China’s Alibaba innovative, Amazon without new ideas

Presumably, between Black Week and Christmas, you too make extensive use of the many different online shops. Did you ever notice that the design of the shopping experience has hardly changed in the last 20 years?

We learned how online shopping works sometime in the late 1990s. And then? Didn’t get much more. From Amazon and Otto to About You and Zalando – everyone is doing more or less the same thing.

Sure: There are numerous differences in the details – faster deliveries here, a “get inspired” button there. But the core of the shopping experience hardly differs and consists primarily in clicking through endless lists of identically designed product presentations: photos, description, price and delivery conditions. If things go well, there are still a few interesting customer reviews. It’s all clear and functional, but also pretty boring.

The design of the internet shop is somewhat reminiscent of the design of cars. Where everyone is oriented towards the same target values, everyone comes to the same solutions. And once companies and customers have understood how something works, one forgets at some point that there might be another way.

I noticed this myself last week when I clicked through the wasteland of the offer lists on Cyber ​​Monday. Shortly before that, I had dealt with the latest trends at Chinese Singles Day, where many things work very differently, with a clear focus on making online shopping a real experience.

November 11th is called “Singles Day” in China, because its four ones symbolize a meeting of four singles. The company came up with the idea of ​​turning this day into a shopping event in 2009 Alibaba.

At that time, their brand platform TMall was still quite new and they were looking for an approach to make them better known. So “Singles Day” became the day on which singles give each other something – analogous to Valentine’s Day for non-singles. And the gifts for yourself could be found on TMall.

In the meantime, the day has left its humble origins behind and the so-called Double11 is in China become a national eventthat many other retailers have discovered for themselves, both online and offline. Alibaba is now talking about the “Global Shopping Festival” and between November 1st and November 11th this year it had a gross merchandise volume (GMV) of 74.1 billion US dollars.

This corresponds to an increase of 26 percent compared to the previous year and is a good indication that Chinese consumers have left the worries of the pandemic behind. For comparison: all online retailers in the USA made a total of 24.6 billion US dollars in sales between Thanksgiving and Cyber ​​Monday last year.

You can also see the international importance of Double11 from the fact that, according to Alibaba, over 1,300 German brands have achieved sales of over a billion US dollars on their own platforms. This makes Germany one of the top 5 countries in terms of sales.

Shopping apps as a place to experience

In addition to impressive sales figures, there are e-commerce in China also a whole host of other interesting aspects. For example, that in large cities like Beijing or Shanghai many orders are not delivered on the same day but within a few minutes. Or that more and more autonomous drones are also being used for logistics: in cities in the form of rolling packing stations, in the country over the air to cover the last mile.

As already indicated, there is another big difference in the design of the actual shopping experience. Both Alibaba and competitors like JD.com or Pinduoduo are increasingly trying to make staying in their own shopping apps a real experience, which is also possible in the evening competition on the couch against their local counterparts Netflix and Co.: Instead of watching your favorite series online, you also like to go shopping for a while.

Many product presentations are correspondingly more lively. For example, with an unpacking video about the gadget that interests you at the moment or comprehensive background information on the exciting new brand. The Chinese sometimes spend up to ten minutes on the pages of individual products in order to obtain detailed information.

Wherever this fits the respective target groups, you will also find many playful elements that make online shopping more entertaining. The big stars at this year’s Singles Day were little virtual kittens that you could raise in your app in order to receive coupons and discounts in return.

Another very popular shop feature also focuses on high entertainment value: live shopping. Here, retailers present their products in live streams that sometimes run for hours. Think of it like thousands of individual mini QVCs that can be used to purchase hundreds of thousands of items.

Depending on the sender, the quality of both the products and the presentation varies quite significantly: from farmers who stream live from the field or weekly market, to owners of smaller stationary shops, to highly professional live streamers who sometimes earn more than 10,000 euros a month A colorful streaming scene is developing here.

Currently working here in the west Facebook, Amazon and many brands of comparable offers. But we probably won’t focus on one important feature as much as it does in China, although it is crucial for success there: the possibility of direct interaction. Because only then really brings out the advantages of a live stream. Mostly via a chat function, viewers can exchange ideas, ask questions or sometimes even help design products.

Potential buyers click their way through many, very lively live streams in the apps of the various providers. Instead of looking through monotonous product lists, you have the feeling of walking through a marketplace with many opportunities to take a look at individual offers and chat.

The example of Austin Li, who mainly sells lipsticks through his live shows and is now known nationwide as the “Lipstick King”, shows that sales are also made. On November 11th last year, it was on the air for six hours and sold lipsticks valued at over $ 40 million to its 37 million viewers.

Overall, the China Internet Report calculates the “South China Morning Post” for 2020 with over 600 million Live streaming users and sales of $ 16.3 billion.

Increasingly, the Using the possibilities of artificial intelligenceto support online shopping. For example, Alibaba used AI systems for the first time this year on November 11th, which automatically and simultaneously translates Chinese live streams into other languages ​​in order to reach other markets.

What currently looks like cartoons and gimmicks could soon enable a completely new, interactive shopping experience: individual advice from an AI avatar who knows his own needs exactly and enables real, scalable one-on-one dialogue. The chances of this technology are likely to go well beyond what we know from chatbots and also enable interaction on an emotional level.

You will probably wonder at this point whether you really need all of this. After all, with a good search and clear lists you can find the goods you want quickly and easily. Of course, a lot of things that work well in China wouldn’t stand a chance here – too overloaded, too playful, too unfamiliar. With us, both shop operators and customers know too well how e-commerce works. Why change something?

A pattern becomes visible, which we encounter again and again when you compare developments in Asia in general with those in the West: We learn how to do something new, we get really good at it and then we are finished at some point. From then on, only the small things are optimized. Really rethinking things seems unnecessary. After all, everything works.

In contrast, the example of e-commerce shows that new ideas also bring completely new possibilities. Brands that have so far deliberately avoided the efficiency machine Amazon feel at home on the more emotional Chinese platforms. That is why products from companies such as Burberry, Ermenegildo Zegna or Mont Blanc available. At the same time, competitor JD.com supplies luxury brands with limousines and white gloves.

And if you manage to become part of the daily entertainment routine in the living room, you don’t have to pay a lot of money for the traffic Google shopping – which for many western shop operators is an essential but very expensive part of their own sales strategy. An option that Chinese online retailers often do not have, by the way, because customers rarely come to them via web searches on their own mobile-only Internet.

While established, successful companies in the West continue what they have done successfully in the past, in China extreme competitive pressure combined with consumers who are happy to accept any innovation means that there is no optimization standstill. Big players like Alibaba or JD.com are also forced to constantly try out new ideas and concepts. As a result, they often think very far ahead, even further than such innovative companies as Amazon.

A current example of this is the latest e-commerce trend in China: C2M – Consumer to Manufacturer. Here, consumer demand directly controls the production of individual items in sometimes very small batch sizes. Since this is hardly possible with existing industrial processes, Alibaba presented the concept for a new, digital factory a few weeks ago. An exciting topic that we will look at in one of the next Disruptive China Briefings.

More: Because of our ignorance, we are missing out on many exciting ideas that are already a reality in China today

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