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Tag: experiences

  • Pinduoduos Parent, PDD Holdings, Experiences Slump Amid Economic Weakness and Intense E-commerce Competition in China

    Pinduoduos Parent, PDD Holdings, Experiences Slump Amid Economic Weakness and Intense E-commerce Competition in China

    Chinese e-commerce powerhouse, PDD Holdings, recently experienced a significant drop in first-quarter profits along with revenues falling short of projections. This is largely attributed to a sluggish economy dampening demand for their domestic operations. The underperformance sent the company’s share value plummeting by 10% on Wednesday.

    China’s retail sector, being the world’s second-largest, has had difficulties drawing in consumers. This is primarily due to a protracted property crisis and worries over job security and wage growth, which have collectively undermined spending power. This, in turn, has negatively affected the demand for companies like PDD.

    Stiff Market Competition and Aggressive Investments

    PDD’s domestic discount marketplace, Pinduoduo, faces fierce competition from rivals such as JD, Alibaba, and other discount retailers like ByteDance’s Douyin. These competitors have been employing aggressive pricing strategies to attract customers.

    In addition to its domestic operations, PDD also manages the international e-commerce platform, Temu. The company has been making substantial investments in its supply chain network to enhance delivery speeds and broaden product categories, in hopes of enticing more shoppers.

    In an effort to build a new self-operated brand called Xinpinmu, the company announced in March that it would invest 100 billion yuan (US$14.8 billion) over the next three years. This move aims to integrate Pinduoduo’s supply chain resources with Temu.

    These aggressive investment strategies have resulted in a surge in PDD’s expenses, which in turn has weighed down its net income, causing a 15% reduction to 12.5 billion yuan for the quarter ending March 31.

    Regulatory Scrutiny and Model Feasibility

    Temu has grown in popularity as a platform for shoppers seeking low-priced items, capturing demand from lower-income households worldwide.

    However, the company’s model of delivering inexpensive goods directly to customers from China is encountering increased regulatory oversight. Temu’s operations have traditionally depended on duty waivers for low-value parcels in many jurisdictions.

    Changes in international regulations, such as the US abolition of the duty-free exemption on parcels valued under $800 last year, and the EU’s decision to eliminate its duty-free allowance on parcels under 150 euros ($174.57) as of July this year, pose questions about the sustainability of the current business model.

    Questions & Answers

    What is causing PDD’s revenue to fall short of estimates?
    The decrease in PDD’s revenue is primarily due to a sluggish economy that is affecting consumer demand for its domestic operations.

    How is PDD responding to the competitive e-commerce market?
    PDD is making substantial investments in its supply chain network to enhance delivery speeds and broaden product categories, in hopes of enticing more shoppers.

    How might changes in international duty regulations affect PDD’s business model?
    Changes in international regulations, such as the abolition of duty-free allowances on low-value parcels, could impact PDD’s current business model of delivering inexpensive goods directly from China and may require the company to adapt its operations accordingly.

  • Vietnam Experiences Significant Fuel Price Drop Amidst Global Declines and Tax Adjustments

    Vietnam Experiences Significant Fuel Price Drop Amidst Global Declines and Tax Adjustments

    In a notable development, gasoline prices in Vietnam saw a significant drop ranging from 6.47% to 18.8% late on Thursday. The widely used RON95 fuel recorded the highest decrease of 18.8%, reducing its price from Wednesday to VND24,330 (equivalent to US$0.92) per litre.

    Decrease in other fuel prices

    Along with RON95, other fuels also witnessed a price drop. Biofuel E5 RON92 plunged 16.9%, bringing its price down to VND28,070 per litre. Diesel, another essential fuel, recorded a 6.47% decrease to VND35,440 per litre.

    Global fuel price trend

    The decline in Vietnam’s fuel prices aligns with the global trend. Internationally, RON95 gasoline decreased by 7.4% from Wednesday, reaching $135.6 per barrel, and diesel fell 6.5% to $204.6 per barrel. These global price changes were reported by the Ministry of Industry and Trade and the Ministry of Finance.

    Tax Changes Influence

    However, the global price drop is not the sole cause for the fall in Vietnam’s fuel prices. A series of tax adjustments implemented late on Thursday also contributed to the decrease in local rates. The environmental protection tax on gasoline, excluding ethanol, diesel, and aviation fuel, has been reduced to zero from the previous VND1,500–2,000, as per a decision of the Prime Minister.

    Additionally, the excise tax on all types of gasoline and the value-added tax on gasoline, diesel, and aviation fuel have been modified, with the former being cut to 0% from an earlier 10%.

