Using a local Distributor or TMALL B2D
Good local distributors have localization insights, specialist market knowledge, and existing customers. They can give advice and help bring your products to market. You can partner with larger distributors such as Tmall B2D on several smaller regional ones and cover most parts of China to build brand awareness. Distributors can hold inventory of your product in order to shorten the product to market lead time, however, some distributors have high markups and most of them do not usually share market or consumer information.
An official website based in China
A lot of International Brands have their own official website that is set up out of China. This makes it difficult for brands to manage and maintain.
However, this option has several major drawbacks. First, as the servers are not in China, it may be difficult for users to access. Also, another huge disadvantage is the challenge of delivering customer service. As all the services are located outside of China, it is difficult for brands to provide quality after-sales service, refunds, and product exchanges.
An Outlet on a popular online E-commerce Platform
There are large online Chinese e-commerce platforms that have been developed during the last few years such as Taobao, Tmall, and JD.com, and they’re extremely well known. They seem like a simple option, let’s have a look at how they work.
There’s a common misconception in the West that Taobao and Tmall are the same platforms but that’s not really the case. Taobao and Tmall are both operated by the Alibaba Group but they use different unapparent models. Taobao is a C2C (Customer to Customer) platform for individual vendors while Tmall is B2C (Business to Customer) platform for official manufacturers brands or organizations that have a legal entity in China.
To open an online store on Taobao, Tmall, or JD.com, you need to be a Chinese national or have a legal business entity in China. As an option for foreign brands and manufacturers who want to sell to China, both Tmall and JD.com have developed new platforms for cross-border e-commerce, Tmall Global and JD Worldwide. They are also the most popular cross-border e-commerce platform in China. Other platforms include Suning Global and Amazon China Global Store.
These platforms can provide a great deal of access, but online stores in these malls require costly setup fees and commissions. Brands may also need to pay extra advertising and marketing costs.
Unlike the online malls introduced above, online hypermarkets function on a B2B2C (Business to Business to Customer) system. These online hypermarkets operate as intermediates. They purchase an extensive range of goods from overseas suppliers or manufacturers at wholesale prices and sell them at retail marking their profit from the markup.
They are different from online malls in a few ways. Online hypermarkets do not have individual online storefronts for the overseas brand to operate. Storage and distribution are also managed by the hypermarket. Distinguished online hypermarkets in China include NetEase Kaola and Jumei.
While these platforms can pledge a significant deal of access, setting up an online store in these malls requires high setup fees and commissions.
Vertical Specialty Market Places
These platforms operate like online hypermarkets and also purchase goods directly from overseas suppliers or manufacturers. However, they generally only focus on a specific product category, target audience, or location.
As the product catalog is limited, the market on such platforms is rather a niche and the consumer traffic is comparatively low.
Examples are beibei.com and also Little Red Book(Xiaohongshu), this one allows Chinese users to check out and acquire foreign parts products posted by other users including fashion items, shoes, and more.
Using Social Media
To reach out to Chinese consumers and establish a closer relationship with them, a prominent presence on Chinese social media is a must for brands and companies, especially on the most popular platforms- WeChat and Weibo.
These platforms allow brands to create and localize content to build an engaging and interactive social media profile. Brands also need to launch campaigns, engage bloggers for promotion, and run advertising on a regular basis to build brand awareness and reach out to potentials customers.
- Launching campaigns
There are several ways to launch a sales campaign.
On WeChat, for example, Brands can include themed coupons in articles that can be used online. Before the coupon or the discount expires; users receive a message reminding them to use it.
On Weibo, there are Pre-ordering campaigns, this allows users to pre-order products before they’re launched At the end of the campaign, only people who have participated can purchase the product. These are a good way to draw attention and create buzz before an official release.
Engaging influencers, known as KOLs (Key Opinion Leaders) in China, is one of the most effective ways to promote an official account, and content campaigns on social media.
KOLs have their own follower bases that see their opinions and suggestions as credible and influential. Many also excel in driving online sales. Sharing brand information or launching campaigns with bloggers can help to raise brand awareness, attract new followers and contribute to a brand’s credibility.
The price of KOL cooperation differs primarily based on their industry, interest category, follower base, content quality, and the prominence of their posts. The more followers, the higher the content quality, and the higher the cost of a contract.
While WeChat is a semi-opened platform that has a personal or private purpose for users, Weibo has a simple working model with entertainment at its heart. That can explain why Weibo KOLS are cheaper than WeChat KOLs.
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