TikTok is known in China as Douyin (literal meaning: “shaking sound”). Owned by Bytedance, China’s fourth internet giant outside the BAT group (Baidu, Alibaba and Tencent), Douyin is becoming a money-making machine for brands because of a rapid expansion of ecommerce activity, as well as its position as a platform for creators and KOLs to monetize their talents.
In Campaign Asia-Pacific's Asia's Top 1000 Brands research for 2021, Douyin ranks second among all social-networking sites in China, while WeChat and Tencent are first and third. In October 2020, South China Morning Post reported that Chinese people spend more time on Douyin (72.9 minutes) as well as on Toutiao, a news aggregator app developed by ByteDance (73.4 minutes), than they do on Tencent’s super app WeChat (60.6 minutes).
As of May 2021, Douyin is No. 1 short-video app in terms of monthly active users in the Chinese market. In the light of even more restrictions from the Chinese market, Douyin is still the No. 1 short-video platform in terms of brand value. It also ranks eighth on Kantar's BrandZ list of the most valuable Chinese brands, with brand value growing 131% over the past year. In comparison, the brand value of Kuaishou, another short-video app which counts Tencent among its investors, surged 282% and ranked as 10th on the list.
Douyin is not simply the domestic version of TikTok in China. It reflects a more competitive scene in the Chinese market, encompassing ecommerce, gaming and livestreaming in addition to short video. In the domestic market, Douyin's livestreaming and short-video campaigns are becoming a trendy battlefield for brands.
Agencies have seized on the opportunity to use the platform for their clients. For example, Mindshare China took more than six months building a new business model for KFC on the Douyin platform starting from scratch. While many brands rely on livestreaming to increase their sales in the short term. In the long run, creative short videos are driving up sales for KFC, allowing it to surpass its major competitor McDonald's on Douyin.
Publicis Media is among the first few to gain Ocean Engine Certification from Bytedance, giving it the ability to mine data and deliver data-driven operations and experience. Vivian Zhu, China CEO of Zenith and Spark Foundry, mentioned Oreo as an example of a brand connecting its intellectual property with the Douyin platform experience. For example, the brand created a broadcasting room on Douyin and leverages data to drive relevant audiences to view its broadcasts and to purchase, "converting audience love to real consumptions".
While long-established brands, such as KFC and Oreo, make efforts on Douyin, overseas brands, which are newcomers, have also used the platform successfully to enter the Chinese market and raise their brand awareness.
UK-based Dovetail Games worked with KOLs on Douyin (it also works on Weibo, Bilibili, Toutiao and Youku) to excel during the recent 2021 summer sale period. According to Kaitlin Zhang, Founder and CEO of Oval Branding, the brand “worked with two Douyin KOLs to get 600,000 viewings and 24,000 likes within seven days”. Two games, Train Sim World and Train Simulator 2022, are becoming more popular with Chinese players, because the brand began to work with gaming KOLs since April 2020 “using short-form promotional videos and gameplay videos, with the average viewing per video between 40,000 to 100,000”.
Campaign asked marketing and branding experts to analyse Douyin's capabilities compared with direct competitors such as Kuaishou, discuss potential downsides for brands, and discuss the differences between Douyin and TikTok.
CEO of Zenith and Spark Foundry, China
Douyin and Bytedance have pushed on the e-commerce front super hard and aggressive and have seen real momentum in 2021, leveraging drastic growth during the pandemic time when consumers have more time staying indoors and consuming short-video content. The 818 shopping festival is leveraged by Douyin to boost its GMV and cultivate shopping festival behaviours among its audiences. Both Douyin and Kuaishou have driven the ecommerce growth both from KOL live broadcasting as well as the brand’s own live-broadcasting and campaign-driven effort to conversion on ecommerce sites. Douyin is ahead of Kuaishou on establishing a closed-loop from paid media to feeds, live broadcasting and Douyin stores as well ecommerce sites, empowered by data platform and biddable as well as SEM-driven experience.
Douyin’s ecommerce is built around consumer interest and discoveries. Unlike Tmall or JD, it is more of an online shelf commerce space where consumers browse products. Interest commerce may be more powerful in driving new product launches and the development of new consumer behaviours, but it is less effective in attracting repeat purchasers or planned purchases as of now. I believe Douyin's biggest competitor is Wechat mini-programs, as the latter can leverage true social commerce for impulse and interest purchase, as well as continuing engagment with loyal consumers from private domain or account followers. As tech giants are asked to bring down the walls, we would expect to see new possibilities for consumers in their journey across different platforms.
Founder and CEO
In the gaming community, one of the biggest competitors to Douyin is Bilibili, although the target audience for Bilibili and Douyin are different. Compared with Bilibili’s long-form videos for existing gamers, Douyin has been useful for our client [UK-based game developer Dovetail] to attract new gamers. The 60-second short-form video is an excellent way to showcase new products and raise brand awareness.
As with any social-media platform, one potential downside is the negative effect on mental health, especially for young people. China has a history of implementing swift policies to tackle social issues such as gaming addiction and celebrity worship, so foreign brands need to be aware of the wider cultural forces at play that may influence the platforms.
One of the challenges of working with professional Douyin KOLs or MCNs (multi-channel networks) is that they often require a long lead time of four to six weeks to prepare campaigns. This presents a challenge for brands and marketers when products’ launch dates and promotional details may change last minute.
TikTok has more to learn from Douyin when it comes to ecommerce capabilities and advanced search functions using geo-tagging and facial recognition. In addition, the TikTok brand suffers more external pressures related to its controversial security issues and moderation policies. Thus, it is crucial to Tiktok to invest into rebuilding its brand reputation and managing its public perception.
The battle between Kuaishou and Douyin is becoming more intense, as both platforms now possess rather similar features. Not only do both serve short-form videos and livestreams but also both have quite expansive ecommerce features. But consumers perceive Kuaishou and Douyin in very different ways and so, the purchasing behaviour on both varies.
Kuaishou is excellent for FMCG products with a lower price point and thus has a higher conversion rate. Douyin, on the other hand, is a more trend-focused platform, where its algorithm is purposefully pushing content that is viral. This is where China's post-90s [generation] come to get entertained and see what is fashionable, thus being a great platform for discovery.
Douyin's competitors at this point are Tmall and JD. Brands have long had flagship stores on these platforms, and all of them have gradually added on more features, such as livestreaming. Douyin will have a hard time proving to brands that it is worth investing in Douyin flagship stores, as Tmall and JD still remain the places where consumers come with clear purchase intent.
The major differences between Douyin and TikTok are dictated by different audience behaviour and UI preferences of Chinese and Western audiences. Online shopping functions on Douyin are a few steps ahead of TikTok and paving the way for more advanced ecommerce features also on TikTok. However, not all of the features on Douyin will likely be replicated for TikTok.
For example, livestreaming is extremely popular in China and thus, takes on a more prominent position in Douyin. The Douyin interface makes it really easy to tune into a livestream. Sure, streaming is also possible on TikTok, but it's far more advanced on Douyin, with the audience being able to send virtual gifts and even voice messages to the livestream host.