Exclusive | Tencent Reshapes FMCG Marketing with 3 Moves

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Editor: Anna Hu , Hailee, Iris

In 2016, China’s retail industry bid farewell to the golden decade of rapid growth in thatthe traditional retail industry showed slowdown in the trend of declining profits.Giant Coca-Cola even cancelled the chief growth officer andreplacedthe CMO post, while maintaining rapid growth of business has been set as its core objective. Confronted with the disruptive change in FMCG industry, how do enterprises respond to it?

FBIF 2017, the most influential forum in FMCG industry, which was held onApril 19thin Shanghai, gathered numerous marketing leaders of food at home and abroad, to provide ideas for food industry on how to deal with the new normal. At the forum, Helen Luan, Vice President of Tencent Online Media Group & General Manager of Advertising Account Department, shared Tencent’s insights and solutions on FMCG marketing. “At present, FMCG market tends to be saturated, only the consumption upgrade can continue to drive sales growth. According to Tencent data, we believe that the upgrade will focus on three aspects: product upgrade, rise of the youth and channel transformation.”

Helen Luan, the Vice President of Tencent Online Media Group & General Manager of Advertising Account Department

Product Upgrade: Tencent Marketing Continues to DriveFast Growthof FMCGBrand

Data showsthatnewproductlaunch and product upgrade have become an important factor driving the rapid growth of FMCG industry, especially the food & beverage industry. But at present, the industry is still faced with confusions that success rate of new launches is low while product upgrade find no way to follow. Helen Luan pointed out that, advertisers could look for solutions from the perspective of technological upgrading and media innovation.

On the one hand, the traditional way can not effectively grasp the market dynamics, whichleads toblind advertising andconstitutesthe main reason forlowsuccess rate of new launches.To this end, through technical innovation, Tencent launched the “O2Ooptimization tool for new product” which can grasp basic data by directed marketing and advertising, to optimize plan in accordance with data model, and finally conduct new launch and advertising in large scale.

On the other hand, advertisers need to grasp the emotional appeal to create emotional consumption, and expand differentiation to enhance the scale of the population. Take Zhenxi ice cream as an example, through diverse embedded advertising in Go Fridge, a hot online entertainment program produced by Tencent, the product is embedded into a variety of life scenarios so that the ice cream has become a kind of dessert for daily consumption rather than cool food for summer days. And the Snickers is planted into examination scene, reaching out to student groups through integrated Tencent media platform.

Itsmarketing starts with a commercial video of TF boys, leaning close to segmented consumers via customized socialinteractive game and white paper releasing.

Food & Beverage Innovation Forum 2017

Rise of the Youth: Tencent Helps Advertisers to Become the Youth’sBrand

“Our target is 90s”, it has become a universal consensus in FMCG industry. However, if companies press close to the youthwhen they do not really understand them, it will cause resentment and increase communication barriers. In fact, companies not only need to rejuvenate brand, but also to reshape the chain from product to marketing, and truly become the brand of young people.

Currently, in terms of above issues, Tencent has right to speak in that it’s products such as WeChat, QQ and others, have coveredfull range of young users in China. Through the big data from social media, Tencent can not only grasp the basic attributes and preferences of 90 users, but also to achieve a more accurate insight. For example, Tencent YouTu exclusively revealed the fashion concept of the generation after 95s through the identification of billions of public photos on the QQ space.

Meanwhile, Tencent, which fully penetrated into young users’social contact, entertainment, information and shopping, has controlled anumber of effective channels of communication with them. Planting in video conception, a popular manner among advertisers in 2016, which links the elements of play subtly, creatively dialogue with young people. And the Tencent’s animation and gaming platform can help advertisers break the main wall of dimensions, effectively build the emotional bond between brand and young people through implanting, IP offline image licensing etc.. It is reported that McDonald’s, BMW and other brands, have resorted to such effective platformsfor youthmarketing.

Channel Transformation: Leveraging Tencent to Optimize Channel Structure

FMCG channel structure is changing due to the reason that E-commerce changed consumer’s shopping behavior. Therefore, connecting media with e-commerce channel to form a smooth online marketing closed-loop has become a top priority.

As early as 2015, Tencent and Jingdong jointly launched the “Jing Teng plan”, through which the two sidesopen upusers and dataso as to promote the follow-up effect conversion, and achieve the integration between brand-efficiency and brand-commerce by taking brandexposure as the majorbreakthroughpoint. When Tencent’s user attributes, media preference data connect with Jingdong’s shopping preferences and other data, the two sides can achieve three-dimensional consumer identification and insight.

Through the “Jing Teng plan”, HP has beenconducted to Bmarketing to solve the problem of identifyingtarget customers. They first captured the consumers purchased specific commodities in Jingdong, then compared it with Tencent’s data and expanded user scale by lookalike, and eventually made targeted delivery in WeChat momentsand Tencent news client. The final click rate was 3.7 times as much as that of the industry average, the page arrival rate reached 39.4%, product view rate 76%, sales increased by 69%.

On theother hand, the online shopping penetration rate for goods of various categories is different. Taking juice drinks and other categories as example, itsonline business channel sales are limited, then theoffline remains the mainstream sales channels. Therefore, how to achieve effective online-to-offline transfer is still a major issue. At present, through the local promotion advertisinginWeChat moments + card + payment system, advertisers canmake precise delivery based on geographical information, group interest, and push coupon information of stores nearby to the user, to achieve the online-to-offlinetransfer.

Recently, the Tencet produced program, Tomorrow Son, which was title-sponsored by Wong Lo Kat, is about to go online.During the event, consumers can get exclusive props and vote for their favorite idol if they buy customized products, and scan code after opening up. Enhancing program exposure by offline sales, and promoting offline sales through online vote, the two sides form an open traffic closed-loop through which consumer end is turned into the starting point of marketing.

Under the background of product upgrade, rise of the youthand channel transformation, Tencent created a media ecology with full coverage and formed an online-offline marketing closed-loop through in-depth integration of resources and taking advantage of its leading edge in Internet omnimedia. Even more exciting is that, from marketing insight and recommendations, material production and content customization, personalized reaching of omnimedia, tothe evaluation and optimization after marketing, Tencent is relying on AI technology to provide one-stop closed-loop marketing service.

The continuous application of new technologies will provide an effective channel for advertisers to have better consumer insights and targeted precision delivery, help build brand awareness and reputation, and create a better consumption experience for consumers.