The social landscape in China is an ever evolving and dynamic one, but as with many things, some things stay the same, while others change rapidly.
The COMPASS index reflects the social buzz for brands versus the previous quarter across the major social platforms in China. The index considers both engagements driven by the brand owned media, as well as user generated buzz.
With uncertainty surrounding the sales performance of luxury, social buzz can be a key indicator to test the waters of consumer interest. Interestingly there is a strong correlation between the aggregated numbers on social and the general trend in the market: polarization and uncertainty:
Fashion and Leather Goods:
Brand generated engagement grew for the Top 50 brands Q3 vs Q2 for Weibo, WeChat and Little Red Book at 8%, 2%, and 19% respectively – highlighting that RED is gaining traction when it comes to brand direct luxury information.
Douyin declined 29% from Q2 for the Top 50 brands when it came to brand generated engagement.
From a User Generated Content perspective – Weibo and WeChat saw declines in the number of posts for the Top 50 of 11% and 15% respectively, while RED remained stable at 0%.
Interestingly Douyin saw an increase in UGC of 6% for the Top 50, perhaps highlighting a shift in content preference for the platform.
More drastically, engagement on UGC for the Top 50 was down significantly with Weibo (-20%), RED (-43%) and Douyin (-33%) – does this highlight a significant downturn in user interest for luxury related content?
At the brand level we saw risers and fallers:
Jimmy Choo was the biggest climber in the top 50, moving from 42 to 16, while Ralph Lauren, Hogan, MCM, Longchamp and Golden Goose all saw double digit climbs. This could highlight a shift in preference towards the more affordable end of the luxury scale.
Our biggest fallers (sometimes the result of a very successful previous quarter) see Balenciaga, Lanvin, Zegna, Ami Paris, Valentino, Furla, Kenzo and Givenchy all taking double digit slides.
The gold star represents brands that broke into the top 50 – and this month congratulations must be given to Longchamp and Karl Lagerfeld for breaking through.
Watch and Jewelry:
Q3 is important for the category given the QiXi festival that occured on August 10th this year. Many brands typically look to the festival as the biggest in their marketing calendar.
Here are some the numbers behind the Top 20 brands performance vs Q2:
Engagements on Brand Generated Content are up on Weibo, RED and Douyin – with RED seeing the biggest overall increase for the Top 20 brands of 16%.
At a more like-for-like comparison, Bvlgari saw its Weibo engagement levels nearly double or triple across Weibo, RED and Douyin – highlighting the importance of the quarter for the pillar LVMH W&J Brand.
The number of user generated posts also increased across the board, with the highest increase being on Weibo with 23% growth.
However, the bleaker side of the picture sits on the engagements on UGC posts which is down double digits for Weibo, RED and Douyin – with, interestingly, the biggest fall being on RED at a 45% drop.
My interpretation – QiXi being as important as it is, has a strong prevalence of celebrity based campaigns – these campaigns drive engagement from consumers, thus BGC engagements increase. Similarly, consumers comment on the activation resulting in more UGC posts.
The fall in UGC engagements may tell us that consumers are not further talking about the brand. This highlights an opportunity – how can you go beyond celebrity to generate a meaningful and engaging activation? Easy to type – hard to do!
Another interpretation relates to budget constraints - brands may have been deleveraging influencers in order to save on cost, which in turn gives less opportunity for consumers to engage in conversations outside of the brands owned ecosystem.
Which brands were notable?:
Risers – the aforementioned Bvlgari takes the top spot this quarter with impressive increases across the majority of metrics. Cartier is not far behind, with an increase in some metrics of 600/700% during the quarter.
Jaeger-LeCoultre, Rolex, Boucheron, Chaumet and Tasaki all managed to climb the rankings in the quarter too.
Omega appear to have shifted strategies a little, with significant declines in Weibo but significant increases in RED engagement from both UGC and BGC – this may highlight a belief that content on RED is more valuable to the business than pure Weibo engagement, but unfortunately leads to a decline within our methodology.
New entrants – De Beers Group, Vacheron Constantin, Breitling, Audemars Piguet and Pomellato enter our Top 20 – with De Beers (up 11) and AP (up 14) having the most impressive rises
