What is Kuaishou?
Kuaishou is a social network specializing in short videos.
Kuaishou and Douyin (TikTok in China) are currently the most popular social media platforms in China. However, they differ significantly in their audience, positioning, and content style.
In China, Douyin primarily targets young urbanites with trendier video content. By contrast, Kuaishou attracts a large number of users from less developed areas in China, mainly aged 25 to 35 years old. Its content is more deeply rooted in everyday life.
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Kuaishou’s Main Markets
Kuaishou’s main markets are those of local consumption. Kuaishou started with short videos and live streaming. Once its content ecosystem was sufficiently developed, users naturally extended their needs into other areas, such as local life.
Kuaishou has invested in local life through a differentiated competition strategy. It continues to expand its pilot cities by penetrating into local group buying in smaller cities. In 2023, Kuaishou launched a project to encourage merchants, content providers, and influencers to settle in.
It also promoted the mini-program on WeChat and the official application for B merchants to create a complete transaction cycle. These show that Kuaishou will experience even more rapid expansion in 2024.
What is the Local Market in China?
In China, the local market encompasses products and services essential to daily life, such as food, household products, catering, etc. These are available and used in local areas close to consumers.
Unlike traditional e-commerce platforms, the local market favors offline interactions and connections with physical stores. Users often have direct contact with merchants when buying products or ordering in a local restaurant.
The Size of the Local Market on Kuaishou in China
The reason is very clear for Kuaishou. For some years now, Kuaishou users have expressed a strong desire to consume local products and services while enjoying various content.
For example, in content related to food or landscapes, many users asked for information and comments on restaurants or tourist sites. However, these consumption requests were not systematically satisfied at the time.
For Kuaishou, the local life market and group buying bring a huge increase in customer flow and relatively low operating costs, which represents its greatest value. That’s why Kuaishou is starting to focus on the area of local life to create an increase in online consumption.
Why Does Kuaishou Focus on the Local Market?
The reason is very clear for Kuaishou. For some years now, Kuaishou users have expressed a strong desire to consume local products and services while enjoying various content. For example, in content related to food or landscapes, many users asked for information and comments on restaurants or tourist sites. However, these consumption requests were not systematically satisfied at the time.
For Kuaishou, the local life market and group buying bring a huge increase in customer flow and relatively low operating costs, which represents its greatest value. That’s why Kuaishou is starting to focus on the area of local life to create an increase in online consumption.
China’s Blue Ocean: The Business Opportunities Brought by the Lower-tier Market
What is China’s Lower-tier Market?
The emerging market in China refers to smaller and less developed cities and regions in China. Although these cities have a relatively low level of economic development, they have a significant population and enormous consumption potential. In these regions, many residents have free time and a relatively comfortable disposable income. They are accustomed to watching short videos and following live streaming on platforms such as Kuaishou and are also inclined to make online purchases.
Compared to larger cities, consumers in the emerging market are more relaxed in their spending and have more time to consume. With the development of China’s digital economy, these cities have a significant population and enormous consumption potential.
However, online services and products are relatively insufficient, and market demand is not yet fully satisfied.
International Brands on Kuaishou
In September 2023, Coca-Cola collaborated with Kuaishou’s KOCs to launch a series of customized short films focused on the culture of banquets in small Chinese towns (weddings, graduation ceremonies, and birthdays).
These short films vividly and realistically depicted the moments of joy and happiness shared among Chinese people and their families and friends on these festive occasions. They precisely targeted the psychology of consumers in small Chinese towns. By reinforcing the emotional value of the brand, Coca-Cola successfully linked its brand values to popular culture with depth.
The Stereotypes of the Lower-tier Market
The rural and peri-urban market in China refers to regions located in less developed cities, which are generally characterized by a lower level of economic development. These areas are often associated with various stereotypes, where residents are perceived as having limited purchasing power.
However, these users do not necessarily represent low-income consumers. They have enough time and means to consume. For example, these users on Kuaishou spend an average of more than 2 hours per day on this platform and also spend significantly.
According to forecasts by consulting firms like McKinsey, by 2030, more than 66% of the growth in individual consumption in China will come from these cities.
Conclusion
As the leading short video social network in China, Kuaishou has initiated a new wave of consumption by diving into the local market. Although many users come from economically less developed emerging cities, they do not fit the stereotype of low-income consumers.
On the contrary, they are affluent individuals with time and disposable income. This vast emerging market is becoming the main driver of consumption growth in China, offering huge business opportunities to companies.
If you would like to learn more about marketing strategies on social media in China, please do not hesitate to contact us. The international digital marketing experts at STAiiRS will be delighted to answer your questions in detail!
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