China News This Week: Wednesday 17 August 2022
This week's news and trends in China:
Digital China
Infographic: China's KOL Ecosystem: A comprehensive view of China's KOL ecosystem and the interconnectedness between KOLs, brands, platforms and the user.
Tencent Accelerates the Development of its One-Stop Live Shopping Platform, Will it be Able to Compete with Douyin?: The WeChat Channels Store was released by Tencent on July 21, further challenging Douyin's live streaming ecommerce business. The debut of the new service is designed to replace the previous online store based on WeChat, making sellers more dependent on "WeChat Channels," which features short videos and live streaming. The short video service had 500 million daily active users in 2021, a 79% increase over the previous year, using it for 35 minutes a day, an 84% increase over 2020 but less than a third of the time spent on Douyin and Kuaishou.
Don’t You Dare Say "WeChat": Facing strict curbs on social media, Chinese users have long used creative wordplay such as homonyms and intentionally misspelled words to tiptoe around censorship. Beside political no-nos, there are also commercial rules. On Douyin, livestreamers cannot reportedly say "WeChat" or "friend circle," or even "limited time offer" and "money making" are banned phrases. Don't mention the "pandemic situation" or "country" either.
Food & Beverage
'Chinese Demand for Beef Set to Remain Firm, Outlook for Sheepmeat Less Rosy': The impact of Covid has changed consumption habits in China, which has impacted meat sales in the country. Beef sellers have been able to successfully shift a portion of sales from food service to the retail channel, whereas lamb meat is predominantly sold through restaurants.
How to Verify and Label Vegetarian, Vegan, and Plant-Based Products in China: As the appetite for animal-free products and alternative proteins grows, effective labelling and marketing are crucial to getting through to the right consumers. There are currently limited requirements on the labelling and certification of vegetarian, vegan, and plant-based products in China, providing challenges for which standards to follow and how to certify products. 62% of Chinese consumers are "very or extremely likely to purchase plant-based meat regularly" versus 33% in the US according to the Good Food Institute.
China's New Iron Chefs: Robots and AI Dish Out $4 menus in Shanghai: The menu is extensive, boasting between 10 and 20 items depending on the day, including classic dishes such as celery and shrimp stir-fry and chopped edamame and chicken. While robots provide the muscle at the canteen, AI programs give it the brains by crunching customer traffic and other historical data to decide what menu items to make available on a specific day. Human hands are still needed to wash utensils and dispose of wastewater - at least we're still good for something!
Travel
Flight Bookings to Hong Kong Surge 249% After Quarantine Cut: The number of bookings for flights to Hong Kong on Trip.com increased 249% from a day earlier, after quarantine was cut from 7 to 3 days. Many mainland residents come through the city as it’s the easiest way to reach China because international flights to the country are rare and costly.
Hyatt, BTG Plan New Brand for China: Hyatt and BTG affiliate Homeinns formed a joint venture to create an upper-midscale brand in the under-served segment in China, to capitalise on the country's expanding travel and tourism market.
Health
Chinese Medical Portal Censored After Doubting Herbal 'COVID Remedy': Chinese health information provider, DXY, valued at more than $1 billion with backers like Tencent, has had at least five of its Weibo accounts banned after questioning the value of a Traditional Chinese Medicine, Lianhau Qingwen, as a Covid treatment. The herbal remedy is typically marketed for fever and sore throat treatment and contains ingredients like honeysuckle and apricot seeds.
Fashion
H&M Returns to Alibaba's Tmall, 16 Months After Xinjiang Controversy: Tmall and many other Chinese platforms and apps scrubbed references to the fashion brand when it was revealed that H&M had pledged not to source cotton from China's far western Xinjiang region. It was not clear what prompted the reopening. H&M had more than 500 stores in mainland China early last year but its website currently only lists 375.
Education
China Tried to Ban Private Tutoring. It Created a Huge Black Market: Last year, China outlawed private academic tutoring in a bid to promote social equality. The result: a thriving network of underground study centres, serving the children of wealthy, well-connected families.
Banking
Global Markets Can Learn from China’s Success in Mobile Commerce, PayPal Survey Says: 47% of Chinese consumers pay for cross-border purchases using Alipay, with credit cards coming in second at only 34%.
Luxury
Why Luxury Brands are Increasingly Turning to Gifting in China: In 2022, the total number of gifts purchased by consumers born after 1995 outstripped that of those born after 1985 for the first time. During the Qixi Festival - Chinese Valentine's Day - the portion of men making gift purchases rose from 57% in 2021 to 70% in 2022. Bags and jewellery remained core categories for gifting. Home furniture gifting rose by more than three digits year-over-year.
$24,470 Hermes Bicycle Sold Out in Chinese Mainland Signals Potential of the Market: A French-made Hermes bicycle inspired by a Japanese-style portable bicycle, listed at ¥165,000 ($24K) has sold out from Hermes stores in China. Original stock numbers are unreported. Louis Vuitton, Chanel, Gucci and TOD's have also produced limited edition bicycles.
