Cyber stars in China hit the jackpot

BEIJING - NOT long ago, YouTube star Michelle Phan wowed the beauty products market when she succeeded in setting up her own cosmetics brand by just uploading make-up tutorials onto the video-sharing website.

To this day, the Vietnamese-American's success is hailed as a testament to the power of the Internet.

Now, thousands of others are trying to emulate Phan in China. They boast huge online followings. These days, the ability to transfix eyeballs online, especially on social networking platforms, translates to celebrityhood and riches.

In China, there are 688 million Internet users so the knack of influencing even some of them could make one a "key opinion leader".

Such leaders are building up thousands of online communities by sharing knowledge on subjects like fashion, beauty and electronic games or just by producing humorous videos. In the process, they make loads of money.

Some key ways by which such cyber stars grow rich include the following:

TIPS AND VIRTUAL GIFTS

Most online platforms have introduced a "tips" system for fans to give cash to online celebrities.

For example, when an online celebrity publishes a fashion-themed article on WeChat, China's most popular instant messaging tool, readers can reward the author with tips ranging from one yuan (S$0.20) to 256 yuan by using its digital payment tool.

The tips system can bring in a lot of cash, given that each article by online celebrities often generates more than 100,000 hits or visits.

For instance, Papi Jia, an online celebrity well known for making humorous videos, recently received tips from more than 3,500 fans because they loved her latest video post on WeChat.

Popular broadcasters on live-streaming platforms also derive income from viewers who buy virtual gifts for them, like digital flowers.

AD FEES FROM LUXURY BRANDS

Luxury brands such as Chanel and Prada are turning to online celebrities for targeted marketing. When releasing products, these companies often invite online celebrities to advertise the products on Sina Weibo, China's version of Twitter.

"Compared with traditional fashion magazines, online celebrities have stronger bonds with us and I am more willing to accept their recommendations," said Liu Chang, a 28-year-old white-collar worker in Shenzhen, Guangdong province.

PROFITS FROM ONLINE STORES

Setting up a personal fashion brand is the most popular income source for most online celebrities. It is also the stream that pulls in the largest part of their income.

One shining example is Zhang Dayi, 28. She has cultivated more than four million followers on Sina microblog.

By regularly posting her store's fashion items and corresponding links on her Sina microblog account, Zhang successfully converted her online store on marketplace Taobao into a must-visit destination for female online shoppers.

Her shop is listed as the second-best store in terms of sales last year on Taobao, the consumer-to-consumer platform of Alibaba Group.

A report from Guotai Junan Securities, one of China's largest investment banks, estimated that e-commerce stores run by Internet celebrities handled transactions worth more than 100 billion yuan in 2014, accounting for about one-sixth of the entire online clothing retailing market.

APPEARANCE FEES

Internet celebrities no longer limit their commercial activities to the online world. It is increasingly common for companies to pay them to attend offline gatherings like product launches, as well as corporate events and celebrations.