Chinese Flash Sales Companies - More Than a Flash in the Pan

Flash Sales or ‘daily deals’ as they are known in the west, are a growing phenomenon in China’s competitive online market. Flash sales have become increasingly important as companies offering similar products are forced to compete on price in creative ways. Not only do companies list daily deals on their website, but they also have fully automated apps that allow users to receive notifications for products and brands that they select. Generally a flash sale will last up to 2 days, but it could be as short as 2 hours. The shorter the sale, the bigger the discount.

“In the west, we’ve had deal of the day type offers going for a while, but they’ve never taken flight the way they have in China,” says Ryan Cordoni, Marketing Manager at Richway Tech. “A company like VIP shop has built an entire business around the idea, with enough success to attract a lot of foreign investment in just a few short years.” VIP shop formed in 2008 and has been a publicly traded stock since 2012 in America.

VIP Shop is arguably the most successful flash sales company in China. They are one of several large Chinese companies coming to Vancouver, Canada to attend The Canada China Trade Conference. The CCTC is taking place on August 23rd of this year at the Vancouver Convention Centre with talks starting at 9:00AM. The event presents an opportunity for Canadian businesses to network with Chinese e-commerce companies as well as learn digital marketing strategies from the people who built China’s Internet from the ground up. Tickets start at $300.

The Billion-Dollar Travel Company You've Never Heard Of

China’s “C-Trip” is Another Reason to Watch the Chinese Digital Space

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China’s premier travel company, C-Trip, made over $1 billion revenue last year on travel packages and services sold in the Chinese market. In fact, 70% of C-Trip’s sales came from Beijing, Guangzhou, Shanghai, and Shenzhen. By comparison, Expedia made almost $6 billion in the entire world (including China). C-Trip is dominating the Chinese market. Their strongest competition is Chinese rival eLong, a company that Expedia had a majority stake in until recently.

“When you look at companies like Expedia, you’re really looking at dozens of companies that have been acquired and molded into one giant firm,” says Ryan Cordoni, Marketing Manager at Richway Tech. “C-Trip is pretty inspirational because they’ve built a significant business from the ground up.” C-Trip is also expanding into the western market, even acquiring foreign businesses along the way.

C-Trip is one of several Chinese e-commerce companies coming to Vancouver, Canada to speak at The Canada China Trade Conference. The CCTC is taking place on August 23rd of this year at the Vancouver Convention Centre with talks starting at 9:00AM. The event presents an opportunity for Canadian businesses to network with Chinese e-commerce companies as well as learn digital marketing strategies from the people who built China’s Internet from the ground up. Tickets start at $300.

How China's Craigslist Became a $650 Million Company

58.com is a Shinning Example of What Chinese E-Commerce Can Do

When people in the west think of Craigslist, they don’t think of an economic powerhouse. In China, this is a different story. China’s Craigslist, 58.com (WuBa), earned over $650 million USD of revenue in 2015. That figure is impressive considering 58.com was founded in December 2005, a full 10 years after Craigslist. The company is headquartered in Beijing and is trading on NYSE under the ticker symbol WUBA – pretty good for a company you have never heard of.

“So many of us completely discount the achievements of the Chinese Internet,” says Ryan Cordoni, Marketing Manager at Richway Tech. “The fact is that 58.com turned a very unglamorous classified website into one of the most profitable e-commerce platforms in the world.” Craigslist earns a small profit on certain items like job postings, but 58.com makes money on a wider variety of services and post types. They also make a significant amount of money from advertising, something their audience isn’t bothered by.

58.com CEO Jinbo Yao is coming to Vancouver, Canada to speak at The Canada China Trade Conference. The CCTC is taking place on August 23rd of this year at the Vancouver Convention Centre with talks starting at 9:00AM. The event presents an opportunity for Canadian businesses to network with Chinese e-commerce companies as well as learn digital marketing strategies from the people who built China’s Internet from the ground up. Tickets start at $300.

China's Business Elite Have Their Own Social Network

Zhenghe Island is China’s “LinkedIn for Billionaires” 

Zhisland.com (Zhenghe Island) is a social network that’s being called the LinkedIn for Chinese Billionaires. It costs $5,000 a year and requires that members be the founder, CEO, or president of a company with annual revenue of at least $8 million. Zhisland.com, was founded in 2011 by Chinese entrepreneur Donghua Liu, and already has more than 2000 heavyweight members from the elite business community including Alibaba founder Jack Ma and Lenovo founder Liu Chuanzhi.

“Even though the Zhenghe Island network is closed to outsiders, the opportunity to meet a guy like Donghua Liu is huge,” says Kevin Li, Project Manager at Richway Tech. “We really wanted to get him as a speaker because he typifies the kind of well connected Chinese rich guy we want to expose Canadian businesses to.” Donghua Liu will be speaking about his successes and failures on his way towards creating the Zhenghe Island network.

The CEO of Zhenghe Island, Donghua Liu, is coming to Vancouver, Canada to speak at The Canada China Trade Conference. The CCTC is taking place on August 23rd of this year at the Vancouver Convention Centre with talks starting at 9:00AM. The event presents an opportunity for Canadian businesses to network with Chinese e-commerce companies as well as learn digital marketing strategies from the people who built China’s Internet from the ground up. Tickets start at $300.

