China’s influencer agencies strike out in new directions

Agencies representing China’s influencers are launching their own brands and exploring brick-and-mortar retail as livestreaming develops in new directions. 

For example, agency Jiaoge Pengyou (Let’s be friends) is making 200 million yuan ($28m) a year from Reloading Peacemaker, a clothing label it launched in 2021, Jiemian Global reports. 

Why it matters

The shine has been taken off influencers after several ran into problems with government authorities (eg evading tax) and new regulations began to constrain the sector. Agencies also have to contend with the fickle nature of online fame and the sometimes trying demands of celebrity influencers. But now, agencies are finding that selling their own brands is more profitable than relying on influencers and commissions from clients. 

Takeaways 

• The supply chain is a crucial factor but, given China’s manufacturing base, it is relatively straightforward to find a factory capable of making good quality products. 
• Product cycles for agency-owned, internet-sold brands can be far shorter than for existing rivals. In apparel, for example, it can be just 45 days compared to six months. 
• Some agency brands are looking to reduce their reliance on livestreaming for sales and get their products stocked in traditional retail outlets. 
• If livestreaming encourages impulse purchases, brick-and-mortar builds trust and connections, which brings customers back, explains the manager of one agency-owned brand.

Sourced from Jiemian Global