Brands are investing in customer membership programs more than ever to engage and retain Chinese consumers during this year’s 11.11 Global Shopping Festival.
Marquee names from The North Face to Royal Canin are using membership programs to drive repeat purchases. They’re offering early access, hard-to-match experiences and community interactions in China to build a loyal following.
“As our most loyal and high-potential customers, members are important growth engines for our business in the long term,” said Claire Sun, Omni-SPT Associate Marketing Director at Mars-owned pet food brand Royal Canin in China.
The North Face is one of 82 brands that surpassed RMB100 million ($13.8 million) in gross merchandise value (GMV) generated from members on Nov. 1 on Alibaba’s business-to-consumer e-commerce platform Tmall.
Other membership winners on the list were Nike, Procter & Gamble, L’Oréal, Estée Lauder, Bosideng, and UNIQLO.
“Transforming consumer awareness into customer loyalty is key to generating the best return on investment,” said Chui Xue, President of Industry Development and Operation Center of Alibaba Group’s digital marketplaces, Taobao and Tmall.
Behind the Sales
Developing a loyal following on Tmall is a summit that The North Face is working to conquer.
For this year’s 11.11, members of the American outdoor recreation brand can access exclusive products and gift sets and win attendance at snowboarding events featuring top snowboarders. A lucky few will even be able to take to the slopes themselves, but membership is about more than shredding.
There’s a strategic imperative to sharpen differentiation as a way of deepening customer loyalty, consultancy Bain & Company noted in its 2022 Singles Day report.
Over 40 merchants have attracted above 11 million members on Tmall, and another 600 attained more than 1 million members in their loyalty membership programs.
On Nov. 1, 2,700 prominent brands saw their members contribute more than half of their GMV, an important line to cross for those brands, said Zhang Xiuming, who is in charge of the membership programs for Taobao and Tmall.
“It means that the brand can have very high certainty for its business performance on the Tmall platform,” Zhang said.
Turning a shopper into a member of a Tmall store will increase a brand’s conversion rate, the percentage of people who make a purchase among overall foot traffic, by at least 20% points and their total spending on the brand by at least 20%, Zhang estimates.
The future of retail will see consumers looking beyond discounts and seeking more unique offerings and experiences to develop identification with the brand, said retail executives.
California-based haircare brand Olaplex has realized the value in education and effectiveness of products in gaining and retaining loyal customers.
Olaplex’s CEO JuE Wong said Chinese consumers are extremely consistent, repeat shoppers once they trust a product’s quality and effectiveness.
The haircare brand’s recent livestream with China’s lipstick king Austin Li last month generated more sales in results than that during 6.18 Mid-Year Shopping Festival and last year’s 11.11. She noted that Austin loves Olaplex because he, and his mother, are fans of the products.
To capture the hearts and minds of consumers, brands need to show that they cared.
“For this year’s 11.11, we want to give our members [the] human touch,” said Wu Meng, Vice President of Jala Group.
The Shanghai-based cosmetics company launched a customized digital calendar for its members on Tmall store this 11.11. Consumers can find product recommendations based on their skin conditions, and each day on the calendar comes a set of products offering and tips on the best way to obtain the discount price.
It ensured its members got priority access to try out new brand products. And for members that have their birthday coming, it will send out greeting cards and gift packs to let them feel the care.
And that care extends to their fur friends as well. Royal Canin launched a pet profile feature for its members, numbering over 1 million, on Tmall ahead of 11.11.
Members can tap in the details of their pets, including their breed, age and health conditions to get customized product suggestions specific to their pets.
Besides coupons and deals, the brand also offers regular live streaming sessions for its members on science-based pet nutrition and healthcare. Whenever consumers have questions on pet care, they can also turn to one-on-one consultations with pet experts on the brand’s Tmall store.
“Through providing more membership benefits and improving our membership marketing, we want to attract more consumers to sign up to become members,” said Royal Canin’s Sun.
Brands are striving to offer consumers an integrated shopping experience across e-commerce sites, brick-and-mortar stores and social media channels.
Olapex said it provides a loyalty membership service on Tmall Global, Alibaba’s cross-border e-commerce platform, while using KOLs, and other platforms to drive brand awareness and education.
The North Face said it had integrated its membership system on Tmall with other channels, including its official website, WeChat mini-store, and offline retailer at the end of 2021.
Consumers can accumulate loyalty points no matter where they purchased the products and use them to redeem membership benefits on all channels.
The omnichannel approach also helps brands deliver a consistent and personalized experience for consumers, which is key to building connections.
“We want our members to feel all-round care and attention,” said Jala Group’s Wu.