The impact of social media “influencers” on digital media marketing is being felt across the globe, but the phenomenon is enormous in China. To capitalize on this growing digital marketing strategy, Acorn International has launched a local Chinese influencer facilitator business, called A-KOL (standing for “Acorn Key Opinion Leader,” with a key opinion leader being equivalent to a social media “influencer” in other parts of the world).
A-KOL is initially established to support other parts of Acorn’s broader business, such as Acorn Streaming, which monetizes digital content, and Acorn Products, which houses Acorn’s e-commerce business. A-KOL is distinct from Acorn’s core social media management business since A-KOL actually facilitates the development of local China influencers to optimize their ability to convert Acorn’s content and product sales.
In China, grassroots influencers, known as KOLs, have become a social media and e-commerce phenomenon, and a major part of B2C business activity now in China. Based on research from Frost and Sullivan, China’s internet KOL economy, which refers to all activities relating to the monetization of the KOLs’ influence and impact on their fans, grew at a CAGR of 181.5% from 2013 to 2017 and is expected to continue expanding at a CAGR of 41.8% from 2017 to 2022. Moreover, China’s market for internet KOL facilitators generated revenue of RMB38.8 billion in 2017 and is expected to grow at a CAGR of 38.9% to RMB200.9 billion in 2022. Despite its size, the industry remains nascent, with many KOLs operating independently, or connected to small, unsophisticated KOL facilitation companies.
In line with Acorn International’s business model of combining social media management, content creation, and sales of its own, as well as third-party brands through e-commerce, various parts of Acorn frequently engage KOLs as part of its business growth. However, with this move, Acorn can now develop its own KOLs to support its business and capitalize on this emerging space.