How does Tencent continually connect with China’s ever-changing consumer?

To understand the breadth of opportunity in China’s digital ecosystem, it helps to look at how much the landscape has changed in recent years. During the recent launch of the the 2019 China True- Luxury Playbook, a research project between Tencent Marketing Solution and Boston Consulting Group, at the Cannes Lions International Festival of Creativity, Kiki Fan, GM of Sales and Operation of Key Accounts at Tencent Marketing Solution, broke down this evolution into three distinct ‘eras’. 

20 years ago was the ‘era of location’, during which a brand’s success relied on the position of its store or where its products sat on the supermarket shelves, she explained. This evolved into the ‘era of product’, a time of greater choice driven by the rise of e-commerce. Now, however, we are living in the ‘era of people’, when consumers and their choices drive everything a brand does — and Tencent Marketing Solution has a broad and sophisticated suite of tools to help them win more customers, target them with personalised content and boost engagement in this environment.

The aim is for 'all the dots' on the consumer’s shopping pathway to be connected, explains Fan. This means thinking about the whole cycle of their experience and tailoring appropriate messaging for them at every stage, whether online or off. 

“Most brands don’t pay attention to offline traffic,” pointed out Fan. “But we are promoting that very heavily because we really believe that that type of traffic is worth a lot of attention. A customer walking into a shop means they are highly interested in the brand. The challenge is how to on-board these interested people as engaged customers.”

“In China people are no longer buying SKUs, they are buying ‘look and feel'," says Fan

Data is a critical component in solving this challenge. While the data a brand owns on its consumers used to be scattered and disconnected, Tencent’s solutions now enable brands to get a clear understanding, said Fan. So when a person walks into a shop, or engages with a brand on any digital channel, the brand will know exactly who they are and what they like.

Tencent suggests 'repurposing' sales reps, who typically have less to do in physical stores now that offline traffic is declining. While such reps used to be considered ‘heritage’ for some companies, now they can represent a hurdle for moving forward. “How can we improve efficiency and improve the communication between sales reps and brand VIPs?” asked Fan.

Mini Programmes are one answer, she said. These are sub-applications within Tencent’s WeChat, the most popular app in China, which is used for everything from social messaging and following KOLs and influencers to paying for products and services. Brands investing in and selling through Mini Programmes, whether on the internet or through a sales assistant in a shop, is on the rise, she said. 

“Sales reps can open the Mini Programmes and find daily tasks, like how many customers they should send birthday greeting cards to, or how many customers are about to reach their lifetime value and should be reminded about this.” 

Mini Programmes can also tell people about new season products, share with them the best matches, top fashion SKUs or pictures of celebrities wearing the same SKUs, she continued.  “In China people are no longer buying SKUs, they are buying ‘look and feel’. So that's the reason why we have very high quality pictures and video inserted within the Mini Programmes, all giving the right interpretation of the product's spirit which in the past promoters might not have had enough knowledge to do.” Fan believes the opportunities Mini Programmes offer to service consumers, as well as to sell to them, are huge.

This applies in particular to luxury brands, which place a high premium on providing their customers with excellent, irreplaceable experiences. China’s luxury sector is growing at 6% and already makes up a third of the global market, found the Tencent Marketing Solution and BCG report. Through Mini Programmes, luxury consumers can experience the heritage and look and feel of the brand’s design without having to step into a physical store. 

Take a premium sector like liquor as another example. Brands like Hennessy are particularly successful at using Mini Programmes for after-sell services. Consumers used to accumulate points in order to consume more products, but nowadays, brands can use Mini Programmes to share other experiences they can spend their points on, like free tickets for top DJ parties hosted by the brand, for instance. “This creates a culture of encouragement, an affinity with the customer that they want to create to get the brand closer to them,” Fan says. The resulting data is fed into the back end to continuously improve the shopping service.

Even mass categories like FMCG can benefit from Mini Programmes, Fan asserted, giving the example of a toothpaste company she visited recently. She suggested that the company raise its offering to include 'oral care' and build broader incentives such as free dental examinations for children into its offer to attract families.

Such innovative ideas are par for the course for Tencent Marketing Solution's team of experts, who are deeply plugged into China’s ever-changing, ever-nuanced consumer mindsets.