Beauty China entry – Target Chinese at home first

in GENERAL

Hi everyone. I’m really happy to have Byron Constable here today to talk about Avenue51 and some of the exciting projects that they’ve got going for smaller beauty brands wanting to enter the China Market.

We’ve obviously had conversations before and I really wanted to bring you on today to get brands understand a bit more about what you guys are doing, Avenue 51 and how you’re specifically looking to help smaller beauty brands that want to come into the China market and this is your 10/10 project.

10-10 in Chinese is a kind of a play on words. It’s Shi Shi which also sounds like “try this” it’s essentially what we did was we decided or we found it was necessary to build this community of Chinese.

Mostly Chinese expats that were willing to try new British products and particularly beauty and wellness products and then share their enthusiasm if they do like them across the social media.

Essentially we already had this, just to quickly wind you back little bit, Avenue 51 has a logistics arm, it was a courier site and around about 40,000 Chinese expats use our service every single year to deliver products back to their friends and family in China.

We already had this group and we just really need to mobilize them in a way and that’s how 10/10 came about, was essentially to put this to use, we initially use this community on brands like this works and waitrose and the results were absolutely sensational and really the reason why is because these people trying the products have lived in the UK or are living in UK, there are a natural authority on the products.

When they share their enthusiasm on Chinese social media, people believe it and it has genuine results, so that was the sort of the trigger behind sort of 10/10. But it actually as we started investigating it a lot of data started to appear and my favourite one kind of triggered this kind of fun theme of what we call angel singing and devils ring.

There are three types of shoppers, but the two extreme shoppers, which are you need to focus on are the devils. The devils get your product. They try it. They hate it for some reason and then they ring their bell and it is loud and you need to cut that bell.

I’m not going to talk about devils, but the angels of the other side, the angels are the shoppers who buy your product they enjoy it and love it.

And what they do is they share their enthusiasm with their friends on social media. Now, this is easier now than it’s ever been before in the world.

It was because social media so prevalent and because a lot of the posts are public. Strangers can see it as we’ve seen with brands like Perfect Diary who had you know people with no followers, but having massive influence on social media when they post it. 

This is the idea of the 10/10 project is your angels. When somebody buys your product or when somebody tries your product and likes it, if they trigger three to four more purchase intentions because of their enthusiasm.

If you think about it, 75% of the value of your business happens after the transaction, happens after the product has been bought it’s completely new way of thinking right now and this is really relevant in China.

Probably it’s coming in the UK, probably not as powerful, but it’s very relevant to product us like beauty and wellness where people are more interested in sharing, you know, somebody’s bought a new pen or something else and tyres.

They’re not necessarily going to share on social media, but with luxury goods or beauty, cosmetics sharing is a big part of the shopping experience. This is where the 10/10 sort of community comes into it.

10/10 are this group of people that if your brand is not very well known in China. We can give them your products, they can try them and they will share their enthusiasm on Chinese social media assuming the product works. If it doesn’t we asked them not to share their un-enthusiasm and of course we don’t encourage that.

The idea, is very fast access to the Chinese market for British consumer brands in the world in the beauty space through this natural community that we already have available. I think I had such a great network that you have and those 40,000 shoppers that were already, in your database and to be able to access them.

People as you said the UK Brands, living in the UK, they have that natural authority and in China Word of Mouth anyway, as such the strong mechanic, people really follow what other people recommend so having that authentic link for British brands is a great option, especially for smaller brands.

how does it actually work for smaller brands?

Yeah, actually, it’s very simple. We actually have a page which is a sign-up page. It’s not this complicated. You don’t have to discuss with us.

You just go to avenue51.com/1010 and you can sign up to the service, essentially you choose the number of people, community members that you would like to try your product and then you pay for the service and then you just transfer the product to our fulfillment center in London, and we take care of the rest. We give it to the community.

They try it. Once they’ve tried it, if they do have negative comments we do feed that back to the brand first. But as long as it’s reasonably positive they go ahead they post typically they’ll post on any Chinese social media such as WeChat, Little Red Book.

We don’t control it and then we give you a screen capture of that post and we translate it into English for you so you can understand what they’re saying. We have a number of brands that are using this just to get an initial understanding of what features the Chinese like about their product.

Some of them are not really even going to market yet. They just want to understand that first phase and some of them are actually already products going into the hands of lots of Chinese shoppers and they’re posting reviews with the intention of getting transactions and sales.

Yeah. I mean, I think it’s a great solution to span both those pain points for brand. I mean, I think any brand that I talked to coming in that doesn’t know whether the Chinese shopper likes their product or which products they like, you need to do that due diligence before you enter the market and this is an accurate.

This is a really accessible way of potential doing that with quite large numbers of people.

I really like that about the project. I think that’s all that’s something that and also the fact that it’s so accessible for brands.

As you said you don’t have to have those conversations. You can just literally list the products. And see what feedback is. Yeah, so in terms of the price which is always everybody’s that cares about so we charge 95 pounds per posts to coordinate everything.

We take care of everything you just have to as a brand just move the products transfer the products to our London fulfillment center. And that’s it. We take care of everything else including talking to the community about your product to draw out what we understand that the key features to make sure they have a better understanding but that’s pretty much it.

So one of the parts when we launched this it was initially just the review side of things.

But what we found is that there is, do you remember I mentioned to you about around 75% of the value of every transaction happens after the shopper has bought so every time that you sell one product you should sell three more off the back of that one product with that angel.

