How does Jiao Xia tap into this lucrative market in China? What are some of the key takeaways brands can learn from its success?

About Jiao Xia

Jiao Xia was founded in 2013. It specializes in sun-protective items, including umbrellas, hats, gloves, jackets, and shoes.

The brand grows wildly. From its prospectus, it managed to achieve annual revenues of over 380 million RMB, 790 million RMB, and 2.4 billion RMB from 2019 to 2021. With a gross profit rate of over 50%, Jiao Xia has become a vanguard in the industry.

Tap into the Hard Sun Protection Trend

“Hard sun protection” or physical sun protection is a trendy concept among Chinese girls, thanks to the education finalized by many online publications. It delivers the message that physical items, such as umbrellas, hats, and gloves, are better at preventing sun than sun cream.

With growing awareness of physical sun protection, China Insights Consultancy estimates that the market scale of sun-protective clothes grows from 45.9 billion RMB to 61.1 billion RMB from 2016 to 2021. It is expected that by 2026, the number will reach 95.8 billion RMB in China.

Jiao Xia has met its golden growing period when anxiety and solutions both exist in the market. Most Chinese consumers want to have fair skin and they’ve been educated to embrace the hard sun protection. Jiao Xia, an expert specializing in sun-protective products is there to solve their issues.  

Dare to Change Hero Products  

Sun-protective umbrellas have been Jiao Xia’s hero products for a long time. It is sold at 179 RMB, not cheap in the China market, but with its creative paintings on the umbrellas, a UPF (Ultraviolet Protection Factor) above 50, and its carriable size that can be easily put in a pocket, it wins love from many Chinese girls. Based on Jiao Xia’s Tmall statistics, the brand sold more than 4.5 million umbrellas.

What makes the brand continue to grow is that it doesn’t stand where it was but keeps exploring new opportunities. It sounds cliché, but in practice, not many brands dare to lower the contribution percentage of a lucrative business section to their annual revenues.

In 2019, it introduced new product categories, including sun-protective face masks, jackets, and hats. Moving to 2021, the brand expanded its business to a broader range, such as sunglasses, leggings, and Martin boots.

With new product categories, the contribution of the umbrella has gradually decreased from 86.9% in 2019 to 20.8% in 2021. What replaces the umbrella’s iconic position are clothes and accessories (sunglasses, face masks, and gloves), with growing percentages from 0.8% and 5.3% in 2019 to 29.5% and 25.4% in 2021 respectively.

Use Numeric Facts to Convince Consumers

According to Jiao Xia’s prospectus, the brand has worked with more than 600 KOLs by 2021, among which 199 of them amass over 1 million followers. Together they brought over 4.5 billion traffic for Jiao Xia on the Internet.

Since the prices of Jiao Xia’s products are higher than the average, KOLs often tell the brand’s stories from different angles based on their follower’s profiles. Jiao Xia also scientifically frames its products with hard facts, such as its competitive UPF index, reports from professional assessment organizations, and customers’ feedback.

Our Thoughts

Spotting the trend and leveraging it to expose the brand name and keep introducing new products to satisfy the market’s ever-changing needs secure Jiao Xia’s position in the China market. The brand also has KOLs to tell its story and uses numeric facts to convince consumers.  

With growing numbers of players in the sun protection industry, it requires more for brands to stand out and let consumers see them and try them.

The post How Does Chinese Brand Jiao Xia Tap into The Sun Protection Market In China? appeared first on China Marketing Insights.

According to a data monitoring platform Fan Ruan (帆软), the MAU (Monthly Active User) of Dewu in May 2021 reached 81M, which was 8% month-over-month growth. Over half of its DAU (Daily Active User) are post-90s. On Dewu, the percentage of male and female users is 52:48. This is very different from Red, whose majority of users are females.

Who is this competitive player in the industry? Why can it attract so many young people to download and actively engage with it? And how can brands leverage it?

The Background of Dewu

One of the reasons why the app gained so many male users is that it used to be mainly sneakers and toys oriented. Not children’s toys, but art toys and collectibles that only “it” people would have, such as the popular bearbrick.

