Beth Ann Kaminkow
Sep 21, 2022

Why the West must look to the East for the future of creative commerce

The global CEO of VMLY&R Commerce explains why they're looking to markets like China and India for guidance and inspiration.

Unilever Smart Fill
Unilever Smart Fill

To see the future of retail and commerce, you need to look beyond the West, and focus instead on the East. But Asia is a big place – 60% of the world’s population lives there – so where exactly should you cast your gaze?

In the past I would have pointed you towards China. And there is still so much innovation coming from that market. 

Digitally, China leads the world in livestreaming commerce, for instance, with over a million hyped-up hyperhosts generating an estimated US$420 billion in merchandise value last year. Compare that to about US$11 billion in the US in 2021. Rather than chill with Netflix, Chinese consumers tune into their favourite live streamers – mobile wallets at the ready via AliPay or WeChat Pay. In the face of increasing regulation of the mega Key Opinion Leaders (KOL’s), China is also seeing the rise of Key Opinion Consumers (KOC’s). These livestreaming micro-influencers might only have a few thousand followers each, but together they wield tremendous power. 

Commerce in China is often gamified to make shopping more fun and heighten engagement. Ant Forest, a tree-planting mini-game within AliPay, has given way to an ecosystem of mini games that have consumers completing tasks for rewards such as discounts or coupons, ultimately to drive product sales or website views.

In terms of large-scale shopping events, even with the explosion of “special shopping days” on the Chinese retail calendar, there is still nothing quite like the 11.11 Global Shopping Festival. Initiated by Alibaba, Singles’ Day (which now spreads over two weeks) dwarfs Amazon Prime Day in both scale and interactive entertainment value. Last year’s 11.11 racked up $84.54 billion in China alone. Prime Day this year managed $12 billion worldwide

In physical retail, some fascinating IRL experiences have emerged in China recently. Witness SKP-S, the design-led south wing of the SKP mall in Beijing, where the owners collaborated with South Korean eyewear brand, Gentle Monster, to create a “Digital-Analog Future”

At the same time, there are significant headwinds in China with a slowing economy and rigorous government oversight of e-commerce and online freedom of expression. 

With 48 countries in Asia, however, China should not be the only source of inspiration for the West. South Korea is famous for tech-oriented retail - creating the world’s first QR-code driven virtual supermarket in 2011. Japan punches above its weight in commerce (and the merchandising there in physical retail is next level.) And then there is India, home to 1.4 billion people, of which (in 2020) 375 million belonged to Gen Z. (That’s a larger number of those born between 1997 and 2012 than the entire population of the United States.) 

I’ve been interested in commerce in India for many years. But my curiosity was piqued further when chairing the jury for the inaugural Creative Commerce category at the Cannes Lions International Festival of Creativity this year. With two Gold Lions, India was the #2 country in Creative Commerce, behind the USA. (India scored big at the Festival overall, with its best-ever result of 47 medals.)

One Gold Lion was from VMLY&R Commerce India, entitled “Smart Fill”, which may revolutionise the re-use of packaging around the world. 85% of plastics end up in landfill and Unilever wanted to take responsibility for its business’ impact on the environment. So, they introduced “Smart Fill” stations in store, which let shoppers fill any empty container (yes, competitors’ products too) as packaging for Unilever branded detergents. And it’s working! 150 litres are Smart Filled every hour, with a 57.2kg plastic reduction per day.

The other Gold winner -  “Shagun Ka Lifafa” – encouraged financial equity amongst Indian women. A shagun is a cash gift, traditionally given at Indian weddings, and always accompanied by a 1 rupee coin, contained in a special envelope called a lifafa. The Ujivan Small Finance Bank recognized the opportunity to design special lifafas as account-opening forms, giving many women the chance to have a bank account (and move towards financial independence) for the first time ever. 

These are both brilliant examples of 'creative commerce', operating at the intersection of creativity and culture (and in the case of SmartFill, adding the element of technology and sustainability). 

If the truth be known, India has always had a rich history of creative commerce. In the West we like to think we invented same-day delivery systems. Yeah, right. For the past 130 years, India’s dabbawallas have delivered home-cooked meals daily, with efficiency and accuracy, via bicycle, handcart, and trains. 

In digital commerce too, India is buzzing. It’s one of the world’s most interesting markets, because of a face-off between Flipkart (Walmart majority-owned), Amazon and Alibaba. Amazon is #1, but Flipkart continues to shake up the market, notably with its “Big Billion Days” event, coming in October. This year, expect even more launches, games, interactive videos, livestreams and rewards.

Like many emerging markets, SMS and text are bringing digital commerce to the masses in India, as is messaging. Mark Zuckerberg’s Meta recently announced a deal with Indian online grocery services company JioMart, to create a fully integrated purchase experience within the messaging tool WhatsApp. Users can ‘chat’ with the retailer (via a bot) and buy then and there. 

As science fiction writer William Gibson said, “the future is already here, it’s just not very evenly distributed”. It just happens that a lot of that distribution is across Asia. So, for those of us in the West, it will pay to keep looking East – not just to China, but to India and beyond.


Beth Ann Kaminkow is global CEO of VMLY&R Commerce

Source:
Campaign Asia

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