Growing influence

Updated: 2013-04-05 08:20

By Lin Jing and Chen Yingqun (China Daily)

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In terms of quantifiable returns, the company's 500,000-yuan ($80,500) micro blog campaign has inspired more than 95 million friend-to-friend recommendations, and sparked a 14 percent year-on-year growth in sales.

Growing influence

Customer interactions

Marketing successes aside, the platforms are also about more customer interactions for some companies.

Durex, a condom brand owned by the UK-based Reckitt Benckiser group, perhaps has the most active presence in China's virtual world. The company has created a humorous character called Dudu, that shares sexual health information and love stories. That the platform is immensely popular can be gauged by its ever-growing fan-base of over 670,000 followers.

Ben Wilson, marketing director of Reckitt Benckiser, says that though Durex's success is largely due to the interesting topic of safe sex and sex education, the friendly and conversational style of the micro blog has helped the company reach out to more fans. "Social media is all about making friends and engaging people. As a brand, we have realized how critical it is to engage with our friends," he says.

Durex has a dedicated team of professionals and an external associate to manage its micro blog around the clock. The team puts out 10 to 15 posts every day and conducts two to three events for their followers every month.

"It (micro blog) is the place where people who buy condoms spend a lot of time," Wilson says. "What we do is to connect lots of people, who are passionate about the brand, so that they will ultimately choose Durex when it comes to buying. We also do not use micro blog to force consumers to buy our products. We instead use it to build friends," he says.

Micro blogs are also an important tool for many companies to gauge consumer feedback.

Swedish furniture retailer Ikea set up its official account on Sina Weibo in October 2010, when micro blogs were just beginning their ascent in China.

"The main reason for starting the micro blog activity was to ensure that we do not miss the best opportunity to communicate with our consumers," says Jay Lin, a social media specialist from Ikea. "SNS has a dual role for us - listening to suggestions from consumers and giving positive, timely feedback to consumers on their concerns and needs."

Their daily schedule includes answering netizens' questions, forwarding complaints to relevant after-sales departments, supervising key words and sensitive incidents on micro blogs that might influence the company, and coordinating with other internal departments to draft the proper answers, Lin says.

"Many of these incidents can be turned into future business opportunities, especially if we can seize the moment. So it is of utmost important that we discover and grasp these moments with our account, and also publicize our offline activities to draw enough attention," Lin says.

Michael Chu, managing partner of Ogilvy Public Relations, says micro blogs are an option worth considering for foreign companies, especially for companies that are focused on consumers aged above 20, as their target audience spends a lot of time online.

The total number of micro-bloggers in China is believed to have reached 309 million by the end of 2012, a 58 million addition over 2011, says a recent report published by the China Internet Network Information Center, the administrative agency responsible for Internet affairs under the Ministry of Information Industry. During the past year, monthly visitors of micro blogs have exceeded 200 million, not including the number from smart phones.

Latest research from DCCI shows that micro blog users aged above 19 account for over 88 percent of all Chinese netizens. On average, one user has 1.45 micro blog accounts, puts up 2.13 posts and forwards 3.12 posts. Over 70 percent of them surf their account at least once a day.

The number of Internet users in China is around 564 million. The total daily posts on Sina Weibo are more than 400,000, while the number of micro-bloggers is around 300 million.

Compared with traditional ways of marketing such as television or newspapers, significant features of micro blog marketing are the increased interaction it allows with followers and its lower costs.

Eugene Chew, director of digital strategy at JWT, a public relations company, says that micro blog marketing enables conversations across multiple platforms.

Silloway from Starbucks says micro blog is an excellent tool to gauge customer perception. "Some customers write to us that they want to improve their coffee knowledge, some tell us what they think about our products," she says.

Chew says that big brands are attracted to social media because they are relatively low-cost, compared with TV and print advertising. "It is like a consumer database, where word of mouth is the most important tool for brand building," he says. "Lots of brands realize that they need to build online communities for brand lovers, especially new brands that have limited budget for marketing."

Yao Fang, marketing director of Royal Caribbean China, a unit of Royal Caribbean, the Norwegian-American global cruise company based in Miami, says that unlike traditional marketing channels, micro blog comes at a lower cost, and serves as a supplementary marketing channel. She says that though it is difficult to quantify exact contributions, there is no doubting the boost it gives to overall turnover.

"Micro blog marketing is the next big thing, as Sina has become a stable platform, with a daily growth in user numbers and viscosity. It is a huge marketing opportunity," she says.

Silloway says that though Starbucks has stores in 16 different provinces, it is difficult to establish a pan-China presence as TV marketing is an expensive affair.

"Micro blog is market-efficient, low-cost and interactive, and also gives us instant feedback on what the general perception is," she says.

According to statistics from eMarketer, a US digital market research firm, social network advertising spending in Asia-Pacific will grow by 48 percent from $1.38 billion in 2012 to around $2.5 billion this year. In the US, it is expected to reach $4.1 billion this year and $5 billion in 2014.

For China, the figures are higher. As the biggest SNS market, the advertisement spending on social media will experience a fast increase of 51.3 percent, reaching $612 million this year, it says.

Chu adds that when it comes to fifth and sixth-tier cities in China, where roadside boards are rare, micro blogs are probably the best or sometimes the only channel to reach people.

Though micro blogs are immensely popular in China, they have also received much flak for their similarity with global SNS platforms like Twitter. Both the websites sport distinctive layouts with similar features for posts, referrals and comments. But micro blog differs from its Western peers in terms of the added features it provides.

Jeremy Webb, a digital strategist from Ogilvy, says that the real difference between the two platforms lies in the low penetration rate of the US-based platform.

Twitter still has a relatively low penetration rate in the US market. Of the 74 percent of American adults who use the Internet, only 8 percent use Twitter, says a recent study by Pew Research Center, an American think tank. In contrast, the percentage of micro-bloggers among total netizens in China has grown by 6 percentage points to 54.7 percent.