The coronavirus pandemic has pushed just about every type of business with the capability to do so online. And in China, the world's largest e-commerce market, even its oldest classic brands, and some of the oldest of its population, are making the shift.
Some traditional restaurants and dairy companies in Shanghai have been trying everything they can to lure back their customers, and their latest online gambits have yielded success, they told CGTN.
One such business is the 169-year-old restaurant Xin Hua Lou, one of the oldest in Shanghai, which recently opted to start doing live streams, broadcasting online videos to netizens to market the latest products of a traditional Chinese springtime favorite, green dumplings.
Green dumplings, traditionally flavored with sweet bean paste, are a seasonal treat eaten just before Tomb-sweeping Day (Qingming festival), which falls on April 4 this year. Crowds usually flock to buy them at this time of year, but not so much in 2020 due to the pandemic.
"Most of our consumers are middle-aged and elderly. Live streaming is a new retail model, and even though we're a traditional brand, we definitely want to try a new business approach. The impact of the KOLs is revitalizing our brand," said Zhi Jing from Xin Hua Lou.
Xin Hua Lou said its move has paid off, and has eased the shock to its income from the pandemic, as its seasonal sales have increased by more than 340 percent. Now one third of its sales come from its new online channels.
Expert: Classic brands need to keep up
Shanghai Bright Dairy usually only sells milk or yoghurt, but since the pandemic, it has branched out to include vegetables and fruits on its app. Interestingly, the new products are attracting customers to its old products.
"Forty-two percent of consumers who bought our vegetables then chose our milk too. Fifty-two percent of buyers who picked our strawberries, then chose our milk. And all of them are new customers. The consumer redirection shows that our product line was too simple in the past. We have to vary our products in the future," said Li Xiukun, the general manager of Shanghai Bright E-Commerce.
Business restructuring among China's classic brands is not a new concept. In recent years, many of them have already started selling on e-commerce stores. But industry insiders say that the success of online sales during the pandemic will encourage more brands to learn more about modern purchasing trends.
"The new marketing strategy may have worked well enough if only a few brands were using it. But now that more companies are doing it, it will push a restructuring in all online sales. Young Chinese have already been showing their affection for Chinese brands, and if the classic brands can learn from this opportunity it will promote their future business growth," said Cui Lili, the executive director at Institute of E-commerce, Shanghai University of Finance and Economics.
Food delivery. /VCG
Meituan: Older generation buying online
Since COVID-19 began spreading in December 2019, there has been a flood of new online stores. T-Mall said that 120,000 offline stores have opened online shops during the pandemic, and with the classic brands also joining the battle, online competition can only become tougher.
A report from Chinese food delivery giant Meituan Dianping indicated earlier this month that there's been a surge in new customer registrations, with those born in the 1960s and 1970s representing more than half of new customers in mid-February.
Chen Jiahe, chief investment officer at Novem Arcae Technologies, said that the pandemic was not a game changer for China, but simply accelerated an already rapidly growing market.
"It was a gradual process, some people didn't have the habit of shopping online for food … Now almost everyone in cities knows how to order food online," he told CGTN, adding that businesses that fail to improve or adjust will simply lose out.
(CGTN's Chen Tong and Lily Liu also contributed to this story.)