When it comes to e-commerce in China, there are significant differences in how consumers buy products compared to the Western world.
As a business entering China, it’s critical you understand these differences, and adapt your marketing strategy accordingly.
After all, as a legitimate business in the Western world, you wouldn’t be seen dead trying to penetrate a new high end market by selling your products through CraigsList. Too often, equivalent mistakes are made by Westerners attempting to navigate the Chinese e-commerce platform.
Here’s a breakdown of where Chinese consumers go to purchase goods online, based on their different needs:
WeChat—the platform for social selling
Selling a product, where the opinions of others are critical? WeChat is where Chinese consumers will want to purchase your product.
Because of its social nature, WeChat has an e-commerce scene based heavily on reviews, and the opinions of others. Markets which flourish here are those which need high social validation—health, nutrition, dieting, all the industries where results speak louder than words.
If a Chinese consumer thinks a product is cool, but wants to investigate more before buying, WeChat is their first port of call—and should be yours too, if you’re the seller of such a product.
TMall—a haven for quality and transparency
Selling a product, where price and authenticity are big factors? TMall is where Chinese consumers will be searching for your product.
An offshoot of Alibaba, TMall has incredibly strict barriers for entry. It ensures that all businesses selling products have the legal right to be marketing them—they must show certification, their licence to sell, and undergo a range of checks before uploading merchandise for sale. The result is a marketplace where higher-end consumers go to be assured of quality.
You’ll often find official international brands selling their products on TMall. They may have their own physical stores and distribution channels set up, but will simply be adding another string to their bow by enabling Chinese consumers to purchase through T Mall as well.
Getting your brand to be legally able to market itself in China is pretty damn hard, which is why so many people turn to daigou, or grey channels. But if you’re serious about succeeding in China, making sure you’ve done what you need to do to get onto TMall will set you up for far better long-term success. After all, if a Chinese consumer knows something is cool, and wants to buy it legally, for the best price, TMall will be their go-to e-commerce platform.
Taobao—niche, and a little risky
Selling something that might not be everyone’s cup of tea, or isn’t entirely by the books? Taobao is likely your best bet—this is the less official marketplace of China, where checks and regulations aren’t such a big deal.
For the New Zealanders reading this, Taobao is like the Chinese version of TradeMe—a mix of second hand goods and e-commerce stores, amateurs and professionals. For Americans, think of it as Craigslist, just a little less dodgy.
As one of the easier ways to get into the Chinese market, Taobao is often the way that foreigners will go (even if that’s not necessarily the most by-the-book or effective way to succeed). Still, it’s good to be aware of your options. If a Chinese consumer is looking for a niche product, and is willing to roll the dice a little, chances are they’ll be shopping on Taobao.
The sheer convenience strategy
There is one more approach that Chinese consumers take to shopping online, and perhaps it is the starkest representation of how unique the Chinese market is.
Consumers will see something they like, and then order it off all five of the main e-commerce platforms. The one which arrives first they will keep, and the other four will be turned away at the door (shipping is virtually always free, for delivery and returns).
This illustrates just how competitive China is when it comes to e-commerce, and leads me to my key take away: All of these e-commerce channels serve a purpose, and are great channels for distributing your product, but alone, they won’t lead you to success in the Chinese market.
The reality check is this: It’s a competitive landscape, and to break away from this, you need to position yourself uniquely. Marketing your business and capturing a niche is not viable within the large e-commerce platforms, simply because of how saturated and competitive they are—investing in advertising follows a linear equation, where $9 generates $10; not a grind I’d be willing to engage my business in.
Instead, utilise platforms such as WeChat and TMall as distribution channels for your products, but capture an audience using your own unique marketing strategy.
Don’t know how? Maybe we should talk.