What makes it a learnable case study for brands is that the lotion successfully attracted new customers to La Mer. It helped raise the percentage of new customers to nearly 70%, among which was a 10% growth in the Gen Z consumer group.

What marketing strategy did La Mer apply to launch this lotion? How did the lotion bring young consumers to La Mer?

Product Targets at Young Generation

The hydrating infused emulsion is La Mer’s first lotion for anti-aging, which helps to build up the brand’s products team.

Most lotion has the issue of being too sticky to the skin, and they are not suitable to be applied either in spring or summer. La Mer spotted the problem and decided to create a light and hydrating lotion and, at the same time, has the ability to combat the aging issue for consumers.

Based on research conducted by Mintel, over 60% of Chinese consumers choose high-end skincare products because of the anti-aging need, such as tightening the skin (63%) and antioxidants (60%). Post-85s and post-90s are the most generous groups in spending money on anti-aging skincare products.

La Mer planned to use the lotion to bring consumers aged between 25-30 to the brand in China.

“Young as Me” Campaign

To make sure the brand reach the young consumer group, La Mer launched a “Young as Me” campaign (hashtag #年轻由我#).

The brand filmed a series of mini-movies featuring Chinese millennials and Gen Z. Scenes in the movie echoed with young people’s interest, such as surfing, camping, and skiing, showcasing the characteristics of the young generation: carrying clear goals and keep exploring the unknown, regardless of traditional boundaries.

Another hashtag that La Mer used when introducing the lotion was #轻启年轻#, meaning becoming younger. Either the campaign or the hashtag delivered the message to consumers, especially young consumers that by using La Mer’s hydrating infused emulsion, you can look younger.

Celebrities and KOLs Helped Bring More Traffic

To show La Mer’s sincerity for its new lotion, the brand invited Chinese Victor Ma (马伯蹇) to show up at its launch event with Tmall. Victor created a song dedicated to La Mer, which shared his attitude towards being young. The event was livestreamed on Weibo, generating more buzz for the new lotion.

In terms of KOLs, La Mer invited KOLs whose fans are the young generation to offline glamping, including top fashion KOL Yuanlanshi Ximendasao (原来是西门大嫂), fitness KOL Zoey (周六野), and travel KOL odin and kitty. La Mer coupled the lotion together with its iconic serum and educated KOLs on their effects.

Couple The Lotion and Serum

CP, or couple, is a hot word among Chinese young people. The term originated from actors/actresses, whom fans wish to have real relationships in life, other than in films or TV series. When it comes to marketing, everything can be coupled. Brand A can couple with Brand B to bring more attention. Similarly, Product A can couple with Product B to get a better effect.

La Mer has educated KOLs about the effect brought by the coupling of its lotion and serum. In March 2022, La Mer launched an upgraded serum and officially and publicly announced the combination of its two products.

Our Thoughts

La Mer smartly uses the hydrating infused emulsion to fill the gap in its product team, which mainly serves the young generation. Through its online channels and offline events, the brand successfully targeted Chinese millennials and Gen Z and educated them about its anti-aging effect.

The post How Did La Mer’s New Product Grow Its Gen Z Consumers in China? appeared first on China Marketing Insights.

Why is she so popular? Well people were curious about this perfect-looking girl. AYAYI amazed people with her features and style. People were questioning whether she actually might be a real person. Many people began re-creating AYAYI’s content and imitating her look.

Business Potential of AYAYI

Among AYAYI’s followers, over half of them are the young generation between the ages of 18 to 24. They love chasing after fashion trends and show great interest in different types of art. Working with AYAYI can help brands to become younger and to reach the young consumer group.

Guerlain x AYAYI

Many brands “invited” AYAYI to their offline events, including Louis Vuitton, Guerlain and Disney. On June 15 and 16, Guerlain created a perfume garden in Shanghai, attracting many KOLs to visit.

Even though AYAYI can’t actually attend the event, her designers can create images that make it look like she was there.

What also help the event to generate buzz on social media was that many KOLs and celebrities were learning from AYAYI’s poses and took photos at the same scene with the same gesture. It used to be influencers imitating celebrities, now it’s the other way round, that celebrities are imitating influencers, not even real humans at that!

Principal of Tmall Super Brands Digital (天猫超级品牌数字)

What makes AYAYI different from other virtual avatars is her endorsement with Tmall. She visited Alibaba’s workspace and had her own name card like other employees.

AYAYI is not confined by either time or space, so she can travel anywhere. Because of this, she can be the one who guides people to different art exhibitions in the world and bring engaging visiting experiences for them with technical assistance.

AYAYI is also the representative of the latest trends and fashion. Brands are welcome to have jointly designed products with her. Together with AYAYI’s identity as a metahuman, they can bring novel shopping experiences for consumers.

During this year’s Mid-Autumn Festival, she introduced a mooncake gift set, co-designed by AYAYI’s team and Tmall. Consumers not only received a physical set, but also a NFT (Non-fungible Token) mooncake.

The Prospect of Virtual Avatars

In some way, real KOLs are the same as those digital human beings. KOLs have their own online characters set by MCNs or themselves. They are invited to events and post images on social media. They interact with followers in a digital world and followers don’t know if it’s KOLs themselves replying to their messages or someone else replying on the KOL’s behalf.

Virtual avatars are capable of doing the things above. They are created under a series of artistic analysis and their faces are more sophisticated than real people. Since they first show up on social media, they are born with discussion on whether they are real people. That discussion helps them grab attention and grow fan bases.

According to iiMedia Research, the domestic market of virtual idols reached 3.46 billion RMB, and it is expected that by 2021, the scale of the market will grow to 6.22 billion RMB.

However, though virtual avatars can do most of things the same with real human beings, some are not within their capabilities. Not long ago, a virtual influencer Ling (翎) posted on RED to promote a lipstick. The post was criticized for not being honest, because it described the texture of the lipstick. RED users felt that a virtual person can’t feel the texture personally, and it would be better if she recommends apparel instead of makeup or skincare products.

