Data shows China’s e-commerce market is expected to reach US$ 3 trillion by 2024 and is set to register a strong 12.4 per cent compound annual growth rate, according to analytics firm GlobalData.
Lloyd said with those figures, global businesses should look for ways to attract the Chinese consumer.
“Think about giving your customers a richer experience and engagement, because that drives increased preference and increased purchase,” he said.
According to Lloyd, the following technologies are shaping China’s e-commerce landscape:
About 10 per cent of the total e-commerce gross merchandise volume in China is generated by livestreaming, Lloyd said. Last year, about 90 per cent of the biggest brands hosted livestreaming events during the wildly popular 11.11 Global Shopping Festival, while 300 million Taobao users tuned in.
“Livestreaming allows for a rich shopping experience,” Lloyd explained. “It’s like entertainment and shopping combined. This is truly mainstream and it’s actually an essential mix now for shoppers and for brands.”
Lloyd explained that once a brand has the right influencer, the right product and can demonstrate things in an authentic way, it can sell tens of thousands of products by the minute.
2. Augmented reality
According to a study conducted by Alibaba, 72 per cent of customers reported that AR had influenced them to purchase items they hadn’t originally planned to buy, said Lloyd. The report also revealed a 133 per cent [increase] in dwell time on brands that integrated AR-enabled features.
“Augmented reality can really bring shoppers closer to the brand,” Lloyd said.
“The Chinese audience wants more than just a shopping experience, they want more than just products,” Lloyd said. “Study shows gamification is one of the best ways in building a good digital experience for the Chinese consumer.”
Lloyd shared that there was a 100 per cent increase in time spent on Coach’s Tmall Luxury Pavilion store after the brand introduced its gamified shopping experience. And when the e-commerce platform launched its pet cat raising game last year, it caught the attention of the 100 million users who signed up for it.
“What [consumers are] looking for is a far richer experience…what you need to think is ‘how do I stand out?’, ‘how do I create a richer shopping experience?’, ‘how do I make people want to spend time with my brand?’ Because the more they’ll spend time with you, they’ll end up wanting to be your customer’,” he explained. “So this is why gamification is very, very important for Chinese consumers.”
Tips to realising the China opportunity
Lloyd also shared the following tips for brands who want to engage consumers in China:
1. Listen and react to your customers – quickly
“Your customers are going to tell you a lot about what they want,” Lloyd said. “They’re going to tell you what they’re interested in and what they like and don’t like. And you can react to that and you can develop really quickly. China’s a market that operates at extreme speed, which means your ability to react to feedback should be very, very good.”
2. Create richer online experiences
“Chinese consumers really value a rich shopping experience,” he explained. “So think about how you can give them that, how you can give them more excitement.”
3. Bring the best of online to offline
“How do you create really great offline experiences that mirror those fast and fantastic experiences we have online? I’ll give you an example: our online supermarket called Fresh Hippo, which I really think is the supermarket of the future,” Lloyd shared.
The Fresh Hippo wet market sells seafood and fresh produce from all over the world. The store allows shoppers to scan products with their smartphone if they’re logged into the app and it saves the buyers’ preferences.
“It’s incredibly efficient, you walk around, you scan, you get to the till, and you just scan your phone at checkout, you pay using Alipay which is registered in the app, and you go. It’s a really fast, really nice experience,” Lloyd explained.
For Chinese consumers who are interested in the provenance of their food, that scan allows them to learn where a product came from, where it was farmed or who grew it, how long it has been on the shelf, and how it was transported.
The Fresh Hippo store is also a warehouse, where store assistants can pick produce off the shelves and inventory is updated in real time. From a consumer’s point of view, if a product isn’t in stock, they will be presented with alternative items to choose from.
“This is what I mean by bringing the best of online to offline and what I think is great about Fresh Hippo is it goes way beyond that,” Lloyd said. “It says, ‘yes we’ll give you a really good shopping experience, let’s enhance your shopping experience of the supermarket itself but let’s turn it into a true new retail experience, a true online and offline experience’.”