Luxury brands need to consider what strategies and tactics they can implement to attract China’s digital-savvy traveling shoppers before, during, and after their trip. DLG China’s Elsie Zhang reports.
It is not news that the number of Chinese travelers flowing over the borders both near and far to experience new countries and new cultures is growing. However, what is noteworthy is the fact that more and more of these adventurers are digital-savvy millennials who are fast joining the ranks of the upwardly mobile middle class.
According to a report from the World Travel & Tourism Council, Chinese tourists spent $250 billion abroad last year, with shopping accounting for the largest share of travel spend. This combination of high spending levels abroad and an audience that is always digitally connected makes for a prime battleground for luxury and premium brands to attract shoppers. At Digital Luxury Group, we work with brands like Dior, Four Seasons Hotels & Resorts, and watchmaker Carl F. Bucherer, to help them ensure that are they are best taking advantage of digital opportunities to tap into this lucrative market. We have identified the following winning strategies for each phase of travel—before, during, and after the trip:
“Chinese travelers often make incredibly detailed plans ahead of time.”
1. Before Travel
Chinese travelers are accustomed to planning their trip before they ever leave the ground.
For travel to a number of top destinations, Chinese passport holders require a visa (and often go through a lengthy process to acquire one). The fact that work schedules can be quite busy combined with the issue that the annual leave system isn’t always so straightforward makes traveling abroad a sometimes tedious process for would-be adventurers.
In order to take full advantage of every minute in a new destination, Chinese travelers often make incredibly detailed plans ahead of time, identifying where they want to eat, what they want to see, and where they want to shop well in advance.
Not only have they identified the shops, but in many cases—especially with expensive items—they already know precisely which article of clothing, jewelry, or watches they want to acquire. This pre-visit research includes a thorough analysis of brand websites, travel forums, price inquiries, and tax refund information. Ensuring that they are getting the best possible deal is often of top importance. Purchases may not only be for personal use, but for friends and family members back home, adding to the total shopping trip value of each visitor.
Understanding the importance of the pre-travel research phase is incredibly crucial, and we have advised our clients to consider a few best practices.
Best Practice #1: The journey of new brand discovery starts in China, even if your brand is not physically present there.
When considering how to grow awareness in China for their brand, executives are often inclined (perhaps too inclined?) to take advantage of the huge networks of social media influencers (also known as key opinion leaders or KOLs) by collaborating with them in a way that will grow visibility with a target audience on platforms like Weibo or WeChat. This is a good starting point, but cannot be the only tactic considered.
Baidu owns 70 percent market share in the Chinese search engine market. More than just a search engine, Baidu serves many functions. Baidu Zhidao is equivalent Quora, a platform where users can ask questions and get answers. Baidu Baike is equivalent to Wikipedia, a great source of educational information, and Baidu Tieba is a channel to target a very specific community, oriented around a well-defined theme. All of these functionalities can have relevance for a brand or retailer looking to gain traction with a Chinese audience.
Examples of travel-related searches on Baidu compared to Google. Most Chinese travelers do extensive online research of the destinations (and the shopping options there) before heading on their trips.
A good place to start is by considering a common pre-travel research scenario: A search on Baidu for “ + shopping.” For example, “France shopping” or more specifically “ + ”. In regards to this, it is important to keep in mind that search engine optimization (SEO) is a challenge in China since it requires significant changes to a global site that’s not usually managed by a local Chinese team. It’s also challenging because unlike Google, Baidu doesn’t limit the number of paid results on its results pages. Ensuring you have a presence on Baidu is key, but remember that in order to be most visible, paid advertising may be needed in order to rank well on search result pages. What also gets tricky is the question of whose budget pays for this. Should it be the local China team focused on boosting local consumption, or the global headquarters who understand that investing in China is investing in the global performance?
Best Practice #2: Ensure the store locator is both accessible and relevant to the Chinese audience.