In 2015, the app was created. In the same year, it launched a new function, which was not common at that time, identifying shoes. This appeals a lot to people, especially boys who love sneakers, no matter if they are collecting, or wearing, or buying and selling them. Two years later in 2017, Dewu introduced the sales function. Users were able to buy not only sneakers and toys, but also apparels, beauty products, bags, watches or even home appliances on it.

There are gossips about why the platform changed its name from Du to Dewu in 2020. My thinking is, Du represents poison in Chinese. This is not cool as the name is suggesting something that the law forbids. Second, by reading Du, potential consumers won’t know what the platform is about. By giving the name as Dewu, which in Chinese means someone buys/gets something, it is easy to understand what the platform is. Your thoughts?

What Makes Dewu a Gen Z Hub?

As mentioned, the majority of Dewu’s users are young people, which are the Gen Z. Based on McKinsey’s report of Gen Z in APAC, 40% of the group love brands that can make them different from others. The percentage is twice the scale of Gen X (people born between 1965 to 1980). It is 1.3 to 1.5 times the scale of Gen Y (people born between 1980 to 1995).

When it comes to China, 61% of Gen Z are discovering brands that can make them different. Therefore Dewu is a platform that helps Gen Z satisfy their needs. Most of the brands on Dewu are streetwear brands. Some of them are niche ones that only a small group of people know. This gives this group of people a sense of belonging to find someone that is also paying attention to these niche brands.

What’s the Commercial Prospect of Dewu?

Liu Jianhai (刘建海), founder of a creative agency White Wall, believes that at the moment, the style of short videos on Dewu is still in the early development stage. Image and word posts dominate the Dewu UGC community. However, there is a rise in the number of user-generated videos. In the future, videos might be the mainstream content on Dewu, and users will spend more time on the platform.

Officially, Dewu is encouraging users to create more high-quality content. Recently it just launched a plan named “Giving Video MCNs Bonus”. If videos posted by MCNs satisfy Dewu’s rules, it will offer the MCN a maximum of 8.5 million traffic every month. As individuals, if you have a follower base somewhere over 500 people, Dewu might offer your video at most 600k traffic in the first month after you register on the platform.

This is a big opportunity for content creators. Unlike Red or Weibo and many other social media platforms that are now saturated, Dewu is still in its early stage of business development, which means that it is still providing incentives to both content creators and brands to share content on the platform.  

Not much advertisement

Dewu won’t define your content as hard advertisement even you talk a lot about a specific product in the post. Instead, your post might have a chance to be recommended by the system because of the authenticity and useful information that it delivers. Dewu would love to define your post as viral content.

On Dewu, posts with over 1,000 likes are counted as viral.

Lower cost to work with KOLs on Dewu

To work with a KOL that has around 60k followers on Dewu, it only costs 500 RMB for brands. With such a lower price, the conversion rate could be impressive as many users have the habit to purchase products through links provided by the KOL at the bottom of the post.

For every order that users purchased through links that KOLs provide, the source and amount can be tracked, and thus, KOLs can have commission from users’ buying behaviors. Some KOLs have half of their monthly income through commission.  

I would say Dewu’s users are younger than Red’s, and most of them are also active Douyin users. If your brand targets millennials or Gen Z, Dewu is an ideal platform to consider, with a lower budget. 

Read more: Z世代为什么中了「得物」的毒？

The post Chinese Young People’s New Love: E-commerce App Dewu 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.

Recently, Zhang Zhehan (张哲瀚), a Chinese actor and singer ended his career in the entertainment industry, due to a mistake he made during his nine-day endorsement with the Japanese jewelry brand TASAKI. Why? Because of his misbehaviors in patriotism. Weibo deleted both his personal Weibo account and his studio’s account.

Right before that, top Chinese celebrity Kris Wu was accused of sexual assault and rape of minors. The scandal was so massive that the police detained him. Related topics covered Weibo’s hot topic ranking board for days. Louis Vuitton and Bvlgari were among the luxury brands that had to terminate their collaborations with him so as not to get in any trouble (or any more trouble than they were already in.)

Several months ago, another case that generated a great deal of attention was Zheng Shuang’s scandal. On the day the scandal exploded online, Prada, who had named Zheng as its ambassador just seven days before, experienced a 1.7% drop in its stock price.

