Tapping into Chinese consumers’ intrinsic needs for community

Few businesses symbolise China’s scale and trajectory more than the delivery app Meituan. No company has ridden the trend of o2o, the integration of online and offline, retail quite like them.

As of last year, Meituan had 7.45 million delivery drivers, more than a lot of countries have people. Between April and June this year, they made 6.1 billion deliveries. While growth has slowed for many companies, Meituan deliveries grew 14% last quarter on the year earlier.

A key driver in Meituan's growth has been its Pin Hao Fan service, which launched in April 2022. It creates a quasi-community type situation allowing users to band together to make purchases.? A consumer chooses a dish from a list of options, and then if enough people nearby choose the same dish, they all get a discount. Completion times vary, but can be as short as 10 seconds. The service was used as much as 8 million times a day last quarter and now accounts for 10% of deliveries.

The service, and other community group buying services such as Pinduoduo have picked up in recent years. Whilst a key factor has been the price savings, they also tap into a growing trend of consumers wanting to be part of a community.

The desire to be part of a community is strong in most markets, but the motivations are more pronounced in China. For a start, families are much smaller – a large share of urban youth have no siblings, many don’t have cousins. Fewer youth play team sports. Religious communities aren’t as prevalent or in the open as in other countries. As a result, consumers find communities from more commercial sources.? ???

Whilst China’s enthusiasm for all things digital provides strong platforms to build communities, those that build communities both online and offline are some of the most successful.

You may have noticed our trend article last week about community-driven pub brand, Tiaohai Village. The 30-strong chain is a great case study for community-building done well. It connects people through a common promise of a refuge for stressed urban youth, but takes engagement to another level such as having members as part-time bar people. The pubs provide a variety of community events often led by patrons, such as exhibitions, marketplaces, concerts, job fairs, book clubs, and podcast recordings.

The growing popularity of academic/science bars provides another example of connecting consumers with a shared interest, through an accessible platform, supported and grown by an online community.

Pubs lend themselves to creating a community meeting point, but brands as varied as sports and fashion, skincare and food & beverage are successfully creating communities though online and offline initiatives, amplified by targeted micro-influencers and KOCs (Key Opinion Consumers), partnerships and collabs.

As many brands in China aim to win customers through price wars, there are shining examples of brands who don’t, identifying and targeting specific segments with common interests, and providing a reason for them to be part of their community. That sees these brands much more likely to connect emotionally, making them less price sensitive.

China Skinny can work with your brand to identify your target audiences’ intrinsic needs for community and develop an action plan on how to best tap into them.