Nielsen: Digital Revolution Boosts Online Shopping in China
Global market research company Nielsen recently released a report entitled What’s Next for China’s Connected Consumers – A Roadmap for Driving Digital Demand, which reveals how connected devices and digital platforms have led to a consumption boom in China. It helps brands understand consumer behavior there and improve their digital marketing strategies.
Let’s see the highlights of the report:
Digital Consumer Trends
Mobile is the most common device for online shopping in China. 84% of consumers used their mobile phone to shop in 2017 – up from 71% in 2015. Meanwhile, there are fewer people using laptops or desktops to make online purchases.
Mobile payment apps are also widely used by Chinese shoppers. 70% of consumers have used WeChat Wallet in the past 12 months. A further 92% have used Alipay.
Social media has an increasing influence on Chinese consumers’ purchasing decisions. Nielsen’s 2017 Online Shopper Trend Report reveals that 51% of consumers have opened push notifications sent from a brand’s official WeChat account. 27% of consumers indicate that they buy more after receiving these messages.
As consumers become more exposed to social media advertising, marketers have to launch creative and personalized social media campaigns in order to engage with consumers to convert buzz into sales.
E-commerce is the key catalyst for retail in China. Nielsen’s e-commerce tracking data, within 34 FMCG categories, shows that in a 12-month rolling average leading up to September 2017, online sales grew 28% versus the year before. Offline sales increased just 5% over the same period.
As the demand for online shopping increases rapidly, brand owners should value their e-commerce channels as highly as their brick and mortar outlets. E-commerce advertising and product visibility helps incentivize purchase decisions. The key is to understand which placements and ad formats offer the biggest ROI.
Cross Border E-commerce
The proportion of consumers that buy from overseas websites has grown from 34% in 2015 to 64% in 2017. Younger shoppers are driving the trend – 18 to 35 year olds account for 66% of cross-border buyers.
Baby products are favored items to buy overseas. In the first half of 2017, cross-border purchases accounted for 13% of online baby food sales and 13% of online infant milk formula purchases.
Trust in traditional advertising has begun to shrink, while trust in digital advertising is gradually increasing.
Confidence in mobile advertising reached 23% in 2017, up from 20% in 2016. Trust in PC advertisement also increased from 18% to 24% over the same period. On the other hand, trust in TV advertising was down from 53% to 46%, while trust in magazines also fell from 36% to 34% over the same period.
China Digital Outlook
● Internet penetration in rural areas is just 27%. With improved infrastructure in these areas, the rural digital market will be unlocked in the next decade.
● Consumers no longer need to search for information. Instead, machine learning and virtual assistants enable the provision of instant push notifications and customized information for them.
● Robotics and driverless vehicles will revolutionize logistics and supply chains. Online shoppers will enjoy almost immediate consumption with speedy autonomous deliveries.
● China will likely enjoy mass adoption of VR technologies that will affect every aspects of their lives, including how they shop, play, learn and travel.
● Biometric technologies will be applied to mobile payments, which will make transactions smoother, faster and more secure.
● Big data analysis will allow marketers to have a richer, deeper and more accurate understanding of their target audiences and better predict their behavior.
China’s fast-changing digital economy offers immense opportunities for brands. Technology has unlocked new markets and possibilities to achieve better engagement.
In order for brands to succeed in China, they need to leverage the digital revolution to better understand their audience, target them across platforms, optimize their content in real-time and achieve true ROI.
For the complete report (in English), please go to: What’s Next for China’s Connected Consumers – A Roadmap for Driving Digital Demand
What do you think of the above digital trends in China? Leave a comment below. We’d be happy to answer any questions you may have.
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