    Local Fuel Market Situation

    Despite the ongoing conflict in the Middle East, which has put added pressure on the domestic fuel market, the local fuel supply in Vietnam remains stable, according to an earlier statement by the trade ministry.

    Questions & Answers

    What was the percentage decrease in the price of RON95 fuel in Vietnam?
    The price of RON95 fuel in Vietnam decreased by 18.8%.

    What other factors contributed to the decrease in fuel prices apart from the global price drop?
    A series of tax adjustments, including a reduction in the environmental protection tax and excise tax on gasoline, also influenced the decrease in fuel prices.

    Despite the conflict in the Middle East, how is the domestic fuel supply in Vietnam?
    Despite the escalating conflict in the Middle East, the domestic fuel supply in Vietnam remains secure and stable.

  • South Korean Beauty Brands Leverage Immersive Experiences For Enhanced Customer Engagement

    South Korean Beauty Brands Leverage Immersive Experiences For Enhanced Customer Engagement

    As the beauty industry becomes more competitive, leading South Korean beauty brands are transforming their stores into immersive spaces. These spaces offer customers an opportunity to trial products and gain a deeper understanding of the brand’s ethos.

    Space Dosan: A Unique Testing Ground

    APR Co, a significant player in the beauty industry, operates ‘Space Dosan’ in Seoul’s Sinsa-dong. Here, customers can try the Medicube skincare range and experiment with the brand’s beauty device – Age-R. Trying creams or perfumes can be straightforward, but the opportunity to test electronic skincare appliances, which call for time and careful instruction, has garnered special interest. Staff members are present to help customers with product applications and device usage. This service was so well-received in the store’s initial phase that appointments had to be made by reservation. According to an APR official, some international visitors said they visited specifically to see and try the products personally. “Offering a direct, in-person experience is becoming crucial to expressing a brand’s complete value,” they said.

    Sulwhasoo: Storytelling and Ginseng Classes

    Amorepacific’s Sulwhasoo brand is placing a focus on experiences that tell a story and reflect its heritage. The brand’s Bukchon Sulwhasoo House in central Seoul hosts the popular ‘Ginseng Class.’ This hands-on workshop underscores six decades of ginseng research. Here, participants can make tailored ginseng-scented sachets and bath soaks using Sulwhasoo’s signature ‘Beauty Saponin’ and ‘Jaumdan’ ingredients. Since the reservations opened in July, more than 1,800 people have signed up in just a few days. The sessions continue to sell out within an hour each month, and a modest participation fee was introduced this month. The program, which will soon be available to foreign tourists, aims to increase awareness of the cultural and cosmetic importance of ginseng.

    The History of Whoo: Beauty Classes

    LG Household & Health Care is another beauty industry stalwart providing beauty classes for its product line, The History of Whoo. These classes are offered to department store VIP clients, who have achieved a specific spending level at luxury stores like Lotte and Shinsegae. Each session, with around ten participants, includes traditional experiences such as crafting a royal pouch and enjoying private catering. Since January, approximately 900 customers have participated. An LG H&H representative said, “These classes allow VIPs to connect with our brand identity as a ‘royal dermatology’ cosmetics line.” Meanwhile, LG H&H plans to expand such offline experiences to provide a distinct, premium interaction that reinforces The History of Whoo’s prestige.

    This trend in South Korea’s beauty sector mirrors a broader transition: the sale of not just products but sensory experiences that connect brand identity, tradition, and technology. This strategy is seen as critical in maintaining customer loyalty in an increasingly crowded global market.

    Questions & Answers

    What are the unique experiences Korean beauty brands are providing?
    Korean beauty brands are offering unique experiences that combine product trials with brand storytelling. Examples include the trial of skincare devices at Space Dosan, the ginseng classes provided by Sulwhasoo, and The History of Whoo beauty classes catered to VIP clients.

    What is the purpose of these experiences?
    These experiences aim to create a direct, offline connection between the customer and the brand. They allow customers to understand and appreciate the brand’s complete value, heritage, and identity.

    How are these experiences impacting customer engagement and loyalty?
    These immersive experiences are helping brands stand out in a crowded market and are seen as key to retaining customer loyalty. They provide a unique, sensory encounter that allows customers to connect more deeply with the brand.

