Connecting with Chinese customers in times of digital disruption

Berenice Pendzialek

#SMWHH – #SMWChinaDigitalSocial Media Week Hamburg 2016Hamburg, Feb. 24, 2016

Berenice Pendzialek -白瑞

MBA Focus in China Logistics and Tourism (UNAM)

Economic Analyst in The Economic and Commercial Section of the Embassy of the People’s Republic of China in Mexico

General Manager of COTRI China Outbound Tourism Research Institute

Doctoral studies in the Catholic University of Eichstätt-Ingolstadt (KU-Dept. of Tourism Geography). Dissertation: “Performing tourism: Chinese outbound organized mass tourists on their travels through German tourism stages”

Freelancer - Chinese Outbound Tourism Specialist / Project Manager of the “Destination Targeting China” Project of Heinemann Duty Free

Startup Entrepreneur

@BerenicePAcevesWeChat: BerenicePendzialek

Hamburg Chapter Leaderhttps://travelmassive.com/chapters/hamburg

Consumer opportunity – COT

Source: Pendzialek, 2014; adapted from CNTA and CTA / UNWTO, 2015

Chinese outbound tourism in million border-crossings and CAGR, 2000-2013

2014: 109 million border-crossings 2015: 120 million border-crossing (Est. CNTA)

Hong Kong, Macau & Taiwan share of total million border crossings (Jan-Oct) 2014: 62% 2015: 54%

Outbound tourism international tourism expenditure, 1995-2014

Digital Snapshot

Source: WeAreSocial, 2016 / Merics, 2015

Digital in China, January 2016

Netizens y-o-y increase (2015-2016): 8% Forecast 2016: 700 million Netizens SM users in China = USA und Europe SM users combined Mobile SM users – 88% active SM users

China´s internet giants and their kingdoms

E-Commerce- Taobao, Tmall, Alipay

Social media networks, online games - WeChat, QQ, Qzone, Tenpay

Search engine and maps- Baidu, Baidu Maps

#1 Netizens predominantly use mobile devices

Source: WeAreSocial, 2016

Internet use in China -January 2016

90% internet users via mobile

Mobile-boom, i.a. due to low smartphones prices

Mobile internet users are not just young users anymore

7 out of 10 new users connected via smartphones

Source: eMarketer, 2016 / News.cn, 2014

24-7 access to information, friends and entertainment.

Devices used by new* internet uses in China to access the internet, 2014 & 2015% of respondents

Mobile displaces the PC-based digital world

#2 Increasingly social

Source: WeAreSocial / Next Digital Group / Dragon Trail Interactive

WeChat: 650 million monthly active users in Q4/2015Whatsapp

Qzone:650+ million (MAUs) in Q4/2015Facebook & MySpace

Sina Weibo:220+ million (MAUs) in Q4/2015Facebook & Twitter

SM effect95% Chinese netizens trust a brand they have seen before on SM43% Chinese netizens are interested in products shared by friends on SM38% shopping decision based on SM recommendations

SM Platforms in detail

WeChat: a life style App

Source: Tencent / Tech in Asia

CNY 2016: 8.08 billion red envelopes sent via WeChat

#3 The rise of e-commerce

Source: The Economist, 2015 / KPMG, 2015 / iResearch

E-commerce as % of total retail sales in 2013, and forecast for 2018

CN E-commerce Value 2013: US$295bn 8% of all retail sales 16% in 2018

M-commerce fast growing pace: 74% grow a year, whereas e-commerce shows 35% (2013est)

Top Chinese Marketplaces in 2014

1. TMall 57.36% 6. Amazon 1.5%

2. JD.com 21.22% 7. Dangdang 1.5%

3. Suning 3.5% 8. Yixum 1.4%

4. VIP.com 2.8% 9. The 1 Store 1.4%

5. Gome 1.9% 10. Others 7.41%

Increasing preference for overseas online shopping

Source: Azoya International, 2015 / iResearch 2015

Overseas online shoppers as % of total online customers in China, 2014

Websites used for overseas online shopping (OOS) in 2014

Major reasons for OOS, 2014

How to get the best out of these trends?

Go mobile first

Implications: appropriate content sorted by device, less passive consumers

e.g. mobile media increaseMobile internet ad spending: 22.3% of total media spending in China in 2015Forecast 2019: 47.8%

Get your omni-channel marketing right

Consistency and metrics along different distribution channels

Not to neglect the customer´s preparation phase e.g. 56% of Chinese travelers plan activities before travel and 45% actually book it50% research activities via smartphone and almost 40% book them via the devices

Source: eMarketer, 2016 / Phocuswright, 2015 / Gebr. Heinemann, 2016

How to get the best out of these trends? - 2

Adapt content and marketing messages

Interactive: Visitors can follow HDF WeChat account and, if any, enter a digital campaign. Link to Sina Weibo as well.

Content: All about sharing Adapted marketing

messages Key information

about custom regulations

Info on accepted Chinese payment methods

Recommendation of brands & products

Awake emotions via storytelling

Gov Rules: CN registration and hosting. ICP Licence and verified SM accounts.

Source: Gebr. Heinemann / Storymaker / 21 TORR

Sneak peek: www.heinemann-dutyfree.cn To be launched on March, 2016Responsive web design

Design: East and West style

How to get the best out of these trends? - 3

Immerse in the O2O QR Codes

- Share contact information - Get product information and find the product online- Mobile payments

Geolocation services Shopping Chic with Ctrip: iBeacon & WeChat Shake-a-Shake

Source: Ctrip

Thanks for your attention!

WeChat: BerenicePendzialekberenice.pendzialek.org

@BerenicePAceves