The Chinese Art of Convenience

“Heike” stores are like a 7-11, post office, bank, and online shop rolled into one

SF Express, one of China’s largest shipping companies, has created a new kind of store, the “Heike”. At a Heike store, patrons can pay their bills, buy a drink, order something online and even send a parcel themselves. The Heiki store embodies a growing Chinese trend towards a more convenient lifestyle. In Chinese cities, you would be hard pressed to go more than a block without coming across a convenience store. Beyond that, China has the largest e-commerce marketplace in the world, projected to be worth over $1 trillion by the year 2020.

“After living in Taiwan and China for several years, I can say for sure that convenience is very important to the people there,” says Ryan Cordoni, Marketing Manager at Richway Tech. “When I got back to Canada, it took me a while to adjust to the fact that there wasn’t a 7-11 on every corner.” SF Express is one of several strong Chinese companies that is positioning itself for international business after significant success at a local level.

SF Express VP of E-Commerce, Richard Li, is one of the masterminds behind the Heike stores. He is coming to Vancouver, Canada to speak at The Canada China Trade Conference. The CCTC is taking place on August 23rd of this year at the Vancouver Convention Centre with talks starting at 9:00AM. The event presents an opportunity for Canadian businesses to network with Chinese e-commerce companies as well as learn digital marketing strategies from the people who built China’s Internet from the ground up. Tickets start at $300.

The Business of Influence in China

In China, Social Media Influence is Big Business

Paying influencers isn’t anything new. Celebrities in the west can earn thousands of dollars for a single tweet. In China, this is also true. But what’s different is the way “influence buying” is done. In China, there are several emerging e-commerce platforms that allow businesses to buy social media action from influencers. The way it works is simple: influencers with a high enough following join an influence buying platform and businesses can buy social media action from them.

“I’m sure that more than a few of us feel a bit gross when we see a celebrity tweet that was clearly bought and paid for,” says Kevin Li, Project Manager at Richway Tech. “But in China, people don’t have the same emotional reaction. In fact, if a business is willing to pay an influencer to promote their product, people see it as solidifying that influencer’s celebrity status.”

Weiboyi is one of the largest “influence buying” platforms in China. The CEO of Weboyi is coming to Vancouver, Canada to speak at The Canada China Trade Conference. The CCTC is taking place on August 23rd of this year at the Vancouver Convention Centre with talks starting at 9:00AM. The event presents an opportunity for Canadian businesses to network with Chinese e-commerce companies as well as learn digital marketing strategies from the people who built China’s Internet from the ground up. Tickets start at $300.

The Billion-Dollar Baby Business from China

Mia.com is Leading the Way in Post One-Child Policy China

Mia.com is an e-commerce platform in China that sells foreign baby products to Chinese consumers. There are several factors driving the success of this company. First, China has changed its one-child policy into a two-child policy as of January 2016. Second, in recent years, there have been several scandals in China related to the safety of baby products produced in China. Third, cross-border trade relations are becoming easier to establish in China, especially because of the emerging demand for foreign products from the growing Chinese middle class. All of these factors have led to Mia.com becoming a billion-dollar company within a few short years.

“It turns out that the middle class in China also doesn’t want their babies playing with lead-paint covered toys,” says Ryan Cordoni, Marketing Manager at Richway Tech. “It’s not a surprise when you think about it, but I think the general assumption is that Chinese people are all ‘okay’ with the low quality products coming out of their country. The truth is that they hate them just as much as we do, and they are looking for alternatives from outside of China.” 

Mia.com is one of several successful e-commerce companies attending the upcoming Canada China Trade Conference in Vancouver, Canada. The CCTC is taking place on August 23rd of this year at the Vancouver Convention Centre with talks starting at 9:00AM. The event presents an opportunity for Canadian businesses to network with Chinese e-commerce companies as well as learn digital marketing strategies from the people who built China’s Internet from the ground up. Tickets start at $300.

Failure to Launch in China - The "Guanxi" Dilema

A Lack of Guanxi is one of the Biggest Reasons Canadian Companies Fail in China

Richway Tech, a digital marketing firm in Vancouver, Canada, estimates that almost 50% of foreign businesses fail in China. There is a long list of heavyweights who have fallen: Home Depot, Google, Amazon, etc. One of the biggest reasons companies fail in China is because they don’t understand the importance of “Guanxi”. Guanxi is a kind of cultural shorthand in China that concerns the language, networking, and connections required to get business deals done. When expanding into China, western companies build teams based on CV’s rather than the often-unseen Guanxi influence of potential employees.

“It’s not really so much that the concept of Guanxi is too difficult to understand,” says Kevin Li, Project Manager at Richway Tech. “It’s more that it’s so often overlooked that is the problem.” Companies looking to sell into China should invest some time into figuring out whether or not Guanxi will be an issue for them. With the new e-commerce and trade platforms emerging, a lot of the guess work is being taken out of the process.