Read more: 首个超写实数字人入职天猫，撕开元宇宙入口？

The post Chinese Metahuman AYAYI: Redefining the Word Influencer appeared first on China Marketing Insights.

At the moment, the only way to purchase the new product line is through JD. Even the Mini Program that Perfect Diary guides readers to is JD’s Mini Program, not its own. To me, this shows that the brand wants to see how its male line goes. If its sales perform well, the brand will spare budget to create a separate MP. It was smart of them to choose JD.com as the majority of the platform’s users are male, unlike Tmall.  

Perfect Diary has been smart to grasp trends. It introduced color contact lenses in March, and now, the brand wants to benefit from the growing male cosmetics industry.  

Male Cosmetics Market is Booming in China  

In fact, male cosmetics have been around since the 1920s, but remained low-key for a long time. Well, since the market for girls has become saturated, brands are searching for new growth opportunities, and they see boys are paying more attention to their looks.  

The number of companies dedicated to male cosmetics is increasing in China. According to a corporation monitoring platform Qichacha (企查查), the amount of companies registering in a year has grown from 1,105 in 2017 to 3,141 in 2020.  

Not only more players are joining the industry, but also many investors see opportunities in it and actively investing in those companies. A domestic male skincare brand Make Essense (理然), founded in 2019, has received six rounds of investment so far, among which, the highest amount was up to 300 million RMB. Not long ago, Bilibili showed up in the brand’s info as one of its stakeholders.  

Since 2017, there have been over 18 financing cases in the male cosmetics industry, with a total amount of over 1.8 billion RMB. Heads up, 11 of those 18 happened in 2020.  

What Type of Consumers are Buying?  

Based on a male consumer behavior report published by QuestMobile, over 185 million males are following beauty KOLs. People who age 25 to 30 make up 25.2%, and people who aged over 45 make up 13.5%. That leaves Gen Z as the main consumption group.  

Another report which shows the trend of the development of domestic beauty brands indicates that the consumption of male cosmetics through online channels grew 24.5% in 2019. The GMV that male cosmetics shoppers contributed grew 41.5% on Tmall in the same year.  

Over 60% of men buy skincare products on their own and the number of men buying cosmetics products is 20%. Only 2.5% of men have the habit to wear makeup daily. But this percentage is growing. It is estimated that the rate of growth for the Chinese male cosmetics market is 13.5%, which is twice the scale of the global market.  

Why There Is No Unicorn Male Cosmetics Brand Yet?  

Men’s habits of consuming cosmetics is still in very early stages 

Though people are getting open with men having skincare routines and putting makeup on, the majority are still conservative towards it. Men don’t have the habit yet, and are in a period of testing and trying out.  

There is no top beauty KOL whose majority of fans are males  

You might say what about top live streamer Austin Li? He tests the colors of thousands of lipsticks in front of the public. But most of his followers are females. They are not boys.  

Male beauty KOLs whose majority of fans are males haven’t shown up. No one is there to educate Chinese males about cosmetics.  

A failed example  

In autumn 2018, a male grooming brand HOUSE 99, co-founded by David Beckham and L’Oréal entered the Chinese market, bearing the hope to benefit from the male cosmetics market. Its presence was mainly online, both on JD and Tmall. However, HOUSE 99 exited the Chinese market in less than 3 years.  

Someone needs to educate Chinese male consumers about cosmetics and how to use them before any brands can profit from the market.  

Who are Perfect Diary’s Competitors In The Male Cosmetics Industry?  

Though male cosmetics is a New World waiting to be developed, there are already many players joining the trend.  

Dior, Armani, Chanel, Tom Ford, SK-II and many other international beauty brands have launched their male collections, including skincare and makeup products. L’Oréal has two brands dedicating to the industry, Biotherme Homme and L’Oréal Men Expert. They are smart to directly name the brand with “men” in it, letting consumers know they are brands serving men.  

Besides international brands, Chinese brands are emerging and booming. Martin, Make Essense and dearBOYfriend. However, I think one thing that they fail to achieve is to show they are a male cosmetics brand from their names. Simply reading their Chinese names won’t let consumers know what this brand is doing.  

While it is a long way ahead for men to form their skincare and makeup habits, Perfect Diary takes a shortcut. It directly skips the process of education, as the brand hands it over to men’s partners, aka women who are their existing customers. They encourage their female customers buy the new male products and send them as a Qixi (Chinese Valentine’s Day) gift to the men in their life. 

Read more: 

男士赛道跑不出“完美日记” 

男士理容赛道火热，完美日记也来分“一杯羹” 

男色经济来袭：一年3141家男妆品牌涌入，有公司两年融五轮 

The post Perfect Diary Launches Male Cosmetics Line appeared first on China Marketing Insights.

It was a skincare brand KANS (韩束). This is a great case study of how to leverage ecommerce live streaming to avert a PR crisis.

So What Is the Kris Wu Scandal?

Kris Wu is a singer and an actor. The whole scandal started from one of the victims Du Meizhu’s (都美竹) Weibo post. In the post, Du was saying Kris often hooked up with girls, especially teenage girls. He often select women as commodities to decide which one to sleep with.

Following Du, there were other girls posting their chatting history with Kris, which were really disgusting and alike. The key point is, these girls were underage and many of them said they were forced to do things while under the influence of alcohol.

The scandal and related topics covered most of Weibo’s hot topic ranking board and have continued to stay there for quite some time as the situation continues to unfold.

KANS’s Live Stream Situation On The Night the Kris Wu Scandal Broke

The night Du posted about Kris’ behaviors, many netizens rushed to the live streaming rooms of brands that Wu works with and began criticizing the brands for working with Wu. This was what happened to KANS’ livestream that evening.

That night, KANS’ live stream had two co-hosts, a male and female. Neither live streamer know what had happened and had no idea why people were upset. After the boy searched on Weibo and learned what had happened, he told the girl that it was disgusting. The two live streamers were a bit panicked, and they encouraged each other not to be afraid. Of course they are saying all this live.

