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Mastering product marketing in China: the effective storytelling for brands success
Co-branding, product packaging, online marketing, and KOL partnerships
When it comes to global marketing opportunities, the vast consumer base in China stands out. Marketing for international brands in the Chinese market is crucial because China is one of the largest consumer markets in the world, with a huge population and a growing middle class. For instance, we've seen the local brand Proya outperform the online sales and growth rate of the global titan L'Oréal. This success is attributed primarily to Proya's adept product marketing strategies, underscoring that an insightful and locally tailored approach can yield significant market share, even against well-established competitors. Thus, product marketing proves to be a pivotal factor for brands aiming to thrive within the competitive landscape of China.
The key to successfully entering the Chinese consumer market lies in applying a global mindset. The most significant reflection of a global mindset is the ability of companies to adapt to the culture and language of the countries they enter, and to consciously localize their marketing strategies, thereby generating strong cross-cultural communication.
In this post, we will review effective marketing strategies specifically tailored for the mainland China market. This will enable you to stay updated on the latest developments in product marketing in mainland China.
The collaboration trend: Co-branding 联名
One of the popular marketing tactics in China in recent years is co-branding. The success of co-branding marketing in China is closely related to several factors including culture, market dynamics, and business strategy. For example, the recent collaboration between Luckin Coffee and Maotai, resulting in the co-branded "Sauce Fragrance Latte," is a great example. Luckin Coffee and Maotai Group are both well-known brands in China, and their collaboration has garnered widespread attention.
Consumers tend to trust well-known brands more, which increases the attractiveness of the product. Maotai is renowned for its premium baijiu liquor, which caters to professionals and business customers. On the other hand, Luckin Coffee offers coffee at a relatively affordable price, targeting young office workers. The co-branded Sauce Fragrance Latte combines two different categories, creating a unique taste that appeals to consumers from different backgrounds. Especially for Chinese workers. They also chose the popular marketing phrase "早c晚A", which has become quite popular among the new generation of workers. Its true meaning is in the morning, the need for Coffee to stay awake and start the day of studying and working; in the evening, the need for Alcohol to help sleep and end a day of hard work and tired studying. This collaborative product perfectly embodies this viewpoint.
The Sauce Fragrance Latte incorporates Maotai's sauce fragrance liquor, which is associated with Chinese culture and tradition. This cultural element gives the product a unique regional and emotional value, attracting consumers' emotional resonance. The Sauce Fragrance Latte is released in limited quantities, meaning there is only a certain number of products available for purchase. This limited edition and exclusivity stimulate consumers' purchasing interest as they desire to own a unique product.
Co-branding strategies, like the partnership between Luckin Coffee and Maotai in China, prioritize social media as a means to target the highly active younger generation of consumers in China. Through extensive promotion and advertising on social media platforms, awareness of the co-branded product is significantly increased. The positioning of the Sauce Fragrance Latte appeals to China's younger generation of consumers, who have high expectations for fashion, innovation, and brands. The product meets their needs and preferences.
Several other important co-branding events have happened in China’s consumer market in 2023. And some have contributed to significant market sensation. For instance, MINISO, one of the most successful Chinese corporations to expand both domestically and globally, launched successful co-branding products with Barbie in 2023. Within the first five days of the launch, half of the Barbie items were sold out.
Consumer brands in China are also exploring cross-sector co-branding opportunities. For example, Heytea, one of the largest tea drink chains in China, has partnered with luxury brands Fendi and even Tesla.
This collaboration between Heytea and Tesla offers consumers the opportunity to enter a prize draw for Tesla test drives, while also promoting Heytea's cherry beverage.
Product marketing is greater than the product itself. Many consumers do not care about the internal aspects, only the packaging. For example, the mentioned collaboration between Luckin and Maotai not only created a new product but also designed co-branded packaging specifically to attract consumers. These include a Maotai-themed cup sleeve and paper bag, accompanied by co-branded stickers. Customers who purchase two or more products within a limited time will receive the co-branded stickers for free. By purchasing these items, customers will have unique merchandise. Packaging plays a crucial role in marketing as it is not just the appearance of the product, but also involves brand communication, consumer attraction, and sales success.
Luckin Coffee, along with many other coffee and beverage chains in China, has created a mobile application that enables users to conveniently browse the menu, place orders, make payments, and enjoy their coffee. The application provides a convenient user experience and encourages frequent use. Luckin Coffee allows customers to place orders offline through its mobile application and then provides delivery services. This allows users to enjoy their favorite coffee at home or in the office, increasing convenience. Luckin Coffee regularly launches promotions and discounts on its application to attract consumers to place orders. These promotional activities usually include buying one get one free, discounts on minimum purchases, and coupons. Luckin Coffee has established a membership program to reward loyal customers. Members can accumulate points and receive free drinks or other benefits.
