Chinese New Year: A Growing Ecommerce Opportunity

Ronald Wu

March 7, 2022

Spring Festival—also known as Chinese New Year—is a growing opportunity for brands. Between the rise of online shopping and the spreading popularity of the week-long celebration, we’ve seen staggering revenue increases for brands who invest.

Spring Festival, a changing tradition driven by the rise of ecommerce

Traditionally marked with shopping—as buying new items is seen as an embodiment of a brand-new start in the new year—Spring Festival is an important period for brands. Top selling products vary from festive food, seasonal flowers and accessories, to clothes, furniture, and electric appliances.

Spring Festival usually falls between late January and mid-February, aligning with the start of the Chinese Lunar calendar. What you might not realise about Spring Festival is that this week-long holiday is growing into a promising ecommerce opportunity, comparable to Singles’ Day.

This year, Pattern has leveraged its expertise on local marketplaces, such as Tmall and JD.com, to take advantage of the changing Chinese New Year shopping behaviour, helping some of its brand partners achieve 500% year-over-year sales growth during the period.

The switch to celebrate online

During the Chinese New Year, historical retail sales rose for more than a decade until the COVID-19 pandemic struck in 2020. The pandemic disrupted not only the country’s economy, but also a traditional custom of the Chinese—those who move from the countryside to cities for livelihood returning to their hometown during the Spring Festival to reunite with families. The Chinese government called for its people to stay put during the festival's celebrations to fight the pandemic, resulting in less need to buy festive foods and gifts. That is, until ecommerce turned the tide.

The revenue results of an online celebration

At the Spring Festival in 2021, while still adhering to the stay-put call, the Chinese government joined hands with some local online marketplaces and logistics companies to initiate an online Spring Festival shopping event that ran for 30 days and eventually brought in RMB 906 billion (USD 140.2 billion). As a benchmark, the 2021 Single’s Day raked around RMB 965 billion (USD 152 billion) in sales value. These encouraging results rallied the administration and business community together to create the second edition of the month-long shopping event for 2022’s Spring Festival.

Driven by the government-business joint effort, physical retail sales during the 2021 Spring Festival period also saw a noticeable rebound, as official data shows that total revenue made by key companies in the retail and catering categories stood at RMB 821 billion (USD 127.1 billion) during the 2021 Spring Festival, rising 28.7% year over year and 4.9% higher than pre-pandemic sales in 2019.

The growth momentum continued in the 2022 Spring Festival. During the first five days of the Spring Festival holiday, the People's Bank of China’s clearinghouse platform processed online payment transactions worth RMB 4.2 trillion (USD 660.3 billion), rising 11.6% year-over-year. Leading Chinese marketplace JD.com also announced that its turnover during the first six days of the holiday increased by more than 50% year over year.

The “non-stop” fulfilment surge

Before the pandemic, China's logistics and express delivery sectors tended to grind to a halt during the Spring Festival week, so orders were expected to be dispatched more than a week before the holiday. Things have changed since 2021, as industry players started responding to the government’s call to provide “non-stop” fulfilment services during the period to enable Chinese shoppers to “stay put, buy online.”

The effort yielded a remarkable result, as official data showed China's postal industry collected and delivered a total of 660 million parcels during the 2021 Spring Festival week, which was a 260% increase on a year-over-year basis. During the 2022 Spring Festival week, we even saw some 749 million parcels being handled by the country’s delivery sector, as Chinese marketplaces have worked with logistic operators to ramp up the scale of non-stop fulfilment services.

While Chinese marketplaces still reserve this non-stop fulfilment service to the most highly competitive brands on their platforms, Pattern has helped our partners secure this offer. Thanks to the fulfilment advantage at this Spring Festival, we saw some of our partners yield exciting results of more than 500% in sales growth compared with the same period last year.

The ongoing benefits of Spring Festival

Thanks to the convenience of the ecommerce ecosystem, the hottest selling items are getting more and more diversified. For example, in 2021 Alibaba found that the sales for floor-sweeping robots, window cleaning robots, and floor washing machines increased by 100%, 300% and 1,800% respectively, year-over-year, as younger shoppers often bought such gadgets as a gift for parents.

Another observation is regarding the synergy between Spring Festival and other significant holidays or events happening in the period. The 2022 Spring Festival week coincided with the Winter Olympics in Beijing, resulting in sales of ice sports gear and ski equipment on Tmall increasing by 300% and 180% respectively, year-over-year. In 2021, Valentine’s Day fell in the middle of the Spring Festival week, and JD.com observed that the demand for jewellery, beauty, watches, and other gifts rose significantly during this period. For example, the amount of women’s karat gold necklaces and yellow gold pendants sold increased 6.2 times compared with the same period in the previous year.

