In the present world, China might own the e-commerce market that mostly depends on celebrities and influencers. Intense competition and picky customers in this market are driving brands, marketers, platforms and KOLs to test and innovate their strategies and services at an exceptional rate.
According to Statista, in 2022, the number of Chinese netizens reached 1.07 billion, accounting for about 75.6% of the total population of China, and brought an increase of 2.6% compared to 2021. In addition, Chinese netizens spend an average of 26.7 hours online per week, and 99.6% of them use mobile phones to enjoy the online world.
With the continuous increase in Internet penetration and usage time, online marketing strategies face tremendous changes and challenges in the Chinese market. And there’s one strategy that domestic and overseas brands should take into account is the KOL Marketing.
Things About KOL
What is KOL?
KOL is the abbreviation of Key Opinion Leader. Key opinion leaders are spokespersons, brand representatives, or idea leaders with strong authority or expertise in a specific field. For example, a doctor can become a KOL in the healthcare domain. In contrast, those with no professional background are likely to receive doubts or accusations from the audience on social media. But whatever, both KOLs and influencers share their opinions, judgments and attitudes about a product or a brand with the public.
KOLs interact with their followers to build strong connections, thereby gaining believability. They can make products stylish in order to expand a brand’s followers, increase brand awareness, and motivate potential consumers to purchase from online or offline sources. The use of word-of-mouth marketing is very effective and requisite in influencing the purchasing decisions of Chinese consumers.
Classifications for KOLs
Ⅰ. Mega KOLs
This is the TOP KOL category compared to others, with more than a million followers. These KOLs have the ability to make products hot within a very few hours. The products they promote have no limitations, and they can almost manage items from multiple fields.
Ⅱ. Macro KOLs
These KOLs are defined to own followers between 100k to 1M. For this level of KOLs, they appear to provide the highest ROI to the e-commerce platforms. The products they promote are a bit narrower than those mega KOLs, but still have the advantage of advertising efficiently.
Ⅲ. Micro KOLs
Though with fewer followers, between 10k to 100k, micro KOLs have a closer relationship and interaction with their followers. They behave highly actively on the platforms, and the types of products they publicize are pretty focused.
Ⅳ. Nano KOLs
The number of KOLs with more than 1k but less than 10k followers is huge. They are not good at contributing good ROI, however, are generally capable of increasing brand recognition and reputation.
Target Audience
The Post-80s usually pay more attention to the fields such as news, travel, food, health, and family. However, the leading target group of KOL marketing on e-commerce platforms in China is the post-90s and post-00s. These groups of people show a higher interest in things like cosmetics, fashion and digital products, as well as topics like celebrity-related gossip. Regarding active users, Douyin’s KOLs appear to be the most influential among all the short video platforms, with 604 million users, were initially attracted by KOLs.
The Differences between Chinese & Western KOL Marketing
There are many similarities between Chinese and Western e-commerce platforms, especially when it comes to their young, entertainment-hungry audiences. However, differences still exist. Culture and platform differences mean that marketers need to subtly change their promotion strategies when releasing content for the Chinese audience. And in order to make proper decisions, overseas brands must understand the differences between Chinese & Western KOL Marketing.
Western KOL Marketing
Western consumers care about product reliability and usefulness, thus, Western KOLs emphasize product features and performances more than branding. Unlike Chinese consumers, Western consumers believe their products are high quality, so they don’t just purchase from luxury brands. It is quite “normal” for influencers and celebrities to wear affordable clothes in public.
Chinese KOL Marketing
For Chinese KOLs marketing, the brand is more important than its product. Chinese consumers are more brand conscious and will carefully measure a brand’s socioeconomic status and reputation. Another reason for emphasizing brands rather than products is that Chinese consumers have a poorer experience with KOL content and product manufacturers.
The Value of KOL Marketing
KOL marketing plays an essential role in brand growth in China. As KOLs earn respect and authority in their domain, they bring quite a lot of benefits to brands.
KOLs can reach millions of followers on Chinese social media platforms. That’s why many marketers see it as a positive endorsement. Even better, they’ll know the product as a prerequisite to purchasing, and some followers will become loyal consumers in the long run.
Currently, traditional advertising methods(TV ads or something else) via celebrities do not work well. One of the most effective way to advertise products and expand sales in the Chinese e-commerce market is to cooperate with KOL. Unlike ordinary influencers and celebrities, KOLs prosper in specific niche markets, which means brands or marketers no longer need to spend much time finding the suitable groups of consumers, and at the same time, don’t need to worry about audience differences. KOLs’ expert endorsements will definitely add trust to brands as they can build a solid brand reputation through KOL marketing.
Finally, cooperating with KOLs can give the brand a sturdy toehold in the Chinese e-commerce market. Interacting with trustworthy influencers in a specific field can help brands or retailers visualize their competence, confidence and trust. Future marketing campaigns will obviously benefit from the KOL marketing mode.
The Relationship Inside the Ecological Development of KOL
The KOL ecological chain is inseparable from 4 crucial elements, namely the KOLs, platforms, brands and users(potential followers & consumers). Each part is tightly connected with the other 3 elements and serves each other, which builds a KOL ecological cycle.
Let’s briefly talk about their relations: E-commerce platforms provide channels for brands to do marketing, and the brands provide opportunities for KOLs to gain commercial realization. Then, KOLs use platform traffic to attract users’ attention, gain trust, and continuously recruit new users for the platform to ensure user retention. And finally, the users provide objective traffic to the platform and offer product experiences feedback for the brand. So far, the 4 parts form a perfect closed loop for the KOL ecological cycle.
