22 Oct 2013
Social Media in China: Effective Etailing
Interview with Eugene Wang, CEO of Cosset Shop
“At Cosset Shop, we strive to become a leading e-tailer offering quality branded children’s wear over the internet,” says the official website of Cosset Shop which has marketed its children’s clothing brand through online channels over recent years. The views and experiences shared by Eugene Wang, chief executive officer of Cosset Shop, in this article will make valuable reference for Hong Kong companies interested in promoting their products over the internet.
From OEM to ODM
Similar to many Hong Kong manufacturers, Cosset Shop was originally engaged in the production of children’s clothing in the form of OEM (original equipment manufacturing) operation. In 2003, it began to switch to the ODM (original brand manufacturing) mode while developing its own brand business and licensing sales in the US and Europe. In 2011, it decided to turn to domestic sales in the mainland market with a fresh brand of fast fashion through online channels.
Good grasp of market with specific positioning
Wang says he has found that while product price remains one of their concerns, mainland consumers are paying more and more attention to product quality and design creativity. To win over these maturing mainland consumers, companies should allow them to understand the values carried by the products in place of low prices.
As setting up a network of physical stores in a new market is no easy job, Cosset Shop opted for the online model, presenting the values and characteristics of its products through various digital marketing means such as online advertising and social networking websites. “Word-of-mouth marketing is a crucial tool in the mainland market,” said Wang.
Branding, product values and characteristics
In selling their products over the internet, companies have to rely on some major B2C websites such as Tmall. As well, they should also set up online flagship store to promote their own brands. Although setting up an online store on B2C websites involves a threshold, it is an easier way to gain the trust of consumers because consumers tend to feel more assured when making online transactions through these platforms. In this way, initial confidence in a brand is built up among consumers. “This kind of platform is purely sales-driven,” said Wang. “But for a brand to really take hold in consumers’ minds, it must have its own online flagship store. This is because the brand values, positioning as well as product values and characteristics can only be laid out in its own website.” In his opinion, it is through its own platform that a brand can reach out to customers directly with a view to better understanding their profile and preferences, thus engaging them interactively.
Word-of-mouth marketing through social media
There may be different ways to build up a brand. According to Wang, e-tailing operations cannot do away with social networks, given the current conditions of the mainland market. Broadly speaking, social networks refer to digital channels such as the brand’s own official website, online advertisement, QQ, WeChat and Weibo. Most importantly, there should be a good marketing strategy that makes use of various channels to convey the brand values to consumers effectively. “I don’t support any large input of resources on advertising. In fact, not many companies can afford a large advertising budget over the long term. Word-of-mouth marketing is therefore very important,” says Wang, adding that it is crucial to make the best use of social networks where consumers share posts and experiences of using the products.
Don’t just count on web celebrities
There are many “celebrities” and “experts” on the social networks and some of them will write about certain products for a fee. Wang dismisses this tactic as ineffective because most website visitors reading the posts of these “celebrities” and “experts” already know that the write-ups are mostly for advertising purpose. If a brand over-relies on these “celebrities” and “experts”, it will give consumers the impression that the brand only knows how to advertise with money without any genuine strengths. Some “celebrities” and “experts” share information on specialised websites which provide more in-depth information with higher credibility. “If you can make use of these platforms to enlighten visitors about your product features and their differences from other products, they will naturally help in building up word-of-mouth reputation for you so long as the products are genuinely of good quality,” Wang says.
Promotions such as special offers and lucky draws (using Weibo and other digital channels) can work like viral marketing. When consumers find out after trial that a product is more superior in quality and good value for money, they will naturally share their experiences among their circles. Cosset Shop, for example, has organised activities such as photography competitions via Weibo and other similar channels. Customers are encouraged to take part in these activities through which positive word-of-mouth is spread through cyberspace.
In Wang’s views, price alone no longer works in the mainland market. Consumers today are looking for what added value is provided by a company, be it professional knowledge in relation to products, brand characteristics or membership benefits. “This is particularly the case with brands positioning at the medium-to-high end. The key is to make consumers agree that the product in question has high quality but is sold at an affordable price,” says Wang.
Customer service matters
Apart from special campaigns which will be entrusted to public relations companies, regular marketing and promotional activities are handled by Cosset Shop’s in-house marketing team which will draw up yearly promotion schedules in line with the timing of new arrivals. Creative marketing gimmicks are said to be important in keeping customers’ interest. Put simply, both hard and soft marketing skills are indispensable. Apart from special offers, there should also be practical tips and insights which will be shared by members or “fans” of their website. There is no hard and fast rule for the size of the marketing team but Wang reckons a company should at least have one dedicated marketing specialist to oversee and coordinate social media marketing plans. That person should also be able to come up with new ideas to complement the company’s expansion moves.
Social networks involve a broad spectrum of activities. For example, some writers now specialise in browsing social media websites and sharing posts about their clients’ products and services. Yet in the long run, consumers can tell which posts are in fact advertisements. Wang advises that companies should not burn money blindly on marketing and promotion because a huge digital ad spend is no guarantee for success. They should consider if their capabilities in marketing, logistics and fulfillment, customer service and others can effectively cater for and meet the demands of customers.
According to Wang, customer service is the most crucial part of the operation. Mainland consumers always want to communicate directly with the company, whether through QQ, telephone or other channels. Apart from the timeliness factor, good customer service also relies on high-calibre staff members who are well versed in all aspects of the company’s operations including corporate systems, brand positioning, product features and logistics arrangements. In view of this, companies must not overlook the importance of providing comprehensive and appropriate training to customer service staff.