Presentation on Building your Multi-channel eCommerce strategy in the China eCommerce Landscape - Brand eCommerce Platform - Wechat (Weixin) - Market Places (Tmall, JD, Amazon..)

1. 1
By Dominiek Pouwer
Date: January 26th, 2016
Building a Multi-channel Strategy through
Wechat eCommerce

2. 1. Stats
2. Channels
3. Strategy

3. 1. Stats

4. 4
1.1 Billion Registered Accounts
570 million Daily Active Users
Tencent, 2016
January 2016

5. 5
36% of Wechat Users are Female
65% of Wechat Users are Male
Male users spend 1.3x more time shopping on Wechat than female users
Tencent, 2015

6. 6
Social Media active users activated on eCommerce
0%
22.5%
45%
67.5%
90%
Wechat
SinaWeibo
Snapchat
Instagram
Facebookmessenger
Twitter
Pinterest
Youtube
Tumblr
Facebook
67%68%69%70%71%72%72%
76%
79%
83%
Global Web Index, 2015

7. 7
Wechat Penetration in China City tiers 2015
0%
25%
50%
75%
100%
First-tier cities Second-tier cities Third-tier cities Fourth-tier cities Fifth-tier cities
28%27%
43%
69%
93%
Tencent, 2015

8. 8
Types of Wechat Applications
0%
10%
20%
30%
40%
CustomDevelopment
CRM
IndustrialPlatform
OpenPlatform
WechatMall
WechatWebsite
EnterprisePlugin
Wechatplugin
SmartDevices
EnterpriseSoftware
8%9%
12%
15%
18%19%19%
21%22%
38%
Wemedia, 2014

9. 9
Main 3rd Party Mobile Payment players in China 2015
0%
20%
40%
60%
80%
Alipay
Tenpay
Bestpay
99bill
PingAnoay
Lakalapay
Yeepay
JDWallet
BaiduWallet
Lianlianpay
0.2%2.0%0.3%0.3%3.0%0.5%0.6%0.6%
18.0%
71.0%
Analysys, 2015

10. 10
Wechat Payment Usage in Different Industries
0%
7.5%
15%
22.5%
30%
E-Commerce
Catering
Hotel
Tourism
Wedding
RealEstate
Enterprise
Finance
Education
Medical
Government
Automotive
Other
1.6%2.2%2.5%2.8%3.3%3.8%4.2%4.8%
5.7%
9.1%
12.9%
17.6%
29.6%
Wemedia, 2014

11. 11
8.5 Million Public Accounts (January ’15)
25,000 new accounts per month
~17.5 Million Public Accounts (January ’16)
Tencent, Q1 2015

12. 12Tencent, 2015
> ¥10 million
1%
¥5 million - ¥10 million
1%
¥960k - ¥5 million
3%
¥100k - ¥960k
19%
<¥100k
29%
No Investment
47%
Investment
by SME on
Official Account
Management /
Features

13. Key Take Aways
๏ Wechat - Social Media channels with the highest shoppers
๏ Key cities - 1st and 2nd tier cities (BJ, SH, GZ, SZ, SZH, NJ, CQ, CD,
WH, TJ)
๏ Wechat users - Male Skewed
๏ Wechatpay has the highest adoption rate in eCommerce / Service
Industry
๏ Approx. 9 Million Public Account owners invest money / develop
custom features in Wechat
๏ Increased competition Public Account growing by 8% a month
13

14. 14
2. Channels

15. 15
eCommerce Channels
Brand eCommerce
website
B2C Platforms*/** B2C Multibrand
Retailers **
B2C Flash buy **
C2C Market places Social Commerce
Operation models:
*Direct sales - shop model
**Reseller - supplier model
Multi-channel Landscape

16. eCommerce Channels
Brand eCommerce
website
B2C Market
Place*/**
B2C Multibrand
Retailers **
B2C Flash buy **
C2C Market places Social Commerce
• Own Customer Data
• Own Marketing
Mechanisms
• Low-cost Online Media
(PPC, SEM)
• Long-term Strategy
• Organic - Natural
growth
• Large shopper base
• High traffic
• Least relevant
• Compete on price
• Shop / supplier model
• Middle Brand Identity
• Full / Partial Product
Catalog
• Social Commerce
• Own Customer Data
• Impulsive Buying
• Subscription Buying
• 100% Mobile Commerce
• High Brand Identity
• Limited SKU’s
• Targeted shopper base
• Relevant traffic
• Vertical
• Brand Eco system
• Higher Brand Identity
• Supplier model
• Limited Product Catalog
• Price-sensitive shopper
• Short-term High Volume
• Out-Of-Season / Stock
clearance
• Low Brand Identity
• Supplier model
• Limited Product Catalog
• Compete on price
• Fake products
• “No rules”

17. Wechat eCommerce
๏ Wechat Store can limited test the market
๏ Build a key Target Group
๏ Long-term CRM strategy
- Know who are your customers?
- Know what they want?
๏ eCommerce focusses on a specific occasion
- Impulsive Buying (discount, new)
- Subscription Buying
๏ User Experience
- Limited SKU’s
- Limited Screen Size for comparison (no multi-tab browsing)
17

18. 3rd party SaaS options
18
YouShop ( ), Youzan ( )
Pros:
Fast-time to market
Low cost option
Marketing tools
Wechat-ready
Cons:
Standard template design
No Omni-channel experience
Limited Custom-features
Limited (Customer) Data
Security
No Guarantee for traffic
peaks / concurrency

