Social Commerce China

Guide to Social Commerce in China for 2023

Last Updated on March 27, 2024

Social commerce has surged in popularity worldwide in recent years because of the fusion of online shopping and community engagement. With people opting to purchase products online, social media platforms gradually became the preferred shopping destination for many internet users.

China is no exception to this trend. In fact, Chinese consumers wholeheartedly embraced social media as a shopping avenue, seamlessly integrating their online purchases into social interactions.

In this article, we’ll delve into its impact on consumer behavior, the factors driving its success in China, and its growing significance worldwide. We’ll also tackle which social commerce platform will work with your business goals.

 

What is social commerce in China?

Social commerce in China entails promoting and selling products and services through various social media channels. However, its impact goes far beyond conventional online retail. Chinese social commerce has become a thriving ecosystem that seamlessly merges the digital elements of social interaction, product discovery, research, purchase transactions, and even customer support.

The unparalleled growth and sophistication of China’s social commerce market can be attributed to multiple factors, including the Chinese population’s widespread adoption of social media platforms, the nation’s robust digital infrastructure, and the progressive mindset of consumers and businesses.

As a result, China stands at the forefront of the social commerce revolution, reshaping eCommerce practices and redefining the boundaries of social media engagement.

 

How big is social commerce in China?

Besides dominating the traditional e-commerce scene, China also stood out in the social commerce market. According to Statista, this industry reached an estimated share of 2.5 trillion yuan in 2021. The continued development of Chinese social media platforms also paved the way for the market to reach an 850 million user participation rate.

With over 1 billion potential consumers using social channels as part of their everyday lives, experts predict the continuous expansion of the social commerce market in the coming years.

Furthermore, an average Chinese internet user spends approximately 5 hours and 15 minutes daily online, nearly half of that time on a social media app.

These social media platform options are exceptional avenues for product discovery, research, enticing deals, and purchasing. As of 2022, surveys revealed that over 84% of Chinese consumers expressed a strong inclination to shop through social channels.

 

Why Is China Leading The World When It Comes To Social Commerce?

China’s dominance in social commerce can be attributed to several key factors, highlighting the unique advantages and cultural context that have propelled the country to the forefront of this industry. Here are some of the reasons why the country thrives in this industry:

 

Digital and corporate infrastructure

China boasts an exceptional digital and business infrastructure that has paved the way for the success of social e-commerce. Two prominent companies, Tencent and Alibaba Group, have created robust digital ecosystems that command a staggering 90% market share in e-commerce. It also features 85% social media usage and 85% social commerce sales within China.

Did you know that the level of integration in their social commerce channels surpasses that of global giants such as Facebook, Amazon, and PayPal? And it’s all because their strategy allows for a seamless experience where users can browse through their private social feeds, stumble upon an enticing product, swiftly order, pay for it, and have it on its way for delivery.

 

 

Culture

Their unique cultural landscape has played a pivotal role in fostering the growth of social commerce platforms in China. As the market grew, live streaming and mobile video apps gained popularity in the country more than in other places. Initially utilized for entertainment, gaming, and social interaction, Chinese users have also embraced live streaming to relax and pass the time after work, as highlighted by research from the University of Hong Kong.

Livestream commerce platforms like Yizhibo, Yingke, and YY were specifically designed with audience-host interaction at their core, offering an immersive and engaging experience. In contrast, international social media platforms have only recently started to prioritize similar interactive features. This cultural foundation provided a solid base for social commerce to flourish, as users were already accustomed to interactive and engaging digital experiences.

China’s unique digital infrastructure and cultural openness have created an environment conducive to the rapid growth and integration of social commerce. As a result, China has become the global leader in this space, setting the stage for innovative practices that redefine the boundaries of e-commerce and social media interaction.

 

Where Is Chinese Social Commerce Heading In 2023?

As we look ahead to 2023, the landscape of social commerce is set to undergo significant shifts, with emerging trends reshaping the dynamics of influence and consumer engagement. While Key Opinion Leaders (KOLs) have held a dominant position in the social commerce world in recent years, there are indications of a changing landscape.

 

Rise of the KOC

Since Chinese millennials and younger demographics highly value recommendations from fellow shoppers, content from “Key Opinion Customers” (KOCs) now holds even greater weight than those from traditional KOLs.

Unlike the typical KOL/influencer marketing strategies, KOCs are ordinary consumers who actively participate in live streams, create short videos, or engage in micro-blogging. Their focus lies primarily on representing or reviewing products from an unbiased and objective standpoint rather than promoting a specific lifestyle.

While KOL marketing plans often cater to large audiences, KOCs typically have smaller, more intimate followings, including friends and acquaintances. They drive social commerce in China at the community level, acting as localized brand advocates for the digital age.

The shift from Key Opinion Leaders to Key Opinion Consumers signifies a move towards more authentic and engaging content creation. Through this, consumers increasingly seek genuine opinions and recommendations from their peers.

As the social eCommerce market evolves, we expect KOCs to be increasingly influential in shaping consumer behavior and driving community-driven purchasing decisions.

 

 

What are examples of social commerce trends in the Chinese market?

