What Marketers Can Learn From Chinese Brands’ Approach to Covid-19
From contactless delivery, app-based communication and a centralized customer database
China is approximately three months ahead of the rest of the world in its Covid-19 recovery journey. As its economy begins to open up, companies that have been resilient during the peak of the crisis share one key characteristic: They have made digital a focal point for every touchpoint of their business. This has equipped them with the ability to communicate effectively with their employees and customers, roll out products and services quickly, cocreate and collaborate on ideas and solutions, mobilize parts of their supply chain and, most of all, respond to data.
The power of digital technology in marketing during a time like this is not from releasing more videos on YouTube or jacking Instagram with memes. It is about maintaining a strong connection between customer and company and using insights from engagement to deliver the products and services that people need.
Here are three lessons from the marketing recovery playbook from some of China’s best-performing brands. What they have demonstrated during the pandemic should inspire marketers everywhere to reconsider what brands can do and what marketing can be.
Keep customers out of sight, but not out of reach
Deploying measures to protect the health and wellness of customers has been top priority for major brands. At the peak of the pandemic, this meant closed stores, limited service and frequent messaging around social distancing etiquette. Fortunately, for resilient brands, reminders to stay at home didn’t mean stay away. App-based communication has been a central part of the marketing strategy for many of China’s biggest companies, for the purpose of being accessible and connected regardless of where you were.
Yum China has been aggressively investing in its digital strategy since 2015 and has grown its digital membership to 230 million members, offering services such as pre-order and tableside order, online queuing, delivery and payment, e-gifting and media. Its centralized platform has also enabled the company to release new products and services with relative speed, economy and agility. From customized menus to cook at home kits, corporate catering services and contactless solutions, communicating with millions was made easier by centralizing the customer database.
Make shopping a social event that delivers value
It is ironic that shopping can be social when we’re isolated, but social commerce is growing in China. The concept is faintly resonant of that proposed by Groupon—i.e., offering bulk sales through social networks—but where Groupon looks at value through the lens of products and services, in China, the real value is in the network.
Pinduoduo (PDD) is one of the top social commerce companies in China. Established in 2015, it is worth $50 billion and is owned by Tencent, owner of WeChat, which is used by 1 billion people. The company not only sells the usual suspects of cosmetics and televisions, but as a response to the economic impact of Covid-19, PDD is partnering with farmers in rural areas to sell products. In the Yunnan province, PDD has committed to 100 farm projects. It will also educate 5,000 rural talents to specialize in ecommerce and build 100 agricultural product brands.
As recession and unemployment are forcing people to reassess their expenditure, we might see social commerce grow. PDD is most popular in China among people with lower incomes who live in second- or third-tier cities. Online ecommerce in the West has largely catered to the middle and upper classes, with Kantar calculating that the average Amazon shopper’s income is around $84,449.
Make logistics a key part of the customer experience
From Jan. 26 to March 10, more than 200,000 business owners reportedly opened accounts on Alibaba’s food delivery service, Ele.me. According to numbers by Alipay, ten of the most popular fresh delivery online programs on its platform received three times the revenue compared to the period just before the outbreak. Reflecting the demand for delivery services, ecommerce platform Meituan-Dianping reported that nearly 30% of surveyed restaurants have begun delivery services as a response to the pandemic and nearly half of the surveyed restaurants say they’re getting more than 70% of their revenues from delivery.
Incorporating delivery capability through third-party logistics partners has helped many businesses mitigate some loss of revenue. For companies, this means providing click-to-order for pickup, delivery and courier service. It also means elevating the status of last-mile delivery in the overall hierarchy of customer experience.
Starbucks, in collaboration with Alibaba, has been exploring self-serve kiosks in supermarkets since 2018. Coffee orders are placed via an app, the coffee is made in a kitchen in the store and the shopper can pick up their coffee at an unmanned station in 15 minutes. We will probably be seeing more of this type of contactless delivery in the future.