Shortly after this, they saw the hot topic on Weibo saying KANS has terminated its collaboration with Kris Wu due to the scandal. Their first reaction was, would KANS fire them as well? Haha, of course not.

As the first brand to bravely announced it had canceled its contract with Wu, KANS started receiving support from people. Thousands of people flocked to the livestream room and they actively shared the livestream with their friends.

The live stream lasted until 2am and the total amount of viewers reached 3.7 million. They’ve also achieved a sales amount that they would never expect: over 5.4 million RMB. That the sales from that live stream, combined with the rest of KANS’ sales in July, were more than KANS had sold over the course of 6 months the year before.

So How Exactly Did KANS Managed To Benefit From the Kris Wu Scandal?

Quick reaction to Kris Wu’s scandal

Brands that were hesitating to terminate their contracts with Kris were not able to continue their livestream that night because of too many angry netizens flooding the comments. For example, Lancôme only ran its livestream for 2 minutes before it chose to shut down.

KANS on the other hand, didn’t shut down, allowing a large amount of people to gather at a place and let off their anger. And then, when KANS announced it had canceled the contract, the stream gave people a place to come support KANS.

Two live streamers did a good job to personalize the brand

This may not be intentional, but two live streamers worked very well with each other and their interactions attracted many viewers to follow with them.

The average amount of viewers of KANS’ livestream before the scandal was not even 300. On that night, the amount became overwhelming and when the number surpassed 300, the girl asked viewers how to turn on the beauty filter so to look better.

When a serum, whose original price was 299 RMB, was auctioned to 1,200 RMB, the girl told viewers to spend their money rationally and not to keep raising prices, as it would waste their money.

And because they stayed cool-headed and performed well during the livestream, the boy received a call from their boss saying that both he and the girl would get reward for this. He looked so happy and surprised, and he excitedly shared the news with the girl and viewers.

Viewers were cheering up for them and they were encouraging the boy and girl to get married if the number of viewers reached 500k. Those two live streamers were joking that they didn’t even know each other for 3 days. After the stream, two lives streamers were titled KANS Couple.

Usually, we see live streamers recommend products, reading scripts in front of them. But this time, the KANS Couple acted like “real people”, and it really created closeness with viewers.

Two live streamers are trained well with their livestreaming skills

The first reaction that these two live streamers saw so many people coming into the livestream room, they were shocked. But they quickly presented their livestream skills: recommending products.

They stayed coolheaded and did a great job of grasping this opportunity to get in front of so many people. They told viewers that KANS’ new collection would show up in Austin Li’s livestream on July 19. Then after canceling its contract with Wu, KANS quickly announced that it appointed the National Swimming Team as its new ambassadors, and the two live streamers shared the announcement, and their joy, with viewers. 

Support from the livestream system on Taobao

Many factors influence Taobao’s live stream ranking board including the length of time that viewers’ stay in the livestream, the length of the livestream, the number of viewers, and the likes, comments and other interactions.

In total, the livestream lasted for nearly 23 hours, with different live streamers. KANS’ performance also helped the brand to stay on top on the livestream ranking board for which it got more exposure.

What Can We Learn from KANS’ Success?

Quick reaction

KANS’ quick reaction and the corporation between two live streamers really earned itself a favorable impression. On the other hand, Lancôme was under severe criticism by netizens because of its hesitation to terminate the contract.

Closely monitoring the situation

It’s what people want to see that matters.

Brands need to monitor how the whole situation goes and make decisions that will please people. The earlier they show their attitude, the less harm will occur. They may even gain bonus from it, such as KANS.

Livestream: crisis preparation 

In this incident, we can see that KANS’ live streamers are well-trained and that’s why they were able to drive so many sales in a night.

As livestream has become a necessary sales and marketing channel for many brands, brands often approach livestream agencies to look for live streamers, instead of cultivating their own. It is important that brands educate them about brands’ basic information and how they should behave if any scandal happens.

Maximize the influence of the livestream

KANS didn’t stop at that night’s livestream and has continued to ride the wave of attention. Since netizens named those two live streamers the KANS Couple, the brand has had them do more livestreaming to capture people’s enthusiasm and curiosity to watch them. Also, KANS’ CEO will appear in an upcoming livestream to meet consumers.

Read more: 吴亦凡事件发酵后，韩束直播间为何能一夜爆红？

与吴亦凡解约后，韩束直播间一场卖出500万，居然还卖起了牙签

The post How Chinese Skincare Brand KANS Actually Benefitted From the Kris Wu Scandal appeared first on China Marketing Insights.

Tmall turns out to be the main battlefield for most brands. This year, it attracted 250k brands to join, which was 2.5 times the scale of 2020. Among them, 8,200 brands participated in the Tmall 618 shopping festival for the first time. A lot of brands used the holiday not only as a chance to boost sales, but also as a chance to test out new products. In fact overall there were 1.4 million newly launched items.

Today’s article stems from a report published by Alibaba’s Alimama marketing platform. The report shares 618 case studies from 100 global and Chinese brands. Here we’d like to highlight 10 of the Chinese brands included in the report and share their results.

For brands that we didn’t mention in our previous articles, we will start close monitoring them.  Subscribe to our newsletter and stay tuned!

1. Breo (倍轻松) – Massage Devices

Breo is a Shenzhen-based brand founded in 2000. It is well-known for its massage devices which combine traditional Chinese medicine with advanced technology.

What makes the brand known to the public is its ambassador Xiao Zhan (肖战). He has 29 million followers on Weibo. Xiao once had a massive scandal for allowing his followers to start an Internet war with a platform that presented Xiao’s image negatively. He was criticized by news outlet People’s Daily (人民日报), the mouth of Chinese government.

