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CIM056: KOC Marketing 101 – What is it? Why is it Important? And How Can You be Leveraging it?

Today we’re talking all about KOCs or key opinion consumers with my guest, Ray Veras, co-founder of the KOC marketing platform Pingjia Daren (评价达人). This episode will give you an overview of the topic: who are KOCs, how are they different than KOLs, why has KOC marketing become so popular, and what kind of goals and ROI expectations brands should have when running KOC campaigns.

At the end we also chat a bit about a great report that Pingjia Daren put out ahead of 11.11 where they surveyed over 6,700 KOCs and Ray shared some of the key findings from the report.

Read the report: 11.11 China female consumers’ shopping plan survey 2019

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Notes:

Ray’s background:

  • Ray has been involved in KOC marketing for 5 years, before the term existed. His professional background was in consumer research and back in 2014 was surprised by how few brands were using word of mouth (WOM) marketing in China

What are KOCs?

  • KOCs are ordinary everyday consumers who enjoy sharing their experiences on social media. Generally, they are knowledgeable on certain topics. May only have an audience of several hundred to a few thousand followers therefore have a much closer relationship with them.
  • He feels one of the biggest differences between KOLs and KOCs is that KOC content is generally not financially motivated. Most of the time, at least with their collaborations, KOCs are just being gifted product and product samples.
  • Very important when gifting KOCs that the product fits the KOC’s lifestyle and is relevant, not just randomly gifted
  • I asked “Is there a lot of churn? Do a lot of KOCs become KOLs?” Yes, this year especially. Now that KOC marketing has become popular brands have started paying them and MCNs have been scooping them up to see if they can train them to become larger KOLs

What is Pingjia Daren?

  • It is a product recommendation community (somewhat similar to Xiaohongshu). Users answer a questionnaire when then sign up to share their interests and product preferences, then when there is a campaign, PJ Daren will invite a select group of users to receive free product. They are then encouraged to review the products on their social accounts, brands will indicate preferred platforms.
  • Difficult for brands to do KOC marketing without the help of a platform. To engage with thousands of consumers at one requires a system, you need tech to track performance.

Why has KOC marketing taken off this year? Several factors:

  • Chinese consumers are becoming more sophisticated, they have a lot of options to avoid traditional advertising.
  • Consumer are now very aware that KOLs are promoting products because they are being paid to. He feels they are craving more content that is not commercially influenced.
  • Social media landscape is becoming more fragmented. Consumers have more options. Adds complexity for brand side to determine which platforms to leverage. Harder for them to keep messages consistent, also platforms each have their own rules and best practices.
  • Consumers’ attention span decreasing therefore less attention on marketing campaigns.
  • Last few years seen a decrease in performance of KOLs in China yet costs have increased and become unbearable for many brands. Also cases of KOLs inflating performance, fraud.

What goals should brands have when running a KOC campaign?

  • driving advocacy
  • amplifying other campaigns the brand may be running at the time
  • lifting incremental sales.
  • Need to think about mid-term results, not short term. KOC marketing is about building brand equity.
  • ROI – $1-4 per dollar invested in a campaign

Think mid to long term – short terms successes aren’t what they seem

  • With e-commerce live streaming most cases where you hear crazy sales results, the brand is paying for the hype, they aren’t making a profit, the products are heavily discounted, tied to aggressive commissions, short term burst of exposure, not a long lasting effect which is what KOCs produce
  • Great case study of building brand equity through KOCs is Perfect Diary. They have been using KOCs, building communities, using private traffic for several years and that’s paying off now

Pingjia Daren reports:

  • One that came out ahead of 11.11, was a survey of over 6,700 Chinese female KOCs, evaluated their purchase intent,
  • Key insight – consumers in 3rd tier cities and below are taking the lead with consumption growth in China. Willing to spend more than consumers in 1st and 2nd tier cities
  • Did follow up research – found out they have a lower cost of living, which means they have greater disposable income. Cost of housing really affecting 1st and 2nd tier city consumers.
  • Key drivers of product choice – in 1st and 2nd tier cities discounts are a big driver, but for 3rd tier cities and below, the impact was much lower, they are more focused on value and quality, not paying as much attention as we think on cheap products

Guest: Ray Veras

Website: https://pjdaren.com/

PJ Daren LinkedIn

Ray’s Linkedin

Host: Lauren Hallanan

Website: www.chinainfluencermarketing.com

LinkedIn: https://www.linkedin.com/in/lauren-hallanan/

WeChat: H1212118514

Check out my book: Digital China: Working with Bloggers, Influencers and KOLs


Thanks to our sponsors PARKLU: www.parklu.com and Chatly: www.chatly.com

For additional information and show notes head over to www.chinainfluencermarketing.com

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By |2019-12-13T07:38:00-05:00December 13th, 2019|Podcast|