China’s e-commerce is rapidly increasing with a growth rate of 120%. With this in mind, many businesses are investing time and effort to tap China’s e-commerce industry. How about you? Do you have a clear plan on how to do it?
Read on to learn:
“Among the thirty developing countries indexed, China has the first position in terms of online sales initiatives with 84.0 %, following by Japan with 83.3% and the United States came in third with 82.8 %. ” Source: AT Kearney courtesy of Marketing China
Surprising China fact #1
“Within the next five years, China is expected to reach $271 billion from online shopping.” – Red Luxury
You might be asking, “How can China attain this huge online sales initiative?” The facts about it’s population will give you a better understanding of it
Surprising China fact #2
Half a billion of its citizens do not have access to the internet. Considering this, imagine how much growth it will reach by the year 2020? 700 million? Most probably.
Surprising China fact #3:
Currently, over 200 million people in China are earning between $20k to $50k per annum. However, this is believed to reach 500 million people by the year 2020.
With a rapidly growing e-Commerce market and population capacity to buy more, wouldn’t you want to tap into the Chinese market?
December 2013 – More than 400 Australian products were promoted in China through Yihaodian, one of the leading B2C e-commerce companies in China.
Yihaodian is an e-commerce trading site that features various products online. Through this initiative, they were able to accumulate sales revenue of RNB 10.9 Million ($2Million) within the span of 25 days.
Hundreds of brands were given the opportunity to market their products in China online. Many Australians participated including established brand names such as:
China’s appetite for Australian products is very evident with the revenues accumulated through Yihaodian promotion. The next big question is, how will Australian businesses maximize this opportunity?
Tapping the Chinese market requires strategic planning. Consider these following tips and make it work to your advantage.
Jim Barksdale of Netscape once said, “There are only two ways to make money in business: One is to bundle; the other is to unbundle.”
What do you choose?
Bundling tends to favor the seller. First, there is the simplicity of a single priced product. If you can sell the same bundle to everyone, it makes life easier, which usually means lower marketing and selling costs.
Keep it simple and more profitable with one package deal and the customer is likely to focus on the total experiential value, perceive greater total value, and try features that they may not have otherwise.
You have a huge online market in China. However, remember that almost half of their population does not have access to the internet yet.
Tap both of these markets by developing an offline strategy to market your goods.
Do you recall “Domino’s Pizza” early attempt to penetrate the Australian market? It nearly failed because it underestimated the need to adapt its offerings to local tastes. But when they re-invented their menu, it made them into the largest pizza chain in the country.
The same principle applies to the Chinese market. You need to understand what they want and re-invent your product and marketing strategy according to this thinking.
Think Chinese. Begin by labelling your products in their language and style.
David Lander, general manager of growth and emerging markets at Austrade, pointed the importance of logistics compliance when tapping into the Chinese market.
“You have to have the ability to be a reliable source for your own product and prove to the online provider you are working with that. If people buy online there is going to be a product there to deliver.”
What businesses need to consider?
The logistics and compliance required for exporting to China can often act as a barrier for SMEs. Thus, it is important to consider the following:
BRi is a leading provider of global supply chain management solutions to a diverse range of companies from small businesses to large enterprises.
We have a proven track record of working with our customers to understand their business issues, their priorities and needs, then provide a truly tailor-made and end-to-end supply chain solution. At BRi we deliver what we promise:
Talk to us at 1300 348 828.
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