Even though many thought his career must be ruined from the scandal, after laying low for a while, Xiao magically recovered and has begun working with numerous brands. The most buzz-about one is his appointment as ambassador for Li Ning (李宁), a Chinese sports brand that is often compared with Nike. Xiao is definitely a person that is always in the spot-light and Breo has benefitted from it. During 618, the number of new customers grew 150%. Its neck massage device, eye massage device and scalp massage device all ranked TOP1 in their corresponding product category on Tmall.

2. Xiao Mi (小米) – Technology

Xiao Mi is first known for its mobile phones. It successfully expands its business categories into digital home appliances. Like its phones, the prices of its appliances are more affordable compared with other products in the same category.

During the 618 shopping festival, Xiaomi’s sales on Tmall broke 3 billion RMB. On June 1, an hour after the first round of 618 began, its sales were already higher than its sales from the whole first day last year.

3. Xiao Xian Dun (小仙炖) – Supplements

Chinese people have always been very focused on anti-aging, and birds’ nest supplements are seen as one of the most effective supplements.

During the 618 shopping festival, Xiao Xian Dun ranked TOP1 on Tmall in the birds’ nest category. The number of customers that purchased its annual set grew 113% year-over-year. The annual set, which has 336 bottles, cost 27,591 – 84,405 RMB.

You may wonder why there is such a big price disparity for one set. This is because Xiao Xian Dun doesn’t want to scare its customers with extremely high prices. So it has different portions for several sets, such as the 100g x 336 bottles, 70g x 336 bottles or 45g for each bottle.

Live streaming played a huge role in Xiao Xian Dun’s success. In total, its brand-run live streams contributed 21 million RMB in sales during the 618 campaign.

4. Adopt A Cow (认养一头牛) – Food & Beverage

Adopt A Cow is a Chinese diary brand that managed to surpassed two giants, Mengniu Diary (蒙牛) and Yili (伊利), and ranked TOP1 in its category during last year’s Double 11.

24 hours into the presale of this year’s 618 shopping festival, Adopt A Cow achieved over 13 million RMB in sales on Tmall, which was already more than the total sales amount during last year’s presale. It also gained a lot of new followers during this year’s shopping holiday, helping its Tmall store to pass the 10 million followers milestone. In terms of the amount of average per order, it improved 120% compared with the same time last year.

Why has the brand been so successful? To compete with Mengniu and Yili, Adopt A Cow introduced a new way to approach its customers. It is also building relationship with customers through customer feedback groups, livestream and farm visits and allowing customers to actually adopt a cow.

5. Genki Forest (元气森林) – Food & Beverage

Not long ago, we just wrote about Genki Forest’s scandal. Genki Forest is a soda water brand known for its super healthy ingredients with zero sugar and low fat. But it turns out the brand was misguiding its customers to think it’s zero sugar which in fact, it contains sugar.

However, it seems that consumers quickly forgot the scandal, or maybe they have chosen to ignore it because they love the brand’s drinks too much. During 168, Genki Forest managed to obtain 20 million new customers. It ranked in the TOP 10 in the beverage industry during presale period. Its 618 advertisements also helped the brand increase traffic to its Tmall store by 30%.

6. Toffee (奶糖派) – Underwear

We’ve talked a lot about Ubras, which is a young and fast-growing domestic underwear brand. It’s best known for its one-size-fits-all bras. Well, Toffee is the opposite. Instead of targeting the masses with a one-size-fits-all product, Toffee specifically targets large-chested women.

The brand distinguishes itself with its thoughtful designs and the close relationship with its end users. During the 618 shopping festival, it managed to grow its number of Gen Z customers by 645%. Only 40 minutes after the sale began, the sales amount already surpassed what it achieved in a whole day last year.

Toffee also successfully gets itself enter the TOP 10 in the underwear category on Tmall and it is the TOP 1 in the large chested bras category.

7. Urban Revivo – Apparel

While many international fast fashion brands’ results in China are declining, Chinese brand Urban Revivo is thriving. And it’s not only succeeding in China, but also doing well abroad in many international markets.

During 618, just 11 hours after the shopping festival began, its sales amount already surpassed the sales that it took 3 days to achieve last year. Statistics also show that, the number of customers between the ages of 18-24 grew 8% this year.

8. Warm Studio or Guliang Jiji (古良吉吉) – Bags

Warm Studio or Guliang Jiji was founded in 2012 in Hangzhou, China. The brand’s Chinese name comes from the names of the creators of the brand who also happen to be a couple. Jiji, she is the designer of the brand, and Guliang, who oversees the business side of things, aka, everything else except design.

The price of Warm Studio’s bags are on the pricier side for a Chinese bag brand, almost that the entry lux level. They are sold between 500-2700 RMB. Those bags are very recognizable either in terms of their materials, texture or their designs. I bought a very tiny one which can only store airpods inside, and I was very surprised by how the bag looks and feels. It surpassed my expectations. This is my favorite Chinese bag at the moment!

During the 618 shopping festival, the number of its Gen Z customers on Tmall grew 670%, and its active customers grew 145%. In terms of ROI, it improved 90%.

9. Boohee (薄荷健康) – Food & Beverage

Boohee first started as a platform that provide healthy consultations but now it has expanded into products, specifically, meal plans. Its Tmall flagship store sells low fat, low sugar food, such as chicken breast, pre-made meals, etc. 

Just an hour after the 618 shopping festival began, the brand’s sales already surpassed what it did last year for a whole day. It has also successfully lowered the cost to attract new customers to the store, and its ROI improved 15% this year.

10. KEEP – Fitness

KEEP is first known as a fitness app. It was founded in 2015. I use it a lot as it has many tutorials for different levels and different body parts that you want to target. To enrich its monetization methods, KEEP sell peripheral products on its Tmall store, including clothes and fitness equipment.

An hour after 618 began, it managed to sell more than what it did last year in a day. By 23:59 on June 1, the GMV of KEEP grew 104% compared with the same time last year. Its JD Tmall store’s GMV achieved great progress, with 323%. Not only domestically, the brand’s sales grew over 50% when it comes to international orders.

