New WeChat report suggests slowed growth for luxury brands
Geneva-headquartered marketing agency Digital Luxury Group and China-based marketing automation platform Jing Digital recently released a joint WeChat luxury index report for 2021.
As of this March, social messaging application WeChat had more than 1.225 billion monthly active users.
Based on non-public data collected between January and December 2020, which was then compared against previous editions of the luxury index, a key takeaway was that larger WeChat accounts (those with more than 100,000 followers) appear to be facing a general slowdown in terms of growth since 2018, the report said. This could be down to market saturation, particularly as more brands have leveraged a WeChat strategy in light of covid-related lockdowns, restrictions and store closures in other global markets.
Search was the top follower recruitment channel (roughly 33.7%), pointing to reduced footfall in offline retail stores, for example, where customers would typically have scanned QR codes. QR codes took around 29.5% of the recruitment mix in 2020, compared to 38.4% in 2019.
The unfollow rate during the 48 hours following a content ‘push’ was 0.99% in 2020, more than double the recorded rate (0.4%) in 2019, indicating a higher degree of sensitivity to content quality among consumers. The report’s authors suggested implementing audience segmentation, with content better tailored to individual interests, in order to minimise the unfollow rate going forward.
Further, around 32% of followers recruited by brands via paid channels such as WeChat Ads later unfollowed the brand, according to the 2020 data. As this trend showed little variation on previous years, the report therefore underscored the limitations of paid advertising and recommended that luxury brands develop stronger strategies to build a base of quality followers organically, in order to ensure higher levels of stickiness.
Social commerce and the increased automation of official account marketing were among the strategies identified as key future development opportunities within the app.
