Alibaba and its single’s day, which reached this year almost $ 18 billion in sales, are longer no news. However, for many companies, the Chinese huge and flourishing e-commerce market is still a big black hole. What to consider? Where to start? These are questions that still remain unanswered for potential prospects.
With this short guide (in five parts), I hope to give readers some guidance based upon own experience and also share some of the learnings I’ve made since I started dealing with this very promising topic.
Part I: Learn about Chinese consumers and what they really want to buy from abroad
Basically, there are three words that can summarize the drivers of cross-border e-commerce in China: authenticity, price and safety. Only companies selling authentic and unique goods for competitive prices with an end-to-end control over their delivery-chain can currently win in this market.
Learning I: Have an authentic product assortment
Everyone is aware of the importance of counterfeit in China. Major cross-border e-commerce platforms have implemented strict politics against merchants selling fake/manipulated goods. Though, the number of active sellers and huge volumes, make it nearly impossible for Chinese online platforms to ensure the full control over the quality of the goods being sold through their channels. Therefore customers need to be really sure that the product you are willing to sell is an original one.
Online shoppers are mostly looking into famous A-brands from Europe and U.S. and even Asia (South Korea and Japan), but also have a strong interest into making new discoveries, while flipping through the different international shops. Authentic goods, which are unique and strongly related to a country or culture, can have a successful performance among Chinese consumers as well, e.g. German food snacks company Storck.
Learning II: Be able to sell for competitive prices
Chinese are always looking for the best deals. Even if there is a huge buzz on the growing and affluent Chinese middle- and upper-class, most of them remain smart savers. Therefore, the whole cross-border e-commerce business builds up strongly on sales campaigns and heavily discounted prices.
Usually, there are different levels in which sales campaigns are graded. These special sales days are spread throughout the whole year creating an ongoing competitive price-battle among merchants, but giving shoppers very often a reason to spend some money. Even European holidays like Eastern and Christmas as well as traditional festivals like the Oktoberfest have already become an online sales trigger in China.
Learning III: Traceability is the new order
Nowadays, many Chinese online platforms offer through their logistics and last-mile delivery providers a full order-tracking service to their customers. Among cross-border e-commerce shoppers this feature is key, since international goods are logically more expensive, and some customers (especially new ones) might still experience some trust issues concerning the delivery component of this business.
Some companies and brands go even further, offering to their customers the possibility to trace the products they have just received back to the manufacturing site. This helps them to empower their brand and increase loyalty among their customer base.