Read more: 618收官，最值得看的TOP100营销案例|alimama超级秀可思Vol.05

The post 10 Chinese Brands That Excelled on Tmall During This Year’s 618 Shopping Festival appeared first on China Marketing Insights.

1. National pride continues

Although European, American, Japanese and Korean brands still dominate the premium end of the market while domestic brands are mostly in the mid-range and lower end of the market, there’s a concerted effort and supportive government policies to change this dynamic. We can see that Chinese brands not only want to take over the top end of the market but openly advertise these goals.

Strides made in recent years by domestic beauty brands are part of the Guochao (“national hip”) trend. Makeup brand Perfect Diary is its poster child with its high sales, strong cultural elements and its direct to consumer, social media-centric sales model.

Perfect Diary’s parent company, Yatsen Holding, after its IPO in New York in late 2020, also became the first Chinese beauty company with a market capitalization of over 100 billion RMB.

Chinese brand Florasis has even gone as far as marketing itself overseas and has become a known brand online through influencer campaigns on Instagram, Facebook and TikTok. However, it seems that the brand hasn’t fully worked out its distribution model and is still hard to buy outside of China.

2. Cosmetic procedures are no longer taboo

China’s medical beauty sector is expanding rapidly, growing from 64.8 billion RMB in 2015 to 176.9 billion RMB in 2019 and forecast to reach US $52.4 billion by 2023. Apps like Soyoung, China’s answer to realself.com, where people compare results from various treatments, mean that lots of people are sharing before and after photos and post-surgery diaries.

This is influencing people and affecting their decision-making process. There are around 3.5 million of these diaries on the platform. There are also more than 25,000 professionally qualified plastic surgeons and over 6,000 medical beauty institutions on the platform. It debuted on the Nasdaq in 2019 and is going strong. Post-90s consumers and those in the south of the country are the main force driving in this sector.

3. Men’s grooming continues to grow, just as their hair is failing to

Men’s fashion and grooming is going from strength to strength. Sales of men’s cosmetics were around US$15.6 billion in 2019, up 8% from the previous year, according to Euromonitor, with increasing demands for innovative products designed specifically for men. Men are also more open to aesthetic procedures. Rhinoplasty, cheek fillers and hair augmentation are the top three treatments.

China’s relentless 996 working culture – working from 9 a.m. to 9 p.m. 6 days a week – is taking its toll and men are seeing hair loss at younger ages. On Douban, groups about hair care and people looking for hair loss prevention ideas have grown. People are looking beyond shampoo and conditioner. According to Tmall’s Hair Care Industry Consumer Trend Insights report, they are seeking more advanced solutions such as hair masks, oils, essences and ampoules. Hair transplants and customized wigs and hair pieces are also very popular.

Interestingly, with an average price of 7,025 RMB, men are spending 2.75 times more than women per transaction.

4. Growing needs and desires

The market is growing and segmenting to include more than just basic facial makeup and skincare. People are looking for beauty devices for the eyes, mouth, hair, neck and body. The growth in beauty devices for eyes far exceeding that of other categories.

Late nights and “staying-up culture (修仙文化)” mean that young people are looking for solutions for the dark circles and puffiness under their eyes. According to CBNData, between 2017 and 2019 alone, purchases of eye beauty devices on Tmall by those born after 1995 (Post-95s) and those born after 2000 (Post-00s) has increased 67-fold.

There are also new trends in sunscreens. People are becoming more educated about the effects of both UVA and UVB rays and looking for broad spectrum protection. Older consumers saw sunscreens as moisturizing aids, but younger generations are more focused on their anti-aging benefits. People are also looking for convenient, effective sunscreens that smell nice, go on smoothly, don’t interfere with makeup and don’t look chalky.

Fragrances, especially domestic brands like To Summer, are a big hit on Red and are also looking to expand their reach and offerings with perfumes, balms, incense, scented candles and more.

5. Social media is still front and center

In addition to dedicated apps like Soyoung, content related to beauty brands abounds on platforms like Red (Xiaohongshu), WeChat, Weibo, Douyin, QQ and Bilibili. Domestic brands like Perfect Diary and Florasis have used them skillfully to gain a foothold in the market.

Although beauty products are sold primarily through dedicated e-commerce platforms like Tmall and Taobao, most Post-90s and Post-00s consumers learn about new brands through social media. Red has also successfully connected itself to Taobao as stores can quote posts and comments made on Red when editing a product introduction. Red played a key role for Perfect Diary as its sales improved a lot after it opened a store on Red.

But…

6. The limits of celebrity live streaming and influencer-led sales and promotion models are clear

Beauty brands are heavily reliant on KOLs (key opinion leaders, influencers) for promotions and sales. Nowhere was this more evident than in the May run up to the 618 shopping festival when 27 new endorsements were announced in 7 days. It’s turned into a bit of an overlapping frenzy with multiple titles like image ambassador, brand friend, brand spokesperson and more being used to refer to people in multi-star brand deals with some people representing an entire brand, others repping a line and still others doing promotions for a single product. Things are becoming segmented to the point of craze and confusion.

On top of this, sales often collapse when a celebrity isn’t involved or when a big name live streamer isn’t doing the sales. It’s turned into a celebrity daigou market in many ways and it’s not sustainable. For example, according to data from June to September 2020, reviewed by Zhongtai Securities, a Dr. Yu brand face mask that Li Jiaqi recommended in June sold more than 100,000 units yielding a GMV of 19.9 million yuan. When he stopped recommending it in July, only 6,500 were sold, with sales of 1.22 million yuan. In August, only 8,800 pieces were sold, with sales of 1.56 million yuan.

Some brands think the solution is an in-house live streaming host, but the truth is, none have the pull of big names and experienced live streamers. People know when they hear certain names that they’re in for great discounts, limited editions, a variety of interesting, unique products and an entertaining broadcast. A new, unknown name doesn’t come with these guarantees and it’s a reputation and skillset that is very particular and takes time to build. It also demands a person who has the stamina and energy to pull off an energetic, compelling marathon live stream.