Though pre-travel research often starts on Baidu, it is not unusual for a prospective customer to go directly to the brand’s website when they are familiar with the brand and its offering. When this is the case, it is important to have the store locator very visible on the site. Addressing the limitations of Google (and Google Maps more specifically) in China and proposing a global mapping system that can be accessed both from China and overseas to search both for point of sales in China and abroad is the best solution. A location-based store locator allowing you to find a store nearby and calculating the route to get there is also a key feature, especially when your prospects are visiting a city they don’t know.
A function on Cartier’s WeChat account that allows users to book an appointment at a Cartier store.
Store locators geared to Chinese travelers should also include functionality such as click-to-call dialing, printable driving directions in the local language to hand to a taxi driver, and details on whether Chinese-speaking staff will be present.
“Just because a traveler has left China doesn’t mean that they aren’t still connected to their favorite Chinese platforms.”
Just because a traveler has left China doesn’t mean that they aren’t still connected to their favorite Chinese platforms.
Language is an important barrier to consider for Chinese people traveling overseas. With a store address on hand, how to get there? Once in the shop, how to communicate with the store staff? These are real concerns.
Best Practice #3: Taking advantage of WeChat’s advanced features can mean the difference between a sale and no sale.
Engaging Chinese travelers throughout their journey might otherwise be impossible if not for WeChat, the leading messaging service across China, used by 762 million monthly active users. WeChat is an incredible strong tool for brand marketers looking to engage with their customers, and it’s the reason why we draw so much attention to it.
WeChat captures nearly every single point of data on how the user interacts with the brand and it is possible to achieve various objectives:
Activate online and offline. Take advantage of location based services to engage with your followers as soon as they step off the plane. A welcome message pushed to the user to welcome him/her to their destination can offer assistance to find a nearby store or set up an appointment. In addition to the activation of the existing followers, integrating WeChat QR codes into store merchandising, product packaging, catalogs, and any other collateral, will help to engage despite the language barrier and will ultimately help you to recruit Chinese prospects overseas. QR codes can also be the perfect alternatives to collaterals that are not available in Chinese.
QR codes can be used for CRM at points of sale.
Drive in-store traffic. Develop added-value features facilitating the shopping experience, such as requesting a sales appointment or a highly functional global store locator (including click to call, taxi direction printout, etc.). The WeChat store locator is the easiest and most accessible way to connect consumers to the brand.
According to DLG research, 80 percent of brands in the luxury industry offer a store locator function. However, only 41 percent are providing the navigation map service, and only 11 percent of the brands offer an international store locator. In order to stimulate the sales for travel retail, maximizing international store locator functionality is essential.
WeChat can also be used to support the interaction between a brand’s sales staff (when properly trained) and Chinese visitors by proposing features helping to reduce the impact of the language barrier such as brand information or collection details available in Chinese.
Acquiring customer and prospective customer data and generate insights. Implementing CRM programs with Chinese travelers is a huge challenge when a brand’s staff does not speak Chinese or the growing concern amongst China’s luxury consumers for more data privacy. Despite the challenges, WeChat allows the brand to easily collect CRM data which can then be used for campaigns or satisfaction surveys triggered by the scan of a specific QR code at a point of sale.
An example of a customer survey.
Reactivate your connection and reinforce customer service.
No matter if the previous activities allowed you to recruit a fan, qualify a prospect, or record a new sale, this is not where it ends. We know that often, the relationship with a brand can start overseas but its biggest potential lies in the ability to generate repeat purchase once the client is back in China.
Best Practice #4: Re-activate and develop loyalty
Take advantage of the location-based and segmentation features integrated on WeChat to identify your followers once they travel back to China. Take the occasion to send a message, following up on their shopping experience, inviting them to join the brand’s loyalty or CRM program, send new product recommendations, or even to invite them to your next in-store activity in China. The goal is to extend the relationship locally.
Successfully tapping into the huge pool of money spent by Chinese travelers abroad can be a complicated endeavor and in addition to understanding the customer, their behaviors, and their desires, it requires a team effort by a brand’s marketing, retail, digital, PR, and CRM teams both in and outside of China.
Once you think you have nailed it, however, don’t rest on your laurels. Consumer behavior changes rapidly, especially online, and especially in China, so it is crucial to continue experimenting with different tactics and strategies.