---
title: "The New Domestic Goods Explosion: How to Go from 'Traffic' to 'Sales'?"
description: "At the recent 'China Brand Day' forum, renowned financial writer Wu Xiaobo shared data comparing domestic and international brands in price and sales, surprising many. For instance, Tide sells for 36.8 yuan while domestic brand Liby sells for 42.9 yuan and surpassed Tide in sales in 2017. Other surprises include Anta's 'Marvel' collaboration priced at 898 yuan and Feihe infant formula priced higher than international brand Wyeth."
author: "广告门"
publisher: "New Distribution"
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published: "2019-05-23"
language: "en"
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# The New Domestic Goods Explosion: How to Go from 'Traffic' to 'Sales'?

> At the recent 'China Brand Day' forum, renowned financial writer Wu Xiaobo shared data comparing domestic and international brands in price and sales, surprising many. For instance, Tide sells for 36.8 yuan while domestic brand Liby sells for 42.9 yuan and surpassed Tide in sales in 2017. Other surprises include Anta's 'Marvel' collaboration priced at 898 yuan and Feihe infant formula priced higher than international brand Wyeth.

At the recent 'China Brand Day' forum, renowned financial writer Wu Xiaobo shared a set of comparative data on prices and sales between domestic and international brands, and the results surprised most people.
First, in laundry detergent, Tide, a brand under Procter & Gamble and the world's first-generation laundry detergent producer, sells for 36.8 yuan, while domestic brand Liby sells for 42.9 yuan and surpassed Tide in sales in 2017.
Equally surprising are Anta's 'Marvel' collaboration priced at 898 yuan and Feihe infant formula, whose unit price exceeds that of international brand Wyeth. During this period when we repeatedly mention the 'rise of domestic goods,' such a trend has already spread to broader and more common consumer categories, becoming a 'domestic goods movement' that consumers are experiencing and that brand owners and marketers urgently need to embrace and respond to.
**The Era of the 'Third Domestic Goods Movement'**
**What Major Trends Should We Note?**
It is worth noting that today's market is vastly different from the previous two 'domestic goods movements.' With the rise of new consumer forces, the new middle class, including women and young people, has become the target demographic for both Chinese and international brands. More and more people are willing to pay for quality, but at the same time, their consumption concepts are more rational. This not only means that products must emphasize quality, but also that competition between Chinese and international brands can no longer rely on scale and price wars as before, but has entered an era of quality and technology competition.
Accordingly, brand marketing will also usher in new changes. The following are several trends we may face in both the current domestic and international markets:
**1. New consumer forces are more receptive to brand information, but may also digest negative information faster**
From the '2019 New Domestic Goods Consumption Trend Report' jointly released by the China Economic Information Agency Economic Think Tank and the CUC-JD Big Data Joint Laboratory, we can see that in recent years, the proportion of searches for keywords related to brands, especially Chinese brands, has risen sharply, indicating that the brand awareness of new consumer forces has awakened.
A new report by Uncommon Sense, 'Generation Z: The Unbounded Generation,' also shows that 'Generation Z' (those born between 1998 and 2006) are particularly susceptible to promotional information from celebrities, influencers, and brand official social media accounts.
But at the same time, we should also heed the words of Kantar's Global Chief Security Officer: 'It takes 20 years to build a brand reputation, but a few minutes of online scandal can destroy it.' In contrast, given the large number of 'attention-grabbing' and 'silly' advertisements in the Chinese market, brand owners, if they want long-term development and to go global, might consider in advance how to manage a brand image that aligns with their positioning.
**2. Marketing investment granularity is becoming finer**
China's consumer market is showing a trend of segmentation. According to the 'New Consumption Trends Insight White Paper 2018' released by Analysys, people's demand for personalization and customization is increasing, with 33% of users expecting intelligent analysis of purchase footprints for effective recommendations.
From a brand perspective, the 'Tencent National Beauty Insight Report' shows that differentiation between brands is becoming increasingly important, and by 2017, differentiation contributed 51% to the premium power of beauty products.
This means that when companies place advertisements, they also need to consider how to optimize audience tags to make delivery more precise. Luan Na, Vice President of Tencent Ads, mentioned: 'As Tencent's advertising products continue to evolve, clients will have higher requirements in this regard, because it is an important part of their cost control.'
**3. Marketing communication shows an atavistic phenomenon: returning to social circles and user experience**
Speaking of changes in advertising and marketing, Wu Xiaobo told us in an interview that in the Chinese market, there is an atavistic phenomenon in communication—returning to social circles including WeChat Moments, Weibo, and Xiaohongshu.
The 'Z Generation Youth Consumption Power White Paper' produced by QQ Ads and Kantar shows that the probability of post-95s and post-00s converting from social touchpoints to brand awareness and purchase is 1.5 times that of the pre-95s—word-of-mouth from acquaintances plays an indispensable role in the 'seeding' process of brands.
