamless service, while creating an opportunity for interaction between the digital and the physical worlds and tapping into social interaction.
  • Foster a close relationship with clients based on the latest advances in technology such as chatbots, thus encouraging automatic interaction between clients and the brand, ensuring personalisation of support services and providing the opportunity for real-time interaction with a community.

When social and commerce merge

In March, the China Connect conference dedicated to Chinese digital trends was holding its 7th edition in Paris. The motto of this edition was « Crack the codes » i.e how to uncover the dynamics of a specific, fast moving market which is in many ways leading the West when it comes to digital habits and models.

The explosion of Live Streaming

A key trend this year is the growth of mobile live streaming… maybe later than in Western countries but much faster and stronger! This new form of entertainment has found a place in people’s daily life, especially among the younger generation, and in the strategies of brands of all sectors. Its development is different from what can be seen in Europe and the US thanks to..

  • its scale: 200+ mobile applications such as Ingkee, Huajiao or Douyu which have been downloaded over 50 million times each, and a total of over 350 million regular users of live streaming platforms to date
  • its interactive dimension: live streams are not simple videos that one watches, most of the times they consist in interactive cessions during which fans formulate questions, express demands, interact with the person in the video and offer virtual gifts
  • its monetization: via paid virtual gifts – from a few cents for a hug or flowers to a few hundred dollars for a sports car or a yacht – thousands of streamers earn a very decent revenue while platforms such as Huajiao collect 30% over each transaction

Check out this demo by WSJ

KOLs: a whole new media

The KOL phenomenon – key opinion leaders – already very strong in China has amplified with the development of live streaming. Made of famous or less known celebrities (such as Melilim Fu who participated in the conference with her orange hair and outfit) as well as average individuals with a small audience of loyal followers, the crowd of KOLs is now considered as a media of itself and an essential touchpoint for brands wishing to develop their visibility and engagement with consumers, especially in industries with a strong affinity dimension such as luxury, cosmetics and automotive.

Brands’ campaigns play on the various levels of the KOL pyramid (a few celebrities on top, many influencers on the base) to develop strategies that mix prestige or impact actions with proximity.

The specificity of the KOL media resides in the fact that it appropriates the discourse of brands. Some refer to it as UGC 2.0: creating brand contents for which celebrities and influencers become the main channel.

The convergence of social and commerce

As previously mentioned on this blog site, WeChat, the social network and service platform used by over 700 million Chinese, has taken the world leadership in terms of social commerce e.g integrating purchase opportunities within conversations.

By combining online payment solutions like AliPay and WeChat payment with live streaming platform, China is amplifying the convergence between commerce and social. With the « click to buy » function, the subscriber to a live stream can in a single click purchase the garment worn by the person (KOL) in a video or the product or service he/she is talking about. In a country where 9 out of 10 people online access internet on mobile this generates a lot of spontaneous purchases. For brands, developing affinity, federating communities generates naturally sales. And they cash in!

Once more, China demonstrates its strong ability to innovate and take the lead, not exactly in the development of new technologies but rather in their usage and monetization.

Article written by Christophe Jourdain initially published in Siècle Digital


The « Made in China » takes revenge

For a long time Chinese-made products were associated with low-cost and poor quality. The toxic chairs” sold by French distributor, Conforama, gave stinging allergic rashes to some 400 customers. The harmful dyes t-shirt” which sent a little girl in hospital stuck the knife deeper.

Fed up with the scandals, the world’s second-largest economic power has decided to shed its cheap image.

Inspired by countries such as Japan which used to have a connotation of low-end during the 50’s, China is working on changing its reputation. Manufacturers are seeking to move upmarket by offering qualitative and innovative products whilst maintaining competitive prices.

This initiative is supported by the Government, setting measures for quality control in order to reassure importing countries. It has implemented norms and regulations in its domestic market and created two entities, the AQSIQ and CNAS to supervise the procedure.

Investing in the future is part of the plan. The Government has allocated a more prominent budget for its universities to retain Chinese talents and attract foreign students. R&D is at the very heart of the new Chinese strategy.

The path from imitator to innovator, China conquers the world

China was viewed as the world’s “workbench” rather than as a global innovator. Now it can be proud of its technology sector. The Middle Kingdom has developed its own brands. It no longer plagiarizes or produces for others, it creates added-value items appealing to foreign consumers.