19. A Single SaaS Wechat Store
19
3rd Party Wechat
Store
Product
Management
Stock
Management
Pricing &
Promotion
Management
Customer
Management
3rd party SaaS Admin Back-end System
Sales Order
Management
Statistics &
Reporting
Content
Management
100%9:41 AM 100%9:41 AM
Wechat Store Data

20. Closing the Loop?
20
Brand
eCommerce website
Product
Management
Stock
Management
Pricing &
Promotion
Management
Customer
Management
Admin Back-end System
Sales Order
Management
Statistics &
Reporting
Content
Management
100%9:41 AM 100%9:41 AM
Brand Store Data Wechat Store Data
3rd Party Wechat
Store
No Synergised Branding
No Data Synchronisation

21. Fully Integrated Brand eCommerce
21
Brand
eCommerce website
Product
Management
Stock
Management
Pricing &
Promotion
Management
Customer
Management
Admin Back-end System
Sales Order
Management
Statistics &
Reporting
Content
Management
100%9:41 AM 100%9:41 AM
Brand Store Data
Integrated Wechat
Store

22. Key Take Aways
๏ Diverse eCommerce Landscape in China
๏ Every channel has its function - cost
๏ Find channels to maintain your “price-level”
๏ Wechat can be a cost-effective market entry strategy, but is limited in its
reach
๏ eCommerce requires a combined Brand eCommerce Strategy
๏ 3rd Party Solutions make you look like your competitor
๏ Synergise Data and User Experience / User Interactivity
22

23. 3. Strategy

24. Multi-channel eCommerce Trends
24
Wechat Store
Market Place / Distributor
Brand eCommerce
Organic - lower cost Growth
- high
cost
Market Place
O2O
Omni-Channel
Commerce
• Closed Loop
• Online - Offline - Online
• Extend Customer Lifetime
Value
• Full Customer Behavioural
Data
Brand eCommerce
¥¥¥¥
1a
1b
2
1a
1b
2

25. B2C - Market Chains
25
B2C - Generic B2C- Vertical
Manufacturer
Importer / Excl.
Distributor
Distributor
Wholesaler
Retailer
Offline Shop
Network
3rd party Delivery
Manufacturer
Importer / Excl.
Distributor
Distributor
Wholesaler
Retailer
Offline Shop
Network
3rd party Delivery
Manufacturer
Importer / Excl.
Distributor
Distributor
Wholesaler
Retailer
Offline Shop
Network
3rd party Delivery
Manufacturer
Importer / Excl.
Distributor
Distributor
Wholesaler
Retailer
Offline Shop
Network
3rd party Delivery
Manufacturer
Importer / Excl.
Distributor
Distributor
Wholesaler
Retailer
Offline Shop
Network
3rd party Delivery
Brand eCommerce B2C Market Place B2C Multi-brand Retailer B2C Flash Buy O2O - Wechat Store
(Indirect) Seller
Buyer
Source
End Consumer End Consumer End Consumer End ConsumerEnd Consumer

26. Unified Branding, Experience & LTV
26
Unified Branding, Experience & LTV

27. Common eCommerce Responsive Design
27
1 2 3 4
1 2
3 4 1
2
3
4

28. Responsive & Web APP Design
28
1 2 3 4
1 2
3 4 1
2
3
4
http://m.domain.com

29. Distinct Web APP Features
๏ Fluid dedicated mobile designs
providing mobile user a full optimised
mobile experience for content as well
as compressed UI elements on
different Phone screens, ideal for
integration Wechat / Weixin.
๏ Dedicated Mobile Domain
๏ Thine (Sliding) Menu
๏ Lower navigation menu
๏ Limited Product Overview
29
Desktop
Web APP

30. Unified Login
30
100%9:41 AM 100%9:41 AM 100%9:41 AM 100%9:41 AM 100%9:41 AM 100%9:41 AM
1 2 3
100%9:41 AM 100%9:41 AM 100%9:41 AM 100%9:41 AM
1 2
WebAPPLoginDesktopLogin

31. Unified Payment Experience
31
2
100%9:41 AM 100%9:41 AM
1
100%9:41 AM 100%9:41 AM 100%9:41 AM 100%9:41 AM
1 2
100%9:41 AM
4
100%9:41 AM 100%9:41 AM
3
DesktopPaymentWebAPPPayment

32. Key Take Aways
๏ Strategise your distribution chains
๏ Unification is the key to long-term success
- Branding
- User Experience
- Customer Life-time Value (LTV)
๏ Strategise your design for different channels
๏ Cover the vital features for Wechat
- Registration - Login / Payment / Communication
๏ Make sure you “recognise” your customer on every platform
32

33. Our Expertise
33
Our Experience
Mobile, eCommerce and Cloud Technologies
eCommerce Solutions
Our eCommerce solutions cover from
web shop solutions, mobile commerce
to O2O solutions connecting your offline
strategy

Enterprise Mobility Services
Mobile solutions for Enterprise
customers that require
the power of Information Systems / ERP
systems in a Mobile format

Cloud Services
Running your software & web
applications on an optimised and secure
Cloud infrastructure reaching your China
or International international customer
base

New Technologies
TMO lab is continuously implementing
new technologies for its clients on
Internet of Things and Augmented reality


34. 34
Dominiek Pouwer
e: dominiek@tmogroup.asia
wechat: pouwer
m: +86 186 21 677 377
Thank you for your attention!