Social Commerce Rules in China
China’s brands have achieved conversion rates of almost 30 percent by partnering with social influencers and participating in live-stream shopping—an experience combining instant product purchases with audience participation through chats and reaction buttons.
This led to a 30 percent conversion rate in social commerce, compared to an average of 3 percent in traditional eCommerce. 10 times more! Chinese consumers spent $352 billion (or 13 percent of the total ecommerce sales) in social ecommerce, more then 2x of $132 billion (or 5 percent of total ecommerce sales) spent last year.
In some categories, they seem to work very well, Like the social-commerce leader TikTok (known as Douyin in China) is particularly successful in the apparel industry. The apparel sales on Douyin made up more than half of Tmall’s total sales in 2021, with most of those sales coming from social commerce, including live auctions.
The gamification of product purchasing and a powerful social element with other live users, building rapport and trust, and a sense of community and loyalty—social ecommerce feels a lot more “personal” than the traditional ecommerce.
A unique aspect of the Chinese ecommerce ecosystem are the Key Opinion Leaders (KOLs) and Key Opinion Consumers (KOCs).
KOLs are the subject matter experts in their niches with a massive number of followers and the power to sell thousands of dollars worth of products literally within hours. An example of a KOL would be Doudou Babe with more than 13 million followers on Douyin (TikTok) and brand partnerships with Chanel, Charlotte Tilbury, Lancôme, and YSL.
KOCs have their personal networks where they drive the promotion of a new product through organic, word-of-mouth recommendations. Perfect Diary, a rapidly-growing Chinese-based beauty brand, regularly does giveaways and engages with thousands of users on product review sites, and has grown its own network of KOCs.
However, some unique factors favored the growth of social e-commerce in China.
For example, China has around 1 billion internet users with a high amount of eCommerce base. Alibaba and Tencent paved the way by building trust in eCommerce among consumers who also saw economic growth at the time of the internet revolution in China.
Here’s how the growth of social commerce has been over the years, with the help of live commerce.
