1、WPP CONTENT, CONTENT, CONVERSATION CONVERSATION he or she wants to be immersed in an experience, to engage with like-minded individuals, and to share their perspectives within their network. E-commerce Social Media Social Commerce 5 SOCIAL COMMERCE INTRODUCTION Consumer “voice has always existed, bu

2、t it has never been as quantifiable, manageable and actionable as it is today. Social Commerce, formerly a subset of e-commerce, is now challenging mainstay e-commerce platforms and also creating new commercial models for brands. Social commerce leverages influence (both paid and organic), to captur

3、e users attention and stimulate purchase through any social or e-commerce touchpoint. WPP Social Commerce Used by established brands with larger budgets that are driven primarily through paid advertising on e-commerce platforms with a focus on funnel conversion. Used by challenger brands keen to dev

4、elop a social following around a key differentiator that is inspired from a thorough understanding of the consumer, with the ambition of establishing a direct-to-consumer (DTC) relationship. Acquisition Engagement Conversion Retargeting WOM or they can be platform-led, in which case brands will have

5、 to collaborate directly with influencers or KOLs of that platform or have a multi-platform reach. On the Y-axis, our social commerce activities can be reward-led; in other words, a brand or influencer rewards the consumer for sharing brand information or referring customers to result in the sale of

6、 a product. Or, finally, they can be interest-led, where brands focus their marketing activities on a vertical channel within a larger platform, leveraging its editorial content, consumer communities, influencers, and linking platform activities to a store from where you can purchase a product. We h

7、ave also observed that the type of approach marketers choose is tied closely to factors like product category, brand maturity, and product availability. WPP 11 IN SUMMARY TOP-DOWN APPROACH AGAINST CUSTOMER JOURNEY Leverage KOLs personal charisma and influence to sell products Leverage interesting co

8、ntent to increase peoples interest with direct purchase links Turn social networks into dealership channels based on membership /commission Provide gifting through e-cards and store platforms to match Chinas gifting culture. Use member-get- member mechanism to sell products virally Add content commu

9、nity social function on existing eco-system, that converts retail experience to social Interest To Purchase Browse Products Make a Purchase Experience & Comment WOM & Repurchase FOLLOW TRENDS BROWSE & BOOKMARK BUY NOW, THINK LATER REDEEM AND RECOMMEND KEY APPROACHES SOCIAL COMMERCE KOL/MCN Approach

10、Vertical Content Community Approach Group Buy Approach New Retail Approach Membership Approach Gifting Approach BRAND DRIVEN SALES DRIVEN Typically, approaches that create mass awareness of a brand or product are more brand-driven, and approaches associated with reward or loyalty in CRM are more sal

11、es- driven. In the context of social commerce, brands utilize influencers to identify and best explain product benefits, and to share user experiences of a product. These are achieved by borrowing from an influencers personality to build brand equity and its credentials. From experience, this is alw

12、ays a balancing act between brand-led and Influencer-led initiatives. Gifting and membership tactics help brands continue to create a network of organic influencers, who are sometimes rewarded with limited-edition products and the opportunity to gift to friends. While the customer funnel is typicall

13、y brand-driven, in the world of social commerce it is influencer-led and propagated by users and fans. 雪梨 Cherrier 宸帆 张大奕 如涵 WPP CHAPTER 1. STATE OF THE INDUSTRY 1212 WPP WPP 13 Based on interviews with 5,000 connected consumers in Brazil, China, France, the UK and the US (1,000 each). Source: Kanta

14、r Media 42% 44% 44% 53% 54% 33% 46% 70% 78% 63% 4% 9% 21% 25% 27% 31% 42% 44% 53% 72% Smart speaker/audio enabled device Celebrity endorsements Blogs/vlogs Newspaper/magazine articles Company websites Advertising Social media Review sites Friends and family Internet and websites % using source who t

15、rust it% using as source Consumers Brand Information Sources and Their Trust in Those Sources The rapid and undeniable rise of social commerce in China cannot be understood without acknowledging the ubiquity of social media and its high penetration rates. There are however more profound and deeply r

16、ooted psychological forces that are driving this change. Word-of-mouth, whether its consumer reviews or insight shared by friends, creates more trust than any other source of information as demonstrated by recent qualitative research conducted by WPPs Kantar. CONSUMER BEHAVIOUR: THE NOW CONSUMER Wha

17、t consumers say is the most effective source in influencing other consumers purchase decisions. The second is impulse buying, a recent phenomenon that has developed as a consequence of increasing disposable income, flash sales, Singles Day, Chinese New Year promotions and influencer sales. Social co

18、mmerce platforms use such promotional strategies to encourage purchases and to fulfill instant gratification. WPP 14 2,911 3,954 5,498 7,698 10,338 200172018 China Sales CNY (Billion) + 225% ( 7,427 billion ) Figure 1: All E-commerce Sales Source: 1. CNNIC, 2. Fiscal reports of Tmall/Taob