However, the sweet taste of working Chinese celebrities still overcomes the potential risks that it might bring. But it hasn’t always been this way.

When Did Luxury Brands Begin Liking Chinese Celebrities?

It is not until recent years that luxury brands let down their guards and began to fancy Chinese celebrities.

In 2013, Gucci had actress Li Bingbing (李冰冰) as its ambassador, first in Asia and later the title bacame a global level. Li showed professional skills at performance, and she had no scandal. Back then, brands were skeptical and being very cautious to name a Chinese celebrity as ambassador.

However, with the development of Fan Economy and social media in China, celebrities had an increasing influence on their fans. In 2016, Lu Han (鹿晗, who has 63M followers on Weibo currently) was invited by Cartier to be its “Brand Friend”. Following Lu, in the same year, Kris Wu became the first non-British ambassador for Burberry and walked in its show. With Wu’s influence back then, Burberry’s sales performance grew 25% in the third quarter of 2016.

Dior is the first one to test the water

Among the many luxury brands vying for a piece of the China market, Dior has benefitted the most from its celebrity strategy.

In 2017, Angelababy became the brand’s first Chinese ambassador. The announcement post had more than 380k reposts within hours, making it the most-reposted post on Weibo at that time.

Dior didn’t stop at one spokesperson in China, building a team to expand its influence. It has another skincare ambassador, a makeup ambassador, a jewelry ambassador, a fragrance ambassador and many other Brand’s Friends.

It only took four years for Dior to grow its follower base from 1.79M to 6.56M. Dior has become one of the most popular luxury brands among Chinese consumers.

After Dior’s Success, Other Luxury Brands Decide the Risk is Worth it

In 2019, Prada signed young idol singer Cai Xukun (蔡徐坤, who has 36M followers on Weibo) as its ambassador. At the time, there were voices saying Cai had not been famous for very long and he may not be qualified to be a luxury brand’s spokesperson. Yet since then his fame has only grown, and many of his campaigns with Prada have done quite well.

In 2020, Tiffany’s started working with Jackson Yee (易烊千玺), and promoted him to be a global ambassador. Then Guerlain announced Fan Bingbing (范冰冰) as one of its global ambassadors. This appointment also triggered many skeptical voices. Fan was involved in massive a tax evasion scandal not even a year before.

This year, we have TOD’S collaboration with Xiao Zhan (肖战), who had previously been criticized by state-run media outlet People’s Daily. On the day of the announcement, the number of followers of TOD’S Tmall flagship store grew 110k, which was 24 times the scale before.

Despite the risk that many of these brands face working with these celebrities, especially those with past incidents or those that are newer celebrities, it seems the benefits outweigh the risks. In such a short time span, brands went from being reluctant to work with Chinese celebrities to being so willing to work with them that they are willing to risk their brand reputation.

Panerai Welcomes Chinese Actress Dilraba as Its First-Ever Female Global Brand Ambassador

And despite the host of scandals lately, it appears brands are not planning to stop working with Chinese celebrities anytime soon. What’s more, they are appointing them to even more prominent positions. For example, only yesterday, Chinese actress Dilraba joined the Italian luxury watch maker Panerai as its first-ever female Global Brand Ambassador. Not just Brand Ambassador for China or Asia, but the global ambassador. This is a brave time to make that move!

Read more: 深度｜奢侈品牌请中国明星代言的风潮终于要过去了？

The post With so Many Massive Scandals, Do Luxury Brands Still Love Chinese Celebrities? appeared first on China Marketing Insights.

Luxury brands love him. Over the years he has collaborated with numerous brands including Dior, Cartier, Saint Laurent, and Jimmy Choo. He has even worked with many luxury brands to co-design his own limited-edition bags, including Strathberry, Givenchy, Burberry, Tod’s, Chloé, Montblanc and Qeelin. Every time, those bags were sold out within minutes.

What I admire about him is the fact that Mr. Bags started as a college student studying finance in NYC. But he had a great passion for bags, and he bravely chose to forge a career in a brand-new industry with no connection to his college major. He shared those bags as if he was introducing old friends to readers, and the hard work paid off when he was invited to fashion shows and met high-profile people in the fashion industry.  

