Low frequency + high customer orders, member repurchase rate exceeds 32%. How does Chow Tai Fook manage its membership operations?

In the era of inventory, companies are trying every possible way to retain users and screen super users. What method can achieve more long-term and stable growth?

The gold jewelry industry is different from other industries in many ways: low frequency, high unit price, non-standard, offline-oriented, and extremely high customer acquisition costs.

Therefore, many people think that the gold and jewelry industry is not suitable for private domains. However, the emergence of the epidemic has quietly changed the industry, and many brands have begun to transform, and Chow Tai Fook is a representative example.

According to Chow Tai Fook's official financial report, in 2021, Chow Tai Fook's online jewelry sales exceeded 1.3 billion. The average selling price of products sold in the private domain was about 1.8 times higher than that in the public domain, and the sales conversion rate was about 10 times that of ordinary e-commerce platforms.

In addition, Chow Tai Fook has launched a membership management plan to provide benefits, discounts and personalized services to enhance user loyalty. At the end of fiscal year 2022, the total number of Chow Tai Fook members was about 5.5 million, and the repurchase rate of members in mainland China reached 32%. So how did Chow Tai Fook build a membership operation system? The following is a breakdown of our five-step super user methodology, namely identification-cultivation-screening-operation-fission .

Image source: Fengcheng Consulting

1. Identification-channel operation analysis

Identification is the first step of the “Five-Step Super User Method”. The key lies in how to identify and find your potential customers.

In this regard, Chow Tai Fook established a matrix with the WeChat platform as the core early on, and has operated on different platforms such as Douyin and Weibo, which enables it to reach users efficiently through all channels.

The following is a breakdown of the drainage methods and main contents of each channel:

1. Official Account

Follow the official account "Chow Tai Fook" and you will find a private domain traffic entry in the automatic welcome message. In addition, users can also jump into the group through the menu bar button. The specific path is as follows:

Path 1: Welcome message of the official account – Fan community – Select community – Scan the QR code to join the group

Path 2: Public account Beyond Time – Welfare Club – Home page banner image – Jump to group

2. Mini Programs

Chow Tai Fook has also set up private domain traffic touchpoints in its mini program "Chow Tai Fook Official Mall".

Specific path: My – Others – Fan Community – Homepage banner image – Jump to group

3. Weibo

Chow Tai Fook’s Weibo account has 774,000 followers and 578,900 likes and comments. The content mainly focuses on brand promotion, event promotion, and product introduction.

The homepage has touchpoints for the fan group and e-commerce flagship store, and users can click on the link to enter the private domain.

4. TikTok

Chow Tai Fook’s Douyin account has 1.836 million followers and 1.196 million likes. The content mainly focuses on brand promotion, event promotion, and product introduction.

The homepage sets up fan groups and e-commerce flagship store touchpoints, and users can click on the link to enter the private domain.

5. Xiaohongshu

Chow Tai Fook has 291,000 followers on Xiaohongshu, and the topic #周大福项链 has 100 million views. The number of related tips has exceeded 500,000+ . The content mainly focuses on product tips and brand introductions.

By operating the private domain through omni-channels and setting up a variety of touchpoints, Chow Tai Fook has successfully brought fans from the public domain to the private domain, thereby ensuring that it can obtain stable customer traffic.

2. Training-operation strategy analysis

For enterprises, user identification is only the first step, and subsequent training is more critical, with the goal of increasing the user's repurchase rate. So how can the gold and jewelry industry, where Chow Tai Fook is located, cultivate its own "super users"?

At present, Chow Tai Fook’s operational transformation is mainly achieved through three channels : one-on-one private chat on WeChat, customer circle of friends and community .

First, there is a one-on-one private chat . After adding Chow Tai Fook customer service, users will receive an invitation to join the group. At present, most of Chow Tai Fook's transactions come from the community. Using the community to complete the conversion can reduce unnecessary disturbances to users to a certain extent.

Next, let’s talk about the customer circle of friends . Chow Tai Fook’s customer circle of friends posts a relatively stable frequency, usually 1-2 posts a day, mainly at 11 a.m. and 3 p.m.

The content is mainly product recommendations, promotions, and holiday posters, which attract users to place orders through real-life outfits. In addition, the account will also share some fun and interesting knowledge from time to time.

Finally, let’s focus on Chow Tai Fook’s community . Chow Tai Fook cleverly set up a selection process for users to join the community.

In addition to the common welfare groups, Chow Tai Fook has also set up 9 interest groups, covering pets, clothing, beauty, travel, fitness, parent-child and other fields. Users choose to join the group according to their interests, thus realizing user classification based on interest.

The content sent within the community has a fixed schedule, and different welfare activities are set up from Monday to weekend.

By working together through these three channels, Chow Tai Fook has successfully established the trust of users and cultivated more potential super users.

3. Screening - Membership Benefits Analysis

Nowadays, the "membership model" has long been commonplace in private domain operations. It can not only better serve high-quality users, but also lock in users' consumption for a period of time in the future.

Chow Tai Fook’s membership is divided into two types: growth membership and paid membership.