19、ao/JD. 3. iiMedia Research Since 2014, e-commerce sales have more than doubled. This is thanks to seasonal events like Singles Day, the increased adoption of digital wallet usage within rural China, and the creation of market places for buyers and sellers on the same platform. There are currently 65

20、0 million e-commerce users in China, averaging an annual spend of CNY 6,104. During the past 5 years, e-commerce sales have grown by 255%, a total increase of CNY 7,427 billion. Growth in e-commerce sales over the past 5 years has been driven primarily by continued consumer confidence in the Chinese

21、 economy and the addition of mobile digital wallets Alipay and WeChat pay, which have made the purchase journey a seamless experience. Chinese shoppers in both rural and urban China are benefitting from growth, either through steeper discounting of products, or through greater choice among both impo

22、rted and domestic products. CHINESE E-COMMERCE MARKET: STEADY YEAR-ON-YEAR GROWTH WPP 15 Figure 2: Major Conventional Channel E-commerce Sales The Chinese e-commerce landscape has seenmanyplayerscomeandgo,yet Alibaba and JD have weathered the storm. The former has dominated the conventional e-commer

23、cemarket,generatingroughly 90% of total transactions since 2014 (see figure 2). Figure 3: Three Major Social Commerce Channel Sales Social commerce channels have had a late start but they are steadily catching up. WeChat Commerce has grown seven-fold since 2014 and Pin Duo Duo has almost doubledinsa

24、lessince2017.While Xiaohongshu has yet to release their official earnings, their dramatic active user growth rate hints at their growth into a future social commerce giant. The biggest contributors to conventional commerce are Alibaba, JD, Kaola, WeChat, PinDuoDuo, and to a lesser extent, Xiaohongsh

25、u. They are driving adoption of social commerce but have also challenged traditional commerce platforms to be more content- and influence-led. Interest-led e- commerce platforms contribution to the overall market is much smaller in comparison to these leading platforms, however they are highly influ

26、ential in creating initial demand of a product before mass adoption. Source: 1. CNNIC, 2. Fiscal reports of Tmall/Taobao/JD. 3. iiMedia Research NetEases Kaola, which was one of AliBabas biggest competitors in the cross-border e- commerce space, has recently been acquired by AliBaba to service China

27、s increasing demand for quality imported products. Kaola controls 25% of the cross-border market, as of 2019. CHINESE E-COMMERCE MARKET: DAWN OF COMMERCE WITH SOCIAL CHARACTERISTICS 1678 2444 3092 3787 4820 115 181 260 362 462 220 450 527 680 200172018 China Sales CNY (Million) AlibabaJDK

28、aola 82 194 329 497 707 141 471 200172018 China Sale RMB (Million) Wechat CommercePDD WPP 16 2,274 3,334 4,233 5,048 5,682 1414 1313 14 0 1,500 3,000 4,500 6,000 12.5 13.0 13.5 14.0 14.5 200172018 Tmall Active User Growth & GMV Per Active User in China GMV Per Active UserActive

29、 User Growth Rate 3,024 3,722 3,627 105% 17% 29% 0 950 1,900 2,850 3,800 4,750 0% 28% 55% 83% 110% 138% 200172018 Kaola Active User Growth & GMV Per Active User in China GMV Per Active UserActive User Growth Rate Tmall reached over CNY 2,131 billion GMV (Gross Merchandise Value) in 2018,

30、occupying the largest piece of the pie within Chinas e-commerce market. In 2018, it achieved CNY 5,682 GMV per active user/year, the highest amongst all e- commerce platforms. Despite the fluctuation of active user growth rate, GMV per active user on JD has increased more than 230% in the past 5 yea

31、rs, reaching CNY 3,164 in 2018. Established in 2015, Kaola has maintained double-digit active user growth rates. As a leading cross border e-commerce platform, it enjoys a higher GMV per active user (averaging above CNY 3,300). In 2018 spending per active user reached CNY 3,627, significantly higher

32、 than JD. Consumers on Alibabas flagship platform Tmall spend more than on any other e-commerce platform, and they also represent the highest number of active users. The strategic implementation of social commerce mechanics and content both help to maintain active user growth and contribute to gross

33、 merchandise value (GMV) per active user. Source: CTR Fiscal reports of Tmall/Taobao/JD. 2. iiMedia Research TRADITIONAL E-COMMERCE PLATFORMS: ESTABLISHED PLATFORMS STILL DOMINATE MARKET 1,337 1,828 2,321 2,850 3,164 14% 15% 13%13% 15% 0 800 1,600 2,400 3,200 4,000 12.00% 12.75% 13.50% 14.25% 15.00%

34、 15.75% 200172018 JD Active User Growth & GMV Per Active User in China GMV Per Active UserActive User Growth Rate WPP 288 282 295 41493 53 112 100 32 0 105 210 315 420 525 0 30 60 90 120 200172018 Xiaohongshu Active User Growth & GMV Per Active User in China GMV Per Active User

35、Active User Growth Rate 17 Source: 1. CNNIC, 164 278 370 516 653 47 39 28 8 12 0 175 350 525 700 0.0 12.5 25.0 37.5 50.0 200172018 WeChat Active User Growth & GMV Per Active User in China GMV Per Active UserActive User Growth Rate WeChat saw fast growth in active users between 2014-2016.

