Long ago, people in China would have to visit a stylish and stylish mall for luxury shopping. It quickly changes as high-end brands are competing to embrace digital channels, which are not just the obvious options for e-commerce platforms or brand-owned websites. In China, Louis Vuitton, Cartier, Bulgari and other luxury brands now join millions of customers through WeChat .
Many people know of WeChat as China's largest messaging program and perhaps how it has become an all-in-one ecosystem that lets a chat, run, hire, and deal with an endless list of things. Now you can see how many different products people can get on WeChat can include a $ 1
The trend, according to Pablo Mauron, partner and CEO of China at Digital Luxury Group, a luxury market company, reflects WeChat's great potential as an app tailored to transactions and services.
"I think WeChat is finally what it should be for luxury brands, which is not just a social media app," said Mauron TechCrunch over a phone call. "A [function] may be for customers to buy the product. Another may be for trademarks to build a loyalty program. Customers can pre-order a product or create an agreement with the store [offline]."
According to a new report from the market research firm Gartner L2 has 60% of the luxury branded brands examined at least have a WeChat store rising from just 36% in 2018.
As Facebook, WeChat allows companies to create their online stores. The Chinese app now has more than 1 billion monthly users, but these people cannot be used as customers. WeChat, unlike Alibaba, is not a marketplace and has no central search engine that indexes all merchants selling over their platform.
Thus, a WeChat store is more comparable to an online store – it is in the online universe but requires a lot of marketing before consumers stumble across it. People can discover Wechat stores by scanning a QR code at a brick outlet, clicking on an ad embedded in an online article, or through a variety of other creative ways the merchants think.
Despite Challenges in Road Traffic, the WeChat stores have great appeal to brands because they offer a large toolbox to increase customer loyalty, Mauron observed.
For example, shoppers can talk to buying assistants over WeChat or checking membership status with a few cranes on the screen. It is WeChat's social skills that distinguish it from anchored e-commerce candidates such as Alibaba and JD.com, which focus more on transactions. In one way, WeChat does not directly take Alibaba but plays a complementary role by providing customer relationships (CRM).
A Many of these service-oriented features are powered by so-called "mini-programs", which are essentially discontinued versions of domestic apps that runs within a super app like WeChat. As the Gartner L2 report points out, the rise in WeChat business uptake is linked to increased use of luxury brand mini-programs.
In total, the brands in the test group read with at least one gadget. The degree of admission among fashion-focused luxury brands increased from 40% in 2018 to 70% in 2019, while the watch and jewelry category rose from 36% to 62% during the same period.
"WeChat becomes the most appealing option for brands who want to think about CRM, e-commerce strategies or simply other value-added services without having to rely on external partners," Mauron suggested, referring to Alibaba, JD and others traditionally the more popular choices for digital sales. 19659008] From Social to Shopping
While WeChat sets some rules on sellers, it's built up a reputation for being more laissez-faire compared to conventional e-commerce companies. For one, WeChat doesn't take (yet) commissions from e-commerce transactions that online marketplaces normally do. As Mauron noted, "Tencent's business model is not so much about making money from the gadget transactions."
On the other hand, WeChat's e-wallet WeChat Pay has the benefits of processing transactions that happen within the chat program where Alibaba's Alipay is not available.
It's an important development because WeChat Pay has been most associated with micropayments thanks to a series of early campaigns that encouraged people to send cash-packed digital packages to each other, a tradition deeply rooted in a culture of money exchange during holidays.
However, Alipay is more widely used for online shopping considering its links to Alibaba.
However, with the emergence of mini app-enabled e-commerce, people are starting to use WeChat Pay for the purchase of large goods.
"This allows WeChat to take market share in online payments. It is the second major battle between Alipay and WeChat Pay," says Mauron.
In January, Alipay had at least 1 billion active users through its own app and mobile wallet partners around the world. WeChat does not break the user number of its e-wallet, but the daily transaction volume went 1 billion in 2018.