  • Google to improve shopping experience across platforms

    Google to improve shopping experience across platforms

    In its annual Google I/O livestream, Google has just announced a bunch of improvements it is bringing to the search platform (and others), aimed towards improving the experience of both merchants and customers when it comes to shopping online.
    Google introduces the “Shopping Graph,” a newly developed comprehensive dataset, backed by artificial intelligence, to help shoppers find exactly what they are looking for, updated in real time and ensuring products are currently available.
    The Shopping Graph is able to understand and tie together the billions of “products, sellers, brands, reviews and most importantly, the product information and inventory data received from brands and retailers directly.”
    The Shopping Graph will span all of Google’s platforms, connecting and inspiring people with things they may be looking for (whether they be virtual or physical) from what Google claims are over 24 billion listings from merchants online. This means you should be able to find what you are searching for even more easily than before, with Google adding new interactive features for interconnectivity between platforms as well.
    For example, Google Lens has been integrated into Google Photos to make searching for products online easier. Rather than screenshotting an item you are interested in and then forgetting about it, as soon as you snap that screenshot, Google Lens will analyze it, pick out objects within the image, and allow you to instantly search online for them (should you choose to do so).
    Google also teased a new user experience on its YouTube platform, which should be making it simpler to shop for products featured by your favorite YouTube creators. Hopefully this will alleviate the repeated-to-death phrase “links in the description, guys” (links which are sometimes forgotten as well)! Google didn’t us give any more details, other than that the new features are “in pilot.”
    We are also told to expect online shopping research and product comparison to get infinitely easier, with a new widget we’ll be seeing on our Google home page. We all know the hassle of trying to research the heck out of where a particular item is sold for the lowest price (such as the best new smartphone you may want to upgrade to).
    With so many shops and online retailers to review, most of us end up opening a hundred tabs on our browser until we can barely keep track of what’s where.
    Soon, every time you open a new tab, a widget across the center will display the carts across different sites where you’ve shopped the last few weeks. This should let you keep track of desired purchases or items to compare from different sellers much more easily. You can opt to be shown available discounts on your cart icons, as well as having integrated access to the loyalty programs of your favorite stores.
    Once your carts are full, Google will be able to send you notifications when prices of any items drop—only if you opt in, of course. Google has also announced a new collaboration with Shopify to facilitate your shopping experience across all of Google’s platforms: from Google Search to Google Lens, Google Maps, Google Images, and YouTube.
    We’ll keep you updated once we have more details on some of these changes!
  • Vietnam’s E-Commerce Revolution: Platforms Embrace Immersive Experiences Over Discounts for Engaging Shopping Journeys

    Vietnam’s E-Commerce Revolution: Platforms Embrace Immersive Experiences Over Discounts for Engaging Shopping Journeys

    Double-day events—dates like 6/6, 9/9, and 11/11—have historically served as prime opportunities for online retailers, marked by aggressive promotions and a flurry of sales. However, growing indications of diminishing returns, especially among Gen Z, are nudging platforms to rethink their marketing strategies.

    According to TikTok’s What’s Next 2023 report, a remarkable 72% of Gen Z users trust product recommendations from content creators more than traditional ads. In a striking revelation, 83% confessed to making purchases after enjoying a livestream. These figures underscore a notable shift towards authentic, personalized content over conventional sales pitches.

    Younger consumers are now leaning towards emotional connections, real-life narratives, and product discovery through relatable influencers and entertaining content.

    Transforming Transactions into Engagement

    In response to these emerging trends, many e-commerce platforms are reimagining their strategies. Livestreams, once primarily seen as direct sales mechanisms, are evolving to emphasize storytelling, interactivity, and community connection.

    Take Lazada’s recent 6.6 campaign, for instance. It featured an innovative livestream series titled Kinh LazTo, inspired by the traditional Vietnamese bingo-style game, lo to. Running from June 3 to 6, the show artfully entwined modern e-commerce with cultural flair, creating a vibrant atmosphere that invited viewer participation while seamlessly promoting featured products.

    Rather than merely showcasing discounts, hosts cleverly introduced sale items through interactive gameplay, allowing viewers to add them to their carts in real time. The experience resembled a live festival, complete with a digital bingo machine, dazzling visual effects, and lively commentary. Viewers didn’t just watch; they engaged, responding enthusiastically to each draw and forming connections with the products on display.

    A Shifting Competitive Landscape

    In an ever-crowded e-commerce environment, the old trick of discounting loses its charm and differentiation. As consumer expectations continue to shift, brands are venturing into new territories that place a premium on emotional resonance, entertainment, and engagement.

    Initiatives like Lazada’s bingo-inspired livestream illustrate how platforms are inventively enhancing customer experience while ensuring sales performance. While discounts still play a role in the equation, there’s a growing focus on long-term engagement strategies that aim to foster loyalty and distinguish brands in today’s competitive digital marketplace.

