Key Chinese Consumer Groups Outside of China
Students
As affluence in China grows, and students try to expand their horizons and increase their employability, more and more are venturing abroad for their education. Currently, there are around 1.5 million Chinese students studying internationally, with the U.S., the U.K., Canada, and Australia being the most popular destinations. And forget the poor student stereotype — this is a demographic with a lot of spending power.
Personal branding is a huge motivator for young Chinese millennials and Gen Z-ers — indeed, nearly 50% of mainland China’s luxury shoppers are aged under 30. So when this demographic is overseas for their education, with greater access to luxury items that might not be available in China, they will spend big, not just on items for themselves, but also on gifts for their friends and family back home.
Brands often make the mistake of thinking Chinese international students can be targeted like any other students through the same social media channels, but the evidence shows these students remain loyal to the channels they use back home — the most important of these being WeChat.
Tourists
When compared to other global travelers, Chinese tourists are far and away the world’s biggest spenders. In 2017, these tourists spent a whopping $258 billion, accounting for one-fifth of the world’s total spending on tourism. This is even more staggering when you consider only 5% of Chinese citizens have passports — a figure that is likely to double over the next ten years. This is, therefore, a segment that is projected for significant growth in the coming years.
Like students, these travelers are often affluent with a penchant for luxury. In 2018, Chinese consumers were responsible for one-third of the €260 billion spent on luxury goods worldwide, and by 2025, they are expected to account for 46% of all personal luxury goods purchases — more than Americans, Europeans, Southeast Asians, and Japanese combined. Indeed, take Chinese tourists out of the equation, and luxury sales growth would be relatively flat.
But these tourists aren’t just traveling so they can shop till they drop. Trends show that Chinese travelers are prioritising unique experiences and venturing farther off the beaten path, with one report showing that around 50% of Chinese tourists opted for independent travel (as opposed to a package or group tour).
There are several ways in which brands can use WeChat to engage with these travelers, including (but not limited to) the following.
Providing mobile payments
According to a Nielsen report, 63% of Chinese tourists reported using mobile payments to pay for goods overseas, while 76% said they hoped to be able to use mobile payments overseas in the future. As one of the most widely used mobile payment platforms in China, WeChat Pay is a key means of providing this service.
O2O marketing
A Bain & Co study shows that by 2025, 100% of luxury purchases by Chinese consumers will be influenced by online interaction. We’re already seeing retailers start to bridge the gap between online and offline, using WeChat’s location-based services and physical QR codes to connect with these consumers at brick-and-mortar stores.
Offering more personalised services
In a response to Chinese tourists’ growing desire for independent travel, tourism businesses are using WeChat to facilitate this, allowing travelers to research, plan, book, and guide their way through almost every aspect of their trip. WeChat can also be used to nudge tourists towards out-of-the-way destinations that they may otherwise find difficult to discover on their own, helping consumers to find those unique experiences they’re searching for while also serving as an antidote to over-tourism.
Expats
Think the student and tourism numbers are huge? Well, odds are there’s already an underserved segment of Chinese consumers right at your doorstop — Chinese expats. There are around 50 million people based in Chinese expat communities worldwide.
Typically highly educated with above-average incomes and cosmopolitan tastes, Chinese expats make excellent targets for luxury brands — yet, as one report showed, they are rarely targeted explicitly by these brands, and rarely mentioned in advertising. WeChat could be a key means of reaching this neglected demographic.
6 Ways to Use WeChat to Target Chinese Consumers Outside China
1. Create content that resonates
Just as with any social media channel, getting the most out of WeChat requires regular posting of content. And there’s evidence that the more regularly you post, the more engaged your userbase is — one report showed that brands who post on WeChat more than three times a week have almost double the viewership per post.
It’s not just about posting regularly, though. The content must be developed specifically to appeal to your target demographic. According to the 2016 WeChat Impact Report, users prefer to see images and short videos on their feed rather than long articles, and they are more likely to share useful, interesting, or emotionally touching content. There is also evidence that shows that posts related to nature (rather than urban landscapes), food and drink, and practical information have a lot more cut-through on WeChat than other posts.
