Hi folks, we are back with our weekly edition of China’s Digital Digest, wherein we bring you weekly updates on China’s digital space. The report takes a quick glance at China’s complex and rapidly evolving social media landscape by providing updates on the latest happenings across the social media industry. Here are the major highlights of the report.
1. EU Mulls Curbs on China’s Surging Fast Fashion Online Retailers, Including Shein and Temu
China’s online retailers – including fast-growing internet merchants Shein and Temu – are in the cross hairs of EU authorities amid concerns about the volume and quality of their products flooding the European market.
Officials are studying a range of actions including the possibility of introducing customs duties on items that fall below the €150 (US$167) value threshold at which import taxes are applied. The European Commission has also considered punitive action against the transport subsidies received by Chinese operators, which allow goods to be sent at a low cost by air cargo from China to quickly meet booming consumer demand, according to people familiar with the internal thinking.
Shipments of low-value items from China to the European Union’s 27 member states have surged in recent years, as online marketplaces such as Shein, Temu and AliExpress have aggressively targeted the bloc’s consumers through prominent advertising and search engine optimization.
2. China Fines Influencer Agency US$9.8 Million for Fake Mooncakes
China has slapped Three Sheep Group with a 69 million yuan (US$9.8 million) penalty after the company founded by one of the country’s top-earning influencers was accused of falsely marketing mainland-made mooncakes as “made in Hong Kong”.
The market regulator of Hefei, capital of eastern Anhui province, ordered the influencer agency to suspend its live-commerce operations, which sell products online through live-streamed sessions. Three Sheep apologised for “falsely advertising and misleading consumers” and vowed to “conduct thorough rectifications within the company”, according to a statement published on the company’s official account on Douyin, the Chinese sibling of TikTok.
Founded by Zhang Qingyang – better known by his online name Crazy Little Brother Yang, or Crazy Xiaoyangge – Three Sheep has nurtured some of China’s biggest short-video stars. In 2022, Zhang became the first influencer in the country to reach 100 million followers on Douyin. He earned an estimated 3.12 billion yuan last year, surpassing his peers, according to a list published by the Guangdong E-commerce Summit Forum.
3. Italy Opens Greenwashing Probe Into Shein Website
Italy’s antitrust agency has launched an investigation into a Dublin-based company that operates Shein’s website and app over possibly misleading environmental claims made on the fast-fashion retailer’s website.
The investigation targets Infinite Styles Services and accuses Shein’s website of trying “to convey an image of production and commercial sustainability of its garments through generic, vague, confusing and/or misleading environmental claims,” the antitrust agency said in a statement. Shein said it was “ready to cooperate openly with relevant Italian authorities, providing the necessary support and information to address any inquiries”.
The probe is the latest in a string of investigations by regulators across Europe into potentially misleading environmental claims by companies, as new European Union regulation seeks to crack down on greenwashing.
4. PayPal Expands in China as It Courts Cross-Border Merchants
PayPal has launched PayPal Complete Payments for China with the aim of helping merchants sell abroad by allowing them to accept payments from global customers using credit cards and foreign digital wallets.
While PayPal has long supported cross-border payments, the new service is meant to broaden support for a variety of newer platforms such as Apple Pay and Google Pay while providing additional services such as risk management. PayPal Complete Payments is currently available in more than 30 markets, including the US and multiple European countries.
PayPal’s China expansion comes as it tries to find new growth opportunities in the country’s booming export market amid rising cross-border e-commerce, despite uncertainties in the global macroeconomic environment.
5. Alibaba Waives Delivery Fees for Hong Kong’s Taobao Users In US$142 Million Plan
Alibaba Group Holding has earmarked 1 billion yuan (US$142 million) to waive delivery charges on Taobao users in Hong Kong for certain orders that cost more than 99 yuan during this fourth quarter.
The three-month campaign covers categories such as fashion accessories, electronics, skincare and cosmetic products on Taobao. Taobao users can pick up their orders at more than 800 delivery stations across the city operated by Alibaba’s Cainiao Smart Logistics Network, the company said. Alibaba decided to launch this Hong Kong promotion in October because the fourth quarter is always the company’s peak sales season, according to C.K. Chan, head of Hong Kong and Macau operations at Tmall Taobao World.
6. TikTok Partners With WHO to Combat Medical Misinformation
TikTok is taking steps to further limit health misinformation in the app, by partnering with the World Health Organization on an expanded fact-checking initiative.
The updated process will see TikTok joining forces with the WHO’s “Fides” group to boost its medical fact-checking capacity. Fides is a network of over 800 healthcare professionals who are active on social media, and are aiming to stop the spread of health-related misinformation by presenting factual explainers and insights into key health topics of discussion in the app. TikTok says that Fides creators will post explainers on health and scientific research, and provide expert insight into health topics, helping to dispel misinformation.
7. TikTok Announces Shutdown of Separate TikTok Music App
TikTok has announced that it’s shutting down its separate “TikTok Music” streaming app, after various operational challenges and limited user interest.
TikTok Music was initially launched in India in late 2019, under its original name “Resso,” which aligned with TikTok’s own meteoric rise in the nation. And while TikTok was banned in India in 2020, somehow, Resso avoided the same restriction. TikTok renamed Resso to “TikTok Music” last year (which may have led to its ban in India), and re-launched it in Brazil and Indonesia. It also expanded access to selected users in Australia, Mexico, and Singapore as part of a closed beta test.
8. TikTok Updates Search Ads Campaigns with Keyword Targeting
Tik Tok is adding another way for brands to get their promotions in front of searching users in the app, with an updated version of its Search Ads campaigns.
Search ads are now available for both Traffic and Web Conversion objectives, and include a new element during set up which enables advertisers to select relevant keywords for their campaigns. The biggest difference from its existing Search Ads in format is giving advertisers more control in placement.
Last year, TikTok added a “Search Ads Toggle” in ad campaigns, which, when activated, ensures that ads are eligible to be displayed in related search queries in the app. The limitation with this is that the toggle is only a placement, and not a separate ad option. This means advertisers could switch it on to have ads appear in related searches, but couldn’t target specific keywords.
9. TikTok Offers New Misinformation Measurement To Reassure Ad Partners
TikTok is adding more assurance for advertisers, with new third-party measurement of misinformation, and if/how ad content is being displayed alongside such in the app.
Misinformation was added to the Brand Safety industry-standard measurement earlier this year, and now, TikTok is incorporating it as a new consideration, so that ad partners can be assured that their promotions are not being placed alongside misleading claims. Misinformation tracking has become more advanced in recent years, using a combination of AI and human review to detect questionable claims. TikTok’s partners will now be able to offer these processes as a solution to ensure brand safety, which could be particularly important heading into the last weeks of the U.S. election push.
10. TikTok Expands Subscriptions for Creators
TikTok is expanding its subscription option for creators, which will enable more users to build an audience of paying subscribers in the app.
TikTok initially launched subscriptions for Live creators back in 2022, but earlier this year, at its U.S. creator summit, it announced that it would soon expand subscriptions to non-Live creators as well. Now TikTok is extending availability to even more creators in the app. Eligible creators will be able to customize their Subscription packages into three different pricing tiers, with a selection of benefits that align with their approach.
Wrapping Up
The vast and diverse nature of the Chinese Social Media space makes it incredibly challenging to keep a tab on the rapid developments taking place. However, China’s Digital Digest brings you all the latest updates from there to keep you abreast of all the evolving trends.
To delve deeper into the findings of our latest report, click here.
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