Lenovo is the perfect example of the Chinese success story. In 2013, the brand beat its American competitor, Hewlett-Packard, becoming the world’s leading PC maker operating in 160 countries. Lenovo wants to position as premium by offering top quality and advanced products yet produced with the soul of craftsmanship.

Huawei is another good example. When Samsung and Apple avoid to communicate on product origin, Huawei proudly spells it out at the back of its packaging.

In 2015, the brand announced earnings up 33 per cent from previous year, reaching 5.4 billion €. Still far behind Samsung and Apple, Huawei is however catching up very quickly.

To climb up the value chain and boost sales, Huawei and Leica partnered to set up a new R&D center to be situated at Leica’s headquarters in Germany.

The rise in unexpected fields

Not content to succeed in China, some brands dream of taking on the world.

Chinese brand Herborist is one of the few premium cosmetic brands with international ambitions. The brand reworked its positioning, combining Chinese identity with international design codes. In 2015, Herborist opened its first French store in Paris on the famous “avenue de l’Opera”. The store features a spa, offers a tea ceremony and Thai Chi classes. The brands flashes the Chinese chic in Paris.

The national preference

There was a time when one needed to purchase French to be elegant, American to be cool and German to be strong. This time is over for the Chinese. Buying local is seen as a patriotic deed.

The study “Future of China” conducted by Ifop for OMD showed that 40% of the Chinese prefer local brands and 25% always purchase them, mostly for the quality. Only 9% declare to favor international brands because of their superior quality.

That is all the more true in lower tiers (Tier 3, 4 and 5) where international brands are not always available.

Local brands have the advantage to better understand the population’s needs and they also benefit from a larger distribution channel allowing to meet demand faster than international competitors.

The emergence of emotional-value brands

The emotional drivers play a more and more important role in the purchasing process of Chinese consumers.

The economic boom over the past 3 decades, the access to new products and the growing internationalization transform the Chinese population. They are increasingly sophisticated and tangible product benefits (price, quality etc.) are no longer sufficient to trigger purchase.

Chinese brands know now how to engage and convert consumers. “Lifestyle” brands such as Icicle, Zuczug and JNBY use their proximity to appeal to the Chinese.

Icicle is a clothing brand inspired by Chinese traditional values, endeavored to bring harmony between human and nature. Zuczug is worn by Chinese celebrities and JNBY, inspired from Chinese modern art, opened several concept stores in big cities including Paris.

A unique case: the Chinese footwear brand, Feiyue, was copied by… the French!

The “Made in China” Feiyue by Shanghai Shenglong Shoes are sold 39 rmb (5€) in the country. The French copy is sold 80€ by Feiyue Shoes Holding and was seen in magazines worn by Orlando Bloom and Poppy Delevingne.

To conclude, the “Made in China” is more and more associated with quality.

The Chinese manufacturers have realized that fast and low-cost production no longer generates growth. Chinese brands are able to build innovative yet still cheaper smartphones, tablets and PC. Leaders in the technology sector have fierce challengers!

The reputation of “Made in China” is slowly improving but actions must be taken by the Government to fight the scourge of counterfeiting, detrimental to the development of Chinese companies abroad.


Article written by Thi My Nguyen, Market Research Manager at Ifop Asia.

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Hot trend in China: Live-streaming apps turn Nobodies into Internet Celebrities and offer unique money-making opportunities.


A pretty woman casually dressed, eating noodles and talking about the makeup she is planning to buy. A handsome man gazing at the webcam in silence. A lady singing a cappella in her living room. What do they have in common? Hundreds of thousand followers.

The Live-Streaming craze is sweeping across China. Millions of regular people are now sharing bits of their lives with the world seeking for fame and expecting to gain cash.

Yizhibo, Xiandanjia, Douyu and Ingkee are some popular apps among the 80 apps for live streaming available in China, and the number is growing all the time.

Why these videos which seem meaningless have so much success?

These apps allow people to peek into the lives of strangers and interact with them to an unprecedented extent. The viewers can send pop-up messages to the streamer and “tip” them with virtual presents they buy from the apps. The streamers can then exchange their presents for cash.

On Ingkee, one yuan (0,10€) buys 10 “diamonds”. Tipping a beer will cost you 1 diamond, a Ferrari 1200 diamonds and a yacht 13140 diamonds.

Competition between streamers is fierce, a raking based on the number of followers and the number of “diamonds” is accessible. Some accounts have reached many millions of diamonds.

