Top Ways to Maximize Your Online Brand Presence in China

on May 12 2014 | in Digital Retail | by | with No Comments

brand education, e-commerce, taobao, tmall, weibo, Chinese online shoppers

Online shoppers in China are increasingly relying on the Internet for product information, according to a recent study by the Boston Consulting Group.

BCG projects the number of Chinese online shoppers to rise to 380 million by 2016, up from 145 million in 2010. But the Internet serves as more than just a shopping platform; it is also an invaluable source of information for consumers who want to get the most for their money. For 60 percent of Chinese consumers who shop online regularly, the Internet is now the central source of product information. Another 30 percent of online shoppers consider Internet and non-Internet sources to be of equal importance.

Brand education is essential for China’s online shoppers; BCG found that 90 percent of their “product-related online activity” was spent conducting research on product quality, and immediate online purchases were rare. Consumers spent approximately two-thirds of this “online study time” looking at e-commerce platforms, such as Taobao. Prior to making a purchase, consumers looked at an average of ten individual web pages.

Despite the importance of self-education among Chinese consumers, the study noted that “Chinese consumers typically have less faith in product recommendations from official information sources than do their counterparts around the world” and spent less than 0.5 percent of their time on the Internet browsing the official websites of brands and companies. Rather, consumers favor video, e-commerce, and news sites, which accounted for about 80 percent of consumers’ time spent online, as well as social networking sites, which accounted for most of the other 20 percent.

Consumers also contribute significantly to online product information; around 60 percent of the online shoppers interviewed by BCG reported commenting on products on the Internet. This online advocacy allows consumers to seek guidance in their shopping from other consumers, and is “particularly critical in China, given that consumers place low levels of trust in official sources of product information.”

Social networking services like Sina Weibo have received a mixed reception from consumers looking for product information. About 80 percent of respondents to BCG’s study said that they followed an average of 18 “enterprise or company-run weibo,” but less than 20 percent of these consumers reported that they actually paid much attention to information from them.

News related to companies and brands also received less attention then price- and promotion-related information. Celebrity weibos are considerably more popular; consumers follow an average of 30 weibo run by celebrities. Yet weibo is “averse to overcommercialization,” and celebrities rarely share explicit information about brands, although they often share links to items on platforms like Tmall and Taobao, which collectively accounted for approximately 70 percent of online transactions examined by the study.

The study also stressed that it is important for brands to have presences both online and offline, despite the recent boom in e-commerce.

“Based on our research, 60 to 80 percent of Chinese consumers across a wide range of product and service categories indicated no strong preference for making purchases online or offline. Therefore, it is critical that both types of channels are made available and offer consistent information and experiences. In this way, the different channels can be mutually reinforcing,” BCG reported.

image credit: chanel

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