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In China, eCommerce is at the heart of the economy
China has many eCommerce platforms. Actually, in 2020, pretty all apps and platforms have turned to eCommerce or work in affiliation with eCommerce giants. We are talking Tmall, Taobao, Pinduoduo, Jd.Com, Kaola, Vip, Little Red Book (Red), Douyin, Kuaishou, etc…
Taobao: a Giant that never ceased to evolve
Taobao’s greatness comes from the fact that it’s open to everybody and every budget. You can find everything on Taobao. It is a very competitive and notorious platform for counterfeit and pirated items. If your goal is to build a trusted brand image, it is important to stay away from Taobao.
Taobao had been working hard on its image in the last few years to compete against the growing competition but also to attract young designers and unique creators.
It started with developing live streaming and a Kol network in order to increase conversion but also traffic on the platform. Last summer (2019) Taobao launched an affiliate program with Weibo extending its live stream service. In 2020, Taobao will launch its affiliate program for users, encouraging everyone to promote the app and encourages sales.
This last comes into an effort to not only engage more with its users but also to fight its biggest new competitor: Pinduoduo.
Taobao over the years has become more and more social, with the development of group tools by location, interest, shops can also manage group chat where they are able to promote their new products.
Tmall: an eCommerce platform for big brands
Tmall, which also belongs to the group Alibaba is the biggest eCommerce platform of the Chinese market, it does not have a competitor that comes close. Tmall in a smart move gained what every company in China is trying to gain (and you work hard on getting it too). I’m talking about the trust of Chinese consumers.
How did Tmall achieve this? High and strict requirements to enter the platform. Only brands that are invited can enter the platform. By controlling who is in, tmall was able to control the quality of the products being sold as well as the customer’s services while taking no risks.
If today, Tmall is opening a little bit more to smaller brands with initiatives such as Tmall Oversea Fulfillment, it is still rather complex to get in and even more to get sales when competing with a brand such as loreal, Philips, Zara, etc…
When entering Tmall has a brand, a huge effort will have to be done on e-reputation. Conversion rate is key to success, especially when competing with brands that are in China for years now.
Tmall has recently launched its Luxury Pavillon in order to be more attractive to big names of the luxury world such as Cartier or Kenzo.
I can’t think of a similar platform in the west. Amazon does have big brands on its market place but also a lot of random brands and Chinese companies selling the same stuff you would have found on Taobao a few years back (and still now).
Pinduoduo: The new comer to watch in 2020
Pinduoduo is the main competitor of Taobao and has become incredibly popular. It has started its journey is smaller Chinese cities where consumers have fewer resources and are looking for good deals, which Pinduoduo offers.
Pinduoduo is growing fast for the simple reason that it is centered around the customers. It included its users in the promotion and buying process. It is called social eCommerce and this practice has found a lot of followers all over China.
The idea behind Pinduoduo is simple: Low price by encouraging group purchases directly to factories and suppliers.
The platform not only offer interesting prices but is also pushing users’ affiliation in a partnership with Wechat. Users can get sweet deals by inviting a friend to download the app for instance.
Pinduoduo has also surprised quite a lot in its success in pushing impulsive buying behavior. Anyone that knows China’s buying habits, knows that Chinese consumers do a lot of research. The reason behind Pinduoduo’s success is its low price.
Pinduoduo not only appeals to Chinese consumers but it has many benefits for Brands. No commissions fees, custom tools, low requirements, low deposits, etc
Learn more here.
Little Red Book Aka RED the king of High-end Cosmetic
Little Red Book aka Red aka Xiaohongshu, was the revelation of 2018 and kept growing through 2019 to become a strong place for foreign cosmetic brands to be and brands to promote their products via Kols.
RED concept is around UGC (users generated content), more precisely product reviews – shopping notes. The platform is a dream for Kols who have naturally acquired the platform.
80+% of RED users are women from first tiers cities. The app has its own market place and strong logistic services. It also displays shorts video and influencers can add hyperlinks to platforms such as Tmall, Weibo or Taobao.
Update: 2019-2020 Amazon.cn closed down.
A well-translated brand’s name
To sell well in China, it’s important to adapt oneself to the Chinese consumer’s needs. A Chinese name is required. For choosing a brand’s name, you need to combine the characteristics of the product and the brand values. Chinese consumers always feel more comfortable when they have in front of them a product with Chinese references.
Just to give you an example carrefour: 家乐福 which can be translated to the house of happiness
Chinese websites, Chinese design
To succeed in the Chinese market, it is important for any business, to refine the design of its website and to be surrounded by experts. While Westerners prefer sites with clean and clear design, the Chinese prefer the site with Chinese references, easy communication, and convenience: Live Chat, QR code, Shop Adress easy to find
Not only the website needs to be optimized to appeal to Chinese consumers but also for Baidu. Most of the foreign company already in China with whom we have worked for had to create a website specialy for China as their globlal website was using google plugging, which do not work in China.
Click here for more info about Baidu SEO/SEM
Everyone uses mobile payment. Alipay and Wechat are the most popular way of mobile payment. They are link to your bank account and allows you to pay easily for anything you need.
Paypal is available in China but not al kind a card can be used with paypal and credit card is not popular, poeples have union pay card.
When setting up payment methode you better make sure that your buyers can use alypay or wechat pay.
At the trends goes: Consumers use alipay to pay for bigger amount of money whereas wechat pay is mainly used for small expense.
Wechat: The essential
The social media used by the Chinese are different from the rest of the world. Regardless of the size of the company, Wechat has become the essential media to develop its marketing strategy in China.
Indeed, the engagement on social media is more powerful in China than Europe with the mobile social media and mobile payments, which are ubiquitous. In this context, the Wechat stores and Wechat pay offer a real opportunity to sell. Customers can go directly to the platform of your product in a fast and easy way.
Wechat over the year as launched new tool and create new collaboration (cf above with Pinduoduo). But has also launched it mini program (integrated app) in 2017 that have become a must in 2020.
This mini program can take differents form: Game, mini-app, store etc
Another hot trend of wechat 2019-2020 are wechat Brochures. These brochure are basically the same PDF (actually better) you are mass mailing to look for distributors in China. However, mailing is not an option in China.
Instead of mailing, get in touch with business man on Wechat and share your wechat brochure to introduce your company, your products etc.
Wechat brochure are also wildly use to promote new products, events etc A multi-purpose tools that we can’t recommend enough.
Collaboration with Chinese KOL
Kols or Key Opinion leader are Key in building a brand e-repuation. Consumers can recognize themselves in their favorite influceur and also feel like they belong to a community of poeples with who they share the same values. They believe KOL more, because Kols in theory only promote brand they belive in.
Finding the right Kols and the righ platform is not easy. However, It is important to have a long-term vision before the selection of the partner. You need to find a chinese influencer, who will respect the values and image of your company. A long-term collaboration is better than a short- term.
The most popular plateforms of 2020 are without a doubt short video app like Douyin and Kuaishou. Taobao and it’s Kol are super popular too. Little Red Book just launched a new services to help brand to work with verified Kols inside their plateform.
The choices are multiples and 2020 will also be the year of micro-influencers, less expensive, close to their community and more reliable.
Need an e-Commerce Agency for China?
Gentlemen Marketing Agency is a specialised Digital Marketing firm based in Shanghai.
It has expertise and experience in establishing online stores for foreign companies on TMALL.com and TMALL Global.
For any questions or help needed in establishing online store in China’s e-marketplace, please contact us, we’ll be happy to guide you.