It is necessary for brands to conquer the Live-streaming world.

These Internet celebrities are highly influential leaders among the young generation and they receive money from brands for broadcasting their products.

The apps are already used for commercial purposes. Individuals and companies use them for selling makeup and skincare products.

Celebrities also broadcast to interact directly with fans.

L’Oréal has a live-streaming account and offers sessions of live show with the brand’s muses.

Ingkee, is only one year old but has been ranked No. 1 on Apple’s China app store multiple times. Ingkee says over 50 million users have downloaded its app. Douyu claims 120 million active monthly users.

Live-streaming apps are a great opportunity for brands to reach customers beyond geographical limitations and at low costs.

Article written by Thi My Nguyen, Market Research Manager at Ifop Asia.

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The Evolution of Leisure In China


Today Chinese society is in a flux. Both the economic growth as well as the pace of growth of the past 35 odd years has had a massive impact on not just on the economic wellbeing of the Chinese people but also on the society in general. With the increasing affluence levels, higher disposable incomes, access to new product categories and increasing integration into the wider world, has meant not only have the people’s lives changed but also the way they relax, unwind and spend their leisure time.

Unlike in the past where the favorite pastime of most Chinese people was confined to what was acceptable within the social realm, now the same has evolved with the changes in the society. What is acceptable and not acceptable is now more a domain of the individual with the focus firmly on more balanced, engaging and diversified lifestyle.

Consequently we observe evolution of leisure options beyond traditional restaurants, stroll and activities in the neighborhood parks and KTVs to leisure travel, health & beauty, shopping and even online indulgences. This evolution signifies a move away from more basic motivations of safety, nutrition (health) and tradition to more mature-exploration, experience, authenticity, and value proposition.

The Chinese government too has had a hand in this evolution. The government has pushed to increase domestic consumption by providing more days off for Chinese people to spend on leisure activities. In 1995, the government introduced 5-working-day week, providing people with 2 days a week of leisure and rest. In 1997, the golden week and the national day were introduced as additional measures to boost domestic spends. Finally, the new labor law in 2008 was enacted to provide yearly 5 days of paid leave to make Chinese people to connect more with their families and in the process boost the economy.

Explore and Experience

Traditionally for Chinese people, food (a major leisure indulgence) used to be more about nutrition and health. With increasing affluence and consequently travel becoming more common, food is becoming more about experience, authenticity and exploration. Cheese and regional wine are riding high on this wave. 94% of Chinese consumers say they have tried French cheese and were likely to eat some again. Definitely, times are evolving.

While travel on the other hand was previously considered as a leisure activity with a focus on destinations (been there, seen that), it has now shifted more to qualitative and “out-of-time” experience where people want to live the present moment, enjoy  the experience, explore and exchange.

A study conducted by IFOP has shown that Chinese people save for difficult times, for their children’s education and… for travel. In first tier-cities (Shanghai, Beijing and Guangzhou) travel even emerges as the primary motivation for saving.

Travelling agencies noticed this shift and have tried to seize this new market by offering for instance journeys focused on particular themes such as gastronomy, relaxation (cruise), or sport (hiking) and in the process work on people’s motivation of experience and explore.

Other emerging trends

The younger travelers focus more on independence when it comes to travel and we also see solo or non-tour group travelers on the increase. They are no longer interested just in running from one scenic/tourist spot to other and endure endless bus rides in the process. They now want to experience and live the moment.

Travel aside, we observe rise of health and beauty based leisure avenues. There is a common Chinese belief that to be successful in life, one needs to look good (and of course healthy). This belief is leading to increasing focus on keeping fit and also quick fixing perceived bodily negatives. This aspect is also seen part of leisure and Chinese people are going all for benefiting from options that cater to these needs. While the elderly have the gym and dance in public parks, most young people are hooked to the gym.

People are also opting to go abroad to seek medical attention. It may be for more serious medical conditions or for cosmetic surgeries. This trend has given rise to new travel trends such as medical tourism (e.g. plastic surgery). Countries like Korea, Thailand are hot destinations for Chinese people to travel to get medical attention and also in the process enjoy visiting the country.

