(Yicai Global) April 15 -- The Covid-19 epidemic is revolutionizing how many businesses in China operate. The shift online has changed consumption patterns as well as lifestyle choices and is forcing firms across the board to find new ways of operating to generate fresh opportunities.
Huge online demand and sound internet infrastructure are driving the digital transformation of many Chinese industries, said Ji Wei, founding managing partner of investment firm Meridian Capital China. The Hong Kong-based firm recently made investments in sectors such as live e-commerce services, antiques trading platforms and entertainment for senior citizens.
Internet platforms and related sectors that host these activities are the greatest beneficiaries of this boom. Podcast startup Ximalaya HM's first quarter revenue was up 32 percent from the final quarter of last year and video sharing platform Bilibili is anticipating a 60 percent leap.
The new wave of online businesses is changing the way brands and consumers communicate with each other, Zeng Xiulian, a partner at Alibaba-backed lifestyle platform Xiaohongshu, better known as Little Red Book overseas, told Yicai Global.
In the past, brands would deliver messages to consumers through outdoor adverts, television commercials and stand-alone booths in supermarkets and malls. Now companies and customers can engage in a dialogue on a more equal footing, Zeng found.
Live feedback during streaming and of-the-minute search data can also help brands better grasp fashion trends and consumer hotspots.
Last month, LVMH Moet Hennessy Louis Vuitton, the world’s biggest luxury brands group, livestreamed the release of its latest fashions for the first time ever. Its show on Shanghai-based Xiaohongshu attracted 15,000 viewers in the first hour.
Through its live debut, Paris-based LV found that its online tutorial on how to tie a silk scarf had the most feedback, demonstrating that livestreaming has a more direct and better effect on consumers than hiring celebrities to endorse products.
As users share their experience of purchasing online, they trigger interactions in online communities. This can drive other consumers to spend money in physical outlets, which they will also share online, eventually creating a positive cycle, Zeng said.
Aloooooha Vintage, a boutique store for second-hand luxury goods that has been serving customers in Shanghai for over 10 years, was forced to shut its doors on Feb. 5 due to the epidemic. The store owner, who goes by the alibi ‘Aloooooha_GIGI,’ quickly shifted sales onto Xiaohongshu.
By sharing stories and anecdotes of her used wares, she impressed followers with her knowledge of the cultural and historical value of her products, and after two livestreaming sessions she shifted over CNY600,000 (USD85,000) in sales.
More art and fashion brands have also joined the online ecology. On March 20, Xiaohongshu hosted virtual visits to five art galleries across the country, teamLab Borderless Shanghai, K11 and How Art Museum in Shanghai, M Woods in Beijing as well as K11 in Guangzhou.
More than 30 museums in China, including the National Museum of China, have opened channels on Shanghai-based Ximalaya to share knowledge about history, culture and their priceless relics.
Over 100 million people made virtual visits to museums and art exhibitions on Alibaba Group Holding’s dedicated livestreaming site Taobao Live. Shanghai had the most online venues and visitors of all China’s provincial-level administration areas.
Editors: Xu Wei, Chen Juan, Kim Taylor