Consider what content would resonate most with your audience. Is it a local area guide to help tourists find their way around a destination? Is it a list of restaurant recommendations? Is it a how-to video demonstrating your latest product? Is it a beauty post highlighting the pros and cons of certain luxury items?
2. Take advantage of location-based features
One particularly useful feature of WeChat is its location-based services, which allow you to connect with your target audience based on where they are. You can, for example, search for “Mini Programs nearby,” which will show you location-specific apps.
There are many ways brands can capitalise on this feature to provide customers with highly relevant information and enhance their user experience. For example:
- Stores and restaurants can send discounts and offers to nearby WeChat users.
- Chatbots can provide users with store details and maps showing the closest stores based on users’ locations.
- E-commerce brands can set-up location-based stores, so users can shop from their phones in the relevant country.
Expect these services to become more sophisticated, allowing brands to target users at specific points in their journey, and deliver more relevant, focused messaging.
3. Use QR codes
While QR codes never really caught on in the western world, they are absolutely everywhere in China — due in no small part to WeChat’s dependence on them. The humble QR code fulfills many purposes on WeChat, allowing users to follow accounts, add friends, unlock Mobikes, make payments, and more. This makes them a key means of connecting with Chinese consumers overseas, as they are highly familiar with them.
One key advantage of QR codes is they can be placed in physical locations, making them a great way of bridging a brand’s online and offline experiences. Prominently displaying QR codes allowing users to follow the brand’s account in stores not only helps brands quickly build up their WeChat userbase, but it also signals to Chinese consumers that their specific needs are being catered to, engendering brand loyalty. QR codes could also be placed in magazine adverts, on billboards, or in promotional materials.
4. Build relationships
Considering how central WeChat is in the lives of Chinese users, there’s perhaps no better way to connect directly and build relationships with Chinese consumers. By regularly posting relevant and engaging content, and making yourself available for direct communications, you can encourage brand loyalty and positive word-of-mouth.
Many users use WeChat to chat directly with customer service representatives, allowing them to ask questions or resolve issues quickly and conveniently. To give you an idea just how well such a service is received by Chinese customers, Dutch airline KLM receives 6000–7000 messages a week on WeChat. Travel companies could also use WeChat as a means of helping travelers who might run into trouble on the road, while brands could provide curious users with directions to the nearest store or answers queries about their return policy.
This type of service could be further enhanced with the use of chatbots, which can be used to field simpler queries, meaning your representatives can concentrate their efforts on solving customers’ more complex problems.
5. Invest in Moments advertising
Much like Facebook’s feed advertising, WeChat has advertising that appears in users’ Moments feeds. Because Moments ads appear seamlessly among content from their friends, they typically have a high rate of engagement. Advertisers can also choose between a display or video format, further drawing users’ attention.
WeChat’s overseas targeting feature means brands are able to precisely target ads to Chinese consumers outside China — for example, they can target people who have logged into WeChat in a specific country in the past week.
One thing to note, though, is that Moments ads do require a more significant investment, with a minimum media investment of around $10,000 and a charge of around $25 per 1,000 impressions (or CPM). If you have the budget, however, this investment is well worth it.
6. Engage key opinion leaders (KOLs) or celebrities
As the price gap between luxury goods in China and other countries continues to shrink, Chinese consumers overseas will be far less motivated by price. Rather, they will be seeking out more distinctive products that are harder to find or not available in China, whether that’s limited-edition products, niche brands or local products from museums or artists. To help consumers discover these goods, brands will need to actively reach out to Chinese consumers — and KOLs and celebrities are a highly effective means of doing so.
Celebrity and KOL collaborations, while expensive, have proven their worth in China — one research firm found that social media posts on Chinese platforms that mention a celebrity account for 96% of all fashion brand engagement. Rather than simply sitting back and waiting for Chinese consumers to come to them, brands outside of China will need to start harnessing their power to attract this important demographic.