Why have QR codes taken off in China?

QR codes have largely failed in western markets, but in China, the mass adoption of social communications app WeChat – with its embedded QR reader software – means no brand can market without them.

China’s WeChat has more than 600 million monthly active users. Every time the app is downloaded onto a mobile phone, so too is a QR code reader.

This creates a shortcut for a user to link directly from an offline source to an online WeChat account, without the customer having to find and download a QR reader. It also eliminates the search process of looking for the brand in a Google or Baidu search.

“QR codes are so ugly, but so useful at turning the physical world into an interactive surface. You scan the QR code and every surface becomes a gateway into digital content,” says Eugene Chew, chief digital officer at J. Walter Thompson Shanghai.

Chew says it is the rapid adoption rate and ubiquitous nature of WeChat that has directly led to the popularity of QR codes in China.

Here are some ways brands in China are using QR codes:

1. O2O

Brands are using QR codes to drive online to offline (O2O) sales, especially in retail. It’s not uncommon in China to see a poster at the entrance to a shop or near the cash register asking consumers to “add” them on WeChat.

QR Codes appear on buses, on outdoor advertisements and even on business cards.

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WeChat’s user appeal lies in its intimate and closed environment. For example, unless the user has agreed to follow a brand’s official subscriber account, the brand cannot send personalized and targeted content to them.

Brands are also limited to sending just four direct messages a month to each follower. But it outlines why brands are so eager to increase their followers on WeChat through a QR code – better, and more direct, consumer engagement.

QR codes are not restricted to out-of-home (OOH) advertising either but are cross-promoted across social platforms from Weibo to LinkedIn.

Here is how British brand, The Cambridge Satchel Company is using QR codes as part of its China marketing strategy. Here is the brand’s Weibo page:

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By scanning the QR code in the bottom right hand corner of the screen, the consumer is taken to the brand’s official WeChat account.

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By agreeing to follow the account, the customer can engage with The Cambridge Satchel Company in the more intimate WeChat environment to receive new product information and special offers and promotions.

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With more than 100 million Chinese now travelling overseas each year, The Cambridge Satchel Company has also taken the bold step of introducing a QR code to its London stores.

Here is a QR code inside the entrance of The Cambridge Satchel Company’s Covent Garden store.

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“They wouldn’t integrate a QR code into their UK stores for western consumers because no one would use it, but they know that so many of their customers who come into their UK stores are Chinese,” says Weixin Zhou, engagement manager, Red Ant Shanghai, the agency managing The Cambridge Satchel Company’s China social media strategy and activation.

This initiative is seen as a good way to promote the WeChat and Weibo accounts but also ensures the brand can retain a relationship with the customer upon their return to China.

“If they have gone to the point of sale, they are buying something so it’s already a transactional relationship,” says Zhou. “By having a QR code you are turning that transactional relationship into an emotional relationship, because then they follow you and continue to learn more about what the brand is doing.”

The key here is mobile. WeChat is a mobile application, allowing brands on the platfrom to engage with the Chinese consumer at anytime, anywhere in the world. When a consumer scans the QR code offline, the brand can continue the conversation with the consumer online.

2. Below the line activations / CRM

QR codes lend themselves well to sampling events and road shows. In the old days, a salesperson might have collected an attendee’s personal information by having them fill out a physical form.

Today, it could be a sticker inviting visitors to scan the QR code for a chance to win a car or coffee machine or whatever product is on display.

“Everyone scans it, they join the official WeChat account and the WeChat platform becomes the CRM platform for the brand,” says Chew.

Here’s an example (with some cross-promotion) of a pull-up banner used at the recent ClickZ Live digital marketing conference in Shanghai.clickzsh2015-pull-up-500

 

3. Fighting fakes

Some brands in the infant dairy formula and alcohol industries have turned to QR codes to prevent counterfeiting. For example, when the QR code is scanned, consumers are taken to an HTML5 platform showing product and supply chain history.

This will detail the manufacturing date, when the product left the country of origin, when it arrived in China and who the distributor is. A separate unique code either inside the can, or under a scratchable surface, can then be entered to check the authenticity of the product.

Technology is also moving to 3D QR codes which can’t be copied and video QR codes with animated images.

4. Brand awareness and engagement

Starbucks

Chew has worked with a number of brands to implement QR code campaigns, including a Starbucks initiative in 2012 to introduce its Refresha drink to the Chinese market. Consumers were invited to scan a QR code from a sticker on each cup of Refresha, taking them to the Starbucks WeChat account.

A call-to-action then asked them to share how they were feeling with an emoji. Fans responding with a happy face were sent a happy song, a sad face, a sad song.

From the campaign, Starbucks gained 270,000 fans on its WeChat account and increased its Weibo fans by 15 percent.

 

Sprite

This year’s Sprite summer campaign used QR codes to push Chinese millennials outdoors.

By scanning the QR code from the can, participants could play games on their mobile phones to win prizes in an offline environment, such as admission to a water park or a concert.

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Japan and Korea

QR codes are also popular in Japan and Korea.

In 2011, Tesco’s Homeplus used virtual supermarkets in Korean subways to encourage online shoppers to use their smartphones to scan QR codes and order online.

This example inspired quite a few Westrn brands to experiment with QR.

This video explains the success of the campaign.

In a unique way to create time sensitive content, Korea’s Emart used a 3D sculpture to encourage in-store shopping over the quiet lunch period.

A QR code only became evident at noon when the sun was directly overhead creating specific shadows. By scanning the sculpture at this time, consumers had access to coupons and offers redeemable in-store.

Why did QR fail in the U.S. and Europe?

The ease of creating a QR code led to an explosion of their usage by marketers.

They didn’t take off though, mainly thanks to poor implementaton, such as:

  • Non-mobile landing pages. For example, while it was easy to create a QR code and place it somewhere for users to scan, creating a mobile optimized landing page wasn’t always part of the thinking. It may seem obvious, but many brands got this wrong.
  • Poor placement of codes. There are many examples where QR codes were placed where users couldn’t easily scan them. On the other side of subway tracks, on the back of moving lorries. Or, as in this example, on a moving travelator at an airport:
  • The hassle of scanning a QR code. QR is supposed to offer a shortcut to a specific URL, but the process wasn’t always easy. Mobile users would have to actively download a code reader app then, when seeing a QR code that appeals to them, they’d have to fire up the app, wait for it to load, scan the code, then wait for the page. Was this really quicker than searching or entering a URL?
  • QR codes were not embedded into major apps or mobile phones. If Apple had added a QR reader to one of its iPhones, or Facebook to its mobile apps, then QR may have been adopted more widely.

There were some good examples of QR usage, scanning for more information on exhbits in art galleries or museums for example, but the general attitude to QR in the U.S. and Europe is summed up by this chart:

should-i-use-qr

Does the QR Code have a future outside China and Asia?

“If WeChat can take over the world and become as ubiquitous as Facebook then maybe QR codes have a future outside China,” says Chew.

As more and more Chinese consumers travel abroad, western brands will also need to consider carefully the marketing value of displaying a QR code in their stores outside China.

Finally, because QR code success in China has been led by a mobile platform, perhaps the bigger question is, will Facebook think about introducing QR codes someday soon to increase the marketing opportunities for brands? Only time will tell.

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