4 ways Chinese innovation is shaping global ecommerce

The commonly-told narrative where China entered ecommerce by copying and rolling out concepts from Silicon Valley has been systematically erased over the past decade. Today, from the recent boom of livestreams to 24-7 customer service, Chinese innovation has shaped global ecommerce, providing the rest of us with a glimpse of shopping’s future. Here, we highlight four of these innovations. But rather than focusing on their technological aspects, we explore their impact on the key social and cultural dynamics of global shopping. 'Shopping as entertainment' or 'Competing for share of time' One of the defining characteristics of China’s ecommerce market is the way that online shopping has been created as a pastime, with retailers and apps curating spaces for people to discover, play, and enjoy on their own or with friends. Spending is almost a secondary aspect of these experiences, with retailers competing for consumers’ time rather than their wallets. The explosion of livestreams in China is a case in point, and it is an area that global players are now starting to embrace, from American luxury retailer Nordstrom hosting over 50 virtual events last year to French department store Printemps recently broadcasting four live-shopping programs from its Boulevard Haussman flagship store. Furthermore, the burgeoning success of the US-based livestream startup Popshop Live (the company recently announced a valuation of $100 million) foreshadows growing confidence in the movement. Other examples of entertainment-led commerce incorporated by global players include Instagram’s recent allowance of creators to sell products via Instagram Live, click-through product launches in its Stories, and links to products in Feed photos. Meanwhile, shoppable Reels were introduced in December of 2020 and are similar to the Chinese Bytedance-owned video app Douyin. Taking a page from its sister app Douyin’s playbook, TikTok has persuaded consumers to habitually shop via video in Europe and the US, with the hashtag #TikTokMadeMeBuyIt currently at 4.1 billion views and counting. This angle not only shows the power of short videos but also of recommendation-led purchasing, with the evolving concept of shopping becoming a part of day-to-day online entertainment. TikTok users share the items they bought based on other users’ recommendations. Photo: Screenshots, TikTok 'Tapping the inner child' or 'Addiction is good for sales' Closely related to the previous topic, Chinese ecommerce players have become masters of gamification. Today, shoppers attend virtual exhibitions and performances on Tmall’s luxury pavilion and get drawn to buying an item through branded games or quizzes that personalize their purchases. A gamified approach to selling has been a big part of Chinese mobile-first, fast-fashion brand Shein’s triumph in key Western markets. From the brand showering its customers with virtual confetti when they log on to its famed points system, the company taps into the addictive nature of gaming. Virtual try-on features that incorporate AI and AR, which were welcomed in 2020 and into 2021 due to pandemic-enforced travel restrictions, also reflect the growing gamification of ecommerce. One recent example is Snapchat’s partnership with Farfetch and Prada, where its ‘3D Body Mesh’ technology allowed users to try on clothes, visualize the movement of the fabrics and fit, and share the results with friends. With Snapchat’s new gesture recognition capabilities, Prada shoppers can signal on the app when they want to check out another item or color. Photo: Courtesy of Snap Literal gaming is also becoming more of an integrated part of online shopping. So it is no surprise that some global fashion brands with strong track records in China have made direct forays into this space. Balenciaga, for instance, launched its Fall 2021 collection through the online video game Afterworld: The Age of Tomorrow, while Gucci partnered with Roblox for an in-game Gucci Garden experience earlier this year. 'Create your own shopping festival' or 'The new national holidays' Consumers worldwide were getting roped into the commercial aspects of national holidays long before the internet or ecommerce, and industries creating shopping festivals masquerading as cultural occasions is not an entirely new concept (Valentine’s Day, for example). However, the past decade has seen a plethora of shopping festivals emerge in China, which has been pivotal in shaping the country’s trailblazing retail landscape. And today, several of these specific days now feel like deep-rooted cultural phenomena. Singles’ Day and 618 are now well-known globally and are increasingly being “celebrated” by global retailers and consumers outside China. The 618 festival, in particular, is unique, as it started as a celebration of JD.com’s anniversary in 2010. In fact, many believe Amazon’s launch of Prime Day as an ode to its 20th birthday fi

4 ways Chinese innovation is shaping global ecommerce

The commonly-told narrative where China entered ecommerce by copying and rolling out concepts from Silicon Valley has been systematically erased over the past decade. Today, from the recent boom of livestreams to 24-7 customer service, Chinese innovation has shaped global ecommerce, providing the rest of us with a glimpse of shopping’s future.

Here, we highlight four of these innovations. But rather than focusing on their technological aspects, we explore their impact on the key social and cultural dynamics of global shopping.

'Shopping as entertainment' or 'Competing for share of time'

One of the defining characteristics of China’s ecommerce market is the way that online shopping has been created as a pastime, with retailers and apps curating spaces for people to discover, play, and enjoy on their own or with friends. Spending is almost a secondary aspect of these experiences, with retailers competing for consumers’ time rather than their wallets.

