If anyone has COVID-19 to thank, it’d be The Specials, a British rock band whose heyday can be dated back to the 80s. Their 1981 recession-themed hit song Ghost Town, was trending on social media because coronavirus lockdowns have left streets worldwide deserted and shops empty.

The retail industry was likely hardest hit as lockdowns started across the globe due to the COVID-19 pandemic. US retail sales plunged 16.4% in April, and across the pond, the UK suffered a 18% drop in May.

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China, who had a head-start during this pandemic, too, saw a 20.5% decline in retail sales in February and March. But whilst the rest of the world are still (for the most part) shunning shops due to a continued high level of infection and caution, China is almost out of their dip, with June retail sales down only 1.8% compared to last year, according to China’s statistical authority.

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Having worked with multiple retail brands and destinations through the pandemic, both in China and the West, PingPong Digital uncovered some key patterns and trends during China’s retail recovery.

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Digital integration and social media marketing becomes an absolute must for retailers

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The Coronavirus crisis gave many brands, retail companies and department stores that have shied away from digital integration and marketing a new perspective on their importance. In China, retailers of fresh produce, automobiles, even luxury brands and retail destinations, who rely heavily on offline footfall switched to digital solutions such as personal shopping through social media, live-stream e-commerce and, one of the latest marketing buzzwords in China, private domain traffic.

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A good example of the digital transformation that may be deemed ground-breaking in the West is the Watches & Wonders T-mall live-stream exhibition and sales. Watches & Wonders, formerly known as Salon International de la Haute Horlogerie (SIHH), one of the two largest luxury watch and jewellery trade shows, launched its first ever virtual watch show on T-mall, inviting watchmakers to display their finest timepieces.

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In a single campaign about 800,000 people watched their live-stream show. Brands, including Cartier, A. Lange & Sohne, IWC, Vecheron Contantin, all benefited from these live-stream sales.  

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Communities are the next big opportunity

Apart from live-streaming sales, we have also seen amped up social media marketing efforts and the use of KOL/KOC’s private domain traffic to inject momentum into retailers’ recovery.

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With offline shops still closed or struggling with limited reopenings, brands are converting their offline consumer base to online space, by creating communities on WeChat, or via WeChat Mini-programs to continue engaging with their consumers.  

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These consumer pools, or private domain traffic, as it’s known in China proves to be resilient in face of a temporary shutdown of offline shops and can be relied on to generate continued sales.

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For example, the largest Chinese home appliance retailer Suning shifted their store-centered sales strategy to a more dispersed, shopping guides-oriented model. Hundreds of shop assistants reached out to their past customers and made sales through direct online contact.

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And unsurprisingly, for many Chinese consumers this is also a preferred way of making purchases. This tactic is not only convenient , but also helped increase netizens' trust in retailers.

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We are confident to say that this trend will stay even after the coronavirus crisis. Retail is laying the foundations for a new kind of O2O retail.

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