How did I meet Mr. Bags? 

Recently I had an opportunity to meet Mr. Bags and see him talk about bags in person at an offline event held by entry-luxury brand Tory Burch. The news was announced on Mr. Bags’ WeChat Official Account, inviting followers who are based in Shanghai to attend the event.  

To join the event, interested followers had to leave a message on the account saying that they want to join the event and leave their WeChat ID. Later followers will receive a notification asking them to add a personal WeChat account.  

The guest list selection process didn’t finish here. After adding Mr. Bags staff WeChat account, there was another round of selection by his employees. And finally, if you are selected, you will get a WeChat message from the account.  

Attending the Event

The event was held in Tory Burch’s flagship store at Jing’an Kerry Center, Shanghai. Guests were split into several groups with different color bracelets on their waists.  

At first, I wasn’t expecting Mr. Bags to interact with guests, but to my surprise, he was there, introducing Tory Burch’s bags one by one, with so much passion.  

And because there were so many guests, he had to speak again and again to each group, like teaching the same content to students three times or even more. To be honest, while he was recommending those bags, I started to learn the charm and appreciate them. Before the event, I hardly have any knowledge about Tory Burch.  

In addition to Mr. Bags, Tory Burch also invited a fashion stylist and models to present its products. If guests finished these two activities, they were welcomed to craft their exclusive notebooks with Tory Burch’s monogram on them.  

There was also a photo session with the chance to take a picture with Mr. Bags. What also impressed me a lot was that even after speaking and introducing the bags for a long time, he stood there and nicely took photos with anyone who wanted one. Some of the guests already met him before in other events and they were greeting Mr. Bags as if they were old friends.  

My Thoughts on the Event 

I quite enjoyed the event. First, it had Mr. Bags, a fashion icon in many people’s eyes. Second, the whole setting was comfortable and not aggressive. There were waiters standing everywhere to make sure guests can grab a drink or snacks whenever they want. And staff didn’t push you to buy anything. Even when you were browsing through products, they gave you time and space to appreciate them on your own.  

It is also a good case study for brands of how they can leverage KOL marketing. Offline events serve as a key bridge for both the KOL and the brand to reach followers/consumers. Even if an attendee didn’t buy anything during the event, the feeling that the brand and the KOL generated makes this experience memorable and they may develop a positive connotation with the brand and be more likely to purchase from it in the future. As I mentioned above, I didn’t know too much about Tory Burch prior to the event but Mr. Bags’ passion for the brand made in interested in its products. 

The post I Finally Met Top Fashion KOL Mr.Bags! appeared first on China Marketing Insights.

Right now, international entry luxury brands in China are facing competition from all sides. They are not as classic and desired as high-end luxury brands and now they are also facing the growing popularity of Chinese bag brands.

Chinese bag brand Warm Studio is regarded as one of their strong competitors. The brand is often used as a case study for international entry luxury brands to learn how to engage with young Chinese consumers.

In the video, we introduce the brand, our review of one of its products, and some of the reasons why Warm Studio has become so popular.

The post How Is Chinese Bag Brand Warm Studio’s Popularity Surpassing International Entry Luxury Brands? appeared first on China Marketing Insights.

So how did yoga pants become publicly accepted in China?

While the rise of athleisure and growing interest in sports and fitness has fueled some of this change, one of the main drivers behind Chinese consumers’ acceptance of yoga pants, especially in lower-tier cities, was the re-framing and re-naming of yoga pants by top fashion bloggers into just another type of pants, removing the athletic connotations.

Let’s take a closer look.

Lululemon Drove Popularity in 1^st Tier Cities

The brand entered the Chinese market in 2016, with the athleisure trend. Many of China’s 1^st-tier fashionistas knew about the popularity of Lululemon abroad and were quick to embrace the brand. Plus, because of Lululemon’s fashionable design, for example, its pants don’t show underwear lines and they have a butt-lifting effect, people start wearing those pants in public places. Around this time, fitness also started becoming trendy in China, mainly among white-collar workers in 1^st-tier cities. Wearing yoga pants showed you were part of that trend.

