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Lecture 11The Rise of e-commerce and e-marketing in China
Development of Internet in China
• 1987: 1st email
• 1994: allowed to enter Internet
• 1995: Chinese people began to use Internet
• 2017: Internet users: 751 million
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China vs. US Internet Market Size
• China is the world’s largest internet market with:– 1.397billion population
– 71% own a smartphone
– 751 million internet users (54.3% of population)
– 889 million Wechat users
– 500 million mobile payment users
– 72% internet users are between 10-39 years old
• US is the world’s second largest internet market with:– 323 million population
– 77% own a smartphone
– 287 million internet users (78.2% of population)
– 207 million Facebook users
– 48 million mobile payment users
– 90% + internet users are between 10-39 years old
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E-commercein China
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China eCommerce Market
• $ 1.7 trillion market by 2020
• 75% of 467 million online shoppers are millennials
• 200 million more online shoppers coming from lower tier cities and rural China
• Average spending 12,198 RMB in 2017
• Over 200 cities in China have same-day or next-day delivery coverage by Cainiao and JD
• US: $ 531billon market by 2020
• Average spending $ 1819 USD in 2017
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Types of EC Products & Services
• Products:– books, music and video products, – gifts and toys, – telecom products, – sporting goods, – office supplies, – apparel, & cosmetics. – consumer electronics, – food & health products.
• Services:-Online traveling services-Employment placement & job market-Real estate, insurance & stock
trading online-Banking & personal finance online-Online delivery of digital products,
entertainment, & media -E-knowledge-Online intermediary agency -E-government
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Types of EC Products & Services
Everything
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Tmall and Amazon
• Tmall platform deminates B2C eCommerce in China with a 53% market share and 97% of the online shoppers use the platform
• But many international retailers and brands, new entrants, often make the mistake of assuming the Tmall is just China version Amazon.
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Mobile Commerce
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Annual Spend per Mobile Internet user
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FinTech in China
• The nation is emerging as the world’s FinTech market leader. For the period July 2015 to June 2016, Chinese FinTech investments in the market surged to US$8.8 billion, commanding the largest share of global investment in this sector– FinTech firms are leveraging big data from e-commerce, messaging, search,
social media and other internet-based services to personalise the customer experience, provide new services, and leverage operational efficiencies.
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China is the World’s First Cashless Society
• Mobile payment users is expect to reach 630 million by 2020.
• Alipay takes 54% market share
• Wechat pay had 37% market share in Q4 2016
• 463 million people use mobile payment even when they are shopping offline
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Consumer
• Consumers have new forms of demands
• Digitalized channel and socialized online shopping
• Quality-oriented purchase and experience-based consumption
• Personalized consumption and mobile payment
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E-marketingin China
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China Internet Online Marketing
• E-commerce websites• Pop-up advertising, click-thru (conversion)• Search Engine Marketing• Email • Product reviews and ratings• Recommendation agents• Social media: blogs• Broadcasting…
相亲类网站
订阅
消费点评
电商
问答
论坛
视频分享
轻博客
微博
音乐/图片分享
商务社交
社交游戏
签到服务
即时通讯
博客社交网络
团购
社会化书签
百科
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Spending by Media Type
eMarketing Keynotes
• CONTENT IS not IMPORTANT, it’s VITAL
• VIDEO IS THE FUTURE
• WECHAT is KING OF MOBILE
• O2O
• Enhance USER EXPERIENCE
• Focus on local
• multiple SCREEN INTEGRATION
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The Evolving process
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KOL (Key Opinion Leaders) in China:
“More than any other country, [KOLs] have taken the lead to be a true media vehicle,” “Much like you would use a TV campaign or other promotion, most
marketers in China have a KOL strategy.”
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China KOLs
• Most key opinion leaders are either Chinese celebrities or popular social media users who have created viral content and developed a large following on various social media websites. They are columnists, socialites, fashionistas, and bloggers that have developed massive digital audiences.
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KOL Campaigns
• SPONSORED POSTS
• GIFT
• PRODUCT REVIEWS
• INFLUENCERS CONTEST/GAME
• But Is KOL marketing worth the money in China?
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The live-streaming booming and issue
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• A rising content marketing form or a big question mark?
Ethics and Regulatory Issues
• Internet has a become a powerful for consumers: instant success or destroyed overnight, bad news travel fast
• Privacy and political sensitivity
• Security
• Censorship and filtering is common
• Impropriate content
• Restrictions in certain areas after political unrest
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How New Technology is Shaping the Marketing Practice
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“Big Data”� adopting the technologies required to generate, collect and store
these new forms of data
� using advanced data processing and sophisticated analytical techniques such as predictive analytics
� applying this data knowledge in business decisions and activities
Pioneers in the practicing
• P&G Examines its business program success and react more quickly to changing market conditions,
• UBER’s business is built on Big Data, with user data on both drivers and passengers fed into algorithms to find suitable and cost-effective matches, and set fare rates
• WAL-MART Relies on text analysis, machine learning and even synonym mining to produce relevant search results.
• NETFLIX: Having drawn in millions of users with its high-quality original programming, is now using its trove of data and analytics about international viewing habits to create and buy programming that it knows will be embraced by large, ready-made audiences.
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• Differentiating pricing strategies at the customer-product level
• Gain greater customer insights
• Customer Analytics (48%), Operational Analytics (21%), Fraud and Compliance (12%) New Product & Service Innovation (10%) and Enterprise Data Warehouse Optimization (10%) are among the most popular big data use cases in sales and marketing.
• Supported by Big Data and its affiliated technologies, it’s now possible to embed intelligence into contextual marketing.
• Optimizing selling strategies and go-to-market plans using geoanalytics
• Break of the limits of time and space
• Precise audience targeting
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How New Technologies Shape eMarketing Strategy
E-marketing Strategy in an New Era
• Identify trends– Market trends, demographic trends, performance trends
• Segment data– Customer data, sales data, competitors data
• Understand target audience– Be customized
• Arrange the correct assortments– (product/service/experience) and pricing
• Send the right message– understand which messages have the greatest impact on customers, so each
advertisement is designed around their specific interests
• Contextualize your communication– Use location and timely event smartly
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