The truth is that brands need these big names and their celebrity endorsers, but brands that build their sales model on them thinking that they’re laying a solid foundation are in for a shock.

The only sustainable model in China is for brands to build their own fan and customer communities organically and slowly, putting in the hard work and taking the time, while also working with celebrity endorsers and uber popular live streamers strategically for big promotions a few times a year for the biggest or most suitable occasions. Brands that have special privileges, experiences or online spaces for long-time fans and customers are also on the right track. An offline presence, highly coordinated with the brand’s online entities, is also required at some stage, even if it’s just pop-up stores to start with.

Though the beauty market has been challenged by the pandemic, the crisis also swiftly brought it to the next level and accelerated trends that were already happening. But the days of leaning nearly entirely on live streaming and celebrities, thinking this online-only push is a sustainable business model, are nearly over.

The post 6 Beauty Trends in China, Including a Sales Model Wake Up Call appeared first on China Marketing Insights.

Florasis (the avatar) is designed to be a personification of the brand and reflect the brand’s emphasis on traditional Chinese heritage and beauty.

Florasis was founded in 2017 and it has been growing fast. In 2019 it broke 1.1 billion RMB in sales, which was 25 times higher than its performance the year before. Florasis continued to make great progress in 2020, when it achieved over 3 billion RMB in sales, a 165.4% growth year over year.

How Will the Virtual Influencer Benefit the Brand?

Or a more direct way to say this is, will the virtual avatar help Florasis boost its sales? Having just launched, it is still unclear what role Florasis (the influencer) will play. Will she merely appear in brand content or they give her a voice and have her appear in videos and live streams? Will she have her own social accounts and appear alongside the brand’s ambassadors such as celebrity model Du Juan?

All of this has yet to be seen so it is too soon to say how or if she can benefit the brand. What we do know though, is that when used correctly, avatars such as this can help consumers feel closer to the brand and strengthen the brand’s image.

Other Brands Are Leveraging Virtual Influencers in China

Virtual influencers are already becoming quite common around the world, however, the majority of them are operated independently, not created by brands. For example, Chinese influencer Luo Tianyi (洛天依). She is a virtual singer born in 2012. Luo attended many offline events with real celebrities, such as appearing with Austin Li in his livestream. She has 5 million followers on Weibo and works with brands such as Huawei and Master Kong (康师傅), an instant noodle brand.

An internationally-known avatar is Miquela, from California. She used two years to build up her 2-million fan base on Instagram. She is a model and a singer, and she has appeared in luxury brands’ advertisements including Chanel and Burberry. Miquela even created her own fashion brand in 2019.

As for brands, in China, L’Oréal and beauty retailer Watson’s have created their own virtual ambassadors. The ambassador that L’Oréal has created is for one of its sub brand Mei Ji (美即) or MG. It was a Guangzhou-based beauty brand, and L’Oréal purchased it in 2014. The virtual ambassador is called Sister M or M Jie (M姐), a play on the name of the brand, and she was introduced to the public in 2020.

Sister M has participated in many events, such as MG’s Tmall and JD livetream during Double 11 Shopping Festival last year. She is also very active on Chinese social media. For example, M has her own column on Little Red Book called Sister M Talk (M姐TALK). It covers topics such as how should women face heavy working pressure, how to improve yourself, and how to maintain your body etc. M also has a series on Douyin called Sister M Visits Laboratory (M姐探秘实验室). It shows how the brand invent their products. Those videos are very informative and scientific.

Prior to Sister M, Waston’s introduced its virtual influencer Qu Chenxi (屈臣曦 or Wilson). It is a boy with those “fresh meat” looks. Wilson not only shows up as the ambassador of Waston’s, but also as a customer service representative with those CRM statistics backing him to better serve his customers and followers.

Wilson also has his Weibo account (@屈臣曦-Wilson) with more than 180k followers. He often holds lucky draw activities on Weibo, inviting his followers to either comments and like a post or to repost it so as to be chose to win gifts.

Why Are Brands Working With Virtual Avatars?

Compared with real celebrities, these virtual influencers are a lower risk alternative. Its less likely they will become involved in personal scandals that can ruin their career together with brands’ reputation. 

Prada and Zheng Shuang’s (郑爽) collaboration is an example. Zheng’s scandal caused the fashion group’s stock drop 1.7%. Another celebrity Show Lo (罗志祥), when his scandal went public dairy brand Chun Zhen (纯甄) immediately changed its ambassador, afraid of Show’s negative influence.

Compared with these real people, virtual avatars are easier to control either by its teams or brands. Their hobbies and personalities are shapable based on followers’ preference. They don’t get old, and they can maintain the body shape that they want. With the development of technology, they are able to have real-time interaction with their audience.

There Are Downsides of Course

A serious problem that no virtual influencer can escape is the potential for technical issues, especially during live streams. Luo Tianyi had a livestream in May 2020 where at one point during the stream there were over 2.7 million people viewing simultaneously, and throughout the course of the stream, nearly 2 million people either commented or sent virtual gifts to her. But because of a technical issue, she couldn’t sing when it was her time slot, and it remained dead silent, leaving a lot of viewers disappointed.

On her live stream with Austin Li, while I was watching it, I noticed the volume of the sound decreased a lot when Austin transferred to the scene with Luo, and many viewers were saying they can’t hear what they were talking about. If brands want to work with virtual influencer interactively, they will need strong technical support.

The other downside is that, though virtual avatars are controllable, they lack something real. They are not real people after all. Some people find it hard to connect with them. They know clearly that teams are controlling these avatars and the commercial purpose is too obvious for them to develop a connection with the character.

It will be interesting to observe how Florasis will make use of “Florasis” the virtual influencer.

Read more: 花西子虚拟形象“花西子”，首次亮相。

虚拟代言人出圈：人设不翻车，真人偶像的对手来了？

The post Chinese Beauty Brand Florasis Creates its Own Virtual Influencer appeared first on China Marketing Insights.

