5 facts that you need to know about Crossboder ecommerce in China

 

For many companies all around the world the growth run is existential. That is why emergent countries represent real ooportunities for them. The point is to maintain growth and benefits also.

If we take a look on China, it represent a good opportunity for foreign companies’ goal, however it is crucial how to know how it works and what is the best way to export your business in China.

crossborder China

  1. The Chinese’s Context

Nowadays the Chinese e-business market has become the most important and biggest of the world. It becomes so important that it is growing faster than the Gross Domestic Product (GDP). The GDP of China in between 2014 and 2015 was about 10 355 billion of dollars and a growth of +6.7%. More than half of the Chinese population are connected to internet and 81% of them have bought products online in 2015 and 35% bought on cross border dedicated platforms in order to access to foreign merchant’s products.

Also the Chinese Governement took part on e-commerce Cross-Border. A new tax took effect on the 8th of april and it concerned business and traditional retailers in order to improve the market and create a fair competition mecanism.

 

  1. Chinese People love foreign countries

This is well-known: Chinese consumers love luxury products, especially those aged 18 to 30. Young consumers want quality services and products. A huge challenge for their Western neighbours !

With the evolution of the middle and upper classes in China, consummers now need product which are defined by  3 caracteristics : Authenticity, a positive buying experience and a good balance between price and quality. That is why  they usually are attracted by this kind of products and especially the foreigns one. Chinese like products for United States, Great Britain, Japan, Hong Kong, Canada, Germany, Australia and France also. For example a product « Made in France » is a reference for luxury and a superior quality.

  1. What king of foreign products have the Chinese’s attention ?

After different sanitary scandales, Chinese bacame more and more aware that their life could be in danger. Cases like dead ^pigs sold as fresh meat, the gutter oil, explosive watermelon after abuse of forchlorfenuron, fake mantou out of date, milk with nitrites, clenbuterol pork, milk with melanine… all this happened and scared Chinese people.

That is why consumers know what they do not want and what they want, so behaviors and minds changed.

Since 2015, different categories news products had emerged and made their ways to the Chinese’s heart like culinary books, electronic products or even toys. However their are 3 others which are a the top. Cosmetics, babies stuff and clothes are those products which Chinese love.

 

  1. The E-commerce Cross Border, a good way minimize cost and risks

With the existing rules, the governement omniprecense and the high competition being present in China could turn into a disaster. That is why more and more companies use e-business cross-border where it is easier to be implented and also to sell product in China without investing too much ressources in that « expedition ».
Since the creation of Free Trade Zone in China, companies which are established there benefit from better import procedures and taxes. Today there are approximately 5,000 platforms on the Chinese market and each has its own specifics: bulk purchase, social shopping, focus on small brands or on outlets…
With platforms like Tmall Global, JD.com, KJT.com, Sasa.com or Ymatou, foreign brands can sell their products direclty to the consumers and by this process they will expend their influence. Using E-commerce cross-border to be present in China is a real opportunity. Benchmark and User Experience need to be done at the beginning of that process in order to be familiar with the market and easily penetrate it.

 

  1. The Chinese consumers behaviors to understand

Chinese have specific behavior which your different that the foreign companies might do not know.

First, they are online !

Chinese_online

There is also difference in the platforms the Chinese and Westerns utilize, in particular the Social Networking Systems. The Chinese use WeChat, Weibo, and Youku, whereas the Western use Facebook, Twitter, and YouTube. Also, there is difference in the way Chinese users and Western users react to content such as ads. For example, Western netizens find online ads on Social Networks extremely distasteful, whereas Chinese find online advertising more interesting.

And second, they use their smartphone differently than Western consumers.

Whenever online buyers need to talk to one of the merchants present on the Tmall platform, they can make their inquiry directly to them. An instant messaging application was developed by Alibaba for that purpose: AliWangWang. By using it, buyers can chat with Tmall sellers before making their purchase, in order to learn more about the products they are interested in and even engage in bargaining. Also, transactions on Tmall.com for example, are made with the Alipay payment system. Alipay, the China’s leading third-party Internet payment solution was launched by Alibaba Group. Users can either use their domestic bank cards or scan a QR code on the webpage in order to pay a bill, their shopping to the mall…

 

More information :

  1. e-Commerce in China 
  2. Tax on Crossborder
  3. e-Commerce tips in China 
  4. e-Commerce Agency in Shanghai