The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
LONDON, United Kingdom — The warp speed at which digital trends evolve in mainland China can make it hard to differentiate between need-to-know marketing strategies and flash-in-the-pan trends. With "private traffic," however, all signs indicate the former.
“It is a buzzword, but there’s much more depth to that,” said Patrice Nordey, managing partner at digital agency Fabernovel.
Private traffic means marketing to consumers through direct channels, like brand-operated and moderated chat groups on messaging apps such as WeChat and QQ. This stands in contrast with public traffic, which takes the form of official social media accounts on WeChat, Weibo and Xiaohongshu, or flagship e-commerce stores on platforms like Tmall.
While companies in the West have also begun experimenting with texts and direct messaging, China’s brands have used the medium to take the content-commerce connection to a whole new level.
There are successful local players using carefully crafted fictional brand avatars to introduce exclusive sales, receive priceless feedback and encourage active discussions to promote loyalty. The scale of private traffic activity can be impressive too, with some Chinese brands tapping chat group operators to engage with millions of followers across hundreds of separate, well-segmented smaller groups of customers.
China's 10b Internet native brand Perfect Diary. Source: Courtesy
Private traffic strategies have come a long way in a short period of time. A few years ago, influencers (known as Key Opinion Leaders in China) like Becky Li and Zhang Dayi spearheaded the approach to interact with their fans in a more personal (yet sales-driving) manner. Chinese fashion and beauty brands then jumped on the bandwagon and were rewarded with high conversions and sales — a result of the "sticky" and highly engaged environment that a well-run channel can foster.
But that's not the only thing continuing to attract brands to operate in this way. Nordey noted that a costly overreliance on e-commerce marketplaces like Tmall and JD.com created demand for a channel, independent of third-party retailers, which can be used to collect valuable data and feedback. "Companies are looking for a solution because they need a plan B," he explained.
This is vital for brands in China, said Lauren Hallanan, the head of marketing at WeChat management firm Chatly, who calls private traffic the “most ‘owned’ form of shared media.” Unlike markets such as the US and Europe, Chinese internet users don’t frequent brand.com sites or use email accounts for non-work purposes.
“You have control over what people are seeing and a direct way to contact them. It’s that one to one communication between the brand and the consumer; it’s a lot more personal,” said Hallanan, who added that though some global brands are interested in the tactic, many have yet to make the plunge out of concern regarding execution.
So far, the strategy has been spearheaded by homegrown brands — most notably hit C-beauty powerhouse Perfect Diary, which reaches over one million users through its chat groups. But the move could be just as impactful for global businesses looking to get ahead in China’s cutthroat e-commerce market, which last year hit $1.935 trillion in sales by eMarketer’s estimates — over three times that of the US. Here’s what brands need to know before mapping out their own private traffic game plan.
Think Outside the Chat Box
Private traffic provides brands with an invaluable opportunity to foster loyalty among their community and collect vast amounts of data and feedback while they’re at it.
Hallanan noted that Perfect Diary’s groups — filled with user generated content on the products people are buying, alongside questions about products and usage — were used by parent company Yatsen Global to develop its recently launched sister brand, Abby’s Choice (Abby, also known as Xiao Wanzi, is also the fictional avatar used by Perfect Diary to moderate its chat groups.)
“They started sharing products with loyal members [around January], before officially launching the brand in June... they were testing the products and refining the product line based on feedback,” she said.
Brands should experiment with new formats tailored to their community's needs.
Companies need to get creative to produce unique and entertaining forums. “It’s important for brands to really think through the kind of value they want to bring through the group,” said Nordey.
Sales-focused content should form part of brands’ strategies, but not dominate, added Hallanan. Sandwiching marketing content with educational or social dialogue keeps users engaged: beauty brands can segment their groups by skin concern or invite KOLs and medical experts to take over their channels and explain the benefits of ingredients.
Beauty brands form the bulk of businesses currently operating private traffic groups, but fashion brands could benefit, too. Nordey added that luxury players may opt for a customer service approach, for users to direct queries concerning repairs, deliveries, customisation and locating out-of-stock items they’re after. Private traffic channels could also become exclusive invite-only chat groups for VIPs.
Brands should experiment with new formats tailored to their community’s needs. Activewear maker Maia Active, Hallanan noted, anticipated that its audience would be bored of staying and working out at home during lockdown. It published meal plans and hosted lifestyle-related live discussions and free exercise classes, alongside lucky draws and sales events. “They almost planned your entire day,” said Hallanan, adding that the brand’s year-on-year sales increased as a result.
