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BENEFIT COSMETICS IN CHINA BEFORE LAUNCHING THEIR DIGITAL STRATEGY
Benefit Cosmetics started selling its products on the Chinese market in 2007 via beauty chain Sephora and several department stores. It opened the first boutique in Shanghai in 2008. Five years later, you can find five of these shops throughout China, in four different cities: Shanghai, Shenzhen, Beijing and Guangzhou.
Before launching its website, Benefit Cosmetics’ digital presence was non-existent. Furthermore, its physical stores were doing good at the time and their teams realised that Chinese consumers started going more and more online for luxury products. Therefore they decided to start focusing on the brand’s digital presence in China before dealing with the US and Europe.
WHAT IS DIFFERENT BETWEEN CHINA AND THE REST OF THE WORLD FOR BENEFIT?
Just like any brand, Benefit Cosmetics has acquired years of experience regarding marketing techniques in Western countries. However, these are totally different in China and what works well in Europe or North America might not be welcomed in the same way on the Chinese market.
E-mail subscription is not a thing in China
While e-mail newsletters are one of the pillars of digital strategies for Western retailers where they lead to much e-commerce revenues, it is not the case in China. Chinese consumers do not consider this communication channel to be a trusted way to engage with a brand.
Brand websites are not popular with Chinese buyers
Chinese online shoppers do not visit brand sites to buy products. They would rather choose bigger multi-brand e-commerce platforms such as Taobao or Tmall. Boston Consulting Group says these two major players gathered more than 80% of total revenues of online sales (in dollars) in 2010.
Also, if Chinese consumers like sharing and commenting, you will not find these reviews and ratings on your brand site but rather on these e-commerce giants.
Payment habits are different in China
In 2013, a popular method for payment was still cash on delivery, where one can check a delivery before choosing which products to keep or return. It has now changed and almost everything can be paid online, especially via apps such as WeChat.
Launch schedules in China need to be carefully prepared
Product approval is difficult to obtain when entering the Chinese market and products are therefore often delayed: something that brands need to bear in mind regarding their product launches. Local events and festivals can also be a good occasion to launch new products and it should be organised well in advance.
Chinese consumers prefer some types of products
Unsurprisingly, some products work better than others for Chinese consumers. Indeed, they will mostly buy skincare and perfecters since complexion matters a lot to them. In the make-up department, eyeliner is more popular than mascara for they have straighter and shorter eyelashes than women in Western countries. Specific products are also proposed to counter the effect of humidity, as it is a big issue in Asia.
Paid search has a different ROI in China
Although the brand has collected good results regarding paid search on Baidu – Google’s Chinese counterpart – Hoecke points out that competition is too high to gain high ROI. When Benefit Cosmetics experiences that every dollar invested is paid for five times in North America, it understood that the same investment only helped them breaking even on Chinese search engines.
Social media is powerful in China
Social media is a very powerful tool in China, especially the WeChat application which is used by everybody who owns a mobile. As Chinese consumers chat about and recommend their favorite products on WeChat before buying them on that same application, it sure looks promising to brands willing to enter the market.
BENEFIT COSMETICS’ MARKETING IN CHINA
A brand website that is not designed for sales
Like many brands and unlike retailers for who e-commerce will matter more, Benefit Cosmetics’ major focus is communication. If consumers go to a brand’s website, it is generally more to get informed about its products, so they can later go shopping offline.
Benefit Cosmetics strengthened its own website with Tmall platform
As popular as Tmall might be nowadays, nobody was on Tmall when Benefit Cosmetics launched their own website. They opened a flagship store on Tmall later, in order to experience its business potential.
Settling in China implied a few challenges
The brand needed a local team in order to manage technical issues and adopt the assets sent by the US team. Also: Alipay, which is the payment system mainly used in China, was the solution Benefit Cosmetics went for.
Distribution is a little harder to manage: the brand uses a combination of FedEx and carriers in order to reach any location in China. However, Benefit Cosmetics teams have observed that Chinese consumers travel a lot, so those who don’t have access to these products usually buy them while going to Hong Kong.
Benefit Cosmetics did not change its content for China
Unlike other markets in which it is necessary to adapt your branding approach, Benefit Cosmetics found that Chinese customers received their communication strategy relatively well. Hoecke explains that it was mainly due the fact that these consumers are fond of western culture. However, they still make sure the message they want to convey keeps its meaning since humor does not always translate in the same way.
The brand is active on all social media
As Benefit Cosmetics’ teams consider social media to be part of the customer journey, they make a point of being actively present on any platform out there and of diversifying the content they broadcast.