1.    Gamifying the Social Shopping Experience

The popularity of marketing games among Chinese users can be attributed to several key factors, like the ease of play, the availability of multiple formats, and the ability to interact with friends.

 

Guerlain social commerce gamification

Guerlain Tetris Lottery Game on WeChat

 

Chinese consumers are drawn to the interactive nature of online shopping gamified experiences that add an element of fun and challenge when making a purchasing decision. With brands recognizing the potential of social shopping gamification, most have adopted game-inspired concepts to drive private traffic and consumer engagement.

 

2.    AR and 3D Social E-Commerce Experience

Some e-commerce platforms in China are more than eager to deliver an immersive experience to their consumer base. Besides the obvious social media features, some apps go beyond what is expected and integrate their user interface with the cutting-edge technology of Augmented Reality (AR) and advanced 3D capabilities.

 

Tmall 3D fitting room

3D fitting room on Tmall

 

Users can use their mobile devices to project a true-to-life 3D projection of desired items, like a refrigerator, and place it seamlessly within their living spaces. This interactive feature allows customers to assess how the product fits within their home decor and make well-informed decisions.

Integrating AR and 3D experiences in traditional e-commerce platforms enhances the customer journey and eliminates some of the challenges associated with online shopping. The key advantage of these technologies is that they give consumers a realistic sense of the product’s size, design, and aesthetics, minimizing uncertainties and increasing confidence in their purchasing choices.

 

3.    Group Buying in Social Commerce Platforms

Group buying is another trend that social commerce platforms are implementing right now. They encourage users to make bulk purchases, unlock discounts, and exclusive deals.

 

Group buying on Pinduoduo

Group buying on Pinduoduo

 

By leveraging collective group buying, consumers can access lower prices and enjoy shared benefits. This trend fosters community and excitement as users work together to reach group buying thresholds.

 

4.    Utilizing Live Commerce Common Features

Besides group buying, live commerce has gained significant popularity in China, combining the convenience of e-commerce with real-time interactive experiences. Platforms have embraced live commerce by incorporating common features such as live streaming, real-time product demonstrations, and interactive Q&A sessions.

 

Live streaming on Taobao real time product demonstrations

Live streaming on Taobao with real time products demonstrations and Q&A sessions

 

This trend allows brands and influencers to engage directly with consumers, build trust, and showcase product features more effectively. Every live stream strategy offers a unique blend of entertainment, product discovery, and purchasing convenience, creating a highly engaging shopping experience.

 

5.    Cross-brand & Cross-category Business Models

You may not know, but platforms are willing to collaborate with multiple brands and expand their product offerings to provide consumers with a diverse and comprehensive shopping experience.

 

Cross brand Clarins Le Petit Prince

Clarins and Le Petit Prince cross brand products

 

These partnerships allow consumers to discover and purchase products from various brands within a single platform, saving time and effort. Cross-brand and cross-category collaborations enhance user convenience, offer greater product variety, and encourage exploration. It enables consumers to access various options and make informed purchasing decisions.

 

Top 5 Social Commerce Platforms in China

Xiaohongshu (Little Red Book)

Over the past few years, the most talked about social-media-platform-slash-e-commerce-app that shook the market’s core is Xiaohongshu (Little Red Book). It first gained a reputation for reliable, authentic reviews of products aimed at women; under categories like cosmetics, fashion, and beauty.

As of 2022, this social commerce app gained around 200 million monthly active users. According to Qiangua’s trend report, 72% of the monthly active users on the platform are born in the 1990s, and most of them are not from lower-tier cities.

 

Xiaohongshu live streaming social commerce

Xiaohongshu live streaming, store and WeChat/Alipay

 

If you want to utilize social commerce in China through this platform, here are key points you must remember about Xiaohongshu (Little Red Book):

  • One of the most popular live-streaming and vlogging platforms
  • Engagement metrics are high – average users spend 40 minutes a day on the app
  • Jointly invested in by Tencent and Alibaba, integrated with both WeChat and Alipay
  • It allows brands to capture user interest with content, then seamlessly make a conversion
  • Very young userbase – 90% of its users are under 32 years old
  • Live streaming features are integrated into the social commerce platform using Taobao

 

WeChat

WeChat, widely recognized as the all-encompassing super-app in China, has experienced remarkable growth in its social commerce offerings over the past two years. Its evolution has resulted in a fully integrated platform combining social interaction and commercial activities.

 

Lancôme WeChat store Social Commerce China

Lancôme WeChat Mini Program

 

The utilization of WeChat as a social e-commerce platform brings forth several key advantages that contribute to its popularity:

 

Extensive User Base

WeChat boasts an unparalleled user base, with virtually every individual in China utilizing the app daily. It ensures a vast potential customer reach with over 1.3 billion monthly active users, making WeChat a desirable platform for businesses looking to tap into the local market.

 

Social E-Commerce Integration

Since this platform is primarily a social app, it provides access to users’ social circles, including friends, family, and professional networks. This integration fosters a sense of trust and familiarity, making it conducive to social commerce activities. Users can seamlessly share and recommend products within their social networks, creating a powerful network effect that drives engagement and facilitates word-of-mouth marketing.