I think there’s also getting to be too many shopping holidays in China, especially during the first half of the year. The timeline goes as: CNY, Valentine’s Day, Women’s Day, Double 5 (5.5), Mother’s Day, 520, Father’s Day, 618, Qixi and Double 11. And these are just those big ones, there are many other smaller festivals.

What’s more, 618 used to be a smaller shopping holiday, and 11.11 was the biggest one, but ever since last year, the length and effort of promotion seems nearly as big at 11.11. Last year China was starting to recover from the COVID pandemic in late Spring, and the 618 shopping festival was used as a way to stimulate and kickstart the economy. Well now marketplaces and brands seem to think that after last year’s huge performance, they must do even better this year. In a recent article we shared that the major commerce platforms kicked off their 618 presale in late May.

Back to 520 – it appears that with the growth of 618 and the overwhelming number of festivals, brands are cutting out some of the smaller festivals and to focus on the major ones. Leaving us with fewer 520 campaigns this year.  

For those who aren’t familiar with 520, it is one of China’s many “Valentine’s Days”. In Chinese, the numbers 520 sound similar to the words “I love you”.

Domestic Brands’ 520 Campaigns

NAYUKI TEA x Roberts Rūrāns

This is Nayuki Tea’s sixth collaboration in its artist series. In the past some of the artist is worked with include Japanese artist PePe Shimada, Cinyee Chiu, American artist CDR. All of them turn Nayuki’s bottles into their canvas and put their creativity on it. Customers don’t have to go to these artists’ exhibition because they are viewing it from the bottle.

This year, the brand work with a Latvian artist Roberts Rūrāns. His works are very recognizable with bright colours and strong geometrical shapes. The theme that Nayuki features this time is “Holding hands”.

Instead of only focusing on lovers, Nayuki interprets the theme into six sections. They are “Dear family, hold hands”, “Lovely puppy, hold hands”, “Best friends, hold hands”, “Teammates, hold hands”, “The one, hold hands”, “Soulmate, hold hands”. Besides bottles, Nayuki also has those drawings on its vacuum cups and mugs. They are really cute and their colours are healing.

Perfect Diary and its lipstick box

For 520, the brand launched a sophisticatedly-designed box with its iconic high heel lipstick in it. It also plays a bit with the Chinese pronunciation of box, which is “xiang”. The pronunciation is the same with “miss” in Chinese. So in Chinese, “I miss you” is the same pronunciation with “The box wants to see you”.

POPMART VIP Day

Blind box toymaker used 520 as a way to express its love for its loyal followers, holding a VIP day where members could use points to get exclusive discounts on products. In its WeChat post promoting the event, the brand said that love makes your heart beat excitedly, and so can these discounts and opening blind boxes from POPMART.

Luxury Brands’ 520 Campaigns  

Prada

Prada didn’t’ play seriously with the 520 campaign. On May 20, it simply posted on Weibo promoting its iconic inverted triangle shape, including its Leather Hair Clip and Symbole Earrings. Along with a 3-second video showing these two products, Prada was saying “The classic inverted triangle marks the date of a relationship”.

Gucci

On the contrary, Gucci gave special attention to this year’s 520 campaign. Part of the reason might be the decline (22.7%) of it sales performance in 2020 and the brand wanted to make the best use of this festival to boost sales.

Gucci launched a collection dedicated to this festival, most of the items are in a red colour tone. It also created a 520 video featuring several Chinese celebrities, Ni Ni (倪妮), Lu Han (鹿晗), Song Zuer (宋祖儿) and Lai Guanlin (赖冠霖). The video was posted on April 29 both on Weibo and its WeChat official account. From then until May 20, Gucci constantly used the hashtag #Gucci520# in its Weibo posts.

The brand also did a great job on Qixi Festival (which is another Chinese Valentine’s Day) in 2020. Check out our article to see how it unfolded the campaign.

Tiffany and the 520 Key 

Tiffany’s preparation for its 520 campaign started from May 1. To show its sincerity, it launched a new and limited product for 520 only: a Tiffany Keys necklace with a bright red colour. To increase exposure for this special product, Tiffany invited several celebrities to wear it, including Gong Jun (龚俊), who is the main ambassador for this product as he was the first celebrity announced by Tiffany on Weibo to wear it. Austin Li, Cecilia Song (宋妍霏), Ou Hao (欧豪) also joined in to promote the 520 key necklace.

Read more: 奈雪CUP美术馆｜520，每一次牵手，都是一句我爱你

The post This Year’s 520 Campaigns Overshadowed by 618 Presale Kickoff appeared first on China Marketing Insights.

Yatsen Global multi-brand strategy

At the moment, Yatsen Global owns 7 brands. They are Perfect Diary, Little Ondine, Abby’s Choice, Galénic, DR. WU, Pink Bear and EVE LOM. They cover beauty, skincare and personal care.

• Total revenue: In the first quarter of 2021, those brands brought in 1.4 billion RMB, 42.7% growth compared with Q1 2020.
• Gross margin: The number in Q1 2021 is 992 million RMB, a 58.8% growth compared with Q1 2020.
• Gross profit rate: In Q1 2021 the number is 68.6%, which is a 6.9% growth YoY.

Perfect Diary

As its first and most famous brand, Yatsen Global continues to focus heavily on Perfect Diary.

• In the first quarter of 2021, Perfect Diary launched Name Card Lip Gloss. It has sold 670k pieces and become the TOP 1 on Tmall’s lip gloss ranking board.
• The brand’s High Heel Lipstick is the TOP 1 on Tmall’s lipstick ranking board.
• Its Animal Collection Eye Shadow is the TOP 1 on Tmall’s eyeshadow palette ranking board.

Little Ondine

• Little Ondine’s sales volume grew nearly 100% compared with Q1 2020.
• Its hero eye liner product maintains its TOP 1 position on Tmall’s eyeliner ranking board.
• Its mascara also stays tightly as the TOP 1 on Tmall’s mascara ranking board.

