Young consumers drive Vipshop’s future growth strategy
Vipshop, a leading online discount retailer in China, has used its insight into e-commerce consumption trends and successfully adjusted to the changes.
The company’s number of new customers for the second quarter of this year rose by 8.2 million on the same period last year, and of that number, 45 percent were born in the 1990s. The company believes that the percentage for this demographic is likely to increase.
Feng Jialu, vice-president of Vipshop, said the post-1990s generation demands both quality and corporate values when shopping for products, and Vipshop has given young customers’ demand a priority in its corporate strategy.
The company offers a special category to attract this influential generation, including brands that have been created by noted designers, which are different from the brands traditionally sold by Vipshop.
The post-1990s generation wants to feel that it is not alone, Feng said. “We discovered that we had to upgrade our services and change from a philosophy of ‘I have goods and you buy them’ to ‘I help you choose goods and accompany you to buy them’.”
Vipshop will shortly launch two types of show on its website. The first, called Weipin Meimeida, or You Are So Beautiful, will be a recorded broadcast where professionals show potential customers how to better match their clothes. The other is a live show that will feature a range of key opinion leaders, including emerging figures, who will demonstrate things such as how to choose products and interact with customers online.
Viewers can then buy recommended products simultaneously from Vipshop.
Some of the opinion leaders will be professional buyers employed by Vipshop, who are experienced at selecting the latest, hottest and bestpriced goods for consumers.
According to a report on the online shopping habits of Asian women released by Vipshop and the Economist Intelligence Unit in December 2014, 80 percent of shoppers from Chinese mainland said they would visit shopping websites even if they did not need to buy anything and 77 percent of Chinese mainland respondents believed shopping websites were a crucial source of information.
Feng said e-commerce companies should create consumer need by convincing customers that they want products even when they do not have clear shopping goals and giving them a happy shopping experience.
Vipshop succeeded in increasing its sales of photo printers in June thanks to a live show where a young lady gave a photography class and later demonstrated how to use the printer.
“We want to create customer need through the demonstration and tell them how they can live a better life,” Feng said.
Vipshop also made changes to its mobile application in 2014 in order to adapt to the changing world of e-commerce. Other measures taken by the company in the same year included discounts and early sales promotions to develop its application and increase mobile sales.
“If we had not made the changes at that time, we would have been easily outflanked by our competitors,” Feng said, adding that outside environments have a great influence on e-commerce.
The company has also explored the use of big data technologies to provide better service to its customers. It has made it possible that different users see different things when they open the Vipshop mobile application and its has also shortened delivery time thanks to the technologies.
The Guangzhou-based e-commerce giant launched its website in December 2008 and has so far cooperated with nearly 19,000 brands. It ranked ninth in a list of China’s top 100 internet companies in 2016, which was released by the Internet Society of China and the Ministry of Industry and Information Technology’s information center in July.
We had to ... change from a philosophy of ‘I have goods and you buy them’ to ‘I help you choose goods and accompany you to buy them’.” Feng Jialu, vice-president of Vipshop