The explosion of livestreams in China is a case in point, and it is an area that global players are now starting to embrace, from American luxury retailer Nordstrom hosting over 50 virtual events last year to French department store Printemps recently broadcasting four live-shopping programs from its Boulevard Haussman flagship store. Furthermore, the burgeoning success of the US-based livestream startup Popshop Live (the company recently announced a valuation of $100 million) foreshadows growing confidence in the movement.

Other examples of entertainment-led commerce incorporated by global players include Instagram’s recent allowance of creators to sell products via Instagram Live, click-through product launches in its Stories, and links to products in Feed photos. Meanwhile, shoppable Reels were introduced in December of 2020 and are similar to the Chinese Bytedance-owned video app Douyin.

Taking a page from its sister app Douyin’s playbook, TikTok has persuaded consumers to habitually shop via video in Europe and the US, with the hashtag #TikTokMadeMeBuyIt currently at 4.1 billion views and counting. This angle not only shows the power of short videos but also of recommendation-led purchasing, with the evolving concept of shopping becoming a part of day-to-day online entertainment.

TikTok users share the items they bought based on other users’ recommendations. Photo: Screenshots, TikTok

'Tapping the inner child' or 'Addiction is good for sales'

Closely related to the previous topic, Chinese ecommerce players have become masters of gamification. Today, shoppers attend virtual exhibitions and performances on Tmall’s luxury pavilion and get drawn to buying an item through branded games or quizzes that personalize their purchases.

A gamified approach to selling has been a big part of Chinese mobile-first, fast-fashion brand Shein’s triumph in key Western markets. From the brand showering its customers with virtual confetti when they log on to its famed points system, the company taps into the addictive nature of gaming.

Virtual try-on features that incorporate AI and AR, which were welcomed in 2020 and into 2021 due to pandemic-enforced travel restrictions, also reflect the growing gamification of ecommerce. One recent example is Snapchat’s partnership with Farfetch and Prada, where its ‘3D Body Mesh’ technology allowed users to try on clothes, visualize the movement of the fabrics and fit, and share the results with friends.

With Snapchat’s new gesture recognition capabilities, Prada shoppers can signal on the app when they want to check out another item or color. Photo: Courtesy of Snap

Literal gaming is also becoming more of an integrated part of online shopping. So it is no surprise that some global fashion brands with strong track records in China have made direct forays into this space. Balenciaga, for instance, launched its Fall 2021 collection through the online video game Afterworld: The Age of Tomorrow, while Gucci partnered with Roblox for an in-game Gucci Garden experience earlier this year.

'Create your own shopping festival' or 'The new national holidays'

Consumers worldwide were getting roped into the commercial aspects of national holidays long before the internet or ecommerce, and industries creating shopping festivals masquerading as cultural occasions is not an entirely new concept (Valentine’s Day, for example).

However, the past decade has seen a plethora of shopping festivals emerge in China, which has been pivotal in shaping the country’s trailblazing retail landscape. And today, several of these specific days now feel like deep-rooted cultural phenomena. Singles’ Day and 618 are now well-known globally and are increasingly being “celebrated” by global retailers and consumers outside China.

The 618 festival, in particular, is unique, as it started as a celebration of JD.com’s anniversary in 2010. In fact, many believe Amazon’s launch of Prime Day as an ode to its 20th birthday five years later was inspired by it. And with Shein’s Sheinsider’s Day, Net-a-Porter’s 2021 ‘The Beauty of You’ two-week-long festival, and Youtube’s recent Small Bizz Day, we now see more confidence in brand-led shopping festivals outside of China.

YouTube hosted its first Small Biz Day this year as part of Google’s International Small Business Week. Photo: Courtesy of YouTube

'Shopping never stops' or 'At your service 24/7'

Driven by fierce competition in China, ecommerce shoppers can habitually communicate with brands and retailers directly at any hour, and they expect a response within seconds. They can also view products via video call and ask questions to live retail assistants on Tmall and JD or in WeChat Mini Stores.

Although there is no widespread equivalent in most other markets, retailers like Yoox Net-a-Porter and Selfridges have been utilizing WhatsApp to talk to their highest-spending customers for some time now. And many more luxury labels have recently increased the use of messaging to close sales. Cashmere sweater label Brunello Cucinelli, for example, has been hosting video calls with 30 to 40 shoppers at once while the Genoa-based fine jewelry label Gismondi 1754 sold a $355,000 diamond ring to one of their highest-spending Swiss clients via WhatsApp.

It might have taken a pandemic to follow China’s path to thoughtful and immediate communication between retailers and their customers. And while it has yet to trickle down to lower-end product categories, it will be hard to wean shoppers off these channels now that they are used to it.

Additionally, while the instantaneous nature of delivery in China is unsurpassed, “ultrafast” grocery delivery — aiming for 10-15 minute wait times — is getting funded across Europe, Asia, Russia, South America, and the US, according to research by Sacra.

While we haven’t seen a wholesale adoption of Chinese ecommerce models in Western markets, these innovations have played out quite differently in less mature ecommerce markets, such as South East Asia. And as the above examples demonstrate, there are many aspects of Chinese ecommerce that are now shaping how we shop globally, not only from a technological but also a fundamental socio-cultural perspective.