Forge Inter-Channel Connectivity
Both public and private accounts are needed for brands to operate a well-rounded presence within China's digital ecosystem. Private traffic relies on users to scan QR codes on WeChat or click through a brand's WeChat mini program after buying a product to activate an invitation to a chat group.
This is unlike the US, where platforms are structurally distinct and there isn’t a single, ubiquitous messaging app that brands can utilise and extract user data from. It also explains why private traffic is unlikely to succeed at the same scale in the West, for now: Mark Zuckerberg has voiced his plans to unify WhatsApp, Instagram and Facebook into an interconnected, WeChat-like “super app” but this is still underway.
To start, brands will need a mini program store where users can purchase the products of interest, a WeChat Work account and a tech backend specifically for private traffic, said Nordey.
To make the most out of private traffic data, brands should connect the account (alongside their official accounts and mini programs) to their Customer Relationship Management (CRM) platform through WeChat Work and track users’ data across social and commercial touchpoints. “[For example], you’ll know the consumer in this private traffic group has also bought three eyeshadow palettes from you in the past month,” said Hallanan.
But within the public-private connection, businesses will also need to put in work so consumers bite. “[Success] depends on consumers’ willingness to join private traffic pools and interact with brands,” said Sofya Bakta, marketing strategy analyst at Daxue Consulting.
Private traffic channels won't bear fruit unless a business doesn't already have a strong brand identity.
In other words, private traffic channels won’t bear fruit unless a business doesn’t already have a strong brand identity and community-forward strategy in place. “A brand has to [build] honest relationships with the consumer... having previously earned a decent reputation,” added Bakta.
No Such Thing as Free Conversions
Private traffic marketing started in China, in part, as an alternative to the skyrocketing customer acquisition costs and commissions required to advertise on and maintain a presence on social media and third party e-commerce sites. “A lot of brands are having to reflect on how to engage with current consumers, how to retain consumers and make them more loyal,” said Hallanan.
Brands now have a generally cheaper route, which affords them a closer relationship with their community and, if well-leveraged, a wealth of data. But many often underestimate the costs that can quickly add up as a private traffic strategy is scaled up, and should plan ahead before making the plunge.
While smaller businesses could get by with one or two groups of hundreds of users, channels can quickly grow and necessitate high labour costs (groups typically have more than one manager or operator). Nordey noted that even smaller brands will need a tech infrastructure allowing them to invite targeted people to the right groups and a team to create a consistent stream off content and multiple managers per group (as well as chat bots, for out-of-hours queries).
Moreover, WeChat’s personal accounts are capped at 5,000 followers, so businesses could end up running their groups on multiple accounts and devices. Influencer agency Parklu estimated that a brand managing 1,000,000 followers would require 2,000 separate WeChat groups and 200 WeChat accounts.
Companies shouldn’t underestimate the amount of content they’ll need to put out to keep consumers engaged or how competitive it has become. “I’ll wake up to hundreds of messages,” said Hallanan of the top private traffic groups operated by brands and KOLs. “Make sure there’s a lot of educational-type content you can do to really engage people all the time.”
Furthermore, operators need to be trained and private traffic activity tends to peak outside of business hours so that adds another complication to a strategy’s roll-out. Third-party agencies are also beginning to provide packaged private traffic operations for brands that don’t want to manage their accounts in-house. These services, too, can and will add up to a significant expense.
Find the Right Voice
For luxury brands in particular, training and delegating responsibilities to group managers will require training and trust.
Operators will need to combine the extensive product knowledge of sales associates with a personable, social media-savvy tone. It’s up to the brand in question to decide on a voice to use throughout their groups, and ensure that it is consistent with their broader social media presence while encouraging interaction.
For luxury houses — for which adopting a bubbly avatar like Perfect Diary's as their private traffic persona would be evidently off-brand — hitting the right balance is crucial. This also extends to KOLs, celebrities and experts that brands may invite to host or take over chat groups. Moreover, an educational slant may work for some sectors or product categories, but there isn't a one-size-fits all strategy.
“This is a group with 500 people and there are comments being shared, [so] you’re putting your trust in the group managers to represent the brand correctly,” said Hallanan. “I haven’t seen any issues arise [yet] but especially for luxury brands, that could be a concern.”
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