Whether or not you need to worry about Guanxi really depends on the scale of your business. A company that is selling a few products to a market niche in China could most likely make a few trade partners and logistics partners and be fine without much thought given. However, a big company looking to set up offices, stores and set up their own logistics network would be in trouble if they overlooked the Guanxi concept.

The importance of Guanxi will be discussed in detail at the upcoming Canada China Trade Conference in Vancouver, Canada. This event also offers networking opportunities with several huge e-commerce platforms like Alibaba and JD.com. The CCTC is taking place on August 23rd of this year at the Vancouver Convention Centre with talks starting at 9:00AM. The event presents an opportunity for Canadian businesses to network with Chinese e-commerce companies as well as learn digital marketing strategies from the people who built China’s Internet from the ground up. Tickets start at $300.

Chinese E-Commerce Giant JD.Com Making Moves Into North America

The 28 Billion-Dollar E-Commerce Platform Dominates China and Refuses to Stop There

JD.com, one of the largest online e-commerce platforms in China, is making moves to expand westward. The company had a record year in 2015, with revenues of $28 billion USD. Now the company has made a partnership with DHL in an effort to secure a logistics network. In addition, the company is now investing in western companies like “Wish”, a San Francisco based shopping app. These moves represent a growing trend: Chinese investment in western business.

“JD.com is one of a number of e-commerce power-houses coming out of China,” says Ryan Cordoni, Marketing Manager at Richway Tech. “The fact that it’s making moves into the western market shows how confident they are. It’s going to be interesting to see how Chinese companies do in the west over the next few years, especially since so many western companies have failed in China.”

JD.com is one of several Chinese e-commerce giants attending the upcoming Canada China Trade Conference in Vancouver, Canada. The CCTC is taking place on August 23rd of this year at the Vancouver Convention Centre with talks starting at 9:00AM. The event presents an opportunity for Canadian businesses to network with Chinese e-commerce companies as well as learn digital marketing strategies from the people who built China’s Internet from the ground up. Tickets start at $300.

 

 

Baidu vs Google: What's Different + What's The Same

Everybody is familiar with and thankful for all things Google. The suite of products they have made freely available are used and loved by nearly the entire world. But in China, there is no Google. Instead, Internet users turn to Chinese search engine Baidu. So how does it stack up? What does the Baidu vs Google matchup look like?

The good news is that Baidu, apart from being China’s largest search engine, has an answer for many of the products Google has carefully crafted over the last 20 years. I'm not going to sit here and tell you that Baidu is blazing new trails. But I can say for sure that Baidu is no slouch. Let's take a look at what's different and what's the same between.

Baidu Has The Chinese Internet Completely Covered

Baidu, just like Google, leads with it’s search engine, which is un-matched in China. Beyond that, Baidu has created many sites and services which might serve as a good place for your products to be advertised. In China, Wikipedia is blocked due to government censorship. Baidu isn’t afraid to comply though, resulting in the creation of it’s own “Baidu Wiki”. Just don’t go to it for the most factual take on certain historical events. Despite the lack of facts in some cases, the site is still immensely well used.

Baidu also has the multi-media landscape covered with Baidu Music and Baidu Video. Although these services aren’t without strong competitors, they are still well respected and frequently used. Baidu even has an “answer” for popular sites like Quora and Yahoo Answers - it’s own Baidu Answers.

While it’s questionable whether or not these services would be live if Google could have established themselves in China, their existence is evidence that Baidu is Google’s Chinese analog. If anything, this further strengthens it’s position as the best choice for SEM in the Chinese market.

Baidu Has PPC - Just Like Google

If you’ve ever run SEM campaigns using Google Adwords then you won’t have any difficulty understanding how Baidu Adwords works. The product is essentially the same, however, the way SEM is deployed upon the Chinese audience is very different. First of all, Baidu has a notoriously confusing back-end interface. Even if you are able to eventually navigate the back-end, keywords in Chinese are a monster. This is where the help of a marketing company with a deep knowledge of the China market can come in especially handy. Navigating the keyword landscape in English is hard enough - imagine doing it in Chinese!

Baidu Has Text and Display Ads - Just Like Google

Baidupresents it’s advertising in much the same way as Google. Ads show up in search results alongside content based on keywords. For most products and services, the best option is almost always going to be text ads displayed on search engine results. Depending on the type of industry and products a business is selling, display ads can work quite well. There are different kinds of content in China than in the west, so even if display ads have worked well for your campaigns run on Google adwords, you’d still want to do enough research to find out if your ads have the right content to support them.

Baidu Has Geo-Targeting - Just like...

Just like Google, you can use Baidu SEM to target users geographically to a very precise degree. This is incredibly important for all kinds of products, but it is especially important in China. As you might know, the income disparity level is much higher than in China than in the west. This is important for many reasons. For example, if you are selling luxury products, you’d want users in generally more affluent areas to be viewing and clicking on your ads as opposed to users in the countryside.

Baidu vs Google: The Main Difference is Accessibility

Baidu is China’s Google. They have their own “Adwords” SEM product and the it operates in much the same way as Google Adwords. You're sold. You get it. But depending on what kind of business you are hoping to promote on Baidu, there are some small barriers you should be aware of. In the Baidu vs Google matchup, the main difference comes down to accessibility.

