Multiplicity: All about Expanding your Product Line
How China is changing the future of shopping
December 23, 2017
TED Talks: How China is changing the future of shopping. Angela Wang (Recorded October 2017)
In the age of borderless commerce, there are many notable economic developments in every part of the world. China is a huge laboratory of innovation, says retail expert Angela Wang, and in this lab, everything takes place on people's phones. Below are eight takeaways from this inspiring talk about new business-as-usual, everything is ultra-convenient, ultra-flexible and ultra-social macrocosm.
Top 8 Takeaways:
1. Mobile -- is the way to do business
Mobile reigns supreme over the retail space. Five hundred million Chinese consumers -- the equivalent of the combined populations of the US, UK and Germany -- regularly make purchases via mobile platforms, even in brick-and-mortar stores.
For US, the mobile retail commerce sales are expected to reach nearly 50% by 2020 according to Statista.com.
2. Ultraconvenience -- is how you get more orders and customers
By leveraging native ads on popular social media platforms, merchandises can be easily purchased without significant disruptions to the site visitors.
"..if you give them ultraconvenience that really works in grocery shopping, they're going to switch their shopping behaviors online, like, in no time." Angela predicated.
3. Social shopping -- is how you can be sticky
A typical linear process of social shopping is -- you pick up something on Facebook, watch it, and you switch to Amazon or brand.com to complete the shopping journey. Clean and simple. But in China it is a very different thing. The social shopping experience is formed by a web of bewildering pop-ups and persuasive enticements. The example that Angela gave was "I was having a chat in a WeChat chatroom with my friends. One of them took out a pack of snack and posted the product link in that chatroom. I hate it, because usually I would just click that link and then land on the product page. Lots of information, very colorful, mind-blowing. Of course I bought that pack of snack."
"The whole experience is like you're exploring in an amusement park. It is chaotic, it is fun and it's even a little bit addictive. This is what's happening when you have this integrated ecosystem. Shopping is embedded in social, and social is evolving into a multidimensional experience. The integration of ecosystems reaches a whole new level. So does its dominance in all aspects of our life.", Angela concluded.
4. Low cost and on time delivery -- is the norm, not the exception
Followed by the social shopping event, Angela continued, "What is more beautiful is I know that the next day, around noontime, that pack of snack will be delivered to my office. I can eat it and share it with my colleagues and the cost of delivery, maximum one dollar."
5. High-speed delivery -- is a serious race for businesses
An oft-quoted line from 'Top Gun': "I feel the need, the need for speed", Hema, a retail grocery concept developed by Alibaba, they set to deliver a full basket of products from 4,000 SKUs to their customer's doorstep within 30 minutes. What is amazing is that they deliver literally everything: fruits, vegetables, live fish and even live Alaska king crab. Hema is part of the Alibaba ecosystem makes it faster and also a bit easier to implement. For an online grocery player, it is very difficult, very costly, to deliver a full basket quickly, but for Hema, it's got a mobile app, it's got mobile payment, and also it's built 20 physical stores in high-density areas in Shanghai. These stores are built to ensure the freshness of the product -- they actually have fish tanks in the store -- and also to give locations that will enable high-speed delivery.
6. Quick feedback and fast response - are the ways to beat the competition
An owner of a fashion company told me that he's so frustrated, because his customers keep complaining that his products are not new enough. So I told him there's something more important than that. You've got to give your consumer exactly what they want when they still want it. The online apparel players in China, they collect real consumer feedback from mobile sites, from social media, and then their designers will translate this information into product ideas, and then send them to micro-studios for production. The fact that all these production designs are done locally, the whole process, from transporting to product on shelf or online sometimes takes only three to four days. That is super fast, and that is highly responsive to what is in and hot on the market. And that is giving enormous headaches to traditional retailers who are only thinking about a few collections a year.
7. Virtual shopping assistants -- are your customers' virtual friends
A Chinese snack company, Three Squirrels, built a half-a-billion-dollar business in just three years by investing in 300 to 500 shop assistants who are going to be online to provide services 24/7. In the social media environment, they are like your neighborhood friends. Even when you are not buying stuff, they will be happy to just tell you a few jokes and make you happy. In this integrated ecosystem, social media can really redefine the relationship between brand, retailer and consumer.
8. Experimentation - is the key to survival
In this huge laboratory, a lot of experiments are generated every single day. The ecosystems are reforming, supply chain distribution, marketing, product innovation, everything. Consumers are getting the power to decide what they want to buy, when they want to buy it, how they want to buy it, how they want to social. It is now back to business leaders of the world to really open their eyes, see what's happening in China, think about it and take actions.
“You can’t wait for customers to come to you. You have to figure out where they are, go there and bring them back to your store.” ~ Paul Graham, Y COMBINATOR