Let’s first look at the growth membership. Chow Tai Fook divides members into 5 levels, and the specific benefits are as follows:

1. Fans (authorized mobile phone number): points can be used to redeem cash or points can be used to redeem gifts;
2. Silver members (spending RMB 10,000 or more): membership gifts, points redemption, points redemption gifts, and points redemption benefits;
3. Gold members (spending over 80,000): membership gifts, renewal gifts, upgrade gifts, birthday surprises, points redemption, points redemption gifts, points rebate for consumption, and points doubling rights;
4. Platinum members (spending over 200,000): membership gifts, renewal gifts, upgrade gifts, birthday surprises, points redemption, points redemption gifts, points rebate for consumption, points doubling, holiday privileges, and jewelry tasting privileges;
5. Diamond members (spending over 400,000): membership gifts, renewal gifts, upgrade gifts, birthday surprises, points redemption, points redemption gifts, points rebate for consumption, points doubling, holiday privileges, and jewelry tasting privileges;

Let’s focus on its paid membership. Chow Tai Fook’s paid membership costs 88 yuan per year and includes five major privileges.

Next, let’s take a closer look at the benefits of Chow Tai Fook paid members:

• K+ gift voucher: contains 2 no-threshold vouchers, 1 for 10 yuan and 1 for 20 yuan, valid for one year.
• Exclusive gifts: After activation, you can choose a gift in the designated area, and receive it within three months after activation.
• Birthday Gift Certificate: Gift certificates issued on birthdays offer an 8% discount on designated products.
• Points vouchers: Three free vouchers are given, with denominations of 1,000, 3,000 and 5,000 points respectively.
• Free return shipping: Literally, K+ members do not need to pay postage when returning or exchanging goods.

In fact, the purpose of establishing paid membership is to help companies screen out "super users" more efficiently. After screening out super users, the next step is to do a good job of membership operations.

4. Operation-Activation Gameplay Analysis

The establishment of a super user system is a systematic project. From the overall perspective of an enterprise cultivating super users, daily operations are also essential, and users must be kept active at all times.

Chow Tai Fook’s operations in two aspects are worth referring to.

1. How to use mini program to promote activity

In Chow Tai Fook’s mini program [Chow Tai Fook’s Fan Community], you can see 4 activation methods on the homepage. Through some rewards, user activity and brand stickiness can be improved. The following is a detailed introduction:

1. Sign-in : Daily sign-in is the most common promotion method for enterprises. Chow Tai Fook designed that users can get 5 gold coins for signing in every day, and they can get a chance to draw a lottery after signing in for a full week. There can be up to 4 chances to draw a lottery per month.
2. Topic Club : This function is somewhat similar to "Little Red Book". Users can post creative content in the community. And they are classified on tags. In addition to jewelry, there are also topics of interest such as dressing, travel, pets, and food. The purpose is to maximize the user's stay time in the APP.
3. Welfare Club : The brand will occasionally launch interactive topics and write essays with prizes. Users who participate in the event during the event period will receive a gold coin reward for the Year of the Tiger.
4. Xiaojinku : It is essentially a points mall. The name "Xiaojinku" can be well integrated with the brand tone. Users can accumulate gold coins by signing in, posting, and interacting. The gold coins can be spent in Xiaojinku and exchanged for designated products.

2. Daily community operations

Private domain communities are a very important channel for brands to connect with users and cultivate trust. Here, we see that Chow Tai Fook has carried out refined operations on the community.

When a new user joins the group, an automatic welcome message will be triggered immediately, introducing community welfare activities and community rules, helping users quickly understand their interests and determine boundaries to avoid disputes later.

The community content has formed a SOP, and different welfare activities will be set up from Monday to weekend. Take the content released on a certain day as an example:

1. 10:30: Synchronize the latest gold price information;
2. 12:30: Product recommendations;
3. 14:00: Community activities (the first cup of milk tea in autumn, participants have a chance to win a cup of health tea)
4. 18:00: Product Matching

5. Fission-Fission gameplay analysis

Whether it is a private domain or a membership, fission gameplay is essential. Especially for industries such as jewelry and gold, which have high customer acquisition costs, low-cost customer acquisition through fission is one of the best options.

Chow Tai Fook will use some simple fission gameplay to reasonably utilize private domain resources to achieve the effect of attracting new customers and repeat purchases. Take the public account fission and mini program fission as examples:

1. Public account fission

The most common way for public accounts to split is to attract users to share and participate by offering prizes or benefits in tweets.

For example: When a member user invites a new user to register, both parties can get 90 points. When a new user makes his first purchase, he can also get a first-order bonus of 2,000 points, and the referral can get another 1,000 points.

By rewarding users with points, we stimulate them to attract new customers and place orders, thus cultivating consumption habits.

2. Community fission

Social networks are also an important place for fission. During the National Day last year, Chow Tai Fook launched an "invite to receive gifts" activity through its own corporate social network.

Users can invite local friends to join the group within a specified period. If there are 3 or more people, they can go to the store to receive a bag of Handiqi rice, and if there are 4 or more people, they can get a set of Morning Star watercolor pens. Through fission, not only can new users be brought to the enterprise, but also potential repeat purchases can be achieved.

6. Final Thoughts

We have now entered the "inventory era". Whether it is the jewelry and gold industry like Chow Tai Fook or other industries, they are all trying their best to retain users and screen super users. This has become the foundation for the future survival of enterprises.

This super user methodology model is not only applicable to large enterprises, but also has been verified in small and medium-sized enterprises. In the past, we have also served several jewelry companies, and also used this methodology to implement it, and achieved good results.

Today, even the smallest companies have their own super users, and our companies need to learn to identify and screen them. In today's fiercely competitive world, instead of blindly rolling inward, it is better to cultivate users and achieve more long-term and stable growth.

Author: Yan Tao WeChat public account: Yan Tao Sanshou