Retail in Asia


What can we learn from this Chinese brand’s customer loyalty program?

It’s a lot cheaper to retain a customer than acquire a new one, so the old adage says. Many marketers in China don’t seem to have got that memo, with marketing plans based around increasingly expensive livestreams and KOLs for sales, with limited initiatives to retain those customers once they’ve transacted.

One of the most exciting we’ve seen lately is from Chinese EV brand, Nio. Car sales have been one of the brightest categories in China’s retail sphere, last month growing 17 percent year-on-year. Beijing has been strategic in putting its weight behind car sales – it takes a lot of packaged goods or shoe sales to match that of a single car in making retail sales look rosy.

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Nio has been a beneficiary of these government policies, and has capitalised on them by “creating a sense of allegiance among customers, who then persuade family and friends to spread the word about its cars.”

The Nio app, boasting 400,000 daily users, strays from the usual path of auto apps, combining online shopping with social media. On the ecommerce front, users can buy a new car, or with a tap of the ‘surprise’ button, buy Nio merchandise ranging from cookware to wine, to eco-friendly pillows and antibacterial T-shirts, to a travel collection designed in a Tom Dixon collab and a clothing range with Hussein Chalayan. The app’s users receive rewards in the forms of vouchers and points after completing in-app “missions” such as adding products to shopping carts, filling out personal information, or watching videos.

For those wanting to be social, the app’s ‘discover’ button allows Nio owners and employees to ask questions, comment and make suggestions about Nio, and send direct messages to other users. The virtual bulletin board allows users to discover in-person activities in their communities, such as art exhibitions and kid’s soccer camps.

Also in the real world, customers and the general public can visit dozens of ‘Nio Houses’ across China. The avant garde spaces that Nio describes as “beyond a showroom,” displays cars complemented by cafes, libraries and play areas for kids – an Apple Store on steroids.

Source: Nio

The company was on the brink of collapse after losing USD 5 billion in its first four years, but its customer-centric approach has carried it through. Its latest initiative, choosing the location for its 2022 annual customer event, Nio Day, may be its most endearing initiative yet. The annual event provides a stage for Nio to unveil new models, and get loyal fans in one place for a big Nio summit. The venue is typically a large stadium, brought alive with headline acts such as Bruno Mars, Imagine Dragons and DJ Alan Walker.

Nio called for loyal customers across China to compete to have their home cities chosen as the host for the event. Promotion posters were designed, local authorities were roped in, video clips were produced and even free gifts were sent out. Cities were narrowed down to a shortlist of 10, then three finalists, kind of like a premier sports league with passionate residents getting behind their cities. Hefei, Anhui ultimately won the pageant, piping Guangzhou and Xi’an in the final.

For the Nio Day to be held later this year, the Hefei Nio owners club is offering free bags of rice for anyone who visits a Nio battery-swapping station and giving out free tickets to Anhui’s main tourist attractions, including the stunning UNESCO World Heritage site, Yellow Mountain.

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Many brands are unlikely to be able to host extravagant annual conferences in China, but Nio still offers many takeaways on how to build communities around a brand. In 2019, 45 percent of Nio’s new customers came from custom referrals. By March 2020, it had increased to 70 percent.

Source: China Skinny