Kings of Shopping

Shopping is considered an integral part of leisure activities of Chinese people. To them it’s more than buying. It’s an experience and a social activity. Rise of malls is an example of this trend that caters to these requirements. Chinese people spend a lot of time living the experience of shopping. For instance, when they want to buy a premium beauty product, it all starts with talking to each other (social occasion). It’s followed by an online search for information (personal engagement and involvement) and actual buying of the product in physical stores in China or abroad (experience). It’s not surprising that online channels are now trying to replicate the physical store experience on the website to engage more consumers.

At the same time, shopping malls are becoming a lifestyle and provide a wide range of services to enhance the shopping experience: game rooms, restaurants, beauty salons, and cinemas are much more numerous than in our malls.

Even when it comes to travel, shopping in the world’s biggest cities remain the top motivation irrespective of age or gender. The voracious appetite for shopping can be seen in duty free stores in the world’s major airports as well as high streets.


Talking about online, the digital revolution especially the rise of social media and e-commerce has had deep impact on the way Chinese people conduct their lives and also their leisure habits. Nowadays, it’s very common for Chinese people to explore leisure ideas, discuss travel plans, look out for promotions for hotels, book tours, all using just their smart phones. Smart phones have made information accessible in a magical way and the Chinese people are using it like no other people elsewhere. As a consequence, possibilities are endless and spend time on wechat or weibo is now considered as leisure.

In conclusion, undertaking leisure activities is becoming more and more commonplace among Chinese people. We can fairly say that Chinese people have truly come off age when it comes to their leisure activities and are now looking to further their experience by spending on numerous avenues that offer them such indulgences.    

Article written by Manohar Balivada, Vice President, Ifop, Shanghai. Published in Connexions magazine N.77  

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Capitalizing on opportunities offered by lower tier cities in china

China is not only the world’s second largest economy but also its dominant engine of growth. However in recent years this economic growth has come under pressure because of multiple reasons, both internal as well as external. This decline in growth rate is having a consequent impact on the way the Chinese government sees as its best way forward. It is striving to increase domestic consumption, encourage services sector and keep a check on inflation.

Adding more complexity to this business context is the more crowded and fragmented market, maturing Chinese consumers, impact of digitalization and smart phone and not to mention declining consumer enthusiasm.

Until recently business opportunity in China was limited to big 3 cities and handful of tier 2 for most multinational companies. The above dynamics means the attractiveness of this opportunity is increasingly fading and multinational brands are being forced to look deeper in to the Chinese landscape for new emerging and hitherto untapped markets in lower tiers.

Are the Lower Tier Cities Next Eldorado?

So this begs the question, do lower tier cities offer the same opportunity as that of their higher tier counterparts? In fact, the opportunity that lower tier cities offer is humungous compared to what their higher tier counterpart’s offer and moreover it remains untapped to a large extent.

Over the last decade or so, Chinese government has embarked on a mission to increase domestic consumption and thereby lower China’s reliance on exports. In the process, they have increased their investments in lower tier cities even in the central and western parts of the country and emphasized urbanization by providing housing and civic amenities.

These efforts have paid dividends. According to one estimate, tier 1 and tier 2 combined only accounts for 17% of the national GDP i.e. to say lower tiers combined account for a whopping 83% of the GDP.  However, given the higher tier fixation of most multinationals, it means the focus has been too long and too much on higher tier cities.

Although Tier 3 and 4 have a disposable income half of Tier 1 but given a population approximately 10 times over, it means the potential is not only huge but waiting to be tapped into.

However Opportunity Doesn’t Directly Translates Into Profits

The big question is how to capitalize on this huge opportunity. The challenges are numerous and not very obvious. To begin with, the sheer number of such cities in lower tiers with a million or more is in excess of 200. So which all cities can a brand focus on?

Are these consumers like their higher tier counterparts or do they shop differently with different motivations and preferences? From my experience I can do say that they are definitely different given the context and circumstances that differ across tiers.

So is there a better way to target these consumers? The answer is yes and it’s everywhere around to see.

The Internet Can Make It Possible

Huge proportions of the Chinese population are not only online but are willing to go the extra mile by engaging in it. Lately social media and e-commerce boom has engulfed the country, fueled in part by the high smart phone penetration and also with the more prominence of big players in the market like Wechat, Taobao and Jingdong.

The lower tier cities are not lagging behind on this bandwagon. In fact they are taking to it like a duck takes to water. According to one estimate, the proportion of lower tier city households with internet access is in excess of 50%. This figure is only like to go up and go up fast considering around 85% also have access to a smart phone. These consumers are using internet not just to communicate, exchange or explore but also to buy products and services.

