As of December 2019, China’s e-commerce marketplace will span roughly 900 million users, with transactions exceeding $1.3 trillion USD this year, which makes China the largest online consumer market in the world.
However, China’s internet landscape is built in a completely different way from the rest of the world. While the opportunity to tap into this burgeoning market may appear obvious, global brands cannot simply grab a Go-Daddy domain and immediately launch their web presence in China.
And brands cannot expect to see any traction for their products or services without first securing proper registration and partnering with the right entities that facilitate compliance and market-specific technical processes around online infrastructure, logistics, and more.
WPIC’s recent webinar took attendees deep into the complexities of launching a global brand within the Middle Kingdom. In this discovery session, host Todd Embley was able to draw out key points that brands must take into consideration before entering China’s e-commerce space to ensure successful market entry.
Guests Hao Lin of Alibaba Cloud and Joseph Cooke of WPIC identified key steps required in order to seamlessly execute e-commerce activation and the importance of effective and relevant content.
Listed below are the 7 main takeaways that brands would do well to follow, in order to ensure successful go-to-market in China:
- Do not overlook 2nd and 3rd tier cities: Many brands focus on the most obvious cities within China when considering market entry; Shanghai, Beijing, Guangzhou and Shenzhen. However, there is a strong surge of affluence within the middle-class in 2nd and 3rd tier cities. Expert analysts attribute a significant portion of Alibaba’s 2019 Singles’ Day record-breaking sales to these municipalities, some of which have over 30 million citizens, with significant spending power.
- Create a China specific strategy for your brand: Simply expanding an existing global strategy or taking what works in North America or Europe, and replicating it in China is not going to translate. The sophistication of the Chinese consumer, not to mention their e-commerce and content platforms, means that a brand’s strategy, individual product offerings and marketing collateral need to be localized for the market.
- Get your technology right: Did you know that 90% of e-commerce transactions in China are mobile? Did you know that a significant portion of China is already leveraging 5G connectivity? Unlike the average Amazon shopper in North America, Chinese netizens are mobile first and require the right content to support conversions around purchases. Make sure your content is primarily geared toward mobile shopping experiences.
- The Firewall: China’s great firewall is known to throttle internet traffic during peak shopping times, and if your website is not hosted inside the Firewall, with a proper ICP license and optimized for China’s internet landscape, it could take upwards of 60 seconds to load each page. In a climate where the average online shopper is spoiled with other options, this gives your customer plenty of time to leave your brand in favor of your competitors.
- Alibaba Cloud: Setting up a web presence with Alibaba Cloud will mitigate potential setbacks including loss of sales and hard-to-obtain data due to the firewall. Hosted inside the market, Alibaba Cloud offers best-in-class infrastructure that will allow for seamless integration with e-commerce platforms, payment solutions, databases and ERP systems.
- Proper Analytics and Data: Without proper data, brands run the risk of pushing out content that simply doesn’t resonate with Chinese consumers, not to mention risking the implementation of a poor marketing mix of product, price and positioning. Pulling real data out of China is difficult. However, robust analytics software and big data solutions such as Chinalytics and Discripto can reveal the once unavailable data. Brands would do well to access these insights, in order to adapt to the quickly shifting market in real-time.
- Winning tactic: Gamification. As the recent 11/11 shopping festival showed, adopting gamification to engage consumers is proving to be an effective tactic as we head into 2020. Keep the attention of your customers by making the purchase of simple products an entertaining event.
Global brands looking to launch and succeed in China’s e-commerce space will need to prepare a checklist that includes all the key takeaways here, and more. Lean on WPIC to assist in the process and help your brand secure a strong web presence in China, and ultimately drive revenue.