Giving Yoga Pants a New Name Helped Them Go Mainstream in China

But at that point, yoga pants were still only being worn by a small group of people. One of the limiting factors keeping them from going mainstream was the price (we’ll talk more about that in a moment). The other was the name “yoga pants” or “exercise pants”.

This name signaled that one needed to be exercising in order to wear them. But at that time, the vast majority of women in China, especially in lower-tier cities, didn’t have the habit of going to gyms or doing yoga. This means they didn’t have a reason to wear yoga pants.

So in 2016, popular Taobao fashion influencer Eve Zhang (Zhang Dayi) gave them a new name: Shark Skin Pants or Shayu Ku (鲨鱼裤). The name described the look and texture of shiny, thick yoga pants and the tightening and slimming effect they have.

Because it is such a fashionable and easy-understanding name, it took off. Many Taobao stores started following Eve and referring to their yoga pants as shark pants.

Now with the new name, wearing yoga pants was no longer confined to a specific occasion. People started wearing them with their everyday looks.

They really went mainstream in 2020. I remember in winter last year, I saw so many girls wearing them on the street. Girls love matching shark pants with an oversized hoodie or a sweater on top. They also wore long socks with a pair of sneakers.

Top Chinese celebrity Yang Mi (杨幂), whose street looks influence fashion in China, wore shark pants in one of her airport looks, causing them to become even more viral. But the funny thing is that she was wearing Lululemon’s yoga pants when the picture was being taken.

Nowadays there are many KOLs promoting yoga pants such as Douyin influencer Hu Chuliang (胡楚靓). Hu launched yoga pants in her store last year. She managed to sell 253 million RMB worth of yoga pants within the first year.

Mass production makes prices affordable

Now alongside the new name, another key reason why yoga pants were able to go mainstream was that they became cheaper. At around 800 RMB a pair, Lululemon is expensive which made it hard for the trend to spread to the mainstream.

Before 2016, only a few factories in China produced yoga pants. But after Eve Zhang introduced the name shark pants and the trend started taking off, some factories spotted the potential popularity of yoga pants and started transforming their business.

For example, a factory called Mutuzhe (沐途者) used to mostly produce swimwear (80-90%) and yoga clothes (10-20%), and most of its products were sold overseas.

With the history of producing swimming wear, Mutuzhe easily shifted its business into yoga pant production for the domestic market. Because the needs for yoga pants grew dramatically, Mutuzhe opened another two new factories in 2018 and 2020.

To create ordinary yoga pants, it doesn’t require expensive materials and high-end technology. It only costs around 45 RMB to produce one pair, and that’s why there are many cheap yoga pants on Taobao or Pinduoduo.

E-commerce platforms are speeding up the yoga pants trend

Besides the new name and lower prices, e-commerce and social channels such as Taobao Live, Douyin, Kuaishou and Pinduoduo really helped spread the trend to lower-tier cities.

Live streaming has become a key sales channel for yoga pants, especially those that promise slimming or lifting effects. Unlike skincare products, which require days to see its effects, or bras, which are not appropriate to wear outside publicly, yoga pants, on the other hand, are easy to show viewers their effect.

For example, a Chinese yoga clothes brand molyvivi, which was just founded in 2020 managed to achieve over 5 million RMB sales through its livestream. It has a store on Pinduoduo, and the best selling pants in the store are only 49 RMB.

Key Takeaway

While price, sales channel, and product quality are all important – sometimes these alone are not enough to make a new trend take off. Cultural factors need to be considered as well. Reframing yoga pants as shark pants changed consumers’ perception and made them a product anyone could wear at any time. This case study is important to keep in mind when bringing any product to the China market. 

Read more: 下沉的【瑜伽裤】|趋势分析

The post How Yoga Pants Finally Became Popular in China, Even in Lower-Tier Cities 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

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During Double 11 in 2020, XUELI achieved over 480 million RMB in sales. In 2020, the brand’s number of customers broke 27 million and it did a total of 2.3 billion RMB in sales. The XUELI Tmall store has almost 9 million followers.

In 2019, with the rise of Taobao livestreaming, Cherie also launched her career as a livestreamer, selling products for other brands as well as those from her own brands. She is now also one of Tmall’s top live streamers alongside Viya and Austin Li.

