Digital user behaviour in China

Built for the Masses 38.3% 42.1% 55.8% 53.2% 50.3% 771,980 47.9% 45.8% 731,250 688,260 617,580 648,750 772 million internet users (grown more than 50% in last 5 years) 44% not online yet! 34.3% 564,000 28.9% 513,100 457,300 22.6% 384,000 16.0% 298,000 210,000 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Different levels of internet experience and sophistication, devices, access speed Chinese websites have to dumb-down their designs to cater to a wider range of users Internet users (,000) Penetration rate

More is More Chinese believe that the more activity and visual stimulants a website has, the more it validates the website's value. This is especially the case for e- Commerce platforms which try to replicate the feeling of a real, physical market shopping experience. Liberal use of red (which is good luck in Chinese culture) will have an opposite impression with Westerners, where red is a sign of danger. As an example, a red stock ticker means increase in stock price in China.

Tabs, Tabs and more Tabs Chinese Internet speeds are still comparatively slow as compared to the West This is why Chinese websites, especially news portals or other content rich platforms, are text and link heavy. When users click on links, they will automatically spawn a new tab. This way, users can easily scan through content and click on multiple links at a time. While the pages are loading, they can read each tab progressively. When done, they just close the tab and the previous page is still in the last tab It s a practical means to a functional problem.

Chinese Characters are Complex English consists of a 26 letter alphabet which are combined to create words Chinese is composed of over 50,000 characters, each one of them conveying a succinct and deep meaning. Moreover, there are no upper / lower casing and spacing. Hence, content may look overwhelming and messy on a website if the user is unable to read Chinese.

Limited Font Choices Since English consists of only 26 letters, a font designer would only have to create 26 unique designs to complete a font set. A standard Chinese character set consists of about 10,000 unique characters, with about 3,000 of those characters common in daily use. Because of the huge set of characters, Chinese font sizes normally range from 5 to 10 MB per file. As such, it is not feasible to use CSS font embedding. Hence, we resort to using only web safe Chinese fonts

Side by Side Comparison

Search Gateway to Internet

Gateway to Internet >80%* of Chinese internet population use search engines as an entry point to websites Chinese internet users do not remember domain names and the use of search engines is a necessity. This behaviour is unlikely to change: Domain names are in English. As English is a foreign language to Chinese users, it is difficult for them to remember domain names. Many Chinese companies use domain names which are unrelated to their company names (including the use of numbers). Such practice makes it more difficult for users to remember the domain name. For daily searches, most users do not differentiate between paid search results and organic search results Source: CNNIC Internet report, 2017

Different Search Ecosystem Share Engine Market share Shenma, 4.82% Sogou, 2.50% 360, 8.83% Google, 1.70% Others, 1.65% In China, Baidu is the most popular search engine. Google is blocked in China and has less than 2% share. Baidu, 80.50%

Sponsored links (SEM / paid search) Organic search results (SEO)

Search Engine Visibility is Key Ensure that the website is search engine optimised with high organic search ranking for important keywords, complemented by paid search

Mobile Domination

Mobile is the Device of Choice 120% Devices Used to Access the Internet in China (% of Internet Population) 100% 97.5% 95.1% 90.1% 80% 60% 60.1% 53.0% 67.6% 40% 20% 35.8% 36.8% 38.7% 31.5% 31.5% 27.1% 28.2% 25.0% 17.9% 0% Mobile Desktop Laptop Tablet TV 2017 2016 2015 Source: CNNIC Internet report, 2017

Top 10 Mobile Internet Usage Instant Messaging Mobile Internet Usage 92.2% Search News 82.9% 82.3% Video Payment Music ecommerce Map, navigation 72.9% 70.0% 68.0% 67.2% 61.8% Live streaming 54.7% Games 54.1% Source: CNNIC Internet report, 2017 Banking 49.2%

Mobile First For marketers, the question is not whether they should engage in mobile marketing, but how to make mobile marketing more effective. A mobile specific strategy will be required.

Unique Social Ecosystem

Unique Social Ecosystem?

So what is WeChat? Common Misconceptions Isn t WeChat just a carbon copy of WhatsApp in China? WeChat is only popular in China. Why do I need it? Messaging Apps all do the same thing, what s the difference?

So what is WeChat? Common Misconceptions WeChat is NOT just a Messaging APP

WeChat is a Super-App WeChat is a holistic social media platform that includes everything from messaging to gambling to e-commerce! But most important: utility that can help brands connect with the huge active user-base

Social features

Mobile E-Wallet The linkage of bank accounts to WeChat payment enabled a host of transactional possibilities, including some very commonly used scenarios like: Pay to other WeChat users Credit card payment Mobile phone top-up Payment for utilities / public services Taxi fare payment Investment It also prompted many companies, especially banks to start setting up brand accounts to take advantage of this behavior

What does WeChat look like? Personal Chat Interface Chat Text/Voice One to one/many Sharing Pictures/Videos Locations Web pages Name cards 3 rd party plug-ins Voice or Video Calls Discover Moments, QR code, Shake, People nearby, Drift bottle, Games

WeChat official account WeChat article post Menu bar links to WeChat pages or external webpages

Why WeChat?

