When you first start doing business in China it can often be overwhelming, there are many people coming to you with a range of advice (often contradictory) about how you should proceed. There are many technical articles that demonstrate ‘know how’ but do not offer clear solutions to the problems new businesses face in China.
NEW BUSINESSES IN CHINA
Doing business in China is a series of problems and solutions. Hurdles can always be jumped and the solutions can yield incredible results for the savy business operating in the most lucrative market in the world.
Here is my pragmatic guide for new businesses entering the Chinese market broken down into some key problems and their solutions.
PROBLEM – HOW TO MAKE AN IMPACT IN SUCH A HUGE & COMPETITIVE MARKET IN A COST EFFECTIVE WAY?
The Chinese market is indeed enormous, with a population of 1.4 billion and over 350 million relative ‘middle class consumers’ it can seem like a daunting prospect, how do you make an impact on such a huge market in a cost-effective way?
SOLUTION – DIGITAL MARKETING IS THE BEST SOLUTION WITH THE GREATEST RETURN ON INVESTMENT
In China EVERYTHING is digital. Digital marketing is the most effective solution for new businesses. With 900 million Chinese now connected online it is a no brainer in terms of getting your products or services in front of the most applicable Chinese audiences.
The Chinese spend on average 1.5 hours per day browsing online, mostly via their smartphone. There are now over 550 million smartphones in China.
It’s also the least costly method when compared to TV ads, physical billboards or events. You need to be promoting your business where your audience are most active; this is online.
PROBLEM – YOU ARE UNKNOWN IN MAINLAND CHINA
The majority of companies need to start over again when they enter China. They are practically invisible.
The whole Chinese online eco-system is cut off from the rest of the world web by government censorship through the ‘Great Chinese Firewall’. Your reputation on Google, Facebook or Youtube for example are not taken into account at all.
Chinese search engines such as Baidu (China’s Google Equivalent) do not pick up on English content, especially when they are blocked in China..
SOLUTION – IMPROVE YOUR VISIBILITY AND REPUTATION ONLINE ON CHINESE PLATFORMS
The solution is to build your reputation and visibility on local platforms with quality Mandarin Chinese content and a comprehensive marketing strategy.
The barriers to entry also present opportunities. With such a ‘closed off’ online system many of your previous competitors will not have set up in China, particularly because of the complications. This gives you a strong platform to build on with less competition, it also helps your business stand out as an international company operating in China.
PROBLEM – THE MARKET IS SO ENORMOUS, WHERE TO START?
China is more akin to a continent than a country. New businesses need to stay focused on their target audience and demographic. With many tier 1, 2 and 3 cities still growing in size and affluence where is the best place to start?
SOLUTION – THE COSMOPOLITAN, TIER 1 CITIES OF SHANGHAI, BEIJING, GUANGZHOU AND SHENZHEN
You can target the most established tier 1 cities on the east coast of China where the highest urban population is. These cities have the largest international communities and are certainly the most cosmopolitan in terms of the lifestyle.
Consumers in these locations have a stronger propensity towards international brands with a more established structure for business development as well as delivery, storage, office space etc.
With such a wealth of user information online a digital marketing strategy can target consumers in specific area’s as well as consumer demographics very accurately.
PROBLEM – HOW DO YOU IMPROVE YOUR VISIBILITY WHEN GOOGLE SEARCH RANKINGS ARE NOT VALID
