Fact: China has the busiest online traffic in the world, with a whopping 710 million users.
The good news? Despite its volume, its e-Commerce system is not so different from other countries.
The bad news? It is far more expensive and competitive relative to its market size.
Yes, entering the China e-Commerce Market can be a resource-draining and frustrating exercise. The best way is with a long-term strategy based on a comprehensive understanding of the target market.
Partnering with a marketing solutions provider with local knowledge, experience and network can help foreign brands better understand China’s e-Commerce ecosystem, simplify the entry process and lower initial costs whilst focusing on what brands do best: product development.
Which e-Commerce Channel?
The quickest and simplest way for you as an overseas company to kickstart an e-Commerce business in China, even before incorporation there, is to tap the specific International TMall offer for your country of origin.
The offer will provide substantial targeted support to help you set up your retail account and manage logistics through a third-party service agent without your physical presence in China. You will benefit from significant savings on deposits and the complexities of set-up and site build-up processes.
Alternatively, consider assigning a Chinese representative to set up testing channels to help you understand your product positioning before you officially establish your brand presence in China. You may consider C2C channels like Taobao and other existing social commerce platforms. The e-Commerce account setup is low in cost and especially suitable for brands with China manufacturing outlets.
There are now many more options for foreign brands. Beside Taobao, a leading choice in shoppers engagement channel is RED (XiaoHongShu), the ‘Instagram of China’. This is especially suitable for lifestyle brands targeting women with shopping power.
RED (XiaoHongShu)
Combining social media with e-Commerce and offering live-streaming, RED (XiaoHongShu) has proven itself one of the best brand promoters in the market and very popular with shoppers. The beauty of RED (XiaoHongShu) is in its set up without a local Chinese mobile contact or identity and in its popularity among distinct users – women shoppers with disposable incomes.
RED (XiaoHongShu) currently boasts over 300 million followers: 77% of whom are women shoppers with shopping power, and 100 million Monthly Active Users (MAUs) in the 25 – 34 age bracket. This platform works particularly well for lifestyle brands and service providers in education, influencers, and celebrities. Like Instagram, RED features mini-blogging spaces, live streaming, short videos, and advertising functions.
Many brands use RED bloggers to broadcast their brand for greater exposure, creating a word-of-mouth ripple effect. RED is much more than just a social blog with e-Commerce options that most shoppers will turn to search for product information. You may explore the other trending social media channels here. However, the one that engages the most shoppers is RED.
Taobao Live / RED Live-Streaming
Using live-streaming to brand sell has gained tremendous popularity during the pandemic. Appealing to the internet-savvy with disposable incomes requires selecting the right live-streamer based on consumer DNA. But this is a non-guaranteed sales exercise where outcomes can easily not justify the cost. The success is determined by exposure: ‘digital footprint’. For best results, an effective content marketing campaign before live streaming is a must.
Among the many channels that have ridden the pandemic wave, TaoBao Live has captured a large audience share by nurturing a group of live-streamers strong in advocating product usage and advantage.
Logistics issues
Among all matters, logistics are a challenge for many foreign brands facing high freights costs and extended delivery times.
The good news – Chinese consumers are willing to pay more and wait longer for products they perceive worthy. The question is how do your target customer perceive your brand. Have an honest look at your brand status and work from there.
Local delivery – Brands with local manufacturing capability maintain a distinct competitive advantage by holding inventory in China or contracting a local service provider to handle goods and manage delivery.
Payment Systems
Online payment systems in China are exceptionally well-established and sophisticated and offer a high degree of convenience with security to consumers.
However, as with retail ecosystems in many other countries, national and international brands often face complexity in navigating the multiple options available and the detailed documentation required.
AliPay and WeChat Pay are the
most popular payment channels
for local transactions.
Takeaway:
• Foreign companies that do well in the China e-Commerce Market begin with clear long-term objectives and strategies, irrespective of short-term gains.
• You can start small through social commerce channel like RED (XiaoHongShu) bloggers to promote your product among Chinese shoppers.
• Engaging a marketing services provider to manage their online market presence allows overseas brands to focus on their core duties: quality product and customer service.
RedLine @redlineasia.com – is a B2B2C marketing solutions provider helping brands to connect with Chinese audiences.