How to tackle the opportunity with Pattern

To exploit the thriving opportunity from Spring Festival, brands need to have a strong team of industry experts in the local market to stand out from the stiff competition from local and overseas players.

Pattern can accelerate your marketplace business around the world—we partner with brands through a unique model where we purchase our partner’s stock and sell it for them on online marketplaces, such as Tmall, JD.com, Lazada, Amazon, Shopee, Coupang and eBay.

Not only is Pattern in the top 5% of authorised Tmall Trade Partners, we also have boots on the ground. Pattern has a local team in China providing brand partners with a comprehensive service that help them protect their brand, drive growth, and scale distribution.

Interested in tackling the Chinese ecommerce opportunity? Get in touch and learn what we can do for your brand.

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Why Your Ecommerce Brand Needs an Accelerator
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Why Your Brand Needs an Ecommerce Accelerator to Grow on Global Marketplaces

If you’re in ecommerce, you’ve most likely heard of the rising category of brand partners: ecommerce accelerators. Since the term is still fairly new across marketplaces, CEOs may question the true benefits of partnering with an ecommerce accelerator.

The impact of ecommerce accelerators is evident in the success brands are experiencing. Notable brands like Thorne are experiencing significant success with ecommerce accelerators in high online shopping  regions like China. Alone, Thorne lacked the right resources to increase brand awareness throughout Asia and successfully launch their products on Tmall. By partnering with Pattern, an ecommerce accelerator, Thorne was able to access all of the marketplace tools and expertise they needed to grow their brand in the Asia-Pacific (APAC) regions. 

Ecommerce Accelerator Amplify Brands on Marketplaces

Many brands simply don’t have the bandwidth to do ecommerce the right way—it takes multiple teams of experts, which could increase staffing charts by hundreds. An ecommerce accelerator layers on top of and amplifies a brand’s current efforts in whatever marketplaces and channels are part of its ecommerce strategy.

As the world’s leading ecommerce accelerator, Pattern understands the issues facing your brand, so you get the benefit of extensive experience across multiple marketplaces, regions, and industries with one partner.

How an Accelerator Makes a Big Difference for Brands

1. Provides an Outside Solution to Execute an Ecommerce Strategy

Time and time again, we see brands don’t have the resources they need to succeed on ecommerce marketplaces. And it’s no surprise—the ecommerce space is crowded, competitive, and vastly different from a traditional, brick-and-mortar sales model.

To execute your strategy correctly, you need to have SEO experts, creative resources, data analysts, brand control experts, fulfillment specialists, help to maintain price consistency… the list goes on. 

So, brands have the choice to either ignore issues they’re experiencing or find external  support . We don’t recommend the first option—issues that seem small now will get out of hand fast, and the further problems develop, the more difficult it is to contain them. It’s definitely doable to reverse damage due to loss of brand control, price stability issues, issues with brick and mortar distributors, and the dreaded profitability death spiral. But it’s better to avoid them as much as possible in the first place.

2. More Cost Effective and Maintain Brand Control Better than Agencies or Aggregators

As you move forward in taking advantage of the ecommerce opportunity and gaining control of your strategy now, it is possible you may not be able to justify building out large teams to do that. So, brands are opting to partner with an agency, aggregator, and/or an accelerator. Here’s where the first two options are falling short:

Ecommerce agencies may not be the preferred option for a few reasons. For one thing, the price you pay to hire one may not reflect the value you get out of the agreement. Agencies aren’t paid based on your success, they’re paid from you, a fixed rate (and possibly more), regardless of how your products perform. So, they’re not as invested in making a large impact for your brand. Agencies typically specialize in one aspect of ecommerce, such as SEO, making it necessary to hire multiple agencies to execute all aspects of your ecommerce strategy. Once again, this inflates your costs, may lead to alignment issues within your ecommerce plan, and breaks up your data sources.

Aggregators aren’t a great solution either. They’re interested in purchasing and growing brands, which sounds like a compelling idea, but, since all brands are unique, what works for one may not work for another. Therefore, the aggregator's universal brand playbook often leads to poor product performance for brands. Brands acquired by aggregators often lose all control and ownership to the buyer as well.

3. Amplifies Brands to Grow Revenue

That leaves brands with the option to partner with an ecommerce accelerator. In our opinion, this is the best way to gain control of your strategy and experience the healthiest and most profitable growth for your products.

Accelerators work because they layer on the top of systems, processes, and teams you’re already using, without adding internal headcount. If you’re experiencing success in your D2C efforts and specific marketplaces, an accelerator won’t “rip and replace” what’s already working. Instead, they’ll add the resources you’re missing in your strategy to fix issues, accelerate your brand, and expand your presence across global marketplaces.