If you want to use Baidu for search engine marketing, there are 3 things that you will need no matter what. First of all, you’ll need a fully accessible Chinese language website. This is a requirement of Baidu, not just a best practice for doing business in China. The next thing you’ll need is a valid business license. It doesn’t have to be a license in China, just any business license for any country will suffice in most cases. The third thing you’ll need is a Baidu authorized agency. Unlike Google, where anybody can sign up and start running ads within minutes, Baidu only sells through authorized agencies.

Beyond that, there are a few other things you might need to provide, depending on your industry and what you are selling. You may need to provide various business documents like trade agreements or proof of patent if you are making certain claims in your advertising. You also may need industry specific permits, but generally all these additional documents aren’t needed. There also won’t usually be a situation where you would be surprised with document requests, so rest easy.

If you're like me, you've probably been skeptical of anything coming out of the Chinese Internet. And you should be - it's a wild world out there. But one thing you can't argue with is the size of the web in China. For businesses interested in a piece of that action, Baidu is the closest Google analog they can get. Thankfully it's not that bad; in fact, it may even be better than Google from a advertising point of view. One thing is for sure though, The Chinese market isn't going anywhere and Baidu is here to stay.

Intimidated by the vast Chinese market? Learn everything you need to know about marketing to the Chinese audience:
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Advertising in China: Western or Chinese Agency?

You’ve bit the bullet - you have decided to take your products to China. You have done the research, figured out the logistics and it looks great on paper. Now you need to hire a marketing company to get the word out about your product. Who knows the Chinese market better than a Chinese marketing company, right? When it comes to advertising in China, it's a bit more complicated than that.

There are a number of factors to consider when choosing an agency. This much is true even when looking for an agency to promote products at home. When you look for an agency in a foreign country, the variables can multiply really fast - especially in a country as different as China.

The Cold Reality of Advertising in China

When working with a marketing agency in China, there are several factors that impact the quality you can expect to receive as a small to medium sized client. First of all, the best companies are almost always going to be really busy. There are several international marketing and advertising firms that operate in China, but these firms are only interested in really big contracts. Although your maple syrup export might have huge potential in the Chinese market, they probably wouldn’t be willing to take you on unless you can pay top dollar.

The reality is will only have a chance to work with smaller firms. Unfortunately, these are some seriously dangerous waters to dive into. Advertising in China is already treacherous enough, imagine managing your products and having to worry about an unknown agency operating in another timezone? The fact is that these companies may know the market, but they don’t speak your language. By that, I mean that they don't speak English and they don't speak the language of wester business. The approach to marketing is vastly different in China and these companies may not be able to adapt your brand effectively.

Advertising in China - Do They Speak Your Language?

Speaking of language, does anybody on your staff speak Chinese? If you work with a Chinese agency, you will need somebody who can. A lot can get lost in translation if you work with a Chinese agency. Not only that, but communication moves at a different speed in China altogether. It might be hard to tell whether people are avoiding you or if they are just a terrible communicators. If you bet on a local adverting agency in China,  you may be dealing with an unknown company. A company with no web presence beyond a simple website. So there won’t be any accountability if the projects don’t go down as planned.

Working with a local agency based in the west is going to give you the best of both worlds. You’ll be working with people who speak your language and understand your business. At the same time, they will possess a deep knowledge of the Chinese market. People who will work with you and keep you up to date as projects progress. Not only that, but a local agency has the skills needed to “translate” your brand as effectively and cleanly as possible so that you get the best results possible for your expansion in China.

Intimidated by the vast Chinese market? Learn everything you need to know about marketing to the Chinese audience:
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Chinese E-Commerce Market: Hot for Foreign Goods

With 700 million Internet users and counting, the Chinese e-commerce market is the biggest in the world. But something that many businesses don’t realize is that China represents a huge opportunity for foreign manufacturers and retailers.

The size of the e-commerce market in China is gigantic. Imagine if literally every person in the United States and Canada was regularly buying products online. At present day, China boasts even more e-shoppers than that, at a whopping 380 million. Nielson predicts that by 2025, over 50% of purchases made in China will take place online, so there’s little doubt that the Chinese e-commerce market is a hot space to operate in.

Nielson, a research firm that has done tremendous work in the Chinese space in recent years, has also conducted a survey that found that 38% of Chinese consumers in tier 1 cities like Beijing and Shanghai are making cross-border purchases. In addition to that, 27% of netizens in tier 2 cities are jumping in to the cross-border action, meaning the market is opening up and customers are opening their wallets in a big way.

Chinese E-Commerce Market: No Growing Pains

E-commerce platforms in China are growing rapidly, and foreign enterprises are getting on board selling products across many industries, such as personal care, diapers, infant formula, grocery food, nutritional supplements and household items. If your business can do high volume, then partnering with a big platform like TMall or JD.com makes sense. But even if you are selling lower quantities of specialty products, there are still big opportunities. The Chinese e-commerce market is on pace to become the most active online marketplace in the world.