All of the above means, the lower tier cities have opened up for business and are not inaccessible the way they were a few years ago. With a right business strategy and fresh mindset, it is indeed possible to capitalize on this opportunity offered by lower tier cities.

There are as many ways to do it the right way as there are ways to do it wrong. The success depends on the way a brand will understand these consumers, customize its offering and then make itself available through relevant channels.


Article written by Manohar Balivada, Vice President, Ifop, Shanghai  


The rising attractiveness of local brands

The new aspirations of China’s middle class (part 4 out of 4)


Faced with the rising position of China on the world stage and the success of high profile local companies such as Tencent, Alibaba or Xiaomi, the Chinese middle class expresses growing pride and trust in the leadership capabilities of its country in terms of economics and lifestyle, which translates into an increased interest for local brands. These are perceived as much more price competitive and often better distributed across the country than their Western counterparts, faster at taking positions (launching new products, opening points of sales in new places), efficient at adopting communication codes that appeal to the locals and also more and more often innovating. This is what makes the success of Herborist or Inoherb in the field of cosmetics, Haier or Midea in household equipment, BYD in automotive.

As a matter of fact, the middle class emerging in peripheral cities has been less exposed to foreign brands, usually concentrated in Tier 1 and Tier 2 cities, than the previous waves of rising middle class. It turns more naturally to local brands in its daily life, even in categories traditionally dominated by foreign players such as beauty products or sports goods.

This growing competition from local brands has become a major issue for international brands in China. Its impact is probably stronger than the slowing growth of GDP on which Western media tend to focus but which does not yet impact the propensity of consumers to get richer. Local brands eat up foreign brands market shares and develop an intimate relationship with consumers, a factor of lasting success. In front of this, the reaction of large international groups sometimes consists in acquiring these new competitors, like when L’Oréal purchased the Chinese leader of beauty masks Magic Holdings, or to develop alliances like Danone with Mengniu in the field of dairy products. But the key trend is there: local brands are progressively developing the attributes of genuine brands, Chinese consumers aspire to consume them and this is changing the rule of the game in the China market.


Article written by Christophe Jourdain, Ifop International Director.

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Acceleration, individualization & socialization thanks to digital

The new aspirations of China’s middle class (part 2 out of 4)


Chinese people are very much attracted by technologies and most urbans are frantic users of smartphones. China is now the number one e-commerce market in the world and, leveraging the power and simplicity of local platforms such as TaoBao, Tmall, WeChat, etc., its consumers are together with South Koreans the most advanced of all in terms of mobile purchases.

Digital allows middle class citizens to satisfy their quest for consumption experiences that are:

  • instantaneous, via the real time dimension of internet coupled with the efficiency of parcel deliveries throughout the country,
  • personalized, thanks to algorithms taking into account consumers profile and historical behavior to provide individualized offers,
  • and shared, via the social dimension of internet and the consultation of peers’ opinion not only before but also during the act of purchase.

It brings the satisfaction of “shopping smart”, a high expectation among the middle class, and spreads across even the most daily tasks as shown by the success of the YiHaoDian website and application selling fresh food delivered within three hours.

Amongst the young, the quest for emotionally rich experiences goes primarily through digital and represents a key lever for brands. In secondary cities where a lot of companies have no presence nor distribution, digital provides individuals with an access to brand consumption which they can’t find in their physical environment, and brands with an opportunity to develop without investing massively into retail. Nowadays these secondary cities are the engine of the country’s growth. So the brands that are not yet on Tmall or other digital platforms relevant to their industry are not only missing the train of digital commerce but also the development of the economy into peripheral cities and the interior of the land: they are out of the game!


Article written by Christophe Jourdain, Ifop International Director.

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M-commerce is booming nowhere else as much as in China!

China is the first e-commerce market in the world*. What is striking is how quickly habits shift towards mobile, to such an extent that the major part of online shopping is now done through a mobile device. This trend is a great change for brands.

Alibaba dominates the Chinese ecommerce with 80 % market share and more than 350 million active buyers a month. With two main platforms Taobao (CtoC) and Tmall (BtoC), the group realizes an annual transaction volume higher than Amazon and eBay altogether: it is a monster! Indeed, in one year, between the second quarter 2014 and the second quarter 2015, purchases on mobile increased by 125% for Alibaba and their proportion raised from 33% to 55% of all transactions: a boom!

