Dao Insights, a leading UK-based Chinese consumer intelligence firm, has unveiled their pivotal new report, “China’s Retail Resurgence: Channeling the Power of WeChat and Consumer Trends for Growth in 2023”. This report provides detailed insights into China’s digital and luxury retail landscape, explaining the vital role WeChat plays in enabling brands to capitalize on emerging post-pandemic consumer trends.

The report highlights a significant shift in consumer behavior, with an increasing focus on emotional value in addition to functional needs. This transformation is moving consumers away from a "value for money" mindset to a new paradigm of "value for emotions". To adapt to this change, fashion and luxury brands are strategically harnessing the power of WeChat to cater to these emotional aspirations of the new generation through immersive experiences and storytelling.

“WeChat helps brands achieve their marketing objectives in both sales performance and branding”, states Antony Lin, Head of WeChat Pay Fashion Division. “For instance, Dior has achieved sales growth by having sales associates continuously share product recommendations with customers via WeChat's Mini Programs. The brand also uses WeChat Channels to livestream fashion shows, which has been pivotal in achieving their advertising revenue targets,” Lin adds.

The report also forecasts that, with the decline of impulsive buying, rational consumption will remain the mainstream trend in 2023, leading brands to shift their focus from extensive marketing and advertising to upgrading and optimizing product quality, ensuring activities are more integrated and closely aligned with their global strategies.

The retail industry is now entering a customer-centric era, evolving from previous product-centric and channel-centric phases. This new phase is characterized by fashion retailers leveraging data to directly engage with consumers and unprecedentedly integrate online and offline channels, creating personalized experiences.

Adam Nait, Head of Digital Engagement at Saint Laurent, underscores the unique role WeChat plays in their strategy: “For Saint Laurent, its WeChat Official Account goes above and beyond a brand website. It acts as a gallery, e-commerce site, and CRM toolkit all in one platform.”

With China’s social commerce reportedly ahead of the rest of the world and WeChat being a key driver behind this success, the report serves as a comprehensive guide for brands to navigate their journey in social commerce in 2023. It provides implications for their global strategy to ensure market connectivity and improve brand value and loyalty through an emotion-driven, content-first approach and “phygital” tactics.