Cherie started as a small Taobao seller and now she has a multi-billion RMB apparel brand. What’s more, she has been able to survive in China’s tough fast fashion industry for 10 years. By looking at XUELI’s development, we can learn the development of the Chinese apparel industry.

Why Traditional Fast Fashion Fails to Reach Consumers?

In the past, fashion was not accessible to everyone in terms of decision making. Brands organized press releases to announce their new collections.

However, with the Internet and consumers’ growing confidence, consumers began to show and voice their aesthetics and opinions which can affect brands’ decision-making process.

As Cherie said in a documentary called Chaoliu China (潮流中国), though there are many apparel brands emerging in China every day, they may grow quickly but they can also die quickly, for the fact that the industry is changing too fast to satisfy young consumers’ needs.

Why Can Cherie Grow Her Apparel Business?

Capture & respond to consumers’ needs

Early on, Cherie noticed the trend that fashion brands are no longer the dictator, and they will need to value consumers’ opinions in order to survive. The main thing she has been doing for XUELI is to make the brand an accessible one by handing over some of the decision-making power to its customers.

She said herself in the documentary that she had been talked to “all the girls”. From Renren, Mogujie (蘑菇街), Meili Shuo (美丽说) to Weibo and to livestream, she’s always stepped into the newest platforms where consumers are gathering in order to connect with them.

Offering Styling advice

Cherie noticed that Chinese consumers want suggestions for entire outfits instead of brands’ presenting individual clothes. For example, when they were watching a popular TV series called My Best Friend’s Story (流金岁月), they wanted to immediately copy and paste one of the main actress’ outfits and purchase them.

Once she noticed this need, Cherie stared having XUELI present its products as a whole outfit. XUELI also has its own stylists to help consumers design their looks. This builds loyalty among consumers and increases the repurchase rate of the brand.

Actively working with IPs

Working with IPs has become a trendy thing among brands in China. It gives freshness to its consumers and has great potential to turn the IP’s fans into the brand’s customers.

XUELI is also actively collaborating with IPs. For example, it once worked with Warrior, a Chinese shoe brand that has 94-year history. Within 4 hours, XUELI sold more than 110k pairs, and it achieved over 20 million RMB sales in a week.

Develop Mature Supply Chains

This actually belongs under the previous section, “Why Cherie is Able to Grow Her Apparel Business?”, as it is a key element for XUELI’s success. But since there is so much to cover it demands its own section.

Why made Cherie decide to improve her supply chains?

Back in 2013 Cherie realized that if XUELI (back then called Chinstudio) solely relied on what was already available on the market, her brand wouldn’t be able to stand out.

First, Chinese consumers are pursuing personalized products instead of one that looks exactly the same as what other vendors are selling. Second, sourcing goods from apparel vendors makes it hard to control price and quality. And lastly, sourcing pre-designed apparel from vendors doesn’t leave room for creativity.

Since then, Cherie has been devoted to building and improving her supply chains. Her KOL incubator and e-commerce company Chen Fan has over 1,000 supply chain vendors. XUELI also has its own, and whenever Cherie’s team decides to launch new collections such as down jackets, jeans or jersey, those vendors react quickly and assemble their resources to accommodate Cherie’s needs.

It is known in the industry that Cherie’s supply chain system has big changes every year. This is because she keeps only 30% of her supply chain vendors and weed out unqualified ones.

Benefits of a mature supply chain

The most direct effect that the supply chain brings for XUELI is higher efficiency. For example, the preparation of this year’s 618.

It started on May 10, when the team began designing products. Two weeks later, the design work was finished. Since May 15 and the rest 5 days, supply chain vendors were preparing materials. In the next two weeks, manufacturers were busy mass producing the new designs.

In total, the whole process takes around 40 days. That’s very “China speed”.

This speed and control over the process also allows Cherie to change designs based on feedback from customers. For example, earlier in May, Cherie posted images of her wearing a dress on Weibo. In the comments area, she noticed a user saying that she’s not comfortable with a hole in back, because that looks backless, that she would prefer a version of the dress without a hole.

After Cherie saw the comment, she screenshotted it and sent it to her designer. The designer quickly removed the hole and update the design to the user’s preference. With XUELI’s supply chain, a new dress was quickly launched in the store.