The growth of m-commerce is explained by numerous factors, including the huge appetence of Chinese consumers for digital, the power of local e-commerce platforms and payment solutions, the weakness of physical trading outside the big cities, etc. (see also Why are Chinese consumers so Digital?). It speeds up the transition to a consumption-led economy and contributes to the growth of both rural and peri-urban areas. It is thus greatly encouraged by the government and benefits from a snowballing effect.

There is lots of indication that the growing practice of m-commerce anticipates what will happen, at a slower pace, in most of the others markets in the world. What is currently happening in China has to be followed closely. But what exactly does that change?

Initially, the shift from physical trading to “traditional” e-commerce (not mobile) extended the purchasing time to every moments when consumers are using a computer, and the shopping location to all the places when they have access to a desktop. This evolution meant also a larger amount of information, of influence sources, of comparison means, of collaborative solutions, allowing everybody to buy in a “freer and smarter” way. Nowadays, the shift towards mobile purchase as observed in China goes one step further.

With smartphones and consumers like bosom buddies and permanently connected to the internet, we really move to a 24/7 commerce. Chinese consumers go mad for social networks such as WeChat (one quarter of the population logs in more than 30 times a day) or Weibo and other e-commerce websites such as Taobao or, they are in a quasi-permanent purchasing mind, searching for bargains. Consumer can also switch and be in a selling situation, which multiplies transactions and compels brands to find a space on the mobile media if they want to exist. The permanently connected smartphones make online commerce more and more part of consumers’ daily life and expose them to more and more products categories, e.g. the growth of YiHaoDian (“Number 1 store”), an online shop specialized in fresh food products (fruits, vegetables, seafood) providing a user-friendly app offering delivery within 3 hours from purchase.

M-commerce is social by nature. Most of the Chinese consumers use their smartphone to post pictures and comment their purchase on e-commerce platforms or social networks: they are much more active than the Americans or Europeans. They also share their experiences via dedicated apps such as XiaoHongShu (“little red book”) where girls flaunt and comment their purchase, creating communities of interest in the latest trendy studded shoes or about the new smooth-eyebrow product. Their reviews influence other netizens and are considered by e-commerce platforms which emphasize on the best-rated products. The consumer is now in the center of the offer deployment process instead of the brand and the distributor.

Moreover, with his smartphone the consumer can instantly ask his network of friends for recommendation. He is never alone during the purchasing process: word-of-mouth not only plays a key role prior but also during the purchase.

M-commerce is also going further with customization. When connecting to an e-commerce website, consumers are recognized and their preferences recorded during their previous visits are taken into account. Taobao illustrates it by giving its consumers access to their “footprints”, the history of actions on the website, which allows to target them offering products and discounts matching their needs. The mobile dimension adds geolocalisation, continuity and instantaneity. Digital manages to flip over positions: the consumer, often anonymous in the real life, becomes a well-known and taken into account customer in the virtual space.

But mobile also stimulates the convergence with the physical shop: both have complementary roles in which purchase experience, service, branding and customization are increased via the complementarity of touchpoints. For instance, convergence is seen with QR Codes, much more used by Chinese consumers than Western ones, to find information, promotions, services, and reviews in the physical store… or even to the online store! This convergence is also seen in the payment process, with e-commerce payment solutions such as Alipay and WeChat Wallet which are now adopted by physical stores like Walmart or Carrefour. Easier, quicker, more secure than cash or credit card, containing full and instantaneous information about the consumer, these mobile payment solutions are growing in all sectors of physical daily life such as, in Shanghai, in millions of grocery stores, taxis or restaurants.

Eventually, let’s note that the Chinese m-commerce mostly goes through multi-brand platforms and apps. Nobody wants to go on the slow-debit internet to look for a brand own website then go to another one to compare, type-in the 16 digits of your credit card, etc. when all brands are available on the same app with one-click away payment. This creates the necessity for brands to be present on Tmall-like platforms, WeChat stores, etc. and generates new positioning challenges as, for example, it is not obvious for a lifestyle or luxury brand to sell its products in a space where it stands alongside a multitude of mass market players.

Thus, a crucial challenge for Western brands is to grasp this revolution as fast as possible in order to gain new clients, many clients!, in China now, and to be ready to gain even more clients everywhere else tomorrow.

Article written by Christophe Jourdain, initially published in French in Siècle Digital.

Tags: digital, e-commerce, m-commerce, store

(*) According to Bain and company