But the problem happens if you look at the point to the connecting points, is that a lot of shoppers once they see the product and hear about it. It’s complicated for them to purchase it.

And so what we’ve done is to shorten that and to increase that conversion rate is that we’ve actually created on WeChat a shop which is the 10/10 shop.

If the brand wants to, they can also have their product listed in the shop That anybody anywhere in mainland China can buy it instantly they can place an order in RMB using WeChat and then the product is shipped by us from the London fulfillment center to the shopper.

Again, the brand does nothing and that’s what we call the 10/10 listing service. That’s a fantastic solution as well, for customers who like it, to be able to transacts easily as going to your.com site can be a very difficult experience for Chinese consumers and  very slow as well as payment problems all that sort of thing. Being able to have that is a huge plus for the brands.

Yeah. In terms of the success that you’ve had with brands well obviously you talked about “this works”.

What size brands do you usually work with? Do the brands do thousands of 1010ers?

We have a few brands right now. And I didn’t quite do sort of get this. But the big period looks like it’s going to emerge in Q1 of 2021 with a lot of brands starting to use this service in bigger numbers.

And the reason is I’ve discovered is because in China lots of people make New Year’s resolutions in January just like we do here in the west and obviously that’s the point when they start to try new well-being products.

And natural products, etc. A lot of people seem to be focused. I think they’re quite smart to focus on that particular quarter, which is Q1 to really get everybody trying their product. Is this kind of New Year’s resolution period.

That’s when I would see a lot of discussion we have right now are focused on that particular quarter.

And brands can obviously decide to do a large number of 1010ers less?

No more than 40,000. Yeah. We have quite a base to work with I mean some of these people we’ve worked with quite a lot of time we know that they’re better at posting reviews than others and we tend to work with them at the earliest stage but there’s always some great surprises.

As I said the key thing is that it’s not about the number of followers these people have.

One of the biggest people tend to mistake us from being an influencer agency in that aspect I do explain it, there’s a great case study from Perfect Diary, which is probably one of the fastest moving cosmetic brands in China and also recently from another brand which is doing weight loss, Spanish brand, which shows that the investment in shoppers are what they call KOC in China, people not necessarily with big following, but they’re very authentic and when they post a lot of people tend to see and because they often post on public social media a lot of people see that review and influences their purchase intention.

We’re not about influencers and that’s why it’s only 95 pounds per post. We’re leveraging the power of a shopper and I think that’s powerful because that’s your point difference. I think the two points different obviously with KOCs, so shoppers and also the fact that they’re mainly based in the UK.

They’ve got that authenticity with British Brands. I think those two things together is a powerful combination for brands looking to really test the market.

Okay. Obviously having worked with lots of beauty brands both with the 10/10 and also with the broader Avenue 51 work.

Do you have one trend that you think brands that are coming into the market should know?

The one trend I’ve seen I mean there are themes that I love for example, I love this cyberpunk thing that’s really emerging right now in China, but I’m really not an expert and I don’t have enough data on that and I tend to only sort of reference things that I really understand and have a lot of information on.

The one thing that I do see which is more of a something that we need to address as a country

is that because Chinese shoppers are not shopping and coming to the UK as much right now,

and there’s not as much visibility from Britain, is that a lot of the Chinese shoppers are forgetting to buy British Brands.

And even if you are an established brand and we work with a number of those, even they are turning to 10/10 right now to remind the Chinese shoppers that we are still here. We’re still a reputable sort of place to shop.

So in terms of trends, I actually see a trend from the Chinese almost forgetting to shop in UK and Europe to certain degree and this is a trend that we really need to turn around and this is where British brands, particularly well established ones would do well to raise the voice at this point, get more angels sing if you want to use that analogy.

It’s because we are drifting down and that’s a trend that I’d love to see reversed. Absolutely. Yeah, that’s very worrying for any foreign brand. I think what we all see the rise of C Beauty and you know the power of brands like Perfect Diary, there’s lots of talk around that but there are still shoppers that want to buy foreign brands.

But of course they have a lot of choice. I think that’s a very good point about how British Brands need to also stay top of mind.

Yeah, and they have short attention spans. I mean shoppers do generally and you have to address that you have to concern and so previously people would shopping in London and sending back beautiful selfies of Cambridge, etc, and that was really triggering in the minds of the shoppers back in, I really need to buy from England or Great Britain, but that’s disappeared this year and we really need to sort of force that back.

We really need to to get that visibility back as a nation in countries like China. People continue to remind them to shop because we are high preference, if people remember that’s a very interesting point in something.

I definitely think about people in China. What we’re hoping next year is to have a celebration where by lots of Chinese shoppers are trying British brands in a month before they actually buy them on the 11/11. It’s kind of perfect, you should see a lot of noise particularly working up towards that particular date.

Well, I look forward to that and I hope a lot of British Brands get on board to build up some noise. Thank you so much Byron for that. I think 10/10 is a great opportunity, an option for a beauty brand wanting to come into the market.

If people want to get in touch with you, what’s the best way to do that?

The easiest way is byron.constable@avenue51.com and then certainly happy to contact me. Just go to, as I mentioned avenue 51.com/1010 and there is a live customer service on there. We’ve got a team which are on there most of the time and they’ll be able to answer all the questions immediately.

Great. Well, thank you so much. That was really interesting.

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