Research supports that Chinese consumers are not just looking for the lowest possible price when they look for products online. In fact, they are moving more and more towards paying well for quality, especially when it comes to high-end luxury products from foreign producers. Nielson reports that almost 40% of shoppers in China are amongst those willing to pay more for quality, meaning that the opportunity for specialty high-end products is massive. At this rate, it makes more sense to get into the Chinese market than not.

The story of what Chinese consumers are willing to spend for foreign products gets even sweeter. Currently, China’s e-shoppers spend a giant 176% more per purchase when buying from overseas companies than domestic ones. This doesn’t just extend to luxury products, but also to baby products, foreign wines and alcohol, and even health supplements, which are seen as much higher quality than Chinese equivalents of the same kinds of products.

Explaining the Chinese E-Commerce Market

There are many other factors contributing to the growth in the Chinese e-commerce market. For starters, Chinese consumers are eager to “trade-up” to foreign products that aren’t produced in China. Specifically, they are looking for niche, often country specific products that traditional retailers don’t carry. Think maple syrup or swiss chocolate - products that are famous for their quality and distinctly from a particular place. These kinds of products sell for a huge premium, sometimes double the price you would pay in western countries.

Another reason these products are selling well online is because the e-tailers promise a high degree of quality. Despite China’s reputation for producing fake or counterfeit products, the Chinese market doesn’t want to purchase the copycats. For a long time, they simply had no alternative. The government has helped as well, creating new tax and duty laws to help reduce gray-market imports.

No Sign of Slowing Down

Not only are the markets hot and the regulations favorable, but the logistics are getting better as well. No less than eight Chinese cities have established “trade zones” which provide tax and customs benefits as well as easy access to shipping companies, making a streamlined logistics network much easier to create. Even if your business is shipping less product, there are plenty of solutions available.

At this point, it would be a shock if the digital market in China turned around. The e-commerce trend is strong around the world, but nowhere is it stronger than China. With government support, fully developed logistics networks, and a huge demand for foreign products, western businesses can’t afford to ignore this market much longer.

Intimidated by the vast Chinese market? Learn everything you need to know about marketing to the Chinese audience:
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9 Reasons To Use Baidu for SEM in China

I'll be the first to admit it: I never thought Baidu would amount to anything. I thought it existed purely because Google left China back in 2010. But here we are in today - and Baidu has become a giant success with revenue around 3 billion in Q1 of 2015 alone. Does this mean that Baidu is going to challenge Google for search engine dominance any time soon? Not a chance. But it does mean that Baidu is an extremely strong platform for companies who want to connect with the growing Chinese market online. Here are 9 reasons to use Baidu for SEM in China:

1. Baidu Has 70% Market Share in China

According to China Internet Watch, Baidu has over 70% market share in China. Baidu does have competitors, but it’s safe to consider Baidu in the same way we consider Google: it is ubiquitous. When approaching the Chinese market, it makes sense to use the platform that everybody else is using, at least initially. Let’s put it this way, how many companies are running SEM advertising on Yahoo or Bing compared to Google? It’s the same situation for Baidu in China. Skip the rest.

2. Baidu Reaches Over 700 Million Users

Forbes.com has said that China's Internet users surpasses 700 million. It's clear that China’s Internet is one of the fastest growing in the world. To put that in perspective, that’s more than double the entire population of the United States. Of course, we know that the population of China is still growing and if China reaches the same 85% saturation point that was reached in North America, that means there will soon be 1.2 billion Internet users in China.

3. 90% of China Uses Baidu

Based on this DMR report, Baidu dominates the search engine market in China. Let’s put it this way, Baidu is to China what Google is to the rest of the world. Imagine Google’s competitor, Yahoo, except take away from it the valuable sites that they own and operate, like Yahoo answers, Yahoo Finance, Flickr, and Tumblr. That is the competition to Baidu in China. What’s more, Baidu operates successful Chinese versions of almost all Google platforms you are familiar with.

4. 600k+ Webpages Host Baidu Display Ads

E-consultancy.com has said that Baidu display ads are seen on 600k+ websites. On the Baidu Adwords platform, you can also run your PPC campaigns to run alongside the content of over 600,000 web-pages in China. While this isn’t exactly a one-to-one connection in the same way that SEM products are, for the right kind of product this advertising could really work well. For instance, clothing or cosmetics products could be placed well on a fashion blog.

5. Chinese Consumers Don't Mind Online Ads

I know right. It sounds unbelievable but the landscape is very different in China as stated by Mobileadvertisingwatch.com. Although a significant number of people in the west ignore online advertisements regularly, reports indicate that Chinese consumers feel differently. In fact, 47 percent of Chinese consumers don’t mind be targeted daily for online advertising. That contrasts markedly with consumers in the UK (52 percent) and U.S. (56 percent) who prefer no targeted marketing at all. A market that actually welcomes advertising? Something to consider at least.

6. Chinese Users Even React Well to Ads

Clickz.com has come out with an interesting report that says Chinese Internet users actually react well to online ads. Most of us in the west can’t stand advertisements online. Although Google ads have improved dramatically in recent years, the spam-like appearance of a page with too many ads has forced many of us to completely avoid offending websites. While westerners have a tendency to be suspicious of anything that is paid for, the reverse is true in China – they believe that if brands are willing to pay, they must have something worth checking out.