Abby’s Choice

• The sales volume of Abby’s Choice grew over 100% compared with Q1 2020 (note: the brand didn’t officially launch until Q2 2020 but it had started selling products in early 2020 prior to the launch).
• In the first quarter of 2021, it introduced a new version of its repairing face masks and sold over 1.47 million pieces.

Performance of other Yatsen Global Brands

• The newly purchased skincare brand Galénic also performed well in the first quarter of 2021. The amount of Tmall livestream viewers grew 360%.
• DR. WU, a skincare brand purchased by Yatsen Global in January, becomes the TOP 1 on Tmall’s skincare acids product ranking board with its hero product: Daily Renewal Serum.
• DR. WU appeared twice on Viya’s livestream and its sales broke 5 million RMB in total.
• Pink Bear is a very girly beauty brand developed by the company. It achieved over 10 million RMB GMV in the first month after it opened a store on Tmall.
• The brand’s mirror lip gloss ranks as the TOP1 on Tmall’s lip gloss ranking board.

Yatsen Global plans to invest more in product development

• In Q1 2021, Yatsen Global spent 27.7 million RMB on product development, which is more than twice the scale that it did in Q1 2020.
• The spending of its product development takes up 1.9% of its total revenue in Q1 2021, a 0.7% growth.
• By the end of March 2021, Yatsen Global owned 75 patents. 
• In April, Yatsen Global’ Open Lab was founded.
• Other than developing its own R&D centers, Yatsen also works with other renowned labs globally, including Pierre Fabre from France and Sensient Technologies, a global manufacturer and marketer of colors.
• Along with Yatsen Global’s investment in product development, it has created quite a few results, such as the Smartlock ingredient that targets oil absorption and it built the first 3D and damaged skin model.

Yatsen Global consumers

• The number of its DTC users reached 9.6 million, a 11.6% growth compared with Q1 2020.
• The average amount that each customer spends at Yatsen Global is 122.9 RMB, a 24.5% growth compared with Q1 2020.
• In total, the amount of Yatsen Global’s followers across all channels reached 60 million.

Yatsen Global is targeting the overseas market

• The first brand that Yatsen Global sent overseas is Perfect Diary. The brand has covered markets such as Vietnam, Malaysia, Singapore and Philippines.
• Perfect Diary ranks TOP 1 on Shopee, the biggest ecommerce app in South East Asia. It is also the TOP 1 on Malaysia’s lip product category ranking and the TOP 1 on Philippines’ powder ranking.

Our Takeaways

Not long ago we wrote another article about Yatsen Global presenting some of the issues that the brand is facing due to its extremely rapid expansion. There are many voices saying the company will have issues in the long term, and its stock prices have dipped dramatically.

This article is a major contrast because the report highlights all of the company’s achievements over the past few months. We are somewhere in the middle. While we recognize the issues the company faces, we are still optimistic. Personally, I am a loyal customer for some of its brands such as Perfect Diary, Abby’s Choice, and EVE LOM. The quality of those self-developed brands such as Perfect Diary and Abby’s Choice surprised me when I first tried them, and their prices are very affordable, so I repurchase them very often. I doubt I am the only person that feels this way, so I feel the brand has a strong chance of succeeding in the long term.

Read more: 一图读懂｜逸仙电商2021年第一季度成绩单

The post Yatsen Global First Quarter Report 2021 appeared first on China Marketing Insights.

Etude House, Innisfree, LANEIGE, FANCL, The Body Shop and Benefit were household names in the China market, which makes it surprising to hear that they are scaling down and being forgotten by Chinese consumers.

What led to the decline of these brands?

Solely relying on hero products

Let’s take Benefit Cosmetics as an example. At first, Benefit smartly positioned itself as a master in eyebrow products. Its hero products include eyebrow pencils, eyebrow powder, eyebrow gel etc. Its offline stores used to provide shaping-eyebrow service.

But the thing is, Benefit seemed to stop making the effort to create and promote other products, and it is solely relying on its eyebrow products. Without new products, it becomes really hard to capture consumers’ attention, especially in China where consumers love trying out new things and local brands are churning out new products every week.

Threats from the fast development of Chinese beauty brands

What makes things worse is that, while Benefit Cosmetics’ eyebrow products maintain a slightly higher price, many Chinese brands are taking over the market with better cost performance. Florasis, Colorkey and Little Ondine have all launched eyebrow-related products. Their quality is not bad, yet their prices are very threatening for Benefit. 

The rise of domestic brands also threatens the survival of many South Korean beauty brands. Those brands were popular about 7-8 years ago when Korean dramas were prevalent in China. They had large range of SKUs and frequent launching pace, and they were fashionable and affordable.

But after the downturn in Korea-China relations, Korean dramas were no longer able to air on Chinese streaming platforms, and these brands lost their main point of influence. What’s more, with the improving quality of domestic beauty brands’ products and their down-to-earth prices, South Korean beauty brands have been gradually losing their advantage.

Pointing out ingredients is not enough

Chinese consumers are becoming really picky. When they are buying skincare products, they not only want to know the ingredients but also know what skin issues those ingredients are tackling and what effects will they bring.

A bad example here is Jurlique. It promotes itself as a natural and organic brand, and most of its ingredients are coming from plants. The point is good which appeals to Clean Beauty, a prevalent beauty concept in the industry. However, without telling consumers what those plant based ingredients do, how exactly they benefit the skin, Jurlique is making useless communication. People want to know what problem those ingredients will solve.

According to Tmall’s statistics in 2019, most searched skincare keywords were moisturizing, brightening, acne removing, recovering and anti-aging. These are directions that skincare brands can consider focusing on.

Celebrities might not be able to save those brands

Though Benefit and Innisfree once worked with celebrities to boost their attention, the results were weak. Indeed, collaborations with celebrities can drive sales but that’s not a persuasive reason for consumers nowadays. Consumers want to see the effect of those products and celebrities can only act as a platform to tell brands’ stories.

Read more: 这些曾经风靡中国市场的美妆品牌，怎么都走到了关店自救这一步？

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