Article - Look to China – Now, What Can Digital Agencies Learn?

articles coronavirus mindset Jan 20, 2021
Article

READ: 2 mins
AUTHOR: Robert Craven

America has been the place we look for all things capitalist and innovative. Silicon Valley Rules OK! Right? Wrong!

Right now, that may be the wrong place to be looking.

The pandemic has accelerated digital transformation…most notably in retail. However, it is in China, not the West, where the future of e-commerce is being staked out.

China is still the world’s growth engine. McKinsey reports, “There is no ’next China’. China’s economy is unique and is set to retain its pre-eminent role as the engine of global consumption growth post-pandemic.”

 

How is China different?
In China, the market is bigger and more creative. More like grass roots trading, and buying and selling. It is argued to be fresher and faster and brighter.

It is altogether more dynamic.

For example, online shopping platforms in China now blend digital payments, group deals, social media, gaming, instant messaging, short form videos and live streaming celebrities.

Just to unpick that sentence, they are slamming together:

  • online shopping
  • digital payment
  • group deals
  • social media
  • gaming
  • instant messaging
  • short form video, and
  • live streaming celebrities.

The silos we have (Facebook, Instagram, Amazon, Google) are all sticking to the knitting (plus or minus 10%), doing what they are good at. China seems to be way beyond these narrow, functional silos.

Meanwhile Silicon Valley says that western consumers want these silos. Consumers like separating out buying, shopping, social media, influencers…is that a fact or an opinion or a belief? Let’s see what western consumers say as they get exposed to more blended, omnichannel experiences. 

So, the big question is and will be: will the Chinese e-comm model go global? Who knows!? But we ignore what’s going on there at our own risk. Note that some of our brands are highly active and being more profitable in the East than in the West.

 

What can western digital agencies learn from China?

In China, tech firms blend e-commerce and social media and razzmatazz to become online shopping emporia.

Yes, China is different, but what can we learn and what might be coming our way?

  • Mobile payment is everywhere in China. It is “ingrained in consumer lifestyles and social media platforms, like WeChat.” (SmartBrief)
  • “’Social commerce’ has become the new norm in China’s e-commerce industry. Social commerce is what happens when savvy marketers take the best practice of e-commerce and combine it with social media.” (SmartBrief)
  • Online to offline work there: creating seamless, silo-free experiences. (SmartBrief)

 

So, what next?

“Multinationals such as Unilever, L’Oréal and Adidas make more revenue in Asia than in America and their bosses turn to there, not to California or Paris, to see the latest in digital marketing, branding and logistics.” The Economist

We always laugh at Chinese “innovation” claiming that it is simply copying the West. Not this time. It is time to take note: the super-app may be on the way.  

“Chinese apps are to 21st-century shopping what American malls were to last century’s.” The Economist

 

References

The Economist: Why retailers everywhere should look to China

The Economist: The next big thing in retail comes with Chinese Characteristics

McKinsey: Understanding Chinese Consumers: Growth Engine of the World

SmartBrief: A glimpse of 2021 global retail trends

Econsultancy: How does the e-commerce experience in China differ from the West?