688 million reasons to take your business into China

While China is known to be a gigantic market for local companies seeking to expand offshore, taking your business into the country successfully requires an understanding of local customs and marketing opportunities.

A massive marketplace

Marketing company Sinorbis launched officially in Sydney this week, with the aim of assist Australian businesses to expand their online reach into China.

“[China has] 688 million internet users, [and] half of them are shopping online,” said Nicolas Chu, co-founder and CEO of Sinorbis.

“They spent more than $770 billion last year, and half through mobile devices. This is the scale and the size of the opportunity in China.”

The largest demographic looking for Australian goods were described by Mr Chu as the ‘affluent middle class’.

“As consumers become more affluent, they are looking for premium services, high-quality services and premium products to enhance their lifestyle.

“They are increasingly looking outside of China to countries like Australia,” he said.

The most searched-for ‘premium products’ were, according to research conducted by Sinorbis, health foods and supplements, travel to Australia, offshore real estate, and education through Australian institutions.

My Business has previously reported on the growing demand for Australian products, such as with the launch of the Oz-Town stores in China by the Australian Made Campaign.

Yet it is not solely Chinese consumers seeking out Australian-made products – many businesses are finding ample demand within other parts of Asia.

Early last month, for instance, beverage company MADE announced a $2 million deal to deliver PET-bottled milk to Malaysia by boat.

“Consumers in Asia are accustomed to buying UHT long-life milk imported from countries like Australia that have safe and reliable quality standards, but a growing number of affluent consumers are now demanding the same high-quality fresh milk Australians consume every day, which is why the interest in our fresh PET-bottled milk has exploded,” said Luke Marget, co-founder of MADE.

Product perception

According to Sinorbis, online marketing in China can be highly profitable, provided businesses change their marketing tack from a Western perspective to appeal specifically to a Chinese demographic.

Dandan Cheng, COO of Sinorbis, said that it is important for businesses wanting to branch out to consider the personality of the product.

“They want the product to convey the message of young and energetic,” said Ms Cheng.

“So these are the very much important things if the relevant companies, they want to address the specific new generation as customers.”

“You have to customise your product for China,” said the group’s co-founder Allen Qu.

“In the past, people ... just picked your product and put it on the shelf in China. But [today], it’s not enough.”

According to Mr Qu, the product needs to be altered to adjust for Chinese consumers’ desires.

“From the ... labelling, the packing, the product customisation itself ... it has to be customised, made for China,” he said.

Mr Chu said Sinorbis was formed in order to close the gap between the East and the West by looking at three key angles: maintaining business variety, forming a new online marketing platform and educating Australian businesses about the necessary changes required to advertise online in China.

One example provided by Mr Qu was of an Australian winemaker.

“The label itself ... makes a difference,” he said.

“Some ... Australian wine never [sells] well in China, just because ... they have a very ugly label.

“For some countries, they make very expensive labels, put it on the shelf, it looks much much better.

“Many Australian wineries, they don’t do that.”

Tailoring search engines and social media

Just like in Australia, social media can be helpful for a business’ online presence, but not through typical channels.

Businesses who advertise primarily through Western social media will face issues, given that Facebook and Twitter are blocked in China due to internet restrictions.

Instead, WeChat – a combined instant messaging and social media service with 697 million active monthly users – is a popular channel used in China.

Using search engines to advertise online is also helpful, but like social media, businesses can’t rely on the Western norm.

Google is not available in China, but search engines Baidu, 360 and Sogou are widely used.

Furthermore, websites that are hosted in China with a local internet content provider (ICP) have been found to return better search results than overseas-hosted sites.

“We believe that it’s really important for people to understand the opportunity,” said Mr Chu.

“You could also understand what to do [and] what not to do in China, understand the different buying behaviours [and] trends, and this is starting today.”

Mr Qu added: “Australian businesses that are not addressing this Chinese demand are missing out on a once-in-a-century opportunity.”

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