e-commerce trends 2014: what can we learn from china?

1

eCommerce on Steroids:An introduction to China’s social eCommerce brands and

what we can learn from them.

Nicky Szmala & Rachel Guo

June 2014 | Beijing

2

OUR AGENDA

Quick snapshot of China’s eCommerce landscape

What we can learn from them

Intro to social eCommerce-only brands

3

China’s Giant

eCommerce Industry

Photo Credit: https://www.flickr.com/photos/23860276@N05/3887510836/

In 2013 China’s Gross Merchant Value

reached USD 1.63 trillion

Source: iResearch, Jan. 2014

1.000.000.000.000(12 zeros)

Source: iResearch, Jan. 2014

269.4 million

eCommerce users

Source: iResearch, Jan. 2014

YoY Growth of

Mobile eCommerce:

165.4%

Source: iResearch, Jan. 2014

eCommerce in China

huge

fast growing

more and more mobile

10

China’s eCommerce Ecosystem

Photo credit: https://www.flickr.com/photos/15562978@N08/10149082793/

‹#›

Taobao

Tmall

Jingdong

Horizontal eCommerce Platforms

Electronic Products

Gome,Suning

Apparel

vip.com, Vancl

Grocery & Daily Necessity

SF-Best, 1haodian

Cosmetic

Jumei, Lefeng

Books

Dangdang, Amazon

Offline Service

Meituan, Nuomi, Dianping

VerticaleCommerce Websites

eCommerce

Brands

Xiaomi Smartisan

Liebo Crucco

Three

SquirrelsChu Orange

AFU Roseonly

Tangcha

Diaoye

Brisket

Duokan

Huangtaiji

Pancake

Taobao is replacing

Baidu for product search

eCommerce is tightly

integrated into

social channel

Jingdong-WeChat1 Dianping-QQ2 Taobao-Weibo3

600 Million Users 800 Million Users 500 Million Users

Data Source:We are Social, China Digital Landscape 2014

Shopping festival

In 2013, sales volume reached 4.8 billion USD

on Taobao Double 11 Festival

Express delivery

infrastructure

Community based

eCommerce stores

“Internet users in select countries who would buy a brand because

of a friend ‘Likes’ or follows it on a social networks”

Data Source: IPSOS OXT and Ipsos Global, 2012

CHINA

54%INDIA

44%

INDONESIA

39%

USA

15%AUSTRALIA

15%

SOUTH

KOREA

14%

JAPAN

6%

WOM

Social Media

Data Source: Accenture, Winning the Heart of Chinese Consumers, 2012

77.4%

92.7%

Emotional Story

Niche Target Audience

Communication is 100% Social

Experience

Functional Story

Sales Mechanics

Partnerships

Lei Jun – The Steve Jobs of China

Emotional Story

Functional Story

Experience

Sales Mechanics

Communication is 100% Social

Partnerships

Partnerships with Chinese telecom operators

Niche Target Audience

Electronic device fans, who are

passionate about being involved

in product development

College students, who are tech savvy but

have limited budget for smartphones

A gift for the only one in your life

Emotional Story

Functional Story

Roses are imported from exclusive gardens

high in the mountains of Ecuador

Chocolate is imported from Belgium and

made by Jean George, a three-star Michelin

restaurant in NYC

Experience

• Products are delivered in exquisite

packages by well dressed male

models

• Guaranteed to be delivered within

24 hours

Sales Mechanics

For the lifetime of each customer account, only a single recipient can be registered

Communication is 100% Social

109 comments

573 retweets

Partnerships

• Trendgroup Media: gains media and

celebrity resources

• Jean George Restaurant :

establishes a light-luxury image

Niche Target Audience

Urban, upper middle class males with

high demand for luxury experiences

and quality products

Well educated females with appreciation for

exclusive products and high expectation

around relationships

Emotional Story

Functional Story

Organic Fruit/Vegetable + Nutrition Recipe

Experience

Just-in-Time

ProductionKept Fresh On-Time Delivery

Sales Mechanics

Subscription Model

Communication is 100% Social

Partnerships

Shiyi Pan, as angel investor of HeyJuice, helped recruit celebrities

and business elites as early adopters

Niche Target Audience

The young, professional, LOHAS

females who have above

average income and invest in

their well being

3 Squirrels | 三只松鼠

Emotional Story

A cartoon story about three squirrels with story lines and

merchandise crowdsourced by the brand fan base

Sourcing of the best nuts and

building a distribution system to ensure freshness and high quality

Beijing

Functional Story

Wuhu

GZ

Experience

Shell Bag

Wet

Tissue

Clip

Customer

Feedback

Card

Card Case

Sales Mechanics

Niche Target Audience

Young people with tight budgets but willing to pay a little more

to enjoy better quality products and services

What is missing here?

Photo Credit: :https://www.flickr.com/photos/10687935@N04/3552576743/

Instead invest in:

KOLs

Social Ideas

Social Care

SEO

Product & Customer Experience

Social works.

For product launches.

And beyond.

What we can learn from eCommerce on Steroids:

55

Thank you!

谢谢！

We’re happy to answer your questions:

nicky.szmala@geometry.com

Image Sources

Slide1: http://1.bp.blogspot.com

Slide 3:http://www.winnipegfilmgroup.com

Slide 9:http://www.liveforthepump.de

Slide 12: http://taobao.com

Slide 13: WeChat App, QQ App, Weibo web page

Slide 14，47:http://www.nipic.com/

Slide 16: http://www.ebrun.com

Slide 21,23,24,25,27:Xiaomi official website

Slide 22:http://coffeeticks.my

Slide26: http://bbs.xiaomi.cn/

Slide 28,36,50:http:www.gettyimages.cn/

Slide 29,30,31,33:http://www.roseonly.com.cn/

Slide 34: Roseonly Weibo and WeChat account

Slide 35: http://news.cecb2b.com

Slide 37,38,39,40,41,42,44: http://www.heyjuice.cn/

Slide 43: scity.weibo.10086.cn

Slide 45,46，49: http://www.3songshu.com/

Slide 51: http://architecturebehindmovies.wordpress.com

Thanks!We’ll send you the deck!

Ian Sohn

ian.sohn@ogilvy.com