What’s the Story?

Singles’ Day, also known Alibaba’s 11.11 Global Shopping Festival (or Double 11), has become China’s most important e-commerce shopping festival, with consumers flocking to the site to take advantage of sales promotions. Now that the coronavirus lockdown has lifted, many brands and retailers are looking for opportunities to hit new revenue targets during this upcoming shopping event.

From now until November, merchants (including brands, retailers and other sellers on Tmall) can actively prepare for Singles’ Day by drive online traffic to their Tmall stores. In this report, we highlight three key ways in which merchants can use Weitao—Alibaba’s built-in social feed for Tmall and Taobao—to connect with potential shoppers.

[caption id="attachment_114294" align="aligncenter" width="700"] Source: Coresight Research[/caption]  

Why It Matters

Singles’ Day: An Opportunity That Brands and Retailers Should Not Ignore

Gross merchandise volume on Singles’ Day 2019 reached $38.4 billion across Alibaba’s platforms, with roughly 200,000 domestic and overseas brands participating in the event. This represents growth of 25.7% compared to the previous year and a huge 235% CAGR over the past ten years.

The profound effects of the crisis on the economy and labor market are likely to inhibit consumer demand in European and US markets over the remainder of the year, even with lockdowns now being eased in many countries. Given the depressed demand in Western markets, Singles’ Day could help retailers to mitigate the impact of the coronavirus pandemic, as well as what may be a very weak holiday period. Companies selling discretionary goods could take advantage of this global shopping event to clear inventories through access non-Western markets—as long as products still have relevance. The use of social commerce platforms such as Weitao can help to optimize inventory clearance and sales outcomes for retailers.

Social Commerce in China

Social commerce encompasses retail through social media and other forms of social buying where social participation is prominent. The market is booming in China; it is estimated to grow from $149.0 billion in 2019 to $341.6 billion in 2022, representing 129% growth, according to financial firm Tianfeng. The firm estimates that the Chinese e-commerce market will reach ¥15 trillion (around $2.2 trillion) in 2022; social commerce will therefore make up an estimated 15.5% of total e-commerce sales in 2022. This partly reflects the huge number of Internet users in China—amounting to 904 million as of March 2020, which is close to 64.6% of the nation’s population.

[caption id="attachment_114295" align="aligncenter" width="700"] Source: Tianfeng[/caption]  

We expect the combination of Singles’ Day and social commerce—both high-growth segments within Chinese retail—to have an amplifying effect, with brands and retailers able to drive sales growth higher by engaging in social commerce for Singles’ Day. Brands and retailers should actively conduct social selling during the Singles’ Day sales period to promote their products.

Weitao: Alibaba’s Integrated Social-Selling Platform

To make it easier for brands and retailers to access social commerce, Alibaba launched its own built-in social selling platform, Weitao, in 2013. The content-oriented platform is built with social feeds similar to Weibo—China’s largest micro-blogging platform. Weitao is integrated into the Taobao mobile app and can be accessed from the app’s homepage. When shoppers open the Taobao app and click on the Weitao icon in the navigation bar at the bottom of the screen, they will be directed to the Weitao homepage. The homepage feed shows text, image and video content from brands, merchants and influencers that the user follows.

[caption id="attachment_114296" align="aligncenter" width="500"] Weitao’s window on Taobao (left); Newsfeed on Weitao (right)
Source: Taobao/Weitao[/caption]  

Users can also locate a specific brand’s Weitao content through the brand’s Taobao or Tmall store page. The icon is located on the navigation bar at the bottom of the screen.

[caption id="attachment_114297" align="aligncenter" width="250"] Weitao’s window on the Tmall storefront
Source: Tmall[/caption]  

Weitao has become an increasingly significant marketing platform for brands with online stores on Taobao or Tmall to increase their e-commerce sales and promote their own stores. Brands can post content which directs users to designated product pages on Tmall and Taobao to promote social selling—and influencers can also register an account on Weitao to help brands to promote products. Weitao users can find and read content, which is mainly related to product endorsements shared by brands or influencers.

Weitao Marketing

Weitao provides a platform for brands to tell their stories and raise brand awareness. Below, we highlight three key ways in which merchants can use Weitao to connect with potential shoppers (as summarized in Figure 1).

1. Produce Short-Format Video Content

The main marketing goal for brands on Weitao is to build their follower base and then to convert their followers into customers and actual sales. Content marketing is the core promotional strategy on Weitao. Brands should aim to create promotional content for Weitao that resonates with their target audience.

