As the Year of the Tiger approaches, Mailman Group China executives put their heads together to highlight eight digital predictions that will have the biggest impact throughout 2022 in China.
1. Expansion of Virtual Idols and the Metaverse
Virtual idols burst onto the scene in 2021, from CodeMiko, KDA, Imma, to Ayayi, Liu Yexi, and LING. Gaming studios and streamers started the trend, and in China, we see VR, MCNs, PR firms, and even music labels all joining in. We believe the diversity will continue, not only from a tech and illustration standpoint, but also from a commercial and monetization perspective. In 2022, there will be breakthroughs in real-time motion capture on some mega studio-backed virtual idols, and we will see more brands, from luxury to retail, partnering with virtual idols. We also expect new iconic cases of collaboration with global events.
Lastly, the increasingly blurred boundaries between gaming, social, and content will lead us to see the coming of a real-world “Oasis” in 2022. It could even be the new QQ, who knows. In that case, people will create their own virtual avatar, and live with it in a more interconnected virtual world. Thus, we may see the birth of virtual idols 2.0, no longer created and produced by organizations, but owned and managed by real people.
—Sum Huang, CEO, Endeavor China
2. Digital currency growth
In 2022, we will see increasing emphasis on digital yuan [e-CNY] issued by the People’s Bank of China [PBOC]. As a form of central-bank digital currency, this is an electronic version of the country’s official currency, issued through the existing banking system and service providers, as well as directly to consumers. For the latter, consumers access e-CNY through an app. More than 200 million users have registered thus far, and pilot programs underway in selected cities to further attract users. For 2022, by partnering with banks and merchants such as JD.com and Meituan, as well as incentive schemes (such as digital lotteries), we expect to see significant interest and uptake from local users. Whilst several areas of concern remain to be clarified, and the stability of the system is to be validated, e-CNY will affect the digital landscape. Beyond affecting consumption and payment habits, as an alternative to local interest in cryptocurrencies, e-CNY will also impact other popular digital innovations such as the development of the metaverse in China. Much like how Libra was conceived to be central to Meta’s ambitions, the e-CNY will be a critical element to fostering a managed introduction of the metaverse here in China.
—Justin Tan, managing director, Mailman
3. Government crackdown to kickstart major social-media ‘cleanup’
After a decade of explosive growth in China’s adoption of social media, platforms like Weibo and Douyin are now coming under increased scrutiny to ‘clean up’ their act, targeting the millions of fake accounts which have polluted the media landscape for too long. Towards the end of 2021, the government imposed fines on a number of top social-media networks for mismanagement of their platforms, including an excess of inactive/fake followers, illegal/sensitive content and security breaches.
The powerful influence created by social media is at odds with the government's mission to stamp out China’s unhealthy obsession with celebrity fan culture. These digital platforms are almost all privately owned, so we expect to see them tightly monitored under the central government’s ‘control’ initiative. In short, we can finally hope for transparency around the enormous figures reported by social platforms each year.
—David Hornby, VP, Mailman
4. International travel uptick in Q4
With the Winter Olympics soon to start and conclude, as well as big sporting events happening in the latter half of the year, such as the FIFA World Cup in Qatar, we will begin to see China loosen its border restrictions as the year closes out. Another critical factor is currently there are more than 1.2 billion people in China who are now fully vaccinated with 2.9 billion vaccine doses given across the country. I believe in another six to nine months, with vaccination numbers likely to increase, this will significantly influence the eventual reopening of the borders in China and lead to the reinvigoration of Chinese travel to the rest of the world.
For 2022, look for China to maintain its zero-Covid approach until the conclusion of the Olympics, and strict quarantine rules for the immediate future. However, as China continues to push its citizens to vaccinate to reach herd immunity, the appetite to travel abroad amongst Chinese will only continue to grow as they await the government announcement. Once travel officially opens, expect Chinese travelers to come fast with a willingness to spend. Fast-growing social platforms like Xiaohongshu will become more important and play a pivotal role for travellers searching for their next destinations. Brands and destinations alike should remain in ‘ready’ mode to leverage this first wave.
—Michael Lin, senior business director, Mailman
5. The year of the silver generation
By 2022, over 14% of China’s population will be older than 65. It is widely accepted that when the population aged 65 and above accounts for 7% of the total population, the country has reached ‘aging society’ status. This is a significant turning point for the country, as society is expected to support and contribute to people in these demographics—which is already an important part of the Chinese culture and psyche.
However, this ‘silver economy’, which is expected to reach RMB 5.9 trillion ($930 billion), brings a lot of new opportunities to organisations across the country. New infrastructure is required, new technologies to meet their requirements, and new opportunities for brands that can match this demographic's desire to keep on enjoying life.
—Tom Elsden, senior business director, Mailman
6. Sport accounts diversify online
Sports organisations have traditionally relied on Weibo and Douyin to engage existing fans and recruit new ones on Chinese social media, largely ignoring other platforms with more varied content and diverse audiences. In particular, Kuaishou (500 million MAU), RED (100 million MAU) and Bilibili (250 million MAU) are huge platforms with notably fewer sports accounts.
In 2022, I predict a rush of sporting organisations launching official accounts on these platforms as well as striking platform partnerships as they look to diversify their fan bases and seek new growth opportunities. This will also be fuelled by the platforms looking to align with sport trends in an Olympics and FIFA World Cup year.
—Dom Lytwyn, Business Director, Mailman
7. Common prosperity across consumers
One of the central policies for China in 2021 will start to have ramifications in the digital world in 2022. We’ve already seen Alibaba committing an investment of RMB 100 billion ($15 billion) to support China's drive toward “common prosperity'' back in September last year, whilst Tencent, Meituan and Xiaomi have also followed suit.
These investments will bring President Xi’s policy to the forefront of Chinese consumers which will result in a shift of thinking as they begin to expect more from international and domestic brands, especially those who have yet to be seen giving back to society in one shape or another. This push may also potentially impact a change in people’s own thinking on what's important in life.
8. China regulates big (digital) media
In 2022, we will see continued governmental regulation of popular media platforms in China. This is expected to go beyond issues that were raised and evident in 2021, such as clamping down on fake users, unsubstantiated news and unofficial news channels, discussion of sensitive topics, obsessive fan culture and excesses related to the entertainment industry. The new impetus for regulation will be the usage of algorithms on social-media platforms such as Douyin, Weibo and Kuaishou. New regulations kick in on March 1. A number of new rules stand out.
Platforms relying on algorithms have to be transparent on their mechanisms, as well as include an option for users to opt out. Algorithms have to allow for manual intervention, enabling platforms to emphasise selected content. Platforms are required to ensure that recommended content via algorithms do not breach local laws or sensitivities, or promote excessive consumption, unhealthy habits or harmful behavior. As an extension of past efforts to limit potential exploitation of users’ privacy and data, platforms are not allowed to use data to push differential pricing to consumers.
In short, the new regulations are aimed at protecting audiences and consumers, whilst helping the platform owners’ and the local authorities’ ability to retain control of media. We predict that further monitoring and regulations will follow, as the government reins in fast-growing digital-media platforms. In the short term, brands and entities such as sports organisations that promote sporting values, health and fitness—which tie in well with government priorities—will find that there are increased opportunities to work with digital platforms (previously reliant on algorithms) who will be expected to manually promote such positive content.