    As we navigate this transformed retail world, one can’t help but wonder: Could the next shopping trend be an old-school carnival game come to life in a virtual format?

    Questions & Answers

    What is the main takeaway from the TikTok report regarding Gen Z?
    The report reveals that a significant 72% of Gen Z users prefer product recommendations from content creators over traditional advertisements, indicating a shift towards authentic marketing approaches.

    How did Lazada integrate cultural elements into its 6.6 campaign?
    Lazada’s campaign incorporated the traditional game of lo to, blending it with modern sales tactics to create a lively and engaging livestream event that resonated with viewers culturally and emotionally.

    What does the shift in e-commerce strategy suggest about future trends?
    The growing emphasis on interactive and emotionally resonant content suggests that future trends in e-commerce will prioritize community-driven experiences and personalized marketing over mere discounting strategies.

  • Huawei India revealed massive expansion plan by 2020

    Huawei India revealed massive expansion plan by 2020

    Huawei India plans to open 1000 experience stores across the country by 2020. The first 100 such stores are already in planning or construction in partnership with the brand’s retail partners, offering consumers the chance to try out its flagship handsets. They will also display Huawei’s growing range of smart devices including laptops, speakers and watches.

    “We are initiating the offline expansion with our new flagship device… we are aggressive globally with our offline strategy and we are replicating the same in India,” said Wally Yang, senior marketing director at Huawei Consumer Business Group.

    He said Huawei was experiencing strong growth in the premium smartphone market globally and believes India will give similar results.

    “Our positioning is different, and so is the target audience. We are targeting consumers that are looking for high-end tech,” he said.

    Huawei is investing US$100 million in tackling the Indian market. Its low-cost brand Honor is already selling there both offline and online and the two brands already account for 3 per cent of Indian smartphone sales. From next year it is targeting market share growth of between 5 per cent and 10 per cent, said Yang.

    “India is important for the company’s global product strategy.”

  • Foreign Taobao shop owners in China share experiences and secrets to their success

    Foreign Taobao shop owners in China share experiences and secrets to their success

    Taobao.com, founded by Alibaba in 2003, has become the single most popular e-retailer in China with 423 million active registered shoppers by the end of March 2016. The figure has also far surpassed American e-commerce giants Amazon and eBay. Taobao has not only transformed China’s retail marketplace by providing products and online convenience to rural customers, but it has also created millions of jobs and alternate sources of income for private entrepreneurs, many of whom have become millionaires thanks to the country’s booming e-commerce phenomenon. Foreigners living and working in China are now hoping to get in on the action by opening their own Taobao shops, but are the cultural challenges and business hurdles facing them worth the payout?

    To glean some insight into expatriate e-retailing, the Global Times recently reached out to two foreign Taobao shop owners about their experiences and successes (or lack thereof).

    Kaikai, the Chinese name of a 29-year-old American, became a Taobao shop owner in 2012. He said that his first visit to China was in 2007, when he studied Putonghua at Peking University and National Taiwan University.

    “I can say everything in Chinese, I can also read and type the words on computers and mobile phones,” he said. “However, I didn’t dedicate my Chinese studies to handwriting as there is not much practicality for it in this day and age.”

    His excellent command of Putonghua laid a solid foundation for his future Taobao career. In 2012, Kaikai began selling household kitchen appliances, electronic devices and travel accessories on Taobao.

    He said he was inspired by Chinese friends who kept asking him to buy iPhone 4S from the US for them.

    “At that time, I had a need to convert my salary (paid in dollars) into yuan, so it was a win-win for both sides,” he said.

    Realizing the viability of this new trade, Kaikai decided to quit his job and begin selling products on Taobao full time.

    In terms of procedure, he said foreigners without Chinese partners need only a passport and the completion of a simple Chinese-language test. Like many budding entrepreneurs, Kaikai didn’t have any help at the beginning of his business.

    “I first started the business by myself, living and operating out of a youth hostel in Shanghai. From product procurement overseas, to logistics, importing, sales and final fulfillment, I controlled every step of the process,” he said. “I didn’t have anyone to hold my hand, so I had to learn everything on the fly.”

    Authentic American

    Even though he is not a native Chinese speaker, Kaikai conducted all his customer service interactions himself. “I would often send messages using Taobao’s voice function, which made the sales experience with customers a lot more intimate and congenial, because Chinese are happy to know that it’s really a foreigner communicating with them,” he added.

    Kaikai admits that his identity as an American guy selling American products in China is his biggest competitive advantage on Taobao.

    “In most of my listings, I take all the product photos and videos myself to differentiate my store from other sellers,” he said. “It’s an effective strategy to give my customers peace-of-mind knowing that they are buying authentic American products from an authentic American.”

