Look at Generation Z marketing from Bilibili and Xiaohongshu!

"Capturing Generation Z is equivalent to capturing the business opportunity of the new era."

This sentence has always been one of the important criteria that venture capitalists consider in evaluating new projects, and it is also a business truth that major brands unanimously agree on. The core reason is that today, when the Internet traffic dividend has peaked, this group of people has become one of the few new growth points under the existing competition landscape.

How to understand “a few new growth points” ? It can be considered from two dimensions:

The first dimension is the continuous release of Generation Z’s consumption potential, which reflects that this group of people already has independent economic sources and consumption decisions.

The second dimension goes a step further: the level of higher education received by Generation Z is much higher than that of the Millennials, and a higher proportion of them live in first-tier cities.

This reflects their thoughts and cultural awareness behind their economic sources and consumption decisions. This in-depth insight into the group will directly determine their preferences, where they gather, their worldview and values, etc. These will also become the core topic connection points for brands to communicate with them.

So how do we find places where young people gather, discuss topics that interest them, and communicate and interact with them using marketing methods that they approve of?

01. Know yourself, know your enemy, know the trend, know the insight

As a native Internet group, Generation Z’s online information acquisition, social communication and consumption are rooted in their behavioral habits.

According to Questmobile data, in July 2020, those born in the 1990s accounted for more mobile Internet users than those born in the 1980s, becoming the largest force in the mobile Internet. This means that the younger generation is gradually becoming the main body of Internet consumption, and their acquisition and dissemination of information are more dependent on online content and social networking, providing new tentacles for brands and Internet platforms.

Image source: CITIC Securities

This generation of young people has their own insights into brand marketing. They focus on brand power, have unique aesthetic needs, pay more attention to appearance and reputation when shopping, and pay relatively less attention to price and practicality.

According to Kurun data, Generation Z is mainly influenced by factors such as product appearance, friends' recommendations, brand, fashion trends, etc. when shopping. With the rapid development of my country's economy, the supply of goods has increased greatly. The simple "high cost performance" can no longer meet the demand of the new generation of consumers for goods. The Z generation pays more attention to emotional satisfaction rather than the use value of goods in consumption. At the same time, compared with the previous generation who pursued cost performance, they pay more attention to the values ​​​​reflected by the brand.

In addition to emotional satisfaction, personalization, experience, and interactivity are also marketing points that Generation Z pays more attention to. The personalized values ​​of Generation Z consumers who follow their own interests and emotional satisfaction make them pay more attention to self-spiritual satisfaction and emphasize an independent attitude towards life. It is mainly reflected in the consumption of products that "I like", are good-looking, fun, and have hobbies that I identify with, such as through "mobile diary circle" consumption, personalized consumption, and buying the same products endorsed by idols to satisfy unique personality settings.

Image source: CITIC Securities

On the other hand, the willingness to try new things and the emphasis on consumer experience are also major differences between Generation Z and the previous generation. They pay more attention to the sense of existence gained in the consumption process. Behind this sense of existence is a sense of participation in consumption, a sense of co-creation of the brand, and a sense of honor in enjoying the service.

Of course, this experience is also closely related to Generation Z’s strong need for social expression. In particular, most of Generation Z are only children and have a strong demand for social interaction. This also makes them full of social expectations on a certain topic, a certain circle of people, or even a certain brand’s traffic pool.

The new marketing for Generation Z is actually quite different from the traditional traffic marketing model. The new marketing can provide the audience with an intuitive and real experience of the "grass planting" model. Its core driving force lies in high-frequency and all-round exposure. Through KOL’s experience sharing + picture explanation, the most complete explanation of a product can be given, which is far superior to traffic marketing in terms of persuasiveness and the word-of-mouth effect it generates.

Furthermore, the "grass planting" model itself has a positive feedback loop, and its core barrier is the personal reputation accumulated by KOLs. If users have a good experience with the products promoted by KOLs, it will not only enhance their sense of identification with the brand, but also increase their stickiness to KOLs, thereby facilitating the next "grass planting".

Image source: CITIC Securities

02. Channels are important, models are king

In traditional marketing, "channel" is often emphasized as king, but with the development of mobile Internet today, product information is becoming more and more transparent. Although the importance of channels is self-evident, when facing new target groups, models are king.

The typical new platforms for young people at present include bilibili, Xiaohongshu, and Dewu. Compared with mainstream platforms, their biggest feature is "decentralization". This non-directional distribution and non-fixed audience group is equivalent to completing a round of natural content and user screening through decentralized media user marketing, which has advantages in both distribution effect and marketing efficiency.

