The knife manufacturer's growth is slowing, but half of its sales come from digital. Zwilling sees potential in China.
In the midst of global economic uncertainties and shifting market conditions, the renowned manufacturer of knives and cookware, Zwilling, achieved remarkable success in the Chinese e-commerce sector last year. The traditional company adeptly tackled the challenges of the ever-changing landscape and devised an innovative strategy to solidify its position in the fiercely competitive Chinese e-commerce market.
Zwilling's impressive performance in e-commerce can be attributed to various factors. Despite a moderate overall revenue growth of three percent, reaching 900 million euros in 2022, the online share of total revenue surged impressively to 46 percent. This increase of six percentage points compared to the previous year attests to the company's remarkable adaptability and strategic orientation.
Consumer goods manufacturers have faced diverse challenges in recent years. The global lockdowns due to the pandemic led to sales declines in brick-and-mortar retail worldwide, particularly in China, a pivotal market for Zwilling. Nevertheless, the company adeptly navigated these difficulties and diversified its business in multifaceted ways.
A particularly astute strategy employed by Zwilling involves the use of influencers and the Direct-to-Consumer (D2C) model. These approaches have proven highly effective, especially in segments featuring products with higher average order values. Zwilling's emphasis on influencer marketing enables the company to establish direct relationships with customers and engage them through platforms like WeChat and Douyin.
Chinese consumers are characterized by their affinity for technology. They are receptive to innovations and utilize digital platforms not only for communication but also for shopping. Utilizing mini-programs on WeChat enables Zwilling to establish a direct connection with customers and facilitate a seamless purchasing process. Additionally, the Chinese e-commerce market is rapidly expanding through platforms like Douyin, which leverage live streams and short shopping videos.
Zwilling's success in the Chinese e-commerce realm extends beyond the domestic market. The company is also investing in other emerging Asian markets like Vietnam and India to reduce dependence on a single market. Diversification is a shrewd move that assists Zwilling in mitigating potential risks and fostering future growth.
In summary, Zwilling demonstrates that success in Chinese e-commerce hinges not only on global challenges but also on intelligent adjustments and innovative strategies. The Chinese market presents significant potential for companies willing to adapt to changes and adeptly utilize digital channels. Zwilling has proven that the combination of direct sales, influencer marketing, and diversified investments in emerging markets can be a recipe for sustainable growth and enduring market presence.
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