In the opposite relation direction, the KOLs boost the promotion for brands; brands help the e-commerce platforms gain commercial realization and together build “Business Ecology”; e-commerce platforms provide KOLs with full-link marketing support; in this way, users are taking full advantage to reach concepts from brands, high-quality contents from the platforms and learn something new from the KOLs.
Nowadays, China’s e-commerce platforms are launching incentive events for KOLs (or those who want to be KOL) to create high-quality user-centric content to attract traffic and attention in order to increase user stickiness and strengthen their platforms’ competitiveness. Brands, platforms, and KOLs work together to achieve commercial realization and marketing dissemination. These three build a user-centered marketing ecological model.
Different e-commerce platforms have different positioning, which notably affects user characteristics and KOLs layouts. Those “broad” contents and the “precisely positioned” contents of each platform have different penetration levels, which makes brands need to understand the traffic configuration of different platforms and choose an appropriate KOL placement strategy. For example, the current “broad” content is gradually saturated, and users’ demand for subdivided content is rising. KOLs mainly focus on sports and fitness, science and technology, video games and other domains are snowballing. KOLs who are deeply involved in “precisely positioned” content can attract a large number of followers, and brands or marketers should focus more on these KOLs.
About Douyin E-Commerce & its KOL Marketing
For overseas brands entering the Chinese e-commerce market, you must consider which platform is better before cooperating with a KOL. If your brand vertically targets the groups of young, fun-seeking, fashionable and willing-to-purchase people, Douyin(Chinese TikTok) is the most promising e-commerce platform.
Douyin has a sizable number of active users, and the traffic dividend still exists. Douyin ranked firmly in the 1st tier of short video platforms in China, with daily active users increase of 60% year-on-year, exceeding 400 million, which is close to the peak of 460 million visits on Taobao’s “Double 11” event. Looking into the users’ distribution, the female group is slightly larger than the male group, and 93.2 million users are below 24 years old. So, the user images of Douyin are fairly clear, which makes it easier for KOLs to locate the target groups of potential consumers accurately, focus on 1st and 2nd tier cities, and focus on trendy products.
Also, Douyin emphasizes algorithms, so the commercial potential of those small and medium size KOLs has yet to be discovered.
Ⅰ. Traffic Distribution Logic: “Content Focused”
Douyin is mainly based on endless scrolling recommending content. The core of traffic distribution is the algorithm and content quality feedback, so naturally, the users’ attention becomes a secondary criterion. The platform provides an initial “traffic pool” for short videos based on content quality and performance. It pushes them to relevant users and some followers, and based on the play completion rate, like rate, comment rate, forward rate and other feedback indicators to proceed on the next steps of traffic allocation.
The distribution logic under a strong control rule is easy to create hits and acquire followers(but actually, it is not that conducive to developing social attributes on the platforms, but we’ll not talk further about it in this article). After the initial traffic distribution, better content feedback can let the content creators get another second or even third traffic recommendations, thereby expanding the radiation range of high-quality content and creating popular videos. At the same time, content creators have a high probability of gaining hundreds of thousands of or even more followers with a single hit video.
In terms of commercial monetization, compared with e-commerce monetization that relies on solid trust, advertising marketing that focuses on content and substantial exposure is Douyin’s current most advantageous business.
Ⅱ. The Current Status of Douyin KOLs: “Matched Perfectly”
The sales of goods match well with the users’ images on Douyin. In Douyin’s list of recommended products, women’s boutique clothing, food and beverage, kitchenware, shoes, bags, accessories and daily necessities accounted for 62.85%, and ¥0-200 products accounted for 84.61%. We can figure out that it is indeed the features of post-90s and 95s females who live in 1st and 2nd tier cities in China, because they are the major users on the platform of Douyin. They love fashion, pursue cool trends, have an adequate personal economic foundation and have strong purchasing power, especially for beauty products, accessories, clothing, and snacks; other categories of products also have a high degree of attention.
Douyin is suitable for brands to carry out brand marketing based on multiple levels of KOLs. Douyin provides brands with many KOL-related resources, supports them in combining brand characteristics to mine content creativity, and drives brands to attract targets audience better.
Ⅲ. The Future Trend of Douyin E-Commerce: “Dual Methods Lead Breakthrough”
Short video attracts followers & livestream realization, tap the space for KOLs to bring goods. Since Douyin introduced livestream in 2018, most KOLs have chosen to accumulate followers with short videos and later, use livestream to monetize their traffic. The fan base that KOLs attract with short videos will not be lost due to the over-commercialization of content. The immediacy of information exchange in live broadcasts is conducive to converting the stickiness between anchors and fans into purchasing power.
Douyin’s unique algorithm model gives KOLs a relatively uniform exposure. Small and medium size KOLs may gain more excellent communication opportunities with their high-quality content, and their commercial potential may exceed expectations. According to the data, the followers of those KOLs who provide ideal sales performances are between 0-100k. Among the Top 10 sales KOLs, 4 have less than 500k followers, and 8 of the Top 20 KOLs are less than a million. In the future, the commercial value released by small and medium-sized KOLs may become the core competitiveness of Douyin in the e-commerce market.
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Our company, SENCENT, has in-depth cooperation with Douyin Cross-Border Store. And suppose you want to learn more about KOL Marketing in China or things about Douyin, well, in that case, we strongly recommend you read our previous article about Douyin E-Commerce to get more information and comprehensively understand. For further communication or things about coop with us, please feel free to Contact Us!