As we all know, the traditional model is essentially merchant-centered. The same material is aimed at the general public, and it focuses more on the mass exposure of standardized products to meet the marketing needs of mass brands and merchants.

The new model is consumer-centric, with different materials targeting different consumers, providing personalized, deeply interactive, and more comprehensive content, products, and services. Its KOL "grass planting" model of bringing products is more realistic, forming an equal relationship with fans rather than a hierarchical relationship, and is more likely to attract Generation Z to retain, convert and pay.

To summarize the two models, the new model brings better user recognition and higher marketing efficiency than the traditional model.

Image source: CITIC Securities

From the audience's perspective, on the one hand, it helps to establish users' sense of belonging to the community and shape a good community ecology. Users can establish emotional connections with the community by enjoying more interesting content provided by the community, and obtain product information and spiritual satisfaction. On the other hand, it helps users obtain vertically targeted personalized and content-based product information, giving specific customers a sense of satisfaction and a desire to share.

On the merchant side, the verticality of users and content can enable precise marketing for merchants and precise content acquisition for users, reducing delivery losses. On the other hand, the professionalism of KOLs can enable them to form good brand endorsements and build a niche fan base for vertical audiences, which helps to enhance brand power and consolidate the brand's traffic pool, thereby enabling multiple parties to establish a good trust relationship.

03. It is difficult to develop if you are greedy for too much, but the fittest ones may be able to break through

After the model is upgraded and iterated, how to choose a suitable channel is also extremely important.

Current social media channels can be divided into two categories. One is the large and comprehensive marketing platforms such as Douyin/Kuaishou/Weibo, but they are more positioned as mass platforms rather than vertical platforms for Generation Z. Their advantages lie in the large DAU of their products and rich content ecosystem, but they also have shortcomings in building younger brands.

For example, Douyin KOLs lack in-depth interactions with consumers and community relationships, their content is fast-paced, and they focus on public domain traffic; Kuaishou content lacks an overall tone, and at the same time, the audience on the top platforms is too large, and the cost for merchants to screen vertical content and users is relatively high. Young people's sense of belonging to the platform is still somewhat different from that of vertical communities, and it is more suitable for the marketing construction of mass brands.

Compared with large and comprehensive platforms such as Douyin, Kuaishou, and Weibo, vertical platforms have unique tonality and conversion efficiency for young people's social interaction and content consumption. For example, Xiaohongshu is a content community with a high proportion of young users, among which 31.1% of users are under 24 years old and 30.6% are between 25 and 30 years old. Secondly, Xiaohongshu’s low publishing threshold and high UGC content have brought about the “de-Matthew effect”, allowing ordinary people’s daily shooting content to also obtain good traffic.

Image source: CITIC Securities

Leading media platforms such as Douyin, Kuaishou, and Weibo have large DAU and content reserves, have sufficient traffic volume and content richness, and also occupy important usage time and scenarios for young people.

At the same time, the leading content platforms are more inclined towards mass content consumption and marketing. The segmented content, social, and marketing depth and efficiency of the young people's market are somewhat behind those of the new vertical platforms. If we can further strengthen the construction of scenarios that meet the needs of Generation Z, enhance the social scenarios of Generation Z circles, increase the richness of vertical video and interactive content, and strengthen the supply of segmented products and services that meet the needs of young people, we will be able to gain further opportunities to improve the marketing effectiveness of young users.

04. Summary

In terms of traffic structure, as Generation Z gradually becomes the mainstream, traffic dividends are continuing to emerge. Internet platforms with more young users and richer product content will be expected to benefit from the shift to new marketing models, and their commercialization efficiency is expected to further improve.

Through the above analysis of the population, platform user structure, ecological tone and marketing model, platforms like Douyin, Kuaishou, and Weibo have the largest coverage of young users and rich content. They are not only the main channels for mass marketing, but also the main battlefield for new marketing.

New channels like bilibili are becoming more mature in commercialization by relying on the advantages of Generation Z audience and content marketing; Xiaohongshu has created a high-quality vertical content community with a high monetization rate; and as a leading domestic fashion brand exchange and trading platform, Dewu has gradually established a marketing system and has huge commercialization potential.

Therefore, after choosing the right channel, brands should make arrangements as early as possible, hoping to reap the benefits of the crowd in the new round of generational traffic reshuffle.

Author: Community Marketing Research Institute

Source: Community Marketing Research Institute