Last Updated on November 12, 2024
Nearly half of China’s annual retail revenue comes from its massive online shopping population. As the largest e-commerce market in the world, industry giants are continuously innovating ways to serve the country’s 904 million enthusiastic virtual consumers.
Modern Chinese shoppers also increasingly rely on local social media channels for credible recommendations and feedback from fellow consumers. Because of this, social commerce platforms emerged as the new shopping avenue, seamlessly integrating their online purchasing experiences into social engagement.
In this article, we’ll discuss how the landscape of social commerce in China differs from the rest of the world and its impact on domestic consumer patterns. We’ll also tackle which platform will suit your business needs in the long run.
What is social commerce in China?
Social commerce in China combines online user engagements and virtual shopping functions in one application.
With over 1 billion local internet users actively chatting, connecting, and purchasing products through their mobile devices, these sales channels shorten the average consumer journey and accommodate the fast-paced consumption patterns of online shoppers.
The prevalence of social shopping is also partly influenced by the trust locals place in recommendations from friends, family, fellow customers, and influencers. An early example of this trend emerging in China’s digital ecosystem is a makeup tutorial on Douyin, where the user not only showcased a product but also provided a direct link for purchase.
Over time, even traditional e-commerce giants like Alibaba, Tencent, and JD.com decided to integrate social features into their systems. From letting brands host live-streaming sessions to sharing media content, online shopping has become more dynamic than ever and ready to cater to the changing needs of the younger consumer base.
Thanks to these new trends, the country maintains its position as the most extensive online market in the world, with an overall value of $1.54 trillion.
How big is social commerce in China?
No one can deny how massive social commerce is in China, especially with over 71% of Chinese consumers admitting that they prefer shopping on social media instead of traditional e-commerce channels.
Furthermore, an average local internet user spends approximately 5 hours and 15 minutes daily online, nearly half of that time on Chinese social media platforms.
This consumer pattern obviously empowered China’s social commerce market even further, allowing it to reach an annual GMV increase of 19.7% from 2022 to 2023. If this upward projection will continue, the industry will constitute 17.1% of China’s total online retail sales by 2025, which is an impressive jump of 14.3% from 2021.
The surging social commerce sales were mainly attributed to Chinese Mllennials and Gen Z, but more particularly to the age group ranging from 27 to 39. This audience segment account for 57.8% of the said user base.
How Different is China’s Social Commerce Market From Other Countries?
Unique digital and corporate infrastructure
China boasts a highly distinct digital and business infrastructure, mainly driven by two prominent domestic tech giants, Tencent and Alibaba Group.
These tech giants have created full-scale digital ecosystems that command a staggering 90% market share in the country’s e-commerce scene. They also cover 85% of the local social media usage and 85% of the digital payment transactions within China.
As the line between e-commerce and social media platforms blurs, the ever-changing digital consumption in China has pushed these tech giants to form cross-platform partnerships. The era of closed ecosystems among local apps is seemingly diminishing, allowing businesses to experience the perks of borderless digital landscapes.
The seamless consumer journey on social commerce channels makes it easier for users to make purchasing decisions. It gives them the convenience of browsing through their private social feeds, stumbling upon a product, swiftly ordering an item, processing e-wallet payments, and having the goods on their way for delivery in just a few clicks.
Culture
Cultural nuances have 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.
Real-time content was initially utilized for entertainment, gaming, and social interaction, so many Chinese users have also embraced live streaming as part of their daily routine for relaxing and spending time after work.
This cultural aspect has led every popular social media app to prioritize live-stream commerce. With entertainment, helpful information, and e-commerce fused into one content type, this trend provided a solid base for social commerce to flourish, as users were already accustomed to interacting and engaging with content creators in real-time.
What are examples of social commerce trends in today’s Chinese market?
1. Public Traffic vs Private Traffic
The key advantage of social shopping platforms is their ability to generate different types of audiences for businesses. Depending on your marketing goal, you can use this channel to target new consumer segments via public domain traffic sources like digital advertising.
Meanwhile, a brand with an established presence on social commerce apps can opt to generate leads through private domain traffic sources, like WeChat Mini-Programs.
These platforms operate beyond the capacities of typical social channels, so you have a full suite of tools dedicated to cultivating your existing consumer base or expanding your audience reach.
2. More Group Buying Features
Group buying is another trend that will continue to flourish on social commerce platforms. These features encourage users to make bulk purchases and unlock discounts and exclusive deals.
By leveraging collective group buying, Chinese consumers can access lower prices and enjoy shared benefits. This trend fosters community and excitement as users work together to reach group buying thresholds.
The group buying trend is also particularly effective on social commerce apps like Pinduoduo, which targets consumers from low-tier cities. Beyond that, Chinese consumers are particularly keen on these promotions during public holidays and e-commerce festivals when online consumerism is at its peak.
