From a distance, China looks like a gold mine to international fashion companies. Last year, China became the biggest retail and fashion market in the world, according to estimates, and its growth isn’t even close to finished.
But connecting with Chinese shoppers often requires a very different set of tools than US and European companies use at home. At this week’s big annual conference held in New York by the National Retail Federation—a trade group representing American retailers—the fast-growing US shoemaker Allbirds and Chinese e-commerce leader Alibaba were on hand to talk about the challenges Western brands face entering China, as well as how Allbirds is meeting them.
Communicating with shoppers in China is different than elsewhere. “The media market in general in China is much more fragmented than it is in most of the rest of the world,” said Erick Haskell, president of Allbird’s international business. Much of it is done through digital platforms that may not even exist outside China, such as Weibo, WeChat, and Xiaohongshu. Allbirds had to learn what worked on each of them.
Even on big e-commerce platforms, Allbirds had to rethink its strategy. Tmall, owned by Alibaba, has served as Allbirds’ e-commerce channel in China since the three-year-old company started selling there last year. It’s the country’s largest business-to-consumer platform and an important gateway for international brands. Haskell was surprised at how much of its business happens on phones. So far, at least 95% of Allbirds’ sales on Tmall have happened over phones. In the US, by contrast, about 50% of their digital business happens on mobile.
And interacting with customers has its own idiosyncrasies. Christina Fontana, head of fashion and luxury for Europe at Tmall, said 80% of people who shop on Tmall leave feedback for the brand or other consumers. They share pictures of items they bought and post outfits wearing them. It’s a much more social ecosystem where companies need to find ways to interact with customers and not just market to them.
The power of engagement
One particularly effective method of engaging shoppers is live streaming, often with the help of celebrities and other influencers. It’s another skill Allbirds has had to embrace. Shoppers in China open the Tmall app an average of seven times a day, according to Fontana. “They’re going there because they are looking for content, they’re looking for new products, they’re looking for what other people are doing on the platform,” she said.
Brands also need to be very clear about their target market. Fontana said more than 700 million people shop from their phones every month in China. Not all are potential customers, and consumer tastes can be different. “One of the brand principles for Allbirds is we have a very simple design aesthetic on purpose,” Haskell said, “To be quite honest, it doesn’t always jibe with Chinese tastes.” Sustainability is also a big selling point for Allbirds in the US, but not yet as high a priority for Chinese shoppers.
Allbirds, which had extremely low name-recognition in China, had to identify who its customers could be and work to educate them. It found it had to tell its story and explain the reasoning for the look and materials of its sneakers, including that its signature wool uppers are milled at the same Italian factories making wool fabrics for luxury brands.
“Telling that story repeatedly and constantly is really, really important for brands,” Fontana said. “Working mostly also with luxury brands, they kind of have the sense that, ‘Of course everybody knows who I am.’” But often they just know the name, and not necessarily the story behind the brand.
One of the biggest opportunities to change that is actually Singles Day, Alibaba’s giant annual shopping festival. Haskell said he was surprised to learn it wasn’t just about discounts. “We used it as an educational tool to let consumers know what Allbirds is,” he said. “What happened is we had the biggest [sales] day since we launched.”