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Key in your market entry strategy is some market research. Of course there are reports on market size and market growth, but often these are general. Specific knowledge on how your product is perceived and what your competitions is, is harder to get but more valuable.
Our local consultant can advise you on the best way to enter the market, based on market and competition research.
China is the world’s most populous country, with over 1.4 billion people as of 2023. Known for its long history, rich culture, and rapid economic growth, China is a major global power.
With a GDP per capita of approximately $10,500 USD in 2023, China’s economy is one of the largest in the world. It has transformed from a primarily agrarian society to an industrial powerhouse. Manufacturing, particularly electronics and consumer goods, is a key sector. Services and technology are also growing rapidly.
China’s main imports include electrical and other machinery, oil and mineral fuels, optical and medical equipment, and metal ores, supporting its massive manufacturing industry.
There are three big internet players in China. Baidu is the main search engine provider, comparable to Google in the rest of the world. Baidu is collecting traffic data and offers products based on this data. Alibaba is best comparable to Amazon.com or Ebay and was first developed from B2B services of SMEs, and then extended to the B2C platform Taobao and Alipay, the online payment solution. Tencent focuses on social media applications comparable with Twitter and Facebook as manages platforms like Qzone and Wechat .
As a result of internet traffic monitoring by the Chinese government, locally hosted website load much faster than foreign websites, for which loading time can be 10 seconds or more. Keep in mind that all your Facebook, Twitter & Google plus efforts will have no or limited effect, as these websites are blocked for the Chinese.
Please be aware that Chinese website can have a very different look and feel from US or European websites. The information density is often much higher. Not all companies put so much effort in their website, so it’s relatively easy to stand out with a local Chinese website. You can link to your (international) corporate site. Make sure your local website if fully in Mandarin (and optionