China’s key opinion leader (KOL) market has been one of the fastest-growing and most durable economic phenomena in recent years. The standard retail cycle has been reformed to be influencer content followed by consumer demand and purchases. Multi-channel networks are the main driver behind this game. Service providers in this industry, like Tiktok, and Red, bring standardized channels and products to KOLs to promote their business to customers. In addition, because of the data-driven customer intelligence and AI feed to capture the customer's behavior, the KOLs can precisely match the viewer's liked content and reach every nitch or fragment customer group.
Those customer feedbacks are passed to the production end very quickly, allowing pre-ordering to eliminate excess stock and greatly encouraging small businesses with light capital coming into the game. These firms can rely purely on the online channel, and no physical shops are needed, given all customers are retained with good relations with the KOLs with promotions and discounts. Leading brands shall react quick and be in this "blood-bleeding" game; otherwise, the market could be taken by small players who are willing to share profits with KOLs.
Article: https://www.thedrum.com/opinion/2021/10/14/china-s-kol-economy-shaping-the-conversation-western-brands
Those customer feedbacks are passed to the production end very quickly, allowing pre-ordering to eliminate excess stock and greatly encouraging small businesses with light capital coming into the game. These firms can rely purely on the online channel, and no physical shops are needed, given all customers are retained with good relations with the KOLs with promotions and discounts. Leading brands shall react quick and be in this "blood-bleeding" game; otherwise, the market could be taken by small players who are willing to share profits with KOLs.
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