Content that has a short-video format typically receives higher attention from viewers than we would expect from content that simply comprises images and text. For instance, one influencer’s recent short-video post about a couple playing a drawing game to market stationery products received 20,000 likes, 2,435 shares and 355 comments within one day of posting.

[caption id="attachment_114298" align="aligncenter" width="250"] A short video about a couple playing a drawing game to market stationery
Source: Weitao[/caption]  

By contrast, we have seen brands post non-video content that has failed to capture the attention of Weitao users:

• Beauty retailer Nasaier’s flagship store published a post about Lastar perfume with elegant pictures and text on August 3, 2020. It received 38 views and no likes or comments by August 5.
• Snack brand Liangpinpuzi’s post about its milk tea product—made up of pictures and text—gained 430 views, two likes and zero comments within one day, as of August 7.

[caption id="attachment_114299" align="aligncenter" width="250"] Nasaier’s Weitao post about Lastar perfume
Source: Weitao[/caption]  

Brands and retailers should therefore look to create engaging short videos to maximize the potential reach and popularity of their posts. Although we have seen examples of non-video posts garnering low engagement, brands could use images and text to bolster their content—and thus online presence—but the key is for that content to be relevant and appealing to the brand’s target audience. Testing different types of content to inform their marketing approach could prove fruitful for brands that wish to establish themselves on Weitao over the long term.

2. Work with Influencers

Brands can use Weitao influencers to grow visibility and drive conversion on Tmall and Taobao. Influencers, key opinion leaders (KOLs) and celebrities have become a driver of consumer purchases, especially among young consumers who may look to influencers for style inspiration and product recommendations.

One benefit of influencer-led marketing is the perceived credibility of influencers that brands do not always share. Influencers claim that they are connected to their audiences and give honest opinions and reviews of products, which demonstrates authenticity and drives conversion rates.

Influencers often provide educational content such as instructional videos or product application tips; this is especially popular the beauty category. For instance, Yegongzi, a KOL on Weitao, demonstrated the application of beauty products—including NARS blush and Giorgio Armani lipstick—in a 12-second short-format video to her 1.1 million followers. The video content received 1 million views, 2,642 likes and 119 comments within 24 hours of its release on August 5, 2020.

[caption id="attachment_114300" align="aligncenter" width="250"] KOL Yegongzi’s short video demonstrating the use of NARS blush and Giorgio Armani lipstick
Source: Weitao[/caption]  

Launching campaigns is another key aspect of Weitao marketing that engages users and encourages them to share brand content with their social network, which ultimately boosts visibility and sales.

There are three main types of Weitao campaign:

• Giveaway campaigns—Brands invite users to like, comment on and share a promotional post with the promise of rewards for doing so, such as product samples and coupons.
• User-generated-content (UGC) campaigns—Brands can ask shoppers to share their shopping wish list for the brand’s store.
• Official sales events—Brands can take advantage of shopping festivals and promotions organized by the platform, such as Singles’ Day.

Brands can organize regular campaigns to attract new followers and retain the attention of existing followers. Weitao has added some functionality that allows brands to make their online campaigns more interactive—for instance, with minimal effort, brands can set up a buyer show function that allows users to showcase their purchased products. By participating in the buyer show, shoppers will be able to win prizes, such as coupons and vouchers. Brands can use this function for giveaway campaigns and UGC campaigns as well as sales events.

[caption id="attachment_114301" align="aligncenter" width="500"] Apparel brand Lily’s new product page on Weitao with its buyer show invites (left) and benefits of joining the buyer show (right)
Source: Weitao[/caption]  

What We Think

Implications for Brands and Retailers

• Brands and retailers across a range of categories, such as beauty, fashion and grocery, should look to build their exposure on Alibaba’s social commerce platform, Weitao, ahead of Singles’ Day, so as to draw more shoppers to their storefronts on November 11.
• Weitao can be used as part of a multichannel social marketing strategy spanning various platforms, with popular choices including Weibo and short-video platform Douyin.
• As Alibaba’s built-in social feed for Tmall and Taobao, brands can take advantage of Weitao’s existing customer base.   
• Brands can produce curated content to build their follower base and ultimately convert their followers into customers and actual sales. On average, short-format videos appear to generate the best engagement.
• Brands and merchants can also partner with Weitao influencers to grow visibility and drive conversion on Tmall and Taobao. As influencers have become a driver of consumer purchases—especially among young consumers—brands can leverage their credibility and follower base to boost campaigns.