Tao Yanmei, an analyst at investment research platform Equal Ocean, said domestic brands started to take more market share around five years ago, but they did not really take off until after the coronavirus pandemic, and the trend has extended from sportswear to cosmetics, as well as food and beverages.
In the first half of June, as part of China’s so-called 618 shopping festival – an event hosted by JD.com modelled after Alibaba’s Singles’ Day – Chinese brand Zhuben topped the sales in the make-up remover oil category on Tmall. Fellow domestic brand Narwal, meanwhile, topped the vacuum robot category, traditionally dominated by America’s iRobot. Alibaba is the owner of the South China Morning Post.
Foreign brands Shiseido, Lancôme, Estée Lauder, L’Oréal and Yves Saint Laurent, though, remained the highest performing beauty brands, according to a recent report by Launchmetrics, despite the interest shown in the Chinese brands during the online shopping festival.
“Domestic brands have won some market share over the past few years, but big foreign brands are still very influential in China, which has not been particularly fundamentally reversed or changed, according to our research,” added Yu.
Chinese people used to wear Li-Ning too, but no one felt that it was fashionable, but now it is a fashion when you wear Li-Ning, that’s a real and huge change
Domestic products are becoming more popular among young people, and the post-1995 group aged between 16-25 have surpassed the post-1985 group in terms of shopping preference for Chinese products, said a report by JD Big Data Research Institute.
The post-1995 group now accounts for 25 per cent of the sales of mobile phones, cosmetics and sportswear on JD.com, one of China’s e-commerce giants.
In 2020, the number of domestic brand consumers grew 18 per cent faster than international brands on the same platform.
While on Douyin, the Chinese version of Tiktok, from May 25 to June 18, spending by those born after 2000 increased by 392.1 per cent from a year earlier, while spending by those born after 1990 and 1980 recorded year on year growth of 225.9 and 187.2 per cent. respectively.
“Chinese people used to wear Li-Ning too, but no one felt that it was fashionable, but now it is a fashion when you wear Li-Ning, that’s a real and huge change. This is a result of the development of the Chinese economy,” said Zou Zhendong, a professor of communication at Xiamen University.
Short video platforms, particularly live commerce – the combination of streaming video and e-commerce – on Douyin and Taobao, have also significantly contributed to the popularity of domestic brands.
With around 600 models across the country promoting his products on social media, Li Zhiguang, founder of Guangzhou-based men’s underwear brand Looksee, has seen sales jump by around 30 per cent from the same period last year after he started to promote his brand on Douyin a few months ago.
Looksee’s countless promotional videos on Douyin mimic Victoria’s Secret angels, with male models wearing a pair of angel wings on their back with lights flashing on the big screens behind them as they walk down from the runway.
This is something that has never happened before with a domestic brand, Chinese consumers feel so proud that their motherland is developing so fast, and they are motivated to buy it too
“The Influencers, who have been idolised by the public nowadays, just keep promoting stuff during live streaming, they look so convincing that viewers feel like they are losing out if they don’t buy the recommended stuff,” said Tao from Equal Ocean.
In the first 18 days of June, Weiya and Li Jiaqi, two of the best-known live commerce influencers in China, carried out 17 live commerce shows, with their sales reaching 3 billion yuan (US$462,000) and 2.2 billion yuan. respectively.
Tao added that “patriotism”, which is prevalent on platforms such as Bilibili, the most popular video-sharing site with the younger Chinese demographic, is an important factor influencing consumption behaviour, especially since Chinese cosmetic brand Florasis became a hit in Japan.
Using ancient Chinese recipes for cosmetics and make-up with flower essences and herbal extracts, the Hangzhou-based Florasis launched on Amazon Japan in March, and despite the price being 859 yen (US$7.8) higher than Chanel, its ancient lock-shaped lipstick entered the top three list of hourly lipstick sales on the first day after its launch.
“This is something that has never happened before with a domestic brand, Chinese consumers feel so proud that their motherland is developing so fast, and they are motivated to buy it too,” said Tao.
Once nicknamed the so-called copycat nation, China’s manufacturing system has developed well in the past few years after decades of being the world’s factory, laying the foundation for domestic brands to upgrade their products, Tao said.
In a short documentary titled “Proudly Made in China”, which was released in April, Ying Shaofeng, co-founder of cosmetic brand Colorkey, said he believes an ancient Chinese saying that “a golden opportunity comes from favourable conditions and great harmony”, as more and more Chinese consumers have been quite willing to promote Chinese brands on social media and new media.
“The era resembles wind, and pigs may fly under the right influence of it,” said Li Jiaqi, the so-called King of Lipstick and the best salesman of beauty products in China, in the same documentary.