An accelerator is also paid differently—they agree to a profit margin with your brand, then take ownership of your products and strategy by buying your inventory. As your profitability grows, theirs does, too. By structuring their success this way, they’re truly invested in fixing ecommerce issues at their core and ensuring your long-term gains.

Accelerate your Ecommerce Strategy with Pattern

As a pioneer in the ecommerce accelerator space, Pattern knows the ins and outs of great ecommerce strategy for global marketplaces. We’re fanatical about great data and obsessed with growing our partners’ ecommerce profitability. With pioneering technology, vast expertise, and highly capable internal teams, we have the resources you need to establish and grow your ecommerce presence, brand control, and profitability. 

Ready to explore an accelerator partnership? Contact us today.

2022 Traffic Decline
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Stop Declining Web Traffic: What Your Brand Should Do

2020 and 2021 was a monumental period for the retail sector. Consumers suddenly embraced ecommerce, due to worldwide COVID-19 restrictions. Now that restrictions have eased and physical stores have reopened, many retailers are experiencing a drastic decline in online web traffic. Research shows that traffic to online ecommerce and grocery shopping sites fell 15% in the first five months of 2022, compared to 2021 levels ([SimilarWeb, 2022](https://www.chargedretail.co.uk/2022/07/08/online-retail-and-grocery-traffic-take-a-tumble-in-2022-as-cost-of-living-crisis-intensifies/)). Although shoppers have the option to buy in-store again, the ecommerce boom has still accelerated the rate of ecommerce channel growth. Since consumers are more comfortable purchasing online, maintaining and optimising your ecommerce channels is as pertinent as ever. Earlier this year, Pattern Senior Strategists Hannah Staveley and Peter Boldt-Christmas hosted a LinkedIn Live to address the shift offline, how brands can tackle declining web traffic, and offer guidance to brands struggling with web traffic. Who is Affected? Online-only retailers and marketplace sellers have been hit significantly, due to a lack of channel diversification and an overreliance on online sales channels. Following a wave of success during the pandemic, many brand’s direct-to-consumer (DTC) websites are now experiencing declining web traffic after failing to optimise their operating models and propositions in order to retain consumers. Depending on the maturity of the pre-pandemic ecommerce landscape in each sector, different industries require different strategies to mitigate the effects of declining web traffic. For instance, whilst Q-commerce (quick commerce) has grown significantly, consumers are still opting to purchase their groceries in-store rather than online. Pattern's [2022 UK Shopper Report](https://info.pattern.com/uk-shopper-report-2022) supports this trend, indicating consumers were much less likely to use online channels to shop for food, pantry, and alcohol compared to product categories like books and clothing. Omnichannel Solution for Brands Strengthening your brand’s omnichannel proposition is essential. In Pattern’s benchmarking research with Google, we found that 75% of retailers and brands improved their omnichannel proposition scores since 2019 showing that they had implemented more of these functionalities, or otherwise improved them ([Pattern & Google, 2021](https://www.thinkwithgoogle.com/intl/en-apac/future-of-marketing/digital-transformation/omnichannel-marketing-retail/)). Brands should raise awareness of their online sales channels, such as their website and app, through a number of offline initiatives, including visible in-store advertisements, providing free in-store WiFi, QR codes on product labels, displays, and advertisements, and providing Click-and-Collect services to mend the division between offline and online spaces. How to Succeed Exclusively Online If you have limited control over your offline footprint, or are selling online-only, accelerating your presence on marketplaces can be a strong solution. Marketplaces, such as Amazon, eBay and Tmall, offer a cost-effective and straightforward route to acquiring new customers due to their immense penetration and delivery proposition in the global market - particularly in Europe and Asia. Shoppers are now five times more likely to to search for initial product information on marketplaces than through a brand’s DTC website, according to research from InRiver ([Rigby, 2021](https://internetretailing.net/marketplaces/shoppers-now-five-times-more-likely-to-look-for-a-product-on-a-marketplace-than-on-a-brand-website-study-24025/)). 63% of respondents in our [2022 UK Shopper Report](https://info.pattern.com/uk-shopper-report-2022?) stated they visited marketplaces to check the prices of products, and 50% stated they used marketplaces to look for product information, including reviews. To succeed on marketplaces, brands must differentiate their range and overall proposition from their other sales channels. For example, luxury Whisky maker Macallan surged to number 1 position in terms of revenue within the BWS category on Amazon UK by focusing its listings on premium and limited edition products. Similarly, some of the best-selling and fastest growing spaces within Amazon’s spirits category are low distribution, large format products like magnums and methusalehs. This is likely because many shoppers use Amazon as a gifting destination and are looking for high-end, novelty products. Pattern’s [2022 UK Shopper Report](https://info.pattern.com/uk-shopper-report-2022?) found that 67% of UK shoppers bought gifts on Amazon. Brands can use search and category data to understand where latent consumer demand exists, utilising this as the basis for product differentiation strategy. Boost Traffic to My Brand Marketplaces Keyword research is integral to boosting your brand’s visibility on marketplaces like Amazon. Moving away from a brand defence strategy, to focusing on challenging for placement on the highest volume keywords is an approach that we’ve seen many brands succeed with in the last year. However, thousands of new sellers are joining the platform everyday, making search engine results pages (SERP) placement competition increasingly fierce. Brands must also optimise their product display pages (PDPs) to ensure the improvement of their organic ranking results and conversion rates. DTC Due to high customer acquisition costs, the current retail environment is challenging for brands. In order to develop the most appropriate proposition, brands must understand their target shoppers’ needs and behaviours. During lockdown restrictions, shoppers valued convenience and speed, influencing brands to offer faster and more flexible delivery options ([McKinsey & Co., 2022](https://www.mckinsey.com/industries/retail/our-insights/adapting-to-the-next-normal-in-retail-the-customer-experience-imperative)). However, with restrictions eased and economic pressures felt by shoppers, value is being favoured above convenience. Our data shows sites that provide money saving and price comparison tools experience rapid growth in traffic this year. Therefore, evaluating the value that shoppers gain by purchasing from your DTC website is key to maintaining and growing your site traffic. Value can be provided in a number of ways but needs to be relevant to your target market. Cutting free shipping thresholds, offering 24/7 customer service, providing free samples, free live chat, and other services can all provide your shoppers with value, enhance their shopping experience, and ultimately influence their decision to buy. Want to learn more? [Watch the full LinkedIn Live discussion](https://www.linkedin.com/video/event/urn:li:ugcPost:6970333515246661632/). Accelerate your Ecommerce Strategy with Pattern As the world’s top ecommerce accelerator, Pattern knows the ins and outs of great ecommerce strategy for global marketplaces. We’re fanatical about data and obsessed with growing our partners’ brand and exceeding sales goals. With custom technology, vast expertise, and highly capable internal teams, we have the resources you need to grow profitability. Ready to explore an accelerator partnership? [Contact us here](https://pattern.com/uk/contact/).

