Staying Online: U.S.-Based Chinese Consumers Continue to Avoid Offline Retail

Jul 23, 2020 8:00:00 AM | Julia Dong

Although the influx of Chinese travelers to the US has been temporarily halted, brands should not overlook the number of Chinese citizens currently living in the US, both immigrants and legal nonresidents such as those on work or student visas. In fact, the United States is the top destination for Chinese immigrants, accounting for almost 27% of the more than 12 million Chinese living outside of China, according to mid-2019 estimates by the United Nations Population Division.

And it’s not only the number of consumers that is important, but their economic power. In a recent interview, Chinese finance influencer Qian Chen shared that this group's spending power tends to be higher with an average median income around 40% higher than the US national median income.

Chinese influencer Nicole Liao echoed this sentiment, explaining that very few of her Chinese friends in the US were hurt economically by the pandemic, and many of them were actually shopping more than usual out of boredom.

So, what do these consumers’ current shopping behaviors look like? While many Americans are embracing the reopening of offline retail, the same cannot be said of US-based Chinese consumers. We spoke to several of them and they all said the same thing: they will continue to primarily shop online for the foreseeable future in order to decrease the risk of virus exposure.

If that’s the case, let’s learn more about their online shopping behaviors:  

 

Shopping online feels much safer

US-based Chinese consumers tend to be one of the most cautious groups. Some of the people we spoke with said they definitely miss the personal contact with sales associates and trying on clothes in stores but that these things are not enough to persuade them to shop offline.

Before the pandemic, J Crew, Gap, Macy’s, Nordstrom, and Nordstrom Rack, are just a few of the major brands and department stores favored by Chinese consumers in the US. All of these retailers have a sophisticated online presence, so consumers have simply shifted to purchasing online.

 

Buying without trying

The consumers we spoke with have not lost their appetite for shopping for clothing, cosmetics, and jewelry despite not being able to try them on or test them out prior to purchasing. However, when they purchase items online without seeing them in person, many consumers said they will be less likely to try a lesser known brand, preferring premium brands they can trust. “I would like to stick to the brands that I’m familiar with as I don’t want to take the risk to try new products and then deal with returning them during this time,” said one interviewee.

To get around the problem of not being able to try something on, those we interviewed shared that they will read reviews on Chinese social media platform Xiaohongshu (Little Red Book) or watch try-on videos on Bilibili as influencer content tends to give more details about the product that than the store’s own site does. “I wish the online stores would have more detailed information about sizing and more pictures of models from different angles,” said one interviewee.

Some consumers noted that, while clothing and cosmetics purchases have largely remained the same, they have been buying less shoes. Partially because the reality that they will stay at home most of the time has reduced the need and desire for shoes. Another reason is that sizing and fit is very important for shoes and they are less confident purchasing them online.

 

WeChat is a major information source

All of the interviewees are self-reported active WeChat users. Some spend over 6 hours a day on WeChat. During the pandemic, they have relied on WeChat to receive official and unofficial information regarding the COVID-19 situation in both China and in the US.

On a less serious note, they also use it to discover the latest fashion trends as well as stay on top of promotions and discounts. Several consumers shared that they have learned about brand promotions on WeChat and ended up making purchases. They also mentioned that promotions exclusive to WeChat Official Account followers are a great way to catch their eye and make them feel like it is worthwhile to follow the account.

 

Our Takeaways

Chinese consumers were already avid online shoppers prior to the pandemic so they do not find it difficult to continue shopping online until they feel that offline retail is a safe option.

While Chinese consumers in the US may be more willing to visit your brand’s website or follow your Instagram account, Chinese social media platforms, particularly WeChat Official Accounts, remain a key source of trusted information and a place they will go to actively seek out your brand.

Relevant content and offers will increase engagement and conversion rates. By identifying and segmenting their WeChat followers, brands can push customized content depending on a users’ location.

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