A comprehensive analysis of 100 Luxury & Beauty Brands on Chinese Social Media
To evaluate the degree to which 100 luxury brands have effectively tapped into the potential of social commerce in China, we scored their marketing, sales, and service experiences from search, welcome, reach, product, payment, customer support, livestream showcase to the dedicated loyalty programs and offline appointment booking to see who has formulated the best China social commerce strategy, and here's a sneak peek of our findings.
China's Social Commerce Potential for Luxury
In China, e-commerce on social platforms such as WeChat, Douyin and Little Red Book has become increasingly mature with more features that shortens the path from discovery to purchase. Therefore, it has become a crucial part of any China strategies as brands look to future-proof their business.
According to Statista, social commerce accounted for 14.3% of the total online retail sales in China in 2021, and is estimated to increase to 17.1% in 2025. To put this into perspective, the social commerce penetration rate in the U.S. was only around 4.1%. Moreover, the livestream commerce market in China reached about CNY 2.27tr in 2021, and is estimated to reach CNY 4.9r by 2023.
Social commerce platforms enable brands to harness the advantages of the social network, which is especially powerful in China where WeChat and other social media has penetrated every aspect of life. However, for brands to fully leverage this power, they must create digital experiences that are more personalised, creative, and engaging than ever.
Average Marketing Score: 4.85/10
On Chinese Social Commerce platforms such as WeChat, Douyin and Little Red Book, brands have sought to create exceptional marketing experiences in terms of these three sub-dimensions: Search, Welcome Journey (primarily on WeChat), and Personalisation to interact with their users.
Compared to last year's statistics, surveyed brands have higher average scores in the sub-dimensions of Search and Welcome Journey.
However, brands still under-utilise the sub-dimensions of Welcome Journey and Personalisation, with the majority of them scoring below average. These two sub-dimensions require brands to aggregate data and learn their users' behaviour and preferences, and then to use that data in creating personalised experiences. This can be hard if brands rely heavily on marketplaces for sales where brands would end up with siloed data that cannot provide a full picture of customers for targeted marketing.
Average Sales Score: 6.32/10
Compared to last year, brands have significantly improved their sales features with increasingly innovative and engaging experiences in terms of presentation, checkout, and social storefront sales sub-dimensions.
We see an increasing number of brands innovating in the area of online offerings by incorporating AR Try-on, 3D and livestream product showcase.
Brands looking to engage with and retain users have not only started to build a private traffic pool by connecting users with sales advisors through WeCom, or by inviting users to book in-person store visits through an online-to-offline journey, but also have started to build personalised social storefronts on social commerce platforms with dedicated on-demand services.
Average Service Score: 4.88/10
Chinese consumers prefer in-app customer support that can offer immediate services.Therefore in-app 'live' services such as smart routing, live chat, 1-on-1 private consultation are expected to be a norm.
Users initiate conversations when there are questions or feedback. Brands can therefore also take the opportunity to understand user preferences, recommend products and personalise other services accordingly.
We observe that some top service performers prioritise customer service at the beginning of their customer journey. Entrances to the customer service portal is usually included in the welcome message of their social media accounts, or on the home page of their social storefronts.
Brands looking to either future-proof their business in China or improve social commerce experiences should optimise its marketing, sales and service offerings by taking inspirations from industry leaders.
To view the full report with the entire rankings, best-in-class examples, and tips for improvement, download the file by filling out the form on the right!