3. Continued Dominance of Live Commerce
Live commerce, or zhibo daigou (直播代购), continues to be a dominant force in China’s social commerce landscape. This format combines live streaming with shopping, creating a highly interactive environment where viewers can watch product demos, ask questions, and make purchases in real-time.
Platforms like Taobao Live, Douyin, and Kuaishou are a few of the leading pioneers of the live commerce trend, with high-profile influencers and celebrities often drawing millions of viewers to their streams.
4. Wide Adoption of Mini Programs
Mini programs within larger platforms, such as WeChat, have indeed become essential tools for brands to engage with consumers. These lightweight applications operate within the main app, allowing users to shop, play games, or even access customer service without needing additional downloads.
This ease of access significantly reduces barriers to engagement, making it simple for users to interact with brands through different content mediums.
Sephora’s WeChat Mini-Program with E-commerce and Live-streaming Options
Mini programs also enable brands to create a more interactive and customized journey, helping build loyalty and retention by allowing users to perform multiple activities in one place. As a result, brands can leverage the data to fine-tune their strategies and better meet customer expectations in real-time.
7 Best Social Commerce Platforms in China
1. Xiaohongshu (Little Red Book)
The most talked-about social commerce app that took the market by storm is Xiaohongshu (Little Red Book). It first gained a reputation for reliable, authentic reviews of products aimed at women in categories like cosmetics, fashion, and beauty.
However, in recent years, the platform has expanded to different product categories. Its diversified features and services help the app to gain 260 million monthly active users.
According to Qiangua’s trend report, 72% of the platform’s users were born in the 1990s, and most of them are not from lower-tier cities.
If you want to utilize social commerce in China through this platform, here are key points you must remember about Xiaohongshu:
- 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 and seamlessly make a conversion
- It has a very young userbase, with 90% of its users are under 32 years old
2. WeChat
WeChat is widely recognized as the all-in-one super-app in China. While it was initially launched as an instant messaging platform, it has since evolved and now offers social commerce features.
Its evolution has resulted in a complete ecosystem, from social media and e-commerce to mobile payments and video channels.
The utilization of WeChat as a social e-commerce platform brings forth several key advantages that contribute to its popularity:
- Its extensive consumer reach makes the platform a vital marketing tool for businesses looking to tap into the local market.
- Users can seamlessly share and recommend products within their social networks to drive engagement and facilitate word-of-mouth marketing.
- Whether it’s unveiling new products, conducting live demos, or responding to viewer questions, WeChat Channels allow a more direct way for brands to connect with their target viewers.
- WeChat Mini-Programs can be integrated into Channels and official accounts for a seamless consumer journey, from content discovery to purchasing.
- Brands can accept and process digital payments from local consumers through WeChat Pay.
3. Taobao / Tmall Platform (GuangGuang)
Taobao and Tmall have long been riding the social commerce trend 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, these business giants have redefined online shopping and e-commerce in China.
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, prioritizing buying intent on its algorithm.
- Calendar of special sales events: GuangGuang offers a diverse range of special sales events throughout the year beyond the well-known 11 festival. These events provide customers with exclusive deals and exciting shopping experiences.
4. Pinduoduo
Another app gaining traction among social commerce platforms in China is Pinduoduo. At first glance, it may appear like a typical shopping app, but it facilitates group buying between friends and acquaintances.
It has over 500 million buyers who 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.
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.
5. Weibo
Often dubbed the Twitter of the local 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 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 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 is the most suitable platform for finding KOLs for your marketing strategy.
- 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.
6. Douyin
Douyin’s journey from a simple video-sharing platform to a social commerce titan is a testament to its innovative approach and understanding of consumer behavior. Today, the app integrates e-commerce features directly into its system, allowing users to purchase products without leaving the app.
Here are several key features that have enabled Douyin to become a leading social commerce platform:
- Douyin has an in-app shopping function, allowing users to buy products directly from video content.
- Brands and influencers can add links to their content to lead their audiences to a product page or a Douyin e-commerce store.
- The platform grants the ability to host live shopping events where viewers can purchase products showcased during the stream.
- Douyin utilizes advanced algorithms to analyze user behavior and preferences, providing personalized product recommendations.
7. Meituan Dianping
Meituan Dianping is a “super app” primarily focused on connecting users to a variety of services, including food delivery, hotel bookings, and travel arrangements. It attracts over 678 million active users, with features such as in-store coupons, restaurant reservations, and entertainment bookings.
For businesses, Meituan Dianping is invaluable because it allows them to target consumers seeking recommendations, particularly in travel-focused brands like hotels and entertainment establishments.
To successfully utilize Meituan Dianping for social commerce, consider the following strategies:
- Ensure your business is accurately represented with appealing visuals and informative details.
- Engage key opinion leaders (KOLs) or top reviewers to boost credibility and increase visibility.
- By linking Meituan Dianping with WeChat, brands can enhance user convenience and foster seamless engagement across platforms.
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 goals, it is crucial to customize your approach and understand the intricacies of the local market.
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