    Fortunately, Kaikai’s efforts eventually became profitable. According to him, his store’s sales volume has increased exponentially through a combination of positive feedback, solid reputation and product expansion.

    He also attributes persistence to his success. “I see many small stores come and go because they quickly give up. But if you’re willing to dedicate yourself by putting immense focus and effort into your business, then the possibilities are limitless,” he said.

    Profiting from pollution

    Thomas Talhelm is an assistant professor of behavioral science at the University of Chicago. During his stay in China in 2013, he noticed smog becoming a crucial environmental issue and thus founded the social enterprise Smart Air Filters to promote DIY air filters as cheaper alternatives to expensive air purifiers.

    These DIY purifiers primarily consist of a fan and a high-efficiency particulate air (HEPA) filter, which are the major components of any standard air filter. To ship them to and sell them in China, Talhelm and his team set up their own Taobao store in 2013.

    “We started simple, but since then we’ve expanded to other products that we’ve personally tested and published results for, such as carbon filters for formaldehyde, pollution masks and particle counters,” he said, adding that their customer base is comprised of both expats and locals concerned about China’s worsening air pollution.

    “Opening a Taobao store allowed us to get affordable clean air options to more people in China,” he said. “Taobao is clearly the major online commerce platform in China. The choice is a no-brainer. Now there are more options with Weidian and JD, but Taobao is still huge.”

    When asked about the logistics of opening a Taobao store, Talhelm said that he registered Smart Air Filters as a Chinese company under the name of his Chinese partner, so the registration process was quite simple.

    According to Talhelm, his shop currently has five full-time employees, three part-time employees and several volunteers, most of them foreigners from different cultural backgrounds. All have good command of Putonghua, so language and culture are not barriers for their business.

    “Knowing Chinese is essential, but it’s not enough,” Kaikai countered. “Knowing what to sell, how to buy, how to arrange logistics and how to cope with customer and product issues are equally vital.”

    Talhelm himself designed his Taobao home page and wrote all the Chinese descriptions of their products. He concedes that the business didn’t take off at first, selling less than 10 purifiers in the first week.

    But with China’s “airpocalypse” making domestic and international headlines in recent years, their most popular purifier has now sold over 2,000 units.

    “Over time our open data and tests have reached more and more people, so our sales volume has also gradually increased,” Talhelm said. “Smart Air’s core idea has always been that if people just see the data, most people wouldn’t spend so much money on the expensive purifiers.”

    Trial and error

    Despite such achievements, both foreign shop owners said that they have also encountered numerous challenges and obstacles along the way.

    Kaikai explained that at the beginning he was unsure how to export products from the US into China, which required plenty of logistical research and trial-and-error attempts. “We are now shipping about 12 metric tons of goods each month via air and sea,” he said.

    Kaikai pointed out that learning how to delegate tasks to increase scalability is essential. “Initially, I was a bit of a control freak, as I wanted to control all aspects of the business to ensure the best quality service,” he said.

    “However, I realized that I had to delegate tasks, such as customer service, which is why I now have about five employees just in customer service.”

    Talhelm believes that evaluating customer feedback is extremely helpful, especially negative comments.

    “First we try to figure out what the customer is talking about. Is it true? Where was the problem? If it’s a scientific or technical question, I send data (or even run a new test if it’s something we haven’t tested),” he said.

    He added that the most common negative comment about his product is noise, which is a fundamental problem with almost all air purifiers.

    “Any machine that is pushing out air will create noise, but people want less noise. There are quiet purifiers out there, but they don’t push out enough clean air. We’re working on radical new designs for quiet yet clean filters,” Talhelm said.

    “The reality of day-to-day operations are the less glorious part of my work,” Kaikai said. “Those who can’t handle this will give up and close shop, but if you persevere and are willing to go to battle every day, then you can be a winner.”

    In terms of what administrative or promotional support he expects from Taobao, Kaikai said that he doesn’t expect Jack Ma to just hand over to foreign shop owners a magical key to the castle.

    Thus, his only expectations are for Alibaba to continue maintaining a fair, reliable – and, most importantly, trustworthy – marketplace for both buyers and sellers.

    “There are hundreds of thousands of Taobao shops; my store is just a number in the system. That’s one of the reasons why I love e-commerce in China, though, because I don’t have to deal with guanxi (connections with influential people)” Kaikai said.

    “For the most part, e-commerce in China is very transparent and a level playing field for sellers,” he said. “My success is achieved strictly through hard work and merit, not through relationships with insiders (like bricks-and-mortar stores).”