A version of this article first appeared on Azoya’s WeChat blog. Azoya helps global brands and retailers access the China e-commerce market through WeChat and other channels.
As we wrote last week, WeChat mini-programs are emerging as a key part of e-commerce branding strategies. They give retail brands an opportunity to set up an official brand e-commerce store without having to rely on Tmall/JD.com, and WeChat’s social nature makes it easier to share content and promotions, potentially lowering customer acquisition costs and avoiding the need to spend on low-ROI ads.
But to succeed with mini-programs brands have to incentivize customers to share by creating engaging content and promotions. Today, we’ll see how four brands we examined in a recent report have created highly customized mini-programs to do this.
UGC (User-Generated Content): YSL Members Club
YSL Beauty’s mini-program incentivizes users to post selfies and tag products in a Little Red Book-like fashion. Users receive points that can be redeemed for discounts, and they can also use those points to purchase items directly within WeChat.
In China’s crowded retail market, consumers rely on content to help them decide what to buy. But many of the reviews online are fake or overly commercialized. Thus, users struggle to find a place where they can find quality content from peers they trust
Social commerce platform Little Red Book, which consists primarily of Pinterest-like posts where users can write about their shopping experiences and tag products, was able to scale to >100 million users partly because it started as a content platform first. By incentivizing users to post content using its mini-program, YSL Beauty is trying to create a platform of engaged customers. WeChat Pay enables customers to make easy purchases when they’re finally ready to, creating a direct link between content and e-commerce.
Social Gifting: Dior
Dior’s gift card mini-program lets users buy and send virtual gift cards to their friends on WeChat; the cards can then be redeemed in WeChat or select offline stores. WeChat’s sharing features and WeChat Pay make it so easy that users can do this with just a few taps of the finger.
Gift-giving is a major tradition in China, and luxury brands have become adept at tapping into it. Users are already used to giving gifts on WeChat, using the “red envelopes” virtual money function. Chinese WeChat users sent each other over RMB 47 billion (about $7 billion) in virtual red envelopes to during the six-day Chinese New Year period in 2018.
Dior’s mini-program takes things one step further in allowing customers to send virtual gift cards to one another. From the brand’s perspective, this creates better customer engagement. The mini-program also allows them to single out certain items for sale and track consumption data for gift-giving purposes.
Handbag maker Longchamp’s mini-program enables customers to customize their own bags. Users can select colors and features and place an order without leaving WeChat.
Luxury brands have long struggled to recreate the luxury experience online since there are no trained attendants nor plush leather seats to make customers feel special. Additionally, many consumers go online to shop for discount deals—whereas many luxury brands have been loath to discount their goods for fear of hurting their brand value and proposition.
Offering personalization, a service that is typically reserved for VIP customers at offline luxury retail stores, to mini-app users rewards brand engagement with a taste of luxury.
Online-to-Offline: DFS Group
Chinese tourists flock to DFS stores in Hong Kong, taking advantage of the city’s absence of sales taxes (except on alcohol and tobacco) to purchase luxury and cosmetics goods. DFS Group’s mini-program lets customers browse and order duty free goods online before they get to the store, offering multiple locations to collect purchases.
Duty free shopping can be crowded and chaotic. By nature, it can’t go online. Often gray market daigou (shuttle trader) sellers line up at stores at the crack of dawn to snap up popular products—leaving tourists frustrated when their favorite items are out of stock.
From the retailer’s perspective, it’s also hard to market and sell to Chinese tourists who have a million items on their to-do list when traveling.
Using WeChat Moments ads and this mini-program to target tourists before they even arrive in Hong Kong allows physical stores to compete with e-commerce convenience.