At the moment, it only takes 5-7 days for XUELI’s team to restock spring & summer collections, and 15-20 days to restock fall & winter collections.

Tapping into the Guochao Trend

Most recently, XUELI launched a new line called CU focused on apparel that incorporates Chinese design elements, a trend called Guochao. The company teamed up with 11 artists, illustrators, and independent designers to create the first set of designs. Guochao clothing has become very popular among young Chinese consumers over the past several years and so far XUELI’s CU line has been well received.

Read more: 从仰视到平视，雪梨的十年猛进

The post Chinese Mega Influencer Cherie and Her XUELI Apparel Brand appeared first on China Marketing Insights.

Sounds familiar right? Not long ago something similar happened with the Xinjiang cotton scandal. Every year brands get caught up in scandals. But with the correct response, it doesn’t have to mean the end of their China journey.

Coach is one of those brands. It took the slow road, but it has survived and found its way back from the scandal. Recently it held a large-scale show in Shanghai which helped the brand generate lots of buzz on social media. Though Coach still has a long way to reach its previous peak performance in China, it seems like the brand is getting there.

What happened to Coach in China in 2019?

The scandal started from Versace defining Taiwan, Hong Kong and Macao as individual countries on a T-shirt. Following it, many other brands such as Coach, Givenchy were discovered to have the same issue.

People were outraged and those brands’ ambassadors were busy distancing themselves from brands by announcing the termination of their contracts. A key reason why Coach was severely influenced was the cancellation of contracts by its two ambassadors: Liu Wen (刘雯) and Guan Xiaotong (关晓彤). Both of them are top celebrities and their actions drive massive amounts of attention and traffic.  Under the comment area of Coach’s apology announcement on Weibo, many people were asking the brand to get out of China and stop earning money from Chinese consumers. The future of Coach seemed dark back then.

Coach’s performance after the scandal

Social media engagement on Weibo

I choose Weibo as the subject to monitor Coach’s social media engagement. First, the platform is one of Coach’s official channels to present its brand image and announce big events. Second, Weibo’s statistics (including numbers of likes, comments and reposts) are more transparent compared with WeChat,

The data excludes posts involving celebrities and KOLs, as the engagement numbers usually go extremely high for those posts. Here is the average engagement prior to the scandal: 

And here is the average engagement after the scandal:

You can see from these two charts that Coach’s social media engagement fell dramatically after the scandal. People were reluctant to have interactions with the brand when it first started to post content again.

Sales performance after the scandal

From lack of social media engagement, it appears Coach might not survive from the scandal. However, after parent company Tapestry released its financial report of 2020, it seemed as if the effects weren’t as serious as they looked. The report shows that Greater China achieved $600.8 million in sales, accounting for 17% of Coach’s total sales. If we look at the percentage of Greater China’s contribution in 2019 and 2018, which were 18%, it didn’t make great difference.

Coach’s bags have also frequently shown up in top fashion KOLs’ posts. The event that it held on June 3 grabbed lots of attention. It seems that people have let go of the scandal back in 2019. How does Coach manage to do so?

How Coach Earned Back the Love of Consumers in China

The first Weibo post after the scandal

After its official apology on August  12, Coach didn’t post anything on its Weibo account and went silent on social media for two months.

The first post after the scandal was not until November 6, 2019. The post announced Coach’s participation in the second China International Import Expo. This is not some usual exhibition but a national-level expo, being recognized by the Chinese government.

By showing up at the Expo, Coach was delivering the message to Chinese consumers that it was making efforts to fix its mistakes and it has gained official approval to join such a government-run event.

We don’t want anything bad happens to brands. But if your brand happens to get caught up in any scandals, do keep quiet for a while. Nike hasn’t posted anything on its Weibo account since March 12, after the Xinjiang Cotton scandal, same with Calvin Klein and H&M.

Do the politically right thing

Besides the second China International Import Expo, Coach also participated in the third Expo in 2020. This shows Coach’s sincerity to please Chinese consumers and do the politically right thing in China.