7. There Are 6 Billion Search Queries on Baidu Per Day

People are searching in China in a serious way, according to this Nielson report. With over 6 billion queries per day onBaidu, you can be sure that Chinese consumers are spending money online. In fact, according to a report by Nielson, they spend money on nearly everything: body wash (48%), toothpaste (42%), paper towels (37%), shampoo (37%) and laundry detergent (36%) are the top 5 most cited items which Chinese people buy online.

8. Baidu is Ranked 4th Overall By Alexa

We can safely say that the west dominates the global Internet in every aspect from design to engineering. But even though we might scoff at imposters from time to time, we can’t argue with the numbers. In China, Baidu has the top ranked website, ranked 4th in the world over-all by Alexa. That’s a pretty big deal when you consider that nobody from the world outside China is using Baidu. What it lacks in innovation, it makes up for in popularity.

9. Baidu Has The Largest Reach of Any Medium

According to this report from Group M, Baidu trumps all other advertising mediums in China today. If ad spending statistics are any indication, and they are, then online advertising clearly has the largest reach in China. Internet ad spending in China had surpassed television spending for the first time by 2015, and it’s forecasted to take up 49.7% of the total ad spending in the near future. Specifically, mobile ads are expected to take center stage as smart phones move quickly to become the most used devices in China.

That's good because nobody in China is buying anything but online advertising.

Intimidated by the vast Chinese market? Learn everything you need to know about marketing to the Chinese audience:
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Search Engine Marketing in China = Success

Most of us in the west have learned to completely tune out online advertising, especially when it comes to search engine ads. In fact, a whopping 198 million people are using ad blocking plugins on their browsers. Online advertising may be facing troubles in these parts, but search engine marketing in China is driving their e-commerce economy like no tomorrow.

Not many people can argue with the business potential present in the Chinese market, especially in the booming e-commerce space. Despite the huge opportunities, doing business in China is far from plug and play. The list of huge western companies who have entered China proudly and left prematurely is long indeed.

There’s a lot of reasons why these companies may have failed. But if new businesses are looking to succeed in selling to China in today’s digital era, they are going to have to learn how to market their products effectively. Unfortunately, it’s not as simple as translating your advertising into Chinese either.

The good news is that it actually may only require a simplified approach to begin a targeted campaign marketing to the Chinese audience. If your business is selling the right kind of products, search engine marketing (SEM) is most likely going to be your best bet.

Search Engine Marketing in China is Cheap

For starters, SEM is by far the cheapest form of advertising you can do in the Chinese market. On a search engine like Baidu, the largest search engine in China, the SEM product operates much the same as Google Adwords. It’s the same pay per click (PPC) style that you are already used to. The process of bidding on keywords works the same way too. So if your product is unique enough and there is a demand for it in China, you could be doing very well very quickly.

By now you are probably thinking about how you almost never click on Google ads. But in China, 47% of people actually don’t mind online ads at all. Moreover, the audience in China generally believes that if companies are willing to spend money on promoting their product, this should indicate that they are confident in their products. China is an especially frugal marketplace, so this phenomenon makes sense. The majority of products aren’t even advertising at all. That doesn’t mean the advertising space online isn’t crowded - but a company selling unique products from foreign markets definitely has a chance to use search engine marketing in China.

So SEM is cheap and for the right products it could make a lot of sense. But how do you know if the product is right? Turns out that search engine marketing in China isn’t only good for selling, it’s perfect for doing research as well. A search engine like Baidu has a fully functional keyword research tool. And just like Google it can help you get a really good sense of how much action a set of keywords has.

Before setting up an shop in China, companies can test conversions with and collect information with SEM. They can do this by setting up a landing page (or a few landing pages) and promoting it via Baidu. This way, a business can decided whether or not it makes sense to set up a full operation in China. They can also get information for much cheaper than a research company can likely provide it.

In China, Search Engine > Social Media

Companies in the west spend a lot of time and money developing a social media strategy.  This is a great investment when platforms like Twitter and Facebook can serve large audiences across the world. But in China, there is no Facebook, no Twitter, no YouTube, and no anything else you are used to. China does have their own versions of all these platforms, and they are very active, but there are many reasons why social media shouldn’t be the first thing a company goes to when entering the Chinese market.

Navigating the different platforms, developing a winning strategy, working with and identifying influencers is a daunting task. Is it impossible to market a product on social media in China? Absolutely not. But compared to SEM, the investment required for social media success in China is huge. Social media also requires daily monitoring, whereas SEM runs and get results on autopilot.

What about an SEO strategy? Everybody loves free traffic. But consider this: SEO for the western market is a heavily involved process. It involves knowledge based on the work of thousands of experts who are working each day to master Google. In China, not only do the search engines work differently, but often times the information about SEO available is more mysterious. This reality makes the path to SEO success in China much more difficult. In short, your SEO team might be able to work wonders in the west, but they won’t be able to do anything for your business in China.

