Chinese retail industry revolution : where the boundary of online and offline blurs

It is true! Chinese consumers become the most avant-garde group compared with their western counterpart, thanks to the digital revolution brought by the gigantic players BAT (Baidu, Alibaba and Tencent).

According to the statistics from China Daily, in 2018, the number of China’s total online shoppers reaches 610 million, accounting for 73.6 percent of its total online population. Chinese retail industry is undergoing an unprecedented transformation where brick-and-mortars are in perfect combination with online stores.

In this new retail model, brands are faced with the challenge to break the physical and virtual boundary and to reach consumers at every possible touch point, thus making a purchase action possibly occur anywhere, anytime and anyway.

A market difficult to enter?

For foreign brands who haven’t come to China, their decision makers may be very often intrigued by the question of how to enter this market. One very traditional way, practiced by them over years and did prove to be sound, is to find local physical distributors who firstly purchase in volume and dispatch goods via their network. Nevertheless, this model could work perfectly well in the rest of the world, but not necessarily in China.

Why? Because the offline shops are only part of the marketplace whereas the other crucial battlefield lies online where brands, especially those new ones, could have wider and longer exposure to the public.

A perfect combination between online and offline

In China, a brand’s physical and virtual presence could not exist in silos, because together they form an ecosystem in which every element interacts with each other to fulfill the task of converting a passerby to a loyal customer. The physical touch points act very often as showrooms, whereas the online arena is the place where brands keep influencing, persuading and converting the public.

What does it mean concretely?

A common example could be like this: Walking into a shopping mall, by curiosity you step into a food supplementary shop, checking what they are selling without a definite thought to buy.

A smelling store assistant then approaches you trying to help. During conversation, she advices you to try a new body composition test machine, which could tell you your health information such as body mass and metabolism rate.

In order to get the result, you need to scan the QR code to follow the brand’s official Wechat account, which will lead you to its online store. At this step, a perfect scenario of customer engagement is accomplished, transforming you from a total stranger into a potential prospect. 

In the following days, especially on festive occasion, your Wechat application will pop up various brand campaigns with stimulating product package and attractive price.

More than that, the brand will push instructive articles on nutrition, work-out and health-keeping tips. It is not difficult to imagine, as long as you are someone keen about well-being, you will sooner or later make your first try on these products, and probably one day become a loyal customer.

An aspect to keep in mind for international brands

Nowadays in China, ordering online and receiving products at anyplace you want is just a question of clicking the button. Empowered by the robust logistic network and the flexible mobile payment system, consumers are no longer limited by geographical or contextual constraints. From wait and see, to actually buy and then receive the products, the purchase actions are happening at any place and anytime.

For new brands willing to come to China, you must bear in mind that, the selling and buying actions here are omnipresent, all with the ultimate purpose to offer the best experience to customers. Being present online is no longer a plus but a must, and a seamless connection of omni-channels is the key factor to guarantee your success.

Interested in this theme?

The author of this article, Shurui Wang, will be one of our speakers during our annual event. Do you want to attend her seminar “Going to China: the critical steps to build up a successful retail strategy”, click on the button to register to the event : 

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Source

Shurui WANG