Opinion

Five ways marketers can engage the profitable Chinese market

Making an impact, and big bucks, in the lucrative Chinese market is easy if you follow some basic rules, says Nicolas Chu, in this guest post.

The affluent Chinese middle class is growing. More consumers have money to spend and are willing to buy online. To capitalise, western marketers must discover how to reach them.

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Below are recommendations based on my experiences to help your business tap into the Chinese digital economy and effectively target Chinese consumers online.

Invest in a Chinese website, accessible from China

A Chinese website requires not only using the Mandarin language, but designing the user flow and interface to suit Chinese browsing behaviour.

Importantly, the Chinese firewall means potential customers will have trouble accessing your site if it’s not located in China. Chinese hosting is the ideal solution, otherwise choose nearby Hong Kong.university-of-tasmania-chinese-website-home-page

To keep loading speed acceptable to the Chinese market, you may need special technology to reduce site latency. The Chinese primarily use Baidu and Sogou search engines, so your site must be optimised to suit them.

The University of Tasmania has a Chinese website with hosting solution, built to be readily indexed by Chinese search engines to increase site authority and benefit from organic search. The website has a homepage and navigation bar to suit Chinese user browsing behaviour, giving fast access to the most important information visitors seek.

Take advantage of mobile phone penetration

Chinese consumers are increasingly using smartphones to search and shop online. China has 656M mobile internet users – a 92.5% penetration rate among its entire internet population.

24.5% of Chinese internet users access internet only by mobile phone. In industries such as travel and shopping, mobile search and transaction volume exceeds half of the entire volume online. thinkstockphotos-chinese-consumer-mobile-purchase-shopping

Mobile commerce now exceeds desktop-based transactions, accounting for 51% of total e-commerce volume in 2015.

Targeting the mobile market and ensuring marketing material is mobile friendly is a must-have strategy for entering the Chinese e-commerce market.

McDonald’s does this well by consolidating online and offline marketing. Customers can scan the barcode in store, place the order and make payment all via mobile phone.

It supports a wide variety of mobile payment systems including Alipay and WeChat pay. McDonald’s also engages with social media followers via concepts such as personalised burgers with ‘my’ flavour.wechat-payment_1_1

Partner with someone to adapt your marketing strategy for China

A one-size-fits-all approach doesn’t work. Western marketers should partner with a trusted resource to understand culture, online technology, regulations, and local consumer behaviour, and to deliver an excellent local strategy.

With the help of Sinorbis, UTS: Insearch conducted a successful campaign to build brand awareness and acquire leads to recruit Chinese students.

The campaign leveraged peak search season after Gaokao (higher education entry exam). Applying relevant keywords to Gaokao in the top two local search engines and creating targeted display advertisements in Fuyi of Sina and SohuHuiSuan, generated brand awareness among targeted students and parents.

After analysing demand and conversion effectiveness among different cities/provinces, times and digital media, a detailed media plan was created, generating historically-high daily visit volumes, an optimised result within budget range.

Localise your revenue/profit model

Chinese consumers aren’t accustomed to subscription based business models and are unwilling to pay upfront fees before using the service or buying items. They are attracted by coupons, promotions and different types of merchandising such as daily deals – more so than Western consumers.

Your Chinese competitors use an aggressive pricing model to gain market share first and then develop their monetisation strategy. Western companies must localise revenue and business models to adapt to targeted customer segments, and either prepare to compete or avoid competing with local competitors.

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Häagen-Dazs did well localising its revenue/profit model on entering China. When the brand was launched, instead of going after local brands in supermarkets, its market research showed that Chinese don’t eat ice-cream at home; they eat ice-cream in a retail environment on special occasions.

So, Häagen-Dazs became a luxury experiential brand, very different to their global ‘in-supermarket’ business model, offering luxury in an in-store environment and charging premium prices for the experience.

It also expanded its product categories to include ice-cream mooncake to grow its business, leveraging the annual Chinese Mid-Autumn Festival and habit of buying moon-cakes as a gift or for self-consumption.

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Have a targeted approach

China is vast, with differences in dialect, affluence levels, behaviour and rural versus city lifestyles. Marketers must analyse customer differences and create a very targeted approach to penetrate their chosen segment.

Häagen-Dazs has also done well in this area. As a luxury experiential brand it became super successful with premium and younger customer segments. Its marketing is aligned with its target.

For example, store locations in premium shopping malls, in-store decoration producing a luxury image, and advertisements consistently enhancing the branding message among young and affluent segments.

If western marketers follow these recommendations, they’ll be well positioned to tap into the huge ecommerce potential awaiting them. 

Nicolas Chu is the CEO and founder of Sinorbis and a global digital thought-leader with extensive experience in managing online businesses

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