36、Despite a slowddown between 2017-2018, it had gained over 1 billion active users by the end of 2018. GMV per active user increased rapidly, yet the latest figures are below CNY 700, much lower than Tmall/JD/Kaola that each average above CNY 3,000. Xiaohongshu has been quick at acquiring new users, g

37、rowing 78% on average YoY over the past 5 years. Since it first launched e-commerce functionality on its platform in 2015, Red Books GMV has increased by 100% each year. Growth of users on WeChat continues to increase, however, the ticket price of all products purchased is considerably lower than th

38、at of Alibaba. Similarly, Xiaohongshu, which is a leading product curation platform, is steadily increasing its average GMV per active user. This is a clear indicator that social-driven purchases are progressively contributing to e- commerce growth. SOCIAL COMMERCE: WECHAT & Xiaohongshu PERSONALIZED

39、 CONTENT & INNOVATION WPP 18 Source: 1. CNNIC, PinDuoDuos focus on group-buying and adopting artificial intelligence/machine learning (AI/ML) has resulted in 100% YoY growth of its active users. GMV per active user has increased from CNY 1,763 to CNY 2,820. Douyin came onto the scene in 2016. In 201

40、8, it first announced that its monthly active user base had reached over 300 million in China and over 500 million worldwide. It also launched e-commerce functions in December 2018, with the objective of driving traffic to online and offline stores. 1,763 2,820 567 109 0 750 1,500 2,250 3,000 0 150

41、300 450 600 200172018 PinDuoDuo Active User Growth & GMV Per Active User in China GMV Per Active UserActive User Growth Rate 2.6 877 166 0.00 0.70 1.40 2.10 2.80 0 225 450 675 900 1,125 200172018 Douyin Active User Growth & GMV Per Active User in China GMV Per Active UserActive

42、 User Growth Rate New entrants like Little RedBook and Douyin that have a fast growing user base are looking at how to capitalize on their audience growth by linking user growth to purchasing power. Marketers will have to see how they can best leverage both of these platforms to either help create a

43、wareness of a brand, or to help support penetration of new products within lower-tier markets. There is some notable evidence of success but careful monitoring of these platforms is still required. SOCIAL COMMERCE: PINDUODUO & DOUYIN BITE-SIZED CONTENT & GROUP BUY WPP 19 Source: 1. Fiscal reports an

44、d Public Data of Top 5 Leading E-commerce Platforms 2. iiMedia Research 2% 2% 2% 4% 20018 Cost per Sale Growth Rate Top 5 E-commerce Platform Operation Cost Operation cost per 100 sales generated The cost of operation of e-commerce platforms continues to increase year-on-year. Increased c

45、ompetition and dependency on platform resources (e-store management and commission paid to platform) per sale generated is anticipated to continue to increase beyond 2018. The most dramatic recent increase was in 2018 (see figure 2). For every CNY 100 sold, CNY 3.60 is attributed to platform operati

46、on costs, which has grown 1.7X since 2015. CNY 3.6 Operation costs per CNY 100 generated 2018 CNY 2.1 Operation costs per CNY 100 generated 2015 19 FACTORS SUPPORTING SOCIAL COMMERCE GROWTH INCREASING COST OF OPERATION FOR E-COMMERCE WPP 20 20 The advertising and promotional expenses for leading e-c

47、ommerce platforms have also increased notably from 2015 to 2018. CPM (cost per thousand impressions) costs have increased by 286%. This is forcing brands to uncover new ways to create reach, in particular creating unique reach through influencers and distribution of content within e- commerce platfo

48、rms. CNY 100 Paid media CPM 2018 CNY 35 Paid media CPM 2015 ￥35 ￥57 ￥78 ￥100 20018 Paid Media CPM (CNY) Figure 1: Top 5 E-commerce Platforms Advertising CPM Cost FACTORS SUPPORTING SOCIAL COMMERCE GROWTH INCREASING COST OF MEDIA FOR E-COMMERCE PLATFORMS WPP 21 ApplicationTmallJDKaola Xiao

49、hong shu DouyinWeChatPDD Year of Creation20032004200112015 Brand StoresBrand stores Social Asset Brand video, banner, content KOL Content Livestream Brand interaction (Share/comment/follow) Community News Feed Q&A forum sponsorship Hot topic Search position Time capsule Mini Program Moment Ads in feed Member get Member games Commerce Asset Open Page Ad Advertising Banner Themed festivals KOL Content Community Feed Customer Service Online Pop up Store Brand stick