5 Things to Look for in a China Trade Partner
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What to Look for in a Good Trade Partner

Having a good trade partner who you can trust makes all the difference in helping your brand grow both locally and globally. As a global ecommerce accelerator and trade partner, Pattern often hears global executives’ frustrations with trade partners who aren’t transparent in sharing information with the brands they represent–everything from sales figures and marketing spend to inventory levels and ordering data. 

Learn why transparency is a must-have for brands: 

1. Transparency in Reporting and Data

A lack of transparency in reporting and relevant data is not only frustrating, but also potentially damaging to your business. A lack of data-driven details leads to poor decisions across the business based on little to no actual results. For example, a trade partner who cannot give you a clear idea of what your ROI is, gives you no insight into how to accelerate your product on marketplaces.

A transparent trade partner will provide useful and game-changing data because they are invested in a brand’s success. For brands entering new marketplaces and areas of the world, it’s imperative they’re provided accurate information to inform their expansion decisions. It’s harder for brands to create or evolve their ecommerce strategy, analyze the opportunities forecast, and grow their presence globally without clearly, concretely understanding what’s really going on.

2. Transparency in Ordering and Inventory

Optimizing your supply chain is key to driving revenue and accelerating your business. Making logistics and operations decisions is hard enough, but without the right data, it’s virtually impossible. 

Lack of transparency in ordering and inventory management leads to issues such as stockouts, fulfillment delays, and more. These issues are headaches for executives and subtract possible revenue from their business.

A transparent trade partner ensures their brand partners are given the correct information so they can make sure inventory stays in stock during promotional and high-demand periods. With the right technology, trade partners provide their brands with data and guidance to optimize all areas of their supply chain.

Finding a Transparent Partner

Trade partners have a reputation for shielding their brands from information, but that doesn’t have to be the reality in your relationship. As you move forward in your decision making, transparency and accountability should be a key factor in choosing the right trade partner.

A great first step is to pay attention to what they’re willing to disclose while you’re considering your partnership. Such as:

  • Have they been successful with other brands? And how was that measured?

  • Who else are they working with?

  • Do they sell products that could compete with yours on the same marketplaces? 

Discover How Pattern Can Help

Data powers everything we do at Pattern. As a certified trade partner, we share insights and brand performance with our partners and provide brands with access to proprietary real-time dashboards with complete access to review their data to know what’s going on with their products. 

Whether you want to know how much inventory to keep for Christmas or how much to put into your advertising budget for the coming year, the combination of Pattern’s marketplace experts, experienced trade partners, and Pattern’s acceleration technology platform will help.

Discover how Pattern can become your trade partner. Contact us.