 

Enhanced Livestreaming and Video-Blogging

WeChat’s introduction of the “Channels” feature has expanded its capabilities to include live streaming and video-blogging functionalities. It enables content creators and brands to engage directly with their audiences in real-time, showcasing products, providing demonstrations, and answering customer inquiries.

 

Customizable WeChat Mini-Programs

WeChat offers a vast range of customizable mini-programs, allowing businesses to create tailored and branded experiences within the app. You can integrate these mini-programs into Channels and a micro-blog-style WeChat official account to give users a more cohesive experience.

Most brands leverage WeChat mini-programs to showcase products, offer exclusive deals, and streamline purchasing. Through this, advertisers can track their campaign’s status from discovery to conversion.

 

Integration with WeChat Pay

Considering the platform’s extensive reach, it’s no surprise that WeChatPay is China’s second-most widely used online payment method. Thanks to this feature, users can complete transactions seamlessly within the app, enhancing its image as a reliable e-commerce platform.

With WeChat Pay, the platform can offer businesses a comprehensive and highly effective medium to engage with Chinese consumers and drive sales.

 

Taobao / TMall Platform (GuangGuang)

Taobao and TMall, Alibaba’s e-commerce giants, have fully embraced social commerce through their integrated GuangGuang platform. With a massive market share, the rise of influential live-streaming KOLs like Li Jiaqi, and a calendar of diverse sales events, GuangGuang has redefined online shopping and e-commerce.

 

Taobao Tmall Social Commerce China

Live streaming on Taobao and Tmall

 

Key advantages of GuangGuang include:

  • Huge market share: Taobao and TMall command a significant presence in the e-commerce industry, ensuring a vast consumer base for social commerce activities.
  • Livestreaming KOLs: Influential Key Opinion Leaders like Li Jiaqi, popularly known as the “lipstick king,” have gained celebrity status through their success in social e-commerce on Taobao.
  • Retail-specific platform: Users on Taobao and TMall primarily focus on making purchases, creating an environment where social commerce in China thrives, with buying intent at the forefront of this strategy.
  • Calendar of special sales events: GuangGuang offers a diverse range of special sales events throughout the year beyond the well-known 11.11 festival. It provides customers with exclusive deals and exciting shopping experiences.

 

Pinduoduo

Another app at the forefront of the top social commerce platforms in China is Pinduoduo. At first glance, it may appear like a typical social media space, but it facilitates group buying between friends and acquaintances.

It has over 500 million buyers that can access special discounts by buying as part of teams, thereby leaning heavily toward the tried-and-true digital marketing concepts of social proofing and exclusivity.

 

Pinduoduo Social Commerce China

Pinduoduo live streaming with daily check-in bonus

 

Here are the perks marketers and advertisers can expect from Pinduoduo:

  • It has daily check-in bonuses for its users
  • International brands are more popular on this platform
  • It has a gamified feature with time limits for creating teams
  • Brands can retain consumer engagement through inbuilt mini-games.

 

Weibo

Often dubbed as a dinosaur in the social media landscape, Weibo has defied expectations and maintained its competitive edge amidst the emergence of new and innovative platforms. Over the years, it has proven its resilience by adapting to the evolving market demands. In 2020, the app took a significant leap by transforming into a true social commerce powerhouse by introducing its e-commerce management function, Weibo Xiaodian.

With the launch of Weibo Xiaodian, Weibo gave brands a chance to go beyond simply referring users to external marketplaces. Instead, they gained direct control over inventory management, order processing, and the ability to create their digital flagship store within the platform. This strategy enables them to establish a robust presence on Weibo, further integrating social interaction with commerce.

 

Weibo Social Commerce ChinaWeibo Xiaodian

 

Weibo possesses several key strengths that contribute to its continued success:

  • Its longevity sets it apart from fleeting platforms. Weibo has demonstrated its enduring presence in social media, consistently proving it is here to stay.
  • It boasts a vast user base encompassing diverse demographics across the entire China.
  • Weibo holds the distinction of being the most popular platform for KOLs.
  • Weibo’s appeal to influential figures further solidifies its position as a significant social media platform.
  • It facilitates seamless communication between brands and customers.
  • Its ease of engagement contributes to enhanced customer experiences and strengthens brand-customer relationships.

 

Your Trusted Social Commerce Partner In The Chinese Market!

Consumers in China have unique preferences and behaviors when using social commerce platforms. To truly captivate their interest and achieve the desired marketing outcomes, it is crucial to tailor your approach and understand the intricacies of the local market.

Don’t let the complexities of the Chinese market hold you back! Our dedicated team is here to guide you through every twist and turn, transforming your brand’s potential into a resounding success in the social commerce market.

 

Sekkei Digital Group Services

 

Whether it’s crafting compelling marketing campaigns, harnessing the power of SEO and social media, or making waves with PR, we have the digital solutions you need. Contact us today, and let the world witness your brand’s remarkable growth in China’s thriving business landscape. The possibilities are endless – let’s make them a reality!

 

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