For instance, one of Luckin's signature coupon programs allows consumers to enjoy a cup of Americano or Latte for only 9.9 Yuan (approximately 1.3 USD) once a week. This program has been particularly successful among office workers, who have incorporated it into their weekly routines.
In addition, Luckin Coffee conducts advertising and promotion through social media platforms such as Weibo, WeChat, and Douyin. They post attractive photos and videos to attract young audiences. The brand's online marketing mainly focuses on collaborating with influential individuals. During the announcement of new products, they collaborate with celebrities and top KOLs to generate excitement. Collaborative notes are mainly in video format. Non-collaborative videos attract attention through "lotteries" and "spokespersons".
On major Chinese social media channels, we have observed that Luckin Coffee consistently maintains the highest exposure compared to other competitors in the market.
KOLs are influential individuals in a specific field, with a wide audience and loyal fans within that field. Collaborating with KOLs can bring many benefits to your brand, as the content created by them can effectively convey the brand's message to the target audience.
For example, the newly launched brand Luckin Coffee targeted young professionals and enlisted Zhen Zhang and Wei Tang as brand ambassadors, successfully attracting the attention of the young working population. However, targeting only the youth market was not enough for Luckin Coffee, so they quickly changed their ambassadors. In 2021, Luckin Coffee found the perfect brand ambassador for young professionals in the popular rising star Luxiu Li, who gained fame on the internet with his image of not wanting to work and just wanting to go home on the show "Produce Camp 2021". This image resonated strongly with young working individuals and brought a wave of attention to the brand. Luckin Coffee's consideration of ambassadors is also reflected in its ability to predict viral trends.
In early 2021, they signed Elieen Gu ahead of the 2022 Beijing Winter Olympics. This decision was based on the anticipation of her popularity during the event, which would provide high levels of exposure at a relatively low cost. This also means that consumers will see a professional, youthful, and energetic brand image to attract a large wave of young people and significantly contribute to the brand's rejuvenation.
Recently, news of Xiang Luo endorsing Luckin Coffee caused a heated discussion on the internet, even trending on hot search lists. Criminal law professor Luo Xiang, known for his entertaining and educational video lectures on Bilibili, has garnered nearly 30 million followers. His videos blend humor and complex criminal law concepts, often using absurd case studies. Luo Xiang's unique teaching style has made him a viral sensation, despite not being an efficient way to prepare for the bar exam. This time, he will take on a new role as the spokesperson for Luckin Coffee, promoting their "Sauce Fragrance Latte" through legal education. It is hoped that through his legal knowledge, consumers will have a better understanding and acceptance of this product.
Online marketing, particularly collaborating with key opinion leaders (KOLs), has been a proven strategy to boost sales. However, it is not a foolproof strategy for guaranteed success.
The two sides of marketing
Hua Xi Zi is a well-known skincare brand in China, and recently its marketing strategy has showcased the dual nature of marketing. So, I want to use it as an example. Hua Xi Zi focuses on communicating brand stories and culture, emphasizing respect for nature and purity. This emotionally driven brand-building helps establish an emotional connection with consumers. Hua Xi Zi actively utilizes social media platforms and collaborates with fashion and beauty blogger Li Jiaqi to establish its brand presence on the internet. Jiaqi Li's influence on livestreaming sales and the promotion of domestic cosmetics are associated with Hua Xi Zi. When it comes to Hua Xi Zi, many people's first reaction is "the brand Jiaqi Li helped promote." At the end of September 2019, invited by Hua Xi Zi founder Mantian Hua, Jiaqi Li became the chief brand recommend officer for Hua Xi Zi. During that year's Double Eleven shopping festival, Hua Xi Zi's Air Loose Powder contributed to a crazy sales volume of 700,000 boxes.
On September 11th, it started with a consumer commenting in the livestream room: "Hua Xi Zi is becoming more and more expensive." The response of "What's expensive? Look for your own reasons" brought Jiaqi Li down from his pedestal and shattered Hua Xi Zi's dream of making a fortune. Hua Xi Zi's eyebrow pencil was priced at 79 Chinese yuan for only 0.07g, which sparked a huge controversy. As a result, the "Hua Xi Coin" was born and was treated by workers as a new unit of currency, becoming popular across the internet. Data shows that Hua Xi Zi previously had an average daily sale of 2.5 million yuan, with the highest reaching tens of millions. After the eyebrow pencil incident, sales plummeted to less than 100,000. Jiaqi Li's livestream incident led to a drastic decrease in sales and several days of suspension.
The widespread use of social media can also bring negative impacts, such as negative comments or the spread of negative news. Brands need to actively manage the risks associated with social media to gain the love of consumers.