China's north star in a fundamentally transformed world

Over the previous decade, brands focused on transformation by chasing customer experiences and building digital experiences defined by the same KPIs. This process was meant to be transformational, but often resulted in brand experiences that largely looked and felt the same.

As brands seek to evolve to respond to a truly digital-first world, they face a new test to differentiate, requiring the breaking down of silos and a shift in mindset to build distinct digital environments that meet consumers wherever they are, online and off. In the aftermath of the pandemic, we’ve seen several brands in China succeed in this by adopting a performance-driven mindset for a fundamentally transformed world. This is and will be China’s north star.

Balance tech and creativity to bring new ideas to market

“In the past, the CMO brought marketing and communications expertise, while CIOs knew how to architect systems and unite data,” Adobe CEO Shantanu Narayen told the audience of his keynote address at Adobe Summit 2020. “But IT is becoming more customer-centric and marketing is becoming more data-driven. They are working together more than ever.” 

Narayen’s words point to a simple truth: to truly unlock the unique creative potential in digital, CMOs and CIOs must align and share the goal of customer obsession. Otherwise, they risk sacrificing engagement and relevance with consumers whose digital habits and needs rapidly evolve. 

A compelling example of this is Xiaohongshu. Once a simple lifestyle sharing app, its founders saw that many of its users (mostly Gen-Z and female) were sharing practical tips and reviews of products, prompting a pivot to ecommerce through shopping features. Now backed by Tencent and Alibaba and seeking US$6 billion in funding, the platform has become a major ecommerce channel for young consumers, powered by influencer-generated content. 

The app’s transformation shows how brands must break out of silos or building products in isolation. Instead, they must adopt a wide-lens view of the entire brand ecosystem, a strategy that has played well in Xiaomi’s favour. Xiaomi moved from its core focus on smartphones and smart hardware to invest in the AI that connects them, resulting in a true ecosystem that weaves the brand’s offerings together. Likewise, brands must strive to support the total brand experience throughout the digital customer decision journey—which looks forward to a new north star that brands in China can build toward: the virtualised experience.

Virtualisation opportunities abound

2020 has led to new opportunities for brands to meet consumers through differentiated, distinct digital environments and innovation. A robust culture of livestream commerce has helped consumers shop without going to a store—and serves another purpose for those sheltering in place: the “see now buy now” revival trend. Shortly before the outbreak, Taobao Live, the largest ecommerce streaming platform in China, made $2.85 billion in sales on Singles Day. 

These developments hint at what brands and business leaders may invest in next once they’re digitally transformed: closing gaps between the online and offline digital experience through virtualisation. Now, while consumers have turned to ecommerce solutions out of necessity, brands must move forward by becoming hybrid enterprises that connect both the online and offline worlds.

Consider the shopping experience as a key moment for virtualisation. Brands in China have done well to invest in digital in-store experiences designed to form an emotional bond with their consumers. In an effort to make product discovery online align more closely with the experience of engaging with products in person, Google has begun offering what it calls the Swirl format, which lets consumers explore product features in-depth by interacting with 3D product models within banner ads. It’s not only cool, it’s effective; Google notes a three-time increase in engagement compared to other rich media formats, a 34% increase in exposure time and a 17-point increase in customer purchase intent for fragrance brand Guerlain. 

Let customer obsession link experiences

Now, we’re also seeing interest in what we’ve coined “experiential ecommerce,” in which brands give brick-and-mortar retail features a digital upgrade. Think of your own personalised, contextual window display serving looks on your phone, or “trying on” an accessory with AR that a friend has sent you via a messaging app like WeChat. 

But for brands to succeed in virtualising experiences that existed exclusively offline before, they’ll need to take a more holistic approach to the total brand ecosystem. “One thing I definitely expect is the acceleration of the process of global companies adopting unified commerce into their retail model,” Michael Zakkour, an expert in Chinese digital commerce, told Hive Life. “We should be thinking about unified commerce where all your consumer touchpoints hold equal weight in creating bigger and better commerce.”

By aligning creative and technology teams, brands can better achieve customer obsession through creative experiences built for a digital-first world. Pre-pandemic, China has led in connecting online and offline experiences; now, brands must innovate further by adopting a performance-driven mindset connecting the customer experience across brand ecosystems. With this as their north star, brands will not only differentiate themselves—they will lead in a new era of virtualisation.

Ramzi Chaabane (left) is head of business and strategy in Shanghai and Sanne Drogtrop is APAC VP of business and operations, both at MediaMonks. Drogtrop is a 2020 Women to Watch member.