Over the last few years, there have been many articles about social media in China and the large active monthly users, but often times the media fails to capture the larger social problems facing China. According to McKinsey, “We now call consumers with household incomes in the 106,000 to 229,000 renminbi range upper middle class. In 2012, this segment, accounting for just 14 percent of urban households, was dwarfed by the mass middle class, with household incomes from 60,000 to 106,000 renminbi.” To put this into perspective, the average household income in China is around US$ 10-18,000 per year.
While the social media numbers and internet user data are staggering, social media marketers must remember that most of the users are not within their target market. Where does that leave social media marketers? Weibo and Wechat are great tools for mass marketing and reaching the largest audience, but they might not be the most profitable marketing channels, which is why P1 was born.
China’s Wealthy Millennials use P1
P1 is a social network for China’s wealthy Millennials. According to the founder, Sophia Pan, “It’s an online network for the affluent people in China. We class ‘affluent’ as people according to McKinsey’s definition as people who earn more than 8,000rmb (~USD$ 1,200) per month. We target 20-40 years old, and P1.cn is made up of an interactive Facebook like feed, e-commerce, brand pages, events and a magazine.”
P1 was created in 2007 blending aspects of different social media sites. When the social media site was created it catered exclusively to China’s wealthy Millennials requiring invites to join. Gold members could invite Silver members and Silver members could invite Bronze members. Membership was by invite or review only allowing the site to control content, members, spam, and advertisement. This model allowed the site to grow to around 2 million wealthy users.
P1 actively tracks lifestyle trends and fashion trends and has its own team of photographers attending high-profile events and clubs to recruit members. This model was working well until last year when the site decided to move to a mobile app. Now, the platform has around 3 million users and is changing to the audiences’ tastes. According to spokesperson Svante Jerling, “The people have changed. They are no longer driven by status and recognition as Maslow described it, but by self-actualization. People, especially our members, don’t identify themselves with status as in high and low, and the exclusivity that we provided them has been redesigned to be a platform for this new wave of individualists instead of a simple status segmentation.”
Today, the platform is for young, wealthy, well-traveled, and fashionable Chinese, which means it is an important marketing channel for serious social media marketers looking to engage with China’s wealthy Millennials. Weibo and WeChat have their limitations, especially, when it comes to ROI, but P1 has the potential for sales growth for luxury or expensive foreign products in China. If your product or service costs over US$ 500 in China, chances are that the vast majority of fans on Weibo or WeChat can’t afford it. Weibo and WeChat offer the opportunity to gain millions of followers, but if only 30-40,000 are able to buy your product or service and only 1,000-10,000 actually purchase it. Then you could spend millions of dollars with little or no positive ROI.
Final thought on marketing to China’s wealthy Millennials
It is easy to get caught up in social media marketing; chasing “likes, shares, and favorites,” but as social media marketers, we must not forget that all marketing is designed and implemented to support sales and make a profit for our company. Brand awareness, market share, follower count, etc. are all useful matrices that when measured correctly can provide us with insights that should ultimately lead to revenue and profits. P1 is a great platform to help eliminate noise or mis-targeting when you consider marketing in China. China’s Wealthy Millennials are a highly sought market segment, and P1 has gathered a large group of them in one place. According to Sophia Pan, “Every year we cooperate with many luxury brands on various events, one year our members – a very beautiful girl and her boyfriend bought a Lamborghini after we invited them to a Lamborghini event.” This is just one of the many examples of how P1 has the ability to sell luxury products to China’s wealthy Millennials.
Now over to you, what are your thoughts on using niche platforms vs. mass platforms in China? Do you currently use niche platforms in your social media marketing efforts? Do you have a niche platform strategy?