As short videos shared on social media and celebrity livestream broadcasts take up a growing share of Chinese web users’ attention, luxury brands are shifting their online video investment away from old-school, YouTube-like platform Youku and toward China’s hottest new formats.
L2’s newly released Digital IQ Index: Luxury China finds that while adoption of WeChat and Weibo remains nearly ubiquitous among Index Luxury brands, the number of brands active on Youku is now lower than it was in 2014. The percentage of Luxury brands with Youku accounts declined from 85% in 2016 to 69% in 2017 among those indexed in the past four years. The percentage is even lower when counting all brands in the 2017 Index, with only 65% present on the platform. This is a far cry from what’s happening on Weibo and WeChat, which have both maintained adoption rates at 95 percent or higher among Luxury brands since last year.
While video is still a key online marketing tool for high-end labels, they’re opting for trendier, newer formats that are booming in China such as short video and livestreaming. Short video app Miaopai, for example, attracts an average of 73,700 more views than Youku for brands in the Watches & Jewelry category. The difference is even larger for Fashion brands, which receive an average of 140,412 more views on Miaopai than Youku. Unlike its American counterpart Vine, which met its untimely demise in 2016, Miaopai skyrocketed to 70 million daily active users by November 2016—up from 5 million the previous year. The app is also credited with having a significant role in the recent resurgence in popularity of Twitter-like Sina Weibo.
Luxury brands are also investing in marketing through China’s booming livestreaming platforms. Livestreaming has become so popular that it is now viewed by more than 47 percent of the country’s internet users, with luxury brands enlisting Chinese celebrities and KOLs to broadcast from branded events on platforms such as Yizhibo. For example, Bulgari’s livestream broadcast of the launch of its Octo Finissimo Automatic self-winding watch at Baselworld 2017 earned 24.8 million views on Yizhibo thanks to an appearance by ultra-famous Chinese pop star and actor Kris Wu. Wu appeared in several additional livestreams for the brand at Baselworld, including an interview with Bulgari’s CEO.
Adoption of these new video formats opens up a wider variety of e-commerce marketing opportunities for brands. Alibaba’s Tmall features its own livestreaming platform, which Tommy Hilfiger has used to broadcast “see now, buy now” fashion shows that allow users to click on the items to purchase from the brand’s Tmall shop. The platform also helped Folli Follie earn five times its average number of Tmall sales for the season after the brand held a livestream event featuring over 30 Chinese KOLs, showing that these platforms have the power not just to attract viewers, but to directly influence purchases.
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