Daily Insights

5 China Digital Trends to Watch in 2020

By: Liz Flora | Dec 18, 2019

Despite challenges including an economic slowdown, trade war, nationalistic online cancel culture, and ad fraud, the China market remained a significant source of international growth for global consumer brands in 2019. As Chinese shoppers have continued to up their spending, China has emerged as a digital bellwether for global brands in areas like social commerce, mobile payment and short video. 

This time last year, Gartner L2 discussed key trends for brands to watch in 2019 that remain relevant, including the growing importance of social shopping app RED and the global rise of TikTok, which was already one of China’s top social platforms. Check out this year’s list of China digital trends that will be on our radar in 2020.

 

KOCs

As Chinese influencers known as key opinion leaders (KOLs) are charging increasingly high rates for sponsorship at the same time that their authenticity is in question, brands have been upping their focus on another type of online influence: the key opinion consumer, or KOC. As “KOC” became a top industry buzzword this year, brands have been investing in KOC-driven marketing as part of a multi-tier influencer strategy aimed at both the spread of influence and higher return value. In order to foster their own KOC communities,  brands have been focusing on converting customers into KOCs via private chat groups as well as incentivized referrals, UGC and product reviews across platforms including Tmall, WeChat, Weibo and RED.

 

Gaming and Esports

From Nike to MAC Cosmetics and Louis Vuitton, consumer brands across categories are tapping into marketing opportunities in China’s massive gaming and esports industry. As brands seek out new platforms for exposure, gaming is ripe for marketing thanks to its devoted fan base that can deliver authentic impressions for brands. The MAC Cosmetics campaign with Tencent game Honor of Kings was promoted across a wide range of platforms, including not only the games themselves, but also mainstream social platforms like WeChat and Weibo and gaming-focused platforms including the Twitch-like livestream app Chushou. One major game-related platform of focus in the coming year will be Bilibili, which is popular with China’s Gen Z and just won the exclusive rights to stream the League of Legends championship in China. 

 

Bilibili and Vlogging 

In addition to gaming, the growing popularity of vlogging has also helped put Gen Z-focused Bilibili on the map. The number of vlog viewers in China is estimated to have nearly doubled in 2019, making vlogs another key social video format for influencers alongside short videos and livestreaming. Bilibili’s ad revenue grew by 80% in its most recent reported quarter, even as Baidu, Tencent, and Weibo advertising declined. While Bilibili is known as a key vlogging hub, the longer video format is becoming popular across a wide range of platforms, with influencers like Mr. Bags also featuring vlogs on Weibo and WeChat. 

 

Livestream Commerce 

While livestreaming commerce has been around on Tmall and Taobao for years, it registered significant growth in 2019. L’Oréal Paris, for example, saw 700% growth in GMV on its first pre-sale day of Singles Day after investing in 17 hours of Tmall/Taobao livestreaming. The success of commerce livestreaming has prompted other Chinese social platforms to add the feature. RED will add commerce livestreaming in 2020, Douyin and Kuaishou both offer livestreaming commerce that links to Taobao and Tmall, and Pinduoduo is reportedly adding it as well. Brands have also been utilizing WeChat Mini Programs for livestream shopping. 

Lower-Tier Cities 

As consumer spending power grows outside of China’s Tier 1 cities Shanghai, Beijing, Guangzhou, and Shenzhen, brands and e-tailers are using digital tools to reach consumers across the country. E-tailers have especially been seeing growth in cities where global brands have fewer or no physical retail locations. One of the key themes of Alibaba’s Singles Day was less-developed markets, as the company said that more than 70% of its new customers came from lower-tier cities in the fiscal year 2019. JD.com, meanwhile, attributes its recent revenue growth to lower-tier cities. Brands’ omnichannel activations have also been spreading past Tier 1 cities, with a growing number in cities like Chengdu, Nanjing and Chongqing.