This means that the relationship between consumers and brands will shift from one-way communication to equal dialogue, and consumers will become true creators and spokespersons of brands. Luan Na told us that in the future, companies will rely more heavily on early-stage market research, predictive analysis, and data support, because new marketing strategies need to pay more attention to the needs and experiences of users themselves.
**4. The transformation of brands from 'traffic' to 'sales' is the true purpose of digitalization**
According to survey results from the Interactive Advertising Bureau (IAB) and Winterberry Group, more than three-quarters of advertisers, marketers, publishers, technology developers, and marketing service providers believe that DMP, which integrates data collection, integration, management, and activation as a hub, will provide important assistance to marketing and advertising delivery.
Of course, from the current Chinese market perspective, digital capability is no longer a special skill; the transformation from 'traffic' to 'sales' and from 'online' to 'offline' is the true purpose of digitalization. According to BPR data, more and more consumers aged 18-37 tend to choose shopping venues based on whether merchants provide self-checkout, which means that retail has moved from online-offline competition to integration, and correspondingly, digital platforms also need to undergo a more thorough integration and connection.
**How to Respond to the Trends?**
At the recent Smart Marketing Summit, Guo Junxian, General Manager of Tencent Ads' Regional and Mid-to-Long Tail Business Department, mentioned in his speech: **China has nearly 700 million monthly active users on e-commerce platforms.** The latest data from WeChat shows that its monthly active users exceed 1.1 billion, meaning there are at least 400 million users who have not yet been exposed to e-commerce platforms.
These 400 million users are the important territory they have been exploring in the past three years in the regional and mid-to-long tail business of new domestic goods. Of course, in the view of Tencent Ads, which starts from trends and needs and continuously generates new business modules, this is just a corner of the vast ecosystem. Looking back, if these corners cannot be connected and mutually driven, it will be a huge waste of resources.
In response, Tencent Ads recently carried out a comprehensive business integration:
> First, synergy: connect online and offline integrated scenarios, center on social, achieve full-media collaboration; through cross-scenario recognition, restore consumer decision paths, and achieve brand and performance synergy.
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> Second, connectivity: achieve full-chain digitalization, better understand user needs, truly start from experience, connect users and data, and drive efficient conversion.
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> Third, ecosystem: adjust internal structure, with the first department mainly responsible for physical economy clients, the second department focusing on internet-native clients, and the third targeting all mid-to-long tail clients, i.e., small and medium enterprises and regional brands; externally develop third-party ecosystem partners to jointly produce solutions.
**How Can 'New Domestic Goods' Leverage to Tell Brand Stories?**
Bain & Company's latest research, 'The Time to Double Down on China's Consumer Market,' points out that over the past year, local emerging brands have steadily increased their share in China's consumer market, competing fiercely with established multinational companies. It also mentions that the advantage of emerging brands lies in their better understanding of local consumer needs, their ability to adapt to changes faster, and their extensive use of digital platforms to interact with consumers.
First, national brands, in responding to international brand competition, can leverage platforms with ecosystem capabilities like Tencent Ads to find the most suitable service teams and industry solutions for their enterprise type; on the other hand, by leveraging IP value and momentum through products and scenarios, they can create more connections with local young people, get closer to young users than international brands, and truly communicate in the discourse of their 'circle.'
Second, for Chinese brands that want to go global, Tencent Ads offers two options: one is product support platforms that correspond to the enterprise's growth stage, and the other is rich channels to reach overseas users, including traffic support from domestic apps that have gone overseas and overseas alliances, helping Chinese brands build influence abroad.
Finally, there is the growth and expansion of small and medium enterprises and regional brands, which are currently receiving particular attention. These enterprises have created many disruptive growth miracles of 'small beating big' on various platforms. Now they can not only 'be heard,' but also achieve the transformation from 'marketing' to 'sales' through the combined forces of synergy, connectivity, and ecosystem.
To help more regional brands seize the new trend of social marketing, Tencent Ads also launched the regional 'Assistance Plan' in 2018 and invited Wu Xiaobo to serve as the chief consultant for the regional 'Assistance Plan,' providing guiding business wisdom to Tencent's partners across the country. This year, it will continue to join hands with Wu Xiaobo Channel to launch the 'New Craftsmen, New Domestic Goods' brand plan version 2.0, providing content and technical support and assistance for the marketing and promotion of more domestic artisan enterprises, as they return to the public eye with consumption upgrades.
In this game of 'domestic goods movement' and brand competitiveness, we have seen domestic goods make more extreme efforts in product design, and also seen them, which originally lacked brand awareness and aesthetic concepts, gradually embrace change. But according to Wu Xiaobo's speculation, it may take another 10 years for Chinese brands to close the gap with the world. In these 10 years, what challenges will Chinese brands and marketing platforms face, and what adjustments will they make? We will wait and see.
Source: Advertising Gate (ID: adquan_2012)
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