Traditional Mediums? Not For Foreigners.

Then of course there are the traditional forms of advertising like television, radio, and print. Although these mediums can get results for local companies in China, it takes a lot for foreign companies to see results. There’s also the fact that online ad spending now takes up almost 50% of the total advertising dollar in China. Something to think about down the road, but not something to consider when breaking into the market initially.

SEM on a search engine like Baidu presents the best option for the fastest and most cost effective approach into the Chinese market. Marketing on a search engine can help companies tap into a marketplace that is already up and running. Down the line, invest inother mediums like social media and develop a working SEO strategy. But in the initial stages of a Chinese expansion, nothing beats search engine marketing.

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Marketing to China: Why Companies Struggle

The Chinese market has long been both enticing and mysterious to western peoples. Since the market became opened in the late 1970’s, some of the biggest multinational firms have come and gone. Big names like Google, Home Depot, eBay, and Best Buy have all been forced to leave the Chinese market with their tails between their legs. Marketing to China hasn't been easy, to say the least.

On the surface, it looks like each company failed for it’s own reasons. Perhaps it was a failure to understand the market. Maybe their products had trouble connecting with the locals or they had difficulty with confusing government regulations. Whatever the reasons seemed to be, if take a closer look the failures all strike a very similar chord. These companies failed because they weren't able to effectively market their business to the Chinese audience.

There are a lot of variables in China specifically that companies tend to ignore. Instead of focusing on all that can go wrong, first let's think of one simple truth: China is as different as it is far away. Companies that understand this will understand that they need to approach marketing in a different manner. China has a deep craving for good quality products just like everybody else. It’s just that the messages and the mediums they respond to need adjusting - marketing to China and Chinese people takes a different approach to be successful.

It’s not all that difficult to understand why it would be important to change tact in a country long famed for it’s mystical qualities. The hard part is figuring out how to tap into the very different zeitgeist in China. The reason companies fail to tap-in boils down to four fundamental issues:

  • Limited access to proper advertising channels (leading to wasted money on the wrong mediums)
  • A lack of marketing resources (that doesn't necessarily mean money)
  • Communication problems (leading to a dysfunctional marketing process)
  • No consumer behavior knowledge (leading to further maladjusted marketing directives)

These Channels are All Chinese to Me

The first of these issues is a lack of access to proper advertising channels. Without access to these channels, the message will simply fly under the radar unnoticed. Currently there are many ways to get a message out in China: social media, Internet search, print advertising - really the same channels you would expect in the west. The difference is that access we talked about before.

It’s not hard to sign up for social media accounts or make websites in China, but it takes time to develop a working social media strategy or to make your website searchable online. There are a lot of x-factors to consider when navigating the Chinese Internet landscape, but if your product or service is in demand, there are channels that can be used to your advantage.

SEM or search engine marketing is essentially a “risk-proof” approach and can be used to great effect with the adwords service provided by Chinese search engine Baidu. SEM offers a one-to-one way of connecting with customers in a very straight-forward way. If you are selling French wine, users who search for French wine can find your product on Baidu with the right keywords. This advertising channel makes communicating with the right customers a whole lot easier. Also, since Baidu SEM is PPC (pay per click), you won’t break the bank if your campaign is designed correctly.

The Not-so-straight-forward Art of "Guanxi"

Another reason companies fail in China comes down to a lack of resources. This doesn’t necessarily mean that companies lack cash, it’s that they are ignoring the Chinese concept of “Guanxi”. Guanxi is a bit difficult for westerners to understand, but it‘s a sort of relationship short-hand that helps get deals done in China. No amount of money can make up for a lack of Guanxi, so companies often end up in situations that cash cant't help. This is where it pays to get help from the right kind of agencies who know how to take a strong marketing plan and make it work in China.

The third problem companies run into comes down to communication. Sounds simple enough, just hire some bi-lingual employees and watch them go. Not so. Communication comes down to so much more than just language. People may be gifted at language but may at the same time bad at communication. For example, people in China are much more likely to avoid challenging their superiors. In the west, if managers are wrong about strategic direction, somebody will probably pip up. Not necessarily in China.

Chinese Consumer Behavior: Just a Bit Different

The last reason companies fail in China is due to a lack of understanding when it comes to consumer behavior. Chinese people like good products, but they don’t always see the novelty in everything directly. This could come down to cultural differences or just a lack of necessity. Whereas I couldn't imagine a world where The Home Depot wasn't around, the Chinese market doesn't have the same kind of attitude towards home improvements. 

We can understand the Chinese market a little more by looking at a Chinese made product that sold well in China but wouldn’t have a chance selling in the west: the “facekini”. A facekini is literally a bathing suit mask that people wear when they go to the beach. If you still needed convincing that marketing to China is a different kind of beast, I hope you are converted now. This is of course an extreme example, but the logic here can be reverse engineered to gain some insight. Not every product will work for the Chinese audience and no amount of marketing will change that.

