Next March, Otte, a small boutique chain in New York City, will open up a
store in Shanghai — its first outside of the East Coast of the U.S. and a
significant feat for a multi-line retailer that the majority of Americans
haven’t even heard of.
The reason? Over 50 percent of Otte’s online customers are Chinese, residing
in either the U.S. or in China. And that’s almost entirely because for the past
three years, the 16-year-old retailer has been extremely active on Chinese
social media platforms Sina Weibo and WeChat.
Otte’s expansion into China underlines the potential of social media for
fashion brands — both small and large — who want to grow their reach in the
country. Of course, it’s important for almost any type of brand to be on social
media in any country. But in mainland China, one’s activity on platforms like
Sina Weibo and WeChat can mean the difference between having a booming Chinese
business and having none at all.
In the case of Otte, it’s unlikely the retailer would have had any
significant awareness among Chinese consumers were it not for its aptitude with
Chinese social media. Four years ago, founder Kay Lee, who is Korean, hired
Nancy Zhang as Otte’s chief operating officer. Having come from Google, Zhang
spearheaded the retailer’s digital efforts, mostly out of necessity since
resources were limited for the fledgling retailer. “It’s not like we were going
to buy an ad in Vogue so social media was actually a free way of getting
exposure,” she says. She noticed that, following an interaction with Phillip
Lim’s account on a Japanese social media platform, the designer’s Pashli bag
“blew up” on Otte’s site. “That’s when we really understood there’s a big
untapped potential in Asia in Chinese social media," she says. As one of the
first Western fashion brands to start a Weibo account, Otte’s following is now
on par with much bigger e-commerce sites like Shopbop and Revolve. “People think
we’re a lot bigger than we are in China because of the presence that we
have.”
That fact is not surprising given the way information is consumed in China,
which is predominantly through mobile devices. Last year, the number of people
who accessed the Internet via a mobile device surpassed the number of people who
accessed it via desktop, according to L2. Also, the percentage of consumers that
have email addresses has declined dramatically — they’re using mobile messaging
platforms like WeChat instead. On top of that, China’s corruption crackdown has
led not only to decreased spending on luxury goods in the country, but also to
restrictions on luxury brands’ ability to buy ads and billboards, making social
media an even more important way for brands to spread information to
consumers.
“Chinese Internet users rely heavily on information about fashion and trends
from social media,” says Liz Flora, editor in chief of Jing Daily. That Otte
doesn’t yet have a store in China also wouldn’t necessarily matter since so many
Chinese shoppers do their shopping outside of the country. “Social allows you to
have this direct conversation with consumers without having to get them in the
flagship stores, which were really just like billboards for luxury brands in
China,” says Danielle Bailey, a research director for L2, who also noted that 60
percent of luxury purchases among the Chinese take place off the mainland. “Even
brands that don’t have a physical presence in China, social is a way for them to
gain foothold in the market.”
For a larger brand like Tommy Hilfiger, which employs a team of social media
managers and specialists in China, these platforms are a great way capitalize on
interest around big events, like its 30th anniversary fashion show in Beijing in
May. Content around that event led to a 2,000 percent increase in visits to the
Tommy Hilfiger Weibo page, which raised engagement by 1,900 percent.
Subsequently, sales in the brand’s Beijing stores increased by 21 percent and
its Chinese e-commerce business almost doubled. The U.S. label has a separate
e-commerce site and mobile app for Chinese customers, which is important. Otte,
too, launched a Chinese translation of its site and recently began accepting
yuan.
In addition to having the right infrastructure to support Chinese business
(like a dedicated e-com site), it’s important to post the right kind of content
to Weibo and WeChat; otherwise a brand’s efforts could be fruitless. According
to Bailey, campaigns that encourage engagement — like games, contests and
giveaways — tend to be the most effective. Weibo lends itself particularly well
to posting about big campaigns or events that a brand wants to reach a broad
audience.
Depending on the brand, having an authentic, personal voice (i.e. sounding
like a person, rather than a business) can also be very effective. While that
might not be the right strategy for a company as huge as Tommy Hilfiger or
Burberry, whose brand voices don't come from a single person, it worked for
Diane von Furstenberg, who has 2.5 million followers on her personal Weibo,
compared to just 24,000 on the brand’s account. Tommy Hilfiger has about
225,000.
“If I ever really talked about my business [on Weibo], people wouldn’t
respond,” says Tina Craig, founder of blog network Snob Essentials and a former
VJ on MTV Asia. "But if I was talking about cooking or taking my son somewhere,
they would respond to that, so they want to see a peek of your personal life.
