Since relations between China and Australia reached historic lows after over half a century, China could very probably impose tariffs on industries including honey, fruit, dairy products, and vitamin producers.
China VS Australia clash: how is it impacting Australian food Exporters?
China and Australia have arrived at the lowest point of their relations in a few months, after Canberra’s insistence on an independent investigation on the origin of the coronavirus, which first manifested itself in Wuhan.
The dispute between China and Australia has been dragging on for years, starting from the Australian suspects of political infiltration and including other areas of cooperation, such as Huawei’s exclusion from the 5G race in Australia, already in 2018. The last few weeks have been particularly dense with controversy: Chinese diplomats presented a list of 14 grievances against the Australian government. The tension with China has resulted in a trade war and a further escalation has occurred just in recent days.
China has imposed anti-dumping duties on Australian wine imports from 107.1% to 212.1%, following an investigation launched last August: the imposition of tariffs on Australian wine adds to other similar moves, on barley and beef.
Which Australian food is sold in China?
Australian industries have expanded their trade with China since they signed the China-Australia Free Trade Agreement in December 2015. China was Australia’s largest individual two-way goods and services trading partner in 2018-19, accounting for 26.4 percent ($235 billion) of total trade.
Australia’s main food export to China:
- Honey
- Fruits
- Dairy products
- Vitamin and natural supplements.
Australian honey is very popular in China, with honey consumption in China exceeding 300,000 tons per year. Moreover, the dairy industry, especially the milk, cream-processing industry, and the milk powder industry, earns a lot in China.
In 2019, sales of whole milk powder to China reached $156 million. This is because of the incident of milk contaminated with melamine that in 2008 caused six deaths in the country and about 300 thousand intoxicated babies.
On that occasion, it was discovered that manufacturers and intermediaries, in order to simulate the presence of proteins, used the toxic substance. It was a major shock for consumer confidence in infant nutrition products. Since that episode, Chinese consumers do not have trust in the Chinese milk industries and they prefer to buy it from abroad.
China food importation is massive
China has also become an increasingly important market for some fruit industries, like the citrus fruit, nut, and other fruit-growing industries.
Apple, pear, and stone fruit Australian growers also export a significant amount of products to China, with more than 30 percent of industry experts that are destined for the Chinese market.
That is why, with the huge empty space that Australian products may leave, Chinese distributors are now looking for new brands of honey, dairy products, and vitamin supplements.
If you are a producer/seller of these kinds of products and you are interested in the Chinese market, you should seize this opportunity.
The best time for you to enter the Chinese market is NOW.
How to attract Chinese food distributors?
In China, Build your e-reputation first
China is a market where branding is everything.
Branding is the set of operational and strategic activities related to the management and consolidation of a brand in the market and the differentiation of a product from that of our competitors’ thanks to actions ranging from the creation of distinctive signs such as name or logo to the production of branded content.
To sell in China you need to adapt to Chinese consumers. You must know their tastes and also attach more importance to your packaging. An impactful and original design can play a large part in your favor.
To lure Chinese distributors, you have to build your e-reputation and visibility in China. It is like starting from zero because the majority of the platforms that we use in the West do not work in China due to the Great Firewall.
Chinese Consumers have trust Issues
Firstly, you have to be present on Baidu, the Chinese most important and used search engine, because Baidu is the first “place” where distributors will go and do their researches.
Due to the milk powder scandal that we mentioned above in the article, and speaking about food in general, Chinese consumers do not easily trust new brands. Both Chinese companies and consumers are extremely suspicious. The good news is that you can achieve building a good image around your brand with digital marketing and advertising.
Use an Omni-Channel Marketing Strategy to build trust
An Omni-channel marketing strategy is recommended. Combining SEO, PPC, PR, forums, and social media will ensure your company looks legit to the eyes of your target. We can help you choosing the platform, registering, and managing the content to build your reputation and increase your ROI (return on investments).
Use Baidu SEO to be more visible to Chinese Food Distributors
To be effective, a website must be host in China or Hong Kong, must be translated into Chinese, with an eccentric layout, and with plenty of information.
A website with a Seo structure is indexed in the highest positions. Usually, a user clicks on the first five presented answers. A good Seo campaign can help you to be arranged in a successful way on the internet. For a good Seo strategy, it is necessary to identify the sector and the target, the more effective keywords, and to know the competition. For a real SEO, make sure the website has localized hosting and domain, create ad hoc content in Chinese (simplified Chinese for Mainland China, traditional Chinese for Hong Kong and Taiwan) and do link building.
Convince Food Distributors with Undercover Marketing on Chinese Forums
In China, the word of mouth has great power and it is important that you take advantage of it.
Physical or virtual, word-of-mouth is an essential brand-building tool for companies in China. Sixty percent of Chinese consumers say friends and family members are a major source of product information, based on which they make purchase decisions.
Zhihu (知乎), is a question-and-answer website like Quora. On Zhihu, questions are created, answered, edited, and organized by its users. As time goes, Zhihu has also advanced and become a super community with social tools, media, services, and e-commerce capabilities. While Zhihu’s primary service is still the free Q&A platform, they began extending services to paid content in 2017, targeting especially those looking to further their careers. Their current revenue streams include:
- interactive online Q&As,
- pay-per-view live-streamed talks,
- podcasts;
- e-books
In the same year, Zhihu started letting companies and organizations set up their official accounts, officially setting itself up as a platform to create brand value. Zhihu has indicated for those companies are more for longer-term brand building than hitting sales goals for the month. Not only being present on Baidu Zhihu will allow you to answer questions about your field but also to educate your target audience about your products in an undercover way.
Once you built your e-reputation, distributors will come along.
Do you need help to set up your digital strategy in China? Contact Gma.
GMA shares not only deep insights into the Chinese market but also is an expert in the Chinese digital market since 2012. We have worked successfully with many foreign companies in the way of entering the Chinese market. If you have any questions, feel free to contact us.