WeChat at a Glance In China, WeChat has achieved >95% penetration rate of total mobile Internet users 1 Billion Monthly Active Users (Worldwide) 50 Million Monthly Active Users (55 70 years old) 38 Billion Daily Chat Messages 3.5 Million Monthly Active Official Accounts 797 Million Monthly Active Official Account Followers 800 Million Cash red envelopes sent during Spring Festival 2018

WeChat at a Glance

WeChat at a Glance Source: WeChat 2016 Report

WeChat Key Statistics Source: WeChat 2016 Report

Mini Programs What? Embedded apps which require no download or installation. Can be removed without the need to uninstall. When? Launched in January 2017. How? Discovered through search, friends or in the real world by scanning QR codes. There is no official app store for mini programs. Why? Evolution of its brand accounts, which allow for seamless UX: online shopping and a wide range of interactive services. WeChat wants to be the only app a user will ever need!

Here to Stay? Soft-Sell vs. Hard-sell WeChat Succeeded where Facebook and Google failed Official Accounts Less likely to be a FAD Seamless Mobile E-Wallet Mini Programs

How Can WeChat Help Businesses?

01 BRAND ACCOUNT Similar to other social media (Facebook, Weibo etc), most efforts by brands have gone into creating branded spaces to share content and provide information. Brands distribute stories, means, infographics and audio, or does Q&A with celebrities.

Brand Official Accounts WeChat article post Link to WeChat article, external webpages Menu bar links to auto-reply messages, WeChat pages or external webpages

02 MICRO-CONTENTS Success with branded accounts rests heavily on creating original content on a regular basis short stories, videos, infographics and pictures. The environment (UI) inside of WeChat brands is really clean and simple. As a result, successful content receives attention from audience.

WeChat Articles

03 CUSTOMER SERVICE After content, the second most applied strategy on WeChat is in providing customer service and support. At the moment, most of this service/support is automated (providing balances, bookings) but there clearly is an opportunity for brands to distinguish themselves with more hands-on, customised support, AI chatbot, etc.

Tesla Customer Service Account

04 O2O2O As a mobile, social network, WeChat enables strong connections between offline-to-online (and vice versa) at scale. Location Based Services (LBS) in WeChat offers the potential to: 1) Drive and track retail footfall, 2) Encourage attendance at events/locations, 3) Collect offline audience info online (for CRM).

Chow Sang Sang O2O Campaign Campaign objective: Chow Sang Sang, a major jewellery chain in Hong Kong, wished to drive traffic from online to new stores. Campaign mechanics: Splash proposed and implemented a WeChat campaign to enable customers to check-in at different stores in order to enjoy different promotions and discounts. By leveraging the native GPS function on mobile phones, we were able to verify if customers were at the stores and to push store-specific promotions and discounts.

Chow Sang Sang O2O Campaign After following Chow Sang Sang WeChat account, menu will auto pop up Enter a will receive below promotion message Promotion landing page Check-in contest details page

Chow Sang Sang O2O Campaign After sharing the store location, user will receive a gift message When user accumulates 2 gifts of the same colour, they will win a prize Upon clicking on details, a $500 E-COUPON is presented

05 PAYMENTS WeChat has embedded a robust payments function into its platform, allowing brands to drive ecommerce from official accounts, allowing consumers to pay for a multitude of products and services.

Case Study

06 PUSH ADVERTISING WeChat launched push advertising in 2015, offering brands with a selected few high-profile companies including BMW, Coca Cola etc. The ads were sent to targeted audience segments through its moments function or footer ad, directly into audiences social stream.

Case Study

Real Media Social media is no longer a communication tool but has become a main channel to get information. Brands should leverage social media to interact with consumers.

Key Takeaways Web Design It s not that Western or Chinese web design is better or worse, it s the fact that they are different and it works best for their respective audience. Search Engine Visibility Ensure that the website is search engine optimised with high organic search ranking for important keywords, complemented by paid search. Mobile First Approach A mobile specific marketing strategy will be required. Social media Social media is no longer a communication tool but has become a main channel to get information. Brands should leverage social media to interact with consumers.

Thank you Alan Thorpe Managing Director athorpe@brayleino.co.uk M: 07710 404 382 T: 0117 973 1173 www.brayleinocx.co.uk Kay Kin Tan CEO Greater China kktan@splashinteractive.com.cn T: (86) 21 6218 7776 F: (86) 21 6218 7729 M: (86) 180 1701 5713 www.splashinteractive.com.cn