If Douyin is a Chinese counterpart of TikTok, Kuaishou is undoubtedly the Chinese nemesis of TikTok and Douyin. Publicly listed in Hong Kong in February, Kuaishou is the first Chinese short-video platform that went through an IPO within the past decade. Backed by Chinese tech giant Tencent, Kuaishou is maturing as a national short-video platform but has also expanded globally.
In June, Kuaishou said that its global monthly active users reached 1 billion. Even if this makes Kuaishou China’s second-largest sharing platform for short videos, it stands out from all the intense competition with its down-to-earth content shared by Chinese people from all walks of life.
As JingDaily has reported, by 2025, 1.1 billion users in China are predicted to spend more than two hours a day on video apps. As commercial potential swells, it’s no coincidence that the founders of Kuaishou and Bytedance (the owner of TikTok and Douyin) both stepped down from their CEO positions this year. The next phase for both companies will be more about a new competitive scene for video and mobile commerce in the 5G era.
Tarun Mathur, APAC general manager at Mediaocean, believes that “there will be more competition than ever before, with China’s ecommerce giants joined by a variety of other platforms. Live broadcasting rooms are growing in popularity, with consumers offered coupons and encouraged to buy products viewed on Taobao, Douyin and Kuaishou”.
Jerman Zhang, chief commerce officer from GroupM Commerce China, observes that “Kuaishou and Douyin have been building their own ecommerce platform recently, integrating the brand, content, traffic, and performance with GMV [gross merchandise value, ie sales]”. The ecommerce platforms of both sites cover a wide range of product categories, from home appliances to fashion, Zhang points out, and many of these brands—especially in fashion, beauty, and food—want to embrace these new platforms. But Zhang pointed out that the difference between Kuaishou and Douyin is that Kuaishou is a trust-based ecommerce platform between the network community, while Douyin’s business around advertising and marketing is oriented around user interests.
2021 CNY Kuaishou campaign for the year of ox, featuring 2.1 billion RMB of hongbao and Chinese stars
In the past, Kuaishou planned many campaigns, with the support of celebrities and by sending out red pockets (hongbao) as an incentive during the Chinese New Year. In 2021, Kuaishou earned both trust and user interest through exclusive sports content. The platform announced a strategic partnership with China Media Group, China’s only national sports video provider. The new move makes Kuaishou the first short-video and livestreaming platform to become an official broadcaster of the Tokyo 2020 Olympics Games and the Beijing 2022 Winter Olympics worldwide.
Given the rising competition and the new moves of Kuaishou in 2021, Campaign China talked to marketing experts for their takes on Kuaishou’s competitiveness, as well as its future advantages and challenges.
General manager and head of GroupM Knowledge
Kuaishou takes a very unique role in the ecommerce field, which differs from other players. Its nature is geographically lower-tiered and more acquaintance-based, which earns stronger trust from lots of communities, compared with other platforms. Plus, streamers on Kuaishou are not that polarised. On other platforms the winning streamers take almost all the traffic, whilst on Kuaishou, under its traffic-allocation mechanism, traffic between streamers is more balanced.
As Kuaishou is longing for a bigger GMV, its approach will be to fully utilise its nature of high trust within its communities.
Therefore, Kuaishou needs more community-based content to build and maintain its various communities. For example, Kuaishou is forging its sports content to nourish more sports-related communities. It is also introducing some long videos to build relative communities.
As a key platform for short videos, Kuaishou needs to pay attention to the growth of the entire category. The saturation of short-form video may require Kuaishou to find more content segments to acquire users so as to compete with Douyin. Kuaishou is working hard at fostering content production, improving its efficiency in commercialisation, which will be key to its success in future.
Since Kuaishou is very different from its competitors, it needs to forge commercialisation with its own features instead of copying directly from others. For example, as Kuaishou’s communities operate at higher trust, its live streaming ecommerce offerings should therefore fit for more trust-based or categories with longer decision chains.
As Kuaishou has grown bigger, its users’ viewing behaviours have changed a little bit. More and more users are expecting more exquisite and longer content. Therefore, Kuaishou invited many top stars from OTV platforms into its platform and began producing its own programs. One example was the talk show with Li Dan, a Chinese talk show host and standup comedian, and his company. Fresh was one of the brands that leveraged this by integrated digital marketing. For example, pre-campaign teasers attracted traffic on both Weibo and Kuaishou; there were product placements in the talk show and the Kuaishou app had opening-screen ads and social amplification. The result? Fresh achieved 46 million live viewers, 10 times trending topics and 1 million live interactions in an hour, with more than 800 million video views in two weeks.
Isobar China, Dentsu
After two important ecommerce shopping seasons in 2021, in our cooperation with Kuaishou, we found that the share weight of consumers in Tier 2 markets is very high. Because of the saturation of ecommerce sales in Tier 1 markets, many international/domestic Tier 1 brands are starting to lay out their strategy in the so-called ‘sink markets’. The layout of consumer assets for second- and third-tier markets has become the greatest advantage of Kuaishou in the battlefield of ecommerce.
This year’s 11/11 ecommerce terminal sales still landed on the two ecommerce giants, Tmall and JD. At the same time, the accumulation of consumer assets and the cultivation of interest is a ‘snowballing’ process. From the contribution of ecommerce traffic in this year’s 11/11, Kuaishou’s contribution to interest-based assets in the ecommerce sector is still quite significant.
Kuaishou is a platform that is able to convert short-video interest into user traffic. In the future, Kuaishou’s main competitor in the overall market will still be Douyin. However, as Kuaishou expands in many fields, such as sports videos and ecommerce, Douyin is not the only competitor; many other short-video platforms, such as Xigua (Watermelon video) and Huoshan (Volcano), both owned by ByteDance, are also quietly rising.
VP of media
Mailman Group, an Endeavor China company
Kuaishou’s standout campaign of the year was delivered during Chinese New Year to celebrate the biggest festival in China. The platform launched a unique creative character that intertwined the Chinese traditional character for the ox (牛), as well as the character for ‘power’ (力). The campaign incorporated a daily gamified challenge with a ‘hongbao’ incentive structure built around CNY tradition. They were able to plug in their brand sponsors and advertisers to launch specific digital products during the campaign period.
In the past year, Kuaishou launched high-profile accounts with Chelsea, Cristiano Ronaldo, and the Olympics. For Tokyo 2020, Kuaishou made the bold move of sub-licensing the near-live broadcasting rights from CCTV, meaning they had access to all highlights from the Olympic Games. They produced a behind-the-scenes show called “Welcome the Champions”, live from their studio in Tokyo to directly engage with the Chinese heroes of the Tokyo Games. They commercialized the shows through digital sponsorships with local brands. We are expecting much more to come for the Beijing Games, as this is just the start of Kuaishou’s push to embrace sports content.
In China’s incredibly competitive ecommerce market, where Kuaishou and Douyin have the advantage is that they already have a highly engaged, returning user base who are there to consume content and be inspired. This differs significantly from Alibaba’s Taobao platform which would have a shorter consumer journey, driven largely by the purpose of making a purchase rather than consuming content. Kuaishou and Douyin represent a new generation of ecommerce, where content consumption drives product purchase, often converting users with no intent to buy. Douyin is by no means their only competitor, largely because in this fierce market, everyone is a competitor, however, each is in a different stage of their evolution towards ‘live commerce’ and faces their own unique challenges.