travel the digital silk road with china digital conference

THE ONLINE, MARKETING & RESEARCH AGENCY

@thechinaskinny SHANGHAI | LOS ANGELES | LONDON chinaskinny.com

Mark TannerCHINA SKINNY

Sydney, 24 October 2014

Travel The DigitalSilk Road With

China Digital Conference

#CDC2014




China Today: the Tip of the Iceberg

Affluent &Upper Middle Class

2012

256 million urban households

2022

357 million urban households

Source: McKinsey

Affluent &Upper Middle Class



Who’s Doing the Shopping?

2/3 of China’s international travellers

are under 35 Source: McKinsey

China’s affluent & worldly youth are most likely to buy foreign brands



China’s Urban Consumers’ Media Consumption

9.4 hoursper week

26 hoursper week

Source: Accenture

90% of Weibo Users are aged 18-34 Source: Weibo

81% of Tmall & Taobao Customers are aged 18-34

Source: Alibaba



The All Star Line Up

Michael MotherwellSearch Director, Lined Media

Ben FranziGM Sales, Global eCommerce

Platforms, Australia Post

Nina Kubik-ChengSenior Vice President,

Dragon Trail Interactive

Tony ShuWeChat General Agency and

Partner; Account Director, Interactive Media Pty Ltd

Charles ThompsonGeneral Manager

International & Partner Sales, Australia Post |StarTrack

Express

Arthur LiRegional Head of Sales &

Marketing, UnionPay International South Pacific

Benjamin SunFounder and Managing Director, Think China

Johnny WongCo-founder and Analytics

Director, Think China

William ChenFounder / Chief

Locksmith, ChinaKey

Dr Mathew McDougallFounder & CEODigital Jungle



David Bowie, 1983

“I'll give you television” China Girl, line 20

Let’s Dance. Side 1, song 2



Mark TannerCHINA SKINNY

22 October 2014

The Interconnectivity of China’s Digital World

5 Trends Reshaping China

SHANGHAI | LOS ANGELES | LONDON chinaskinny.com



1. Lack of Trust of a Key Digital Driver



Lack of Trust Means Chinese Consumers Do More Research

95% trust a brand more if they’ve seen it on

social media Source: eMarketer

95% trust a brand more if they’ve seen it on

social media Source: eMarketer



2. Online Chinese are Shopping Up A Storm

when Chinese hear ‘shopping’ 45% think of doing it online

14% shop online daily (5% do it globally)

63% shop online weekly(21% do it globally)

Source: PWC

Source: McCann



Online Shoppers Breaking World Records

600,000cartons of milk sold on

yhd.com

sold out in 52 minutes



Some Surprise Sellers Online in China

Condomsshaped like Ferrero Rochers

were in the top-3 selling Valentine’s Day gift online

in China in 2014

Corpsesgoing for a song at

¥126,500 (AU$23,500)with a 2-year warranty



eCommerce influenced by other channels

share online shopping

experiences on social media

80%read social

media reviews before buying

online

85%

Source: A.T. Kearney Source: Nielsen



3. The Rise of Social Commerce

200517 cars/1,000

2020184 cars/1,000

Source: Cetelem

60,000 cars sold in 2 weeks

on Weibo



Social Commerce Across Many Segments

200531 million

2017220 million

Source: CLSA

84% Chinese tourists share their experiences on social

media during & after their trip

Hotel Viennasold ¥10m ($1.8m) inbookings3 months

on WeChat



4. Mobile Getting Consumers Online

80% Weibo users mobile

100% WeChat mobile

1/3 Taobao & Tmall purchases on mobile



Mobile’s Offline Relevance

50% check products offline before buying online

75% of check prices online before buying offline

Source: Accenture

75% Chinese unsatisfied with experience through multi channels

40% shifted brands in past year due to poor experience

Source: Deloitte



Mobile’s Offline Relevance

75% Chinese unsatisfied with experience through multi channels

40% shifted brands in past year due to poor experience

Source: Deloitte



5. China’s Rise of ‘Smaller’ Cities Redefining Target Markets

have more

cities inChinapeople than

Sydney?

How many



5. China’s Rise of ‘Smaller’ Cities Redefining Target Markets

have more

110cities inChinapeople than

Sydney

Source: China Skinny using data from the National Bureau of Statistics of China



75% of China’s Affluent Consumers will live in ‘Smaller’ Cities by 2020

201235% of Android mobiles bought

in Tier 3 & 4 cities

201345% of Android mobiles bought

in Tier 3 & 4 cities

Online shoppers in Tier 3 & 4cities spent 28% more each than Tier 1 & 2 cities in 2013 Source: Alibaba

Source: Baidu



Traditional Online Tactics Getting Tougher

Tougher to get ROI with Key Opinion

Leaders

Harder to discover

your brand on WeChat

The rich get richer on

ecommerce and social

media



5-month Tourism Malaysia Social Media238% across 170K followers

206% New follower rate

+ 12K mentions #乐乐我爱大马 #

+ 2nd most popular destination for travel purchases on Taobao

Case Study: Reach New Consumers with Integration

Doubled new followers when out on the street



Only a small number who buy think about the

food again

Only a small number who buy think about the

food again

buy

Case Study: Enhance Existing Channels

tryfood

shoppersvisit store



To Summarize

1. Lack of trust is a key digital driver

2. Online Chinese are shopping up a storm

3. The rise of social commerce

4. Mobile getting consumers online

5. China’s rise of ‘smaller cities’ redefining target markets• Traditional techniques getting tougher• Integration captures new audiences and enhances

existing channels



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QUESTIONS?

travel the digital silk road with china digital conference

Presentations & Public Speaking

marketing research agency

online chinese

shop online weekly21

social media source

analytics director

chinese consumers

comlack of trust

partner account director