China’s Restaurant Industry
Revenue for China’s catering subsector totaled $545.0 billion in 2018, of which $495.4 billion was generated by the restaurant industry.
Although the restaurant industry has slightly decreased in recent years, due to the rapid growth of its main external competitor, the fast-food restaurant industry in China. However, the country’s food and drinks sector is expected to become a trillion-dollar industry in the next few years if it continues on its current trajectory. It could soon displace the US as the biggest catering market on the planet.
Catering revenue for the first half of 2019 increased by 9.4 percent, after rising by an amount similar to $ 628 billion across the past year. Food and drinks accounted for 11.2% of total retail sales of consumer goods in China. The catering industry is expected to grow to $927 billion annually by 2023.
The boom of restaurant delivery services in China
A very interesting aspect of changes in consumer behavior is the growing number of young professionals who go to dinner late or order home delivery after a long day at the office. Restaurants, F&B outlets or O2O F&B delivery services are becoming their first choice.
In fact, with busy consumers increasingly placing a premium on convenience in the midst of fast-paced lifestyles and looking for meal solutions that require minimal time and effort, full-service restaurant operators explore the potential of delivery services. Prominent players like Hai Di Lao are planning to increase their revenue from delivery services.
Restaurants can also choose delivery service apps like Meituan-dianping. It is a Chinese group buying website for locally found food delivery services, consumer products, and retail services. Meituan-Dianping is also one of the world’s largest online and on-demand delivery platforms.
How to reassure customers and get more diners during the current health crisis?
Due to the Covid19 pandemic, many people are worried, and getting any customers to confidently eat restaurant food again remains one of the industry’s biggest obstacles.
Since these difficulties many restaurants have adopted some strategies to reassure customers and induce them to buy their food:
- Many delivery orders now often include cards listing the names and temperatures of all the staff involved in preparing your food.
- Others send notes detailing the restaurant’s disinfection procedures.
- On the delivery app Meituan, the cartoon delivery man used to track the progress of your order now covers his face with a mask.
Mobile payments are the best way to pay for dinners
Mobile payments are an aspect of the technological impact in China that is now used to pay for anything, even diners. The covid-19 has more widespread this use also in further restaurants.
Paying with your phone in China has become a way of life. Alipay and WeChat Pay dominate the market.
- Alipay is a standalone app
- WeChat Pay is embedded right inside WeChat and is more heavily used to pay for services in daily life.
Continuous social withdrawal measures also aim to appease the population’s fears. The famous Heytea tea chain is famous for its long lines, but today customers scan a QR code on the door which launches an illustrated guide to the store’s security procedures. From there, customers can order drinks and get notifications when they can pick them up at the door again.
The Gulou Mantou Shop staff, on the other hand, sends its steamed buns down a small slide rather than hand them to customers, and asks customers to use mobile payments only.
Restaurants should merge offline with online
Currently, being only offline for restaurants is impossible, not only for the Covid19. Even before COVID-19, mobile payment systems spurred a delivery boom in China’s large cities, and the Chinese are increasingly using the internet and mobile phones to search for information and book diners.
You should know that Chinese people spend a lot of time using the Internet, they increasingly depend on digital platforms as a place to share their opinions, ask for product advice and connect with others.
Therefore, a presence on these platforms to increase visibility and get more diners is essential. The effect this will have in the future is that most restaurants will consider merging offline with online.
How can a restaurant increase visibility and get more diners?
Social media are the best way to interact with customers
Despite Facebook, YouTube, and Twitter being blocked in the country, local social networking sites such as Tencent WeChat, and Weibo have been attracting millions of users, making China the world’s biggest social media market.
Out of the 904 million Chinese people now using the internet, 897 million people are on mobile devices.
Social media as a channel wins more trust from consumers. Consumers believe more in the message they directly communicate on social media, whether via WeChat, Weibo, or Little Red Book posts.
People get a more solid connection to the brand via social media and at the same time brands can reach Chinese consumers and interact with them.
As a matter of fact, companies should develop a good digital marketing strategy on these platforms. Word of mouth and big communities are at the heart of the Chinese internet and it is essential to increase your visibility. GMA helps you create and manage an active community on social media that will generate engagement and organic awareness toward your brands. In other terms, use communities to spread the word.
Wechat is the best place to work on branding and increase visibility
WeChat is the main Chinese social network. Born as a messaging platform, over the years it has introduced several innovative and advanced features that have made it more than a simple online chat. Nowadays, it is the app on which Chinese spend most of their time. They use it to:
- Make reservations (taxis, restaurants, flights, and much more)
- Use WeChat Wallet to shop online, see their balance, transfer money to other contacts, pay via mobile
- Use QR codes which provide a very low-cost way to connect the digital world inside our phones to things, people, and places in the real world around us.
It is thus the best way to offer your brand visibility and create a community that will follow you.
WeChat is an incredible place for you to share interesting content about your restaurant and your products. You can share videos, audio, photos, and messages. The app enables companies to create an “official account” to promote their company. This is the best way for a brand to create a community, gain followers and being actively engaged with them. As you can also sell your packaged products on WeChat, it is very convenient for the user to directly purchase something on your WeChat account.
Setting up and using the in-app Wechat CRM is also a great tool to communicate with your followers/customers and increase your trust level with them. With a well-set Wechat CRM, answers automatically any questions your followers may have, welcomes new ones, to offers special discounts, etc.
Website presence on the most used Chinese search engine “Baidu”
Baidu is one the most powerful search engines in China, the most used. If you want to break into the Chinese market, Baidu SEO is a must-step and a must-have.
Step number one of Baidu: To rank, your website needs to be hosted in China, get an ICP license, and be in Mandarin. Baidu knows only Mandarin and gives priority to websites hosted in China. The website culture is different, therefore you need to adapt your content/design to the locals’ expectations.
As you can see here, Hai di lao has its own website on Baidu. This could be an opportunity to acquire more clients and increase your visibility among Chinese customers.
PR: Media & community to increase visibility
Reliability in China is everything and your reputation is the key to success. PR is a good way to build your credibility. It increases your visibility because not only you are getting experts talking about you, but it also means backlinks from authority websites.
PR is a free marketing tool, which consists of having an authority profile talking about your company, which can be media (newspapers, blogs..), KOLs, or even community. PR has the advantage of lasting in time and getting you covered by trusted people on third-party websites which gives you legitimacy.
It is not always easy to get a press release that is why our agency with the right connection and that know how to proceed are offering this type of service. Contact us to discuss it further!
Do you want to know more about How to market your brand in the Chinese market? Contact GMA a digital marketing agency, specializing in the Chinese digital market.