Other than the Expo, when COVID first hit Wuhan in early 2020, Coach immediately donated 1 million RMB to the city. In the comments area on Weibo, people were saying Coach reacted fast and was being generous.

Celebrity and KOL strategies

After the two ambassadors terminated their collaboration with Coach, it would need to find a new one. This would be achieved once things cooled down and celebrities were willing to work with the brand again. The new ambassador it picked is Yang Zi (杨紫). She is a child star who became famous from a household TV series called Home With Kids (家有儿女). In recent years she has shed the child-star image and played the lead role in numerous romantic dramas. Yang has 57 million followers on Weibo and it is fair to say almost every young person knows her.

Before officially announcing Yang Zi as its ambassador, Coach had been interacting with her by having her appear in video clips. So on August 31, 2020, when Coach announced the collaboration, Yang’s fans were cheering up for her and the post gained 182k likes so far.

Other than Yang, Coach also actively worked with other celebrities and KOLs, including Ding Yusi (丁禹兮), Chen Yuqi (陈钰琪) and Dong Youlin (董又霖). You may find those names sound unfamiliar. And yes, they are not as famous as Liu Wen, Guan Xiaotong or Yang Zi. I think it’s not because Coach doesn’t have the budget to work with higher-level celebrities. It’s because the brand wants to be low-key for now instead of working with some big names and drawing lots of traffic all of a sudden. The brand wants to grow and recover steadily. It is playing a safe card.

Offline presence is necessary

If you follow the timeline of the Coach scandal, you will find the brand was a little bit lucky. The scandal happened in August, 2019. Coach kept silent for 2 months on social media, and then in early 2020, COVID hit the country and offline stores and events were shut down. Everything offline didn’t restart until March.

So during this period when Coach should be low-key and had better not hold any offline events, every other brand was doing the same thing because of COVID restrictions.

Even after COVID restrictions loosened, Coach stayed fairly quiet and it wasn’t until December 2020 that Coach held a big offline event. I believe December could be some people’s happiest month, as it has Christmas, and it is the end of past and a fresh start of a new beginning. Coach picked a good timing, when hate and negative voices of its past scandal might be less.

What it did for the event was to have 400 drones with lights create images of Coach’s bags and its iconic dinosaurs cartoon. The brand was wishing everyone a good holiday. The location that it chose was at The Bund, Shanghai, which is the most representative spot either in Shanghai or in China.

If The Bund event has somehow brought Coach back to the center of the stage, the following one publicly tells Chinese consumers that Coach has made its way back and it is doing better than ever.

On June 3, 2021, Coach invited top celebrities and KOLs to its Coach Winter Collection show in Shanghai. The brand designed its show place as a drive-in cinema with a vintage vibe. Celebrity attendees were diverse. There were top ones such as Yang Zi, Chinese singer Xiao Jingteng (萧敬腾) and Chinese actor Zhong Hanliang (钟汉良). Idols who become well-known to the public such because of those contestant show such as Liu Xiening (刘些宁) were also invited. In terms of KOLs, Coach mostly invited top ones such as Mr. Bag and AnnyFan.

Because of the amount of celebrities and KOLs that Coach invited and the brand’s promotion, the event drew lots of attention on social media. The tag #Coach秀场直击 (#Coach Winter Collection Broadcast) has more than 100 million views so far. Coach itself keeps posting images from the event on its official channels. KOLs who have attended the event also posted related content to further promote the show and the brand.

Our Thoughts

Well, ideally your brand doesn’t have a scandal. Though everything has two sides, and a scandal might boost your brand’s influence, in the end, it is more likely to bring negative impacts than loyal customers.

If your brand does get involved in a scandal, especially political ones which are more sensitive here in China, the first thing is always to SINCERELY apologize. Don’t just do it because you need it, such as the official apology made by Dolce & Gabbana’s founders, which worsened the situation instead.

The second thing is to keep silent. On one hand this gives your brand time to restructure and plan out next moves, and it also fades either the scandal or the brand for a while. As time goes by, with the massive amounts of information they take in every day, consumers are likely to forget the scandal.

If you strictly follow these two steps, it is likely the scandal will eventually pass.

The post China Marketing Case Study: How Coach Won Back Consumers After a Scandal appeared first on China Marketing Insights.