China Marketing: Insights for Success

Most companies doing business globally have to contend with the unique cultural and technical dynamics of sales and marketing in the Chinese markets. If your brand is just starting out in the market, you’ll be facing a steep learning curve. Even if you’ve been doing business in China for a while, marketing teams still have to develop a culture of measurement and learning and make data-driven decisions to keep up with a rapidly maturing and evolving environment.

For some, it goes without saying that China offers huge opportunities. But in case you were wondering, here are a few proof points. CB Insights recently published a report listing the 37 diverse Chinese companies that reached billion-dollar valuations in 2018. While not all of these will survive, it goes to show the size of the opportunity for both direct-to-consumer brands and B2B brands supplying both domestic and foreign brands doing business in China.

China is on track to become the world’s largest economy as it positions itself to overtake the current largest economy, the US. As China shifts its focus from being a manufacturing and labor supplier to being a world-class innovator, it will continue on its journey to global growth. Understanding how to establish a presence in China and to profit and navigate this huge and unique market is critical to both B2B and B2C brands.

The main takeaway I have learned over the years is that it can take years to learn the complexities of deploying marketing efforts in China. So,, unless you’re an experienced China native marketer or expat, most marketers need to learn the key areas to navigate and build trust and strong relationships with expert native China resources in eCommerce, data, development, hosting, and social media in order to effectively deploy in this market.

Strong relationships with integrated use of digital tools are what powers effective marketing in this important market.

Deploying online marketing in China requires a unique set of skill sets.

First, consider carefully the role and purpose your brand’s website will play in the market. It might not be the same as in other Western markets.

Having said that, I’ll start with the obvious: your brand’s website has to be in Chinese. Be aware that, if you’re doing business in other markets in the region, such as Hong Kong or Taiwan, there are preferences when it comes to the use of Traditional Mandarin vs. Simplified Chinese. Doing business in China also means being aware and sensitive to the regional geopolitical nuances of the perceptions and relationships among mainland China, Hong Kong China, and Taiwan, China. One size doesn’t fit all.

Global marketing operations often require consolidating functional practices in one location to drive cost efficiencies. But the marketing “game” in China is played by a whole different set of rules — technical as well as cultural and demographic. Your usual experienced and senior marketing talent will not have the knowledge and experience needed to succeed in China unless they a) are native Chinese or b) have already gone through the learning curve and have extensive experience in the Chinese markets.

From a technical point of view, operating a brand or e-commerce website comes with significant challenges non-native systems or development talent won’t usually know how to navigate. As a marketing leader, your product launch and marketing timelines can get thrown into disarray if you don’t plan for and appropriately resource your teams to address the inevitable issues that can come up. Here are 4 high level website challenge areas to watch for.

  1. You must host your website in China. Without this, you can’t secure an ICP Beian License from the Chinese authorities. This is a “must do” in order to reach the lighting-fast download speeds Chinese consumers and business stakeholders expect from the web. With more than 668 million people currently using their smartphones to browse, book, buy and transfer money, fast downloads and responsive mobile-centric design are required. Every little detail about publishing in China is important, and missing one can result in challenging technical problems.
  2. Your site must be listed on Baidu. China consumers access the internet from their mobile devices, and Baidu has the most important mobile presence in the market. In 2018, Baidu was (and still is) the leader of China’s search engines market with 80% of market share followed by Sogou with 6.63% and 360 Search 3.27%. Google doesn’t even make an honorable mention! For B2B companies in China, Baidu is the most important gateway for sourcing potential clients and partners. Baidu Search Engine Marketing (SEM) keyword-based services (similar to AdWords) should be part of a brand’s channel mix.
  3. Forget about YouTube: use a local provider. Video is a strong medium for showcasing products and engaging with target audiences, but to reach the Chinese markets, brands have to deliver video with fast download speeds and beware of unreliable Western services blocked within China.
  4. Go to WeChat for direct-to-customer message communications. While email remains a strong, preferred channel for interpersonal distance communication, it will not work for broader “newsletter” or general email marketing type tactics. There is a huge segment of Chinese users that lack an email account. But, whether you’re doing B2B or B2C, Chinese netizens are practically all on WeChat and, according to statistics, check their accounts at least 10 times a day. Make sure your brand has an official account on the platform and has an experienced marketer leading its use.

Search-Engine-Market-China-2018

With Google services blocked within China, online marketing delivery teams must question every established Western “best practice” and commonly used tools to ensure effective delivery. Services like Google Analytics, tag management, tracking database, and other tools must be sourced within China or double-checked to ensure they’re not being blocked or causing significant issues.

E-commerce in China

With its huge population, it makes sense that China is the world’s largest e-commerce market. Unlike western markets with many strong players, Chinese e-commerce is dominated by a small number of domestic platforms such as Alibaba’s Taobao, TMall, and JD.com. Global brands looking to sell direct to consumers or customers within China must usually establish a presence in one of those.

Three-quarters of the B2C market goes to only two platforms: JD.com and TMall. With no other global e-commerce player gaining significant market share in China, using the local platforms remains the most effective method to sell directly to Chinese online consumers. For brands focused on eCommerce, the common Western approach of building a direct relationship with your target customer might not work in this market, and a partnership with one of the big players should be carefully considered.

Relationships matter

You might be surprised that one of my favorite all-time quotes is by the President of PepsiCo. He said, “There is no such thing as digital marketing. There is marketing – most of which happens to be digital.” This is particularly true in China, where consumers are online and mobile! So, inevitably a discussion of marketing in China is going to be centered on consumer’s online and mobile behavior, and will have to contend with technical issues.

That said, focus is also important. China is not a single, unified market. China marketing is best approached by selecting key target markets within China and adjusting as needed.

In short, it’s important to not lose sight of the central role of relationship-building. In China, salespeople and salesmanship are highly respected. Salespeople can build rapport, show respect, and work to impress customers through appropriate gestures such as learning some basic Chinese. Business in China operates on the idea of “guanxi” — the Chinese custom of drawing on personal networks. It is common for business interactions to evolve into friendships and vice versa. Successful brands looking to win in China have to take a long-term and relationship-driven approach, while leveraging digital and online tools and tactics to reinforce and strengthen those relationships.

Related resource:

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