Are you ready for the world of Web3?
If not, it’s time to prepare! Web3 is the latest technological development set to transform content marketing in China.
While western Web3 concepts revolve around decentralized models (with unrestricted access underpinned by crypto), Chinese investment has largely focused on “consortium chains”. This essentially involves verified organizations ensuring accountability, management and community goals.
So, why should international brands incorporate Web3 in their China strategy? Let’s find out.
What is Web3?
From tokenization to NFTs, virtual influencers, the metaverse and DAOs – there’s a lot to get to grips with in Web3. It’s certainly worth the effort though. The Web3 market value reached $3.2 billion dollars in 2021, with investment skyrocketing by 700% year-on-year.
At the most basic level, Web3 is a vision of a new, better internet based on blockchain technology. A blockchain is simply a decentralized ledger of transactions made on a peer-to-peer network.
With this new concept of Web3, the internet (and crucially, data) is no longer monopolized by a few large tech companies. Instead, Web3 aims to return value to the individual. It will replace centralized corporate platforms with open protocols and community-run networks –combining the open infrastructure of the early web with the community participation we currently have.
How will Web3 change China marketing?
So, what does all this mean for marketing opportunities in China?
Well, with Web3, data is controlled by individual users rather than tech giants. They decide when and how to share this data. For marketers, it opens a whole host of new stakeholder opportunities. This includes users as well as developers and the communities they’re active in.
As a result, marketers must invest more time and resources into understanding consumers and build their Web3 China strategy around this. And the rewards? More interactive opportunities, hyper-targeted advertising and digital innovation.
Web3 will transform three fundamental aspects of marketing. These are products, participants and place:
- Products: Non-Fungible Tokens (or NFTs) are the watchword of Web3. As unique digital assets, Chinese Gen Z is rapidly investing in NFTs. In response, Sotheby’s recently launched the Sotheby’s Metaverse, allowing the auction house to sell NFTs in the same way as fine art, wines and fashion. Within a month, they achieved a turnover of over $100 million, also appearing on the Forbes Blockchain 50 list.
- Participants: As well as products, the “people” interacting with brands will change too. In today’s marketing world “people” are users, brands, celebrities and influencers. But with Web3, it’s all about digital avatars. In fact, these virtual influencers are already hitting the mainstream. In late 2021, the massively popular Chinese TV show “Happy Camp” revamped their hosting team after a series of scandals. Met with great success, their new host was Xiao Yang, a virtual woman “born” in 2001.
- Place: Where will all this take place? The metaverse. Including virtual and augmented reality, it’s an all-encompassing way of interacting in the digital sphere. Many brands are already diving in. For example, automotive companies such as Lynk & Co launched car showrooms in the Baidu Xirong Metaverse. To capture Chinese Gen Z audiences, fashion houses such as Dior have also created meta-fashion shows and virtual outfit NFTs.
A brave new world: how brands can survive and thrive in Web3
To survive and thrive in the new world of Web3, luxury brands are already adapting their China marketing strategies. Over the past year, Gucci, Burberry and Prada have all launched NFT collections.
Indeed, digital clothing and NFTs are supplying real breakthroughs for attracting Chinese Gen Z. It’s a way to show creativity and engage consumers both online and offline. Lately, brands are even using these collections as fun ways to overcome physical limitations in terms of design, construction and delivery.
Chinese consumers can now interact directly with brands and even design their own clothing – for instance through virtual platforms and games (already built by the likes of Louis Vuitton and Nike).
And it’s not just luxury fashion brands either. Virtual humans are appearing across social media, on the likes of Little Red Book, Douyin and Weibo. To give just one example, Lui Yexi (a “monster-hunting virtual make-up artist”), launched on Douyin on 31 October. With just one short video, she accumulated over 1.3 million followers in a single day.
It’s playful characters like this that appeal to Chinese Gen Z trends for “gamification” and artistic individuality. With astounding follow-rates to boot, it shows the world of Web3 isn’t something brands can afford to ignore…
If you’re getting to grips with the latest tech and marketing opportunities in China, download our guide to Chinese Gen Z. Whether it’s Chinese social media trends or evolving spending patterns, discover how your brand can thrive in this hugely competitive market.