They don’t want anything to seem sponsored.” She started a SnobEssentials
account after her personal one, and still keeps the two very separate, noting
that the Chinese audience in particular gets “turned off very easily” if posts
aren’t personal.
For brands that don't lend themselves as naturally to those kinds of
conversations, what's extremely common is partnering with local influencers —
called Key Opinion Leaders (KOLs) in China — which include bloggers, “It” girls,
models, musicians and other tastemakers with substantial followings.
“We’ve found that authenticity is also key to our strategy – consumers
appreciate genuine, real life content of models and celebrities,” says Avery
Baker, Tommy Hilfiger’s chief brand and marketing officer. On the day of its
30th anniversary show in Bejing, the brand hired Chinese model Qin Shu Pei to
take over its Weibo account and post behind-the-scenes content. “About 60
percent of our achieved engagement was generated by posts that showed her
interacting with her friends or spending down time between rehearsals.” On top
of that, the brand partnered with 20 local bloggers to report on the event.
That said, “brands need to be very careful about who they choose [to partner
with],” warns Jing Daily's Flora. “There are many self-proclaimed KOLs out there
who buy fake followers because they want to take advantage of the perks from the
brands such as free gifts, party invites and cash. The brands need to look at
who actually has an engaged and dedicated follower base, which actually isn’t
that hard if you look at the number of comments and retweets they have.”
“Retweets” are important on Weibo, where the goal is to make content go
viral; but WeChat, which is becoming an increasingly important platform for
fashion brands, works very differently. “I think on Weibo you start building the
brand awareness and then you get into WeChat to build more depth and to
connect,” says Craig.
WeChat is a one-on-one mobile-only messaging platform similar to WhatsApp.
While brands are on it, you have to subscribe to that brand in order to see its
posts, which end up in your feed of messages so that, unlike Weibo, there’s no
chance of you missing the post. “WeChat is especially important given the fact
that pretty much everyone in China with a mobile phone has it,” explains Flora.
“If a brand can get a user to follow it on WeChat, it has a direct line to reach
them through an app they’re checking constantly throughout the day.”
It also has a lot of different features that brands can utilize. Capabilities
include payment, customized apps within the app, GPS locators, live chats and
more. “It’s a one stop device for everything Chinese consumers need so that’s
why you’re seeing a lot of activity move there,” adds Bailey. While Western
brands may not be using those capabilities, such as payment, to the extent that
they could be — “that’s where we see some of the local brands being more
innovative,” she notes — many of them are using WeChat as a customer service
tool.
For example, say you text a question about dry skin to a skincare brand: it
would have the capability to recognize key words and automatically respond with
a product recommendation. Or if you ping a brand your location, it can send you
nearby store locations.
Otte employs a social media manager for Asia under the WeChat handle “Otte
Girl,” who personally responds to every single private message she gets. The
retailer will also pose questions to its subscribers. “We do a lot of things
that are polls, so, ‘Which color do you like better: navy or brown? Which color
should the buyers buy?’” says Zhang. “Not only does that help us get an
understanding of what the market is like, but it’s also an opportunity for our
customers to voice their opinions and they love that.”
Burberry partnered with WeChat last February to create its own WeChat apps
around its fall 2014 runway show. One feature included the ability to experience
the show live from the perspective of a front rower, including Chinese actress
Angelababy, who provided audio commentary. Similarly, Michael Kors used WeChat
to give live updates from a huge runway show it held to promote its Beijing
store opening. You could even pan around the show through your phone á la Google
Street View, except live. In tandem with its football-themed New York Fashion
Week show, Tommy Hilfiger launched an app called H5, which allowed subscribers
to create, customize and share their own American football-inspired playing
cards.
A few brands have gone so far as to create actual games. Yoox has a game
where users can generate recommendations by shaking their phones. Coach launched
one around Chinese New Year inspired by an existing WeChat game called “Red
Envelope,” through which users can send each other money gifts. In Coach’s
version, users sent each other virtual gift vouchers for Coach items.
There's no doubt that Western fashion brands are still trying to figure out
WeChat and its many, many features. But there's also no doubt that with over
1.12 billion registered users and 500 million active users (and counting), it
can be an extremely powerful tool when used well. A recent study deemed WeChat
the most influential platform for Chinese luxury consumers. Once a brand has a
large fanbase that is also loyal enough to subscribe it on WeChat, the
possibilities are seemingly endless.