Doing business in China presents many difficulties, but with the right approach, it could be one of the most lucrative expansions any business could hope for. It's arguably one of the more challenging places to do business - according to the World Bank (via this article on the Wall Street Journal) China ranks 83 in the world. Considering how much business they do internationally, one might expect a better ranking. Still, money rains from the skies in China at the present moment, and if companies have a product that fits the market they could be set to collect.

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The China-sized Hole in Your Internet Marketing Strategy

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You are an Internet marketing whiz - a master of all things Google, a tweeter of the highest caliber, and a visionary on Facebook. There’s only one problem: the biggest online marketplace in the world doesn’t knows anything about your company or your products. You can be sure that China, with it’s 700 million active Internet users, is home to at least a few people that you should be connecting with. Here's the greatest part: Internet marketing in China is slowly coming within reach for the average outsider.

I can hear it now – “but isn’t the Chinese market mysterious and confusing?” It is a legit concern. You’ve probably already heard that Google hasn’t been operating in China since 2010, but the list of websites currently blocked by Chinese authorities doesn’t end there. Facebook, Twitter, YouTube, Instagram and many others are all unusable, which means all the strategies set in motion on these platforms are going to go unnoticed by millions of people with plenty of dollars to spend. Believe it or not though, the Chinese web is developing rapidly and it's becoming more and more possible for western companies to actually do internet marketing in China.

So if it’s not Google (or Facebook or Twitter), then who? The Chinese government may have blocked those platforms mentioned above, but they haven’t blocked local developers from creating their own “China ready” solutions. Now the Chinese Internet has an answer for all the popular web giants we have come to know and love. No matter the platform, there is a Chinese version of it. For online search, instead of Google, users in China take to Baidu. Chinese people looking for the Facebook experience turn to RenRen. No Twitter, no problem – China has Weibo. There are Chinese analogs for YouTube, Quora, Amazon and everything else you are used to in the western market.

It’s great that Chinese devs have come up with all these platforms, but how many people are actually online and active? Turns out there are a lot. Like, a lot lot. According to this article on Tech in Asia, Weibo had 198 million active users in 2015. By comparison, Twitter has 300 million; so when you consider that Twitter is used worldwide and Weibo is used almost exclusively in China, it seems like Weibo is on to something big. If I were doing internet marketing in China, and I am, I'd want to pay close attention to a platform with that many users. So you should pay attention. I'm glad we agree.

Chinese Consumers are Paying it Forward Online

Although smartphone sales are slowing, mobile manufacturers in China have still shipped at least 400 million units per year for the last 2 years running. Chinese companies are churning out mobile apps, electronic payment solutions, consumer goods websites at an alarming rate. The bottom line: the Chinese market has money to spend and they have the devices and platforms needed to spend it.

Speaking of spending, according to this report by accounting giant KPMG, China’s e-commerce market was worth around USD 426 billion in 2014, with many analysts predicting it will grow to USD 1 trillion by 2018. Yes - that’s trillion with a “T”. Even if the analysts are wrong about the growth, the current market size is something many companies will still want a piece of.

With a rise in smartphone use comes a rise in smartphone apps. In China, none are bigger than WeChat. The unassuming messaging app has grown to a whopping 600 million users in just a few short years. At first glance, it seems to be a dime-a-dozen messaging app. But look closely and you’ll find that WeChat has huge potential. For starters, it has a built-in retail platform that sells anything from shoes to consumer electronics. It also has it’s own micro-payment wallet that streamlines online purchasing within the app. Apps like WeChat are helping to take the mystery out of the Chinese market in a big way.

Internet Marketing in China is Taking Flight

The Chinese economy may be slowing down, but the online space is still growing rapidly. eMarketer has said that digital ad spending in China will reach USD 40 billion in 2016. That's a 30% increase over last year’s spending with predictions to reach over USD 80 billion by 2020. Growth projections for the Chinese market are often a bit overblown. But now that China has gone digital, I think we can hope for a lot less exaggeration.

The progress has been huge. So huge that it’s hard to imagine how platforms with millions of users can appear out of thin-air and still receive limited recognition in the west. Here at Richway Media Tech, our project manager Kevin Li says he’s not surprised. “China has over 1 billion people, so they were going to sit idle while the Internet passed them by. People in Chinese culture value convenience, which is great for companies who want to sell online. Whereas western people would hate product ads in their Twitter feed, many Chinese people actually welcome these kinds of ads.”

A market biased towards welcoming adverts on social media platforms? Sounds like an advertisers dream come true. But Kevin warns there are still extra hoops to jump through when marketing online in China. “There are a number of policies, procedures and regulations in China that an insider would be able to help demystify.” There’s enough mystery involved that Kevin has created an entire conference, The Canada China Trade Conference. The event is dedicated to educating business owners about the pitfalls (and opportunities) to web marketing in China.

To be perfectly honest, I was among the many naysayers who shunned the Chinese Internet when Google was moving out. I thought for sure the Chinese web would develop at a snail’s pace. I have to admit I was wrong – and I hate that. The successful rise of e-commerce in China is proof that we need to watch this space more closely. I really believe there will be a future world where Internet marketing in China can be accessible to all. With all the action in China’s digital space, we can be sure there’s going to be a lot happening. My advice? Get off your high horse so you won’t miss what’s next.

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