▷ What Covid-19 has taught brands in China

The approach of brands in China to Covid-19 has been special, and companies have had to adapt. But every crisis makes the companies that survive stronger. China has had a huge advantage, as it was about 3 months ahead of the rest of the world in its Covid-19 turnaround .

As the economy begins to open up, companies that have shown resilience at the height of the crisis share a key characteristic: they have made digital a central point of contact for every touch point in their business.

They have thus acquired the ability to :

  • Communicate effectively with their employees and customers ;
  • Rapid deployment of products and services ;
  • Create and collaborate on ideas and solutions;
  • Mobilize parts of their supply chain and, most importantly, respond to data.

The power of digital technology in marketing at a time like this does not lie in the posting of new videos on YouTube or the use of Instagram.

It’s about maintaining a strong bond between the customer and the company and using the knowledge gained through engagement to provide the products and services people need.

There are three lessons from the marketing recovery cookbook of some of China’s most successful brands. So stay tuned for the rest of the article:

  • Keeping customers out of sight, but not out of reach ;
  • Making shopping a social event that brings value ;
  • Making logistics a key part of the customer experience.

What they demonstrated during the pandemic should prompt marketers around the world to reconsider what brands can do and what marketing can be.

It is ironic that shopping can be social when we are isolated, but social commerce is growing in China.

Keeping customers out of sight, but not out of reach

Deploying measures to protect the health and well-being of customers has been the top priority of the major brands.

At the height of the pandemic, this meant closed stores, limited service and frequent messages of social distancing. Fortunately, for resilient brands, reminders to stay home did not mean staying away.

Application-based communication has been a central part of the marketing strategy of many large Chinese companies, with the aim of being accessible and connected wherever you are.

Yum China, for example, has invested heavily in its digital strategy since 2015 and has increased its digital membership to 230 million.

The company offers services such as :

  • Pre-order and table control ;
  • The queue in line;
  • Delivery and payment, electronic gifts and media.

Its centralized platform has also enabled it to launch new products and services with relative speed, economy and flexibility.

From customized menus to home cooking kits, corporate catering services and contactless solutions, communication with millions of people has been made easier by centralizing the customer database.

Healthcare companies also saw their sales increase, as the Chinese overconsumed food supplements and other medicines during this period. Health care has become paramount for households in China’s major cities.

Making shopping a social event that brings value

It is ironic that shopping can be social when we are isolated, but social commerce is growing in China.

The concept is slightly in resonance with the one proposed by Groupon, i.e. offering wholesale sales through social networks. But when Groupon looks at value through the prism of products and services, in China, the real value is in the network.

Pinduoduo (PDD) is one of the leading social trading companies in China. Created in 2015, it is worth $50 billion and is owned by Tencent, owner of WeChat, which is used by one billion people.

PDD does not only sell the usual suspicious cosmetics and TV sets. But in response to the economic impact of Covid-19, PDD partners with farmers in rural areas to sell its products.

Source: Statista

In Yunnan Province, PDD is engaged in 100 agricultural projects. It will also train 5,000 rural talents to specialize in e-commerce and create 100 brands of agricultural products.

At a time when recession and unemployment are forcing people to re-evaluate their spending, we could see social trade expand.

The DDA is most popular in China among low-income people living in second and third tier cities.

In the West, e-commerce is mainly aimed at the middle and upper classes, Kantar having calculated that the average income of a buyer in the Amazon is around $84,449.

Making logistics a key part of the customer experience

From 26 January to 10 March 2020, more than 200,000 business owners are reported to have opened accounts on Alibaba’s food delivery service, Ele.me.

According to Alipay’s figures, ten of the most popular online fresh produce delivery programs on its platform received three times more revenue than in the pre-epidemic period.

Reflecting the demand for delivery services, the Meituan-Dianping e-commerce platform reported that nearly 30% of the restaurants surveyed have started delivery services in response to the pandemic. In addition, nearly half of the restaurants surveyed said they derive more than 70% of their revenue from delivery.

The integration of delivery capacity through third-party logistics partners has helped many companies mitigate some of the revenue losses.

For businesses, this means providing one-click pickup, delivery and courier services. It also means that the status of the last mile delivery is high in the overall customer experience hierarchy.

For its part, Starbucks, in collaboration with Alibaba, has been exploring self-service kiosks in supermarkets since 2018.

Coffee orders are placed via an application. The coffee is prepared in a kitchen in the store and the buyer can pick up his coffee in an unmanned station within 15 minutes. This type of contactless delivery is likely to be more common in the future.

In conclusion

The Covid-19 has forced the digitalization of the Chinese economy and is now showing us how to revive consumption. Digital marketing seems to solve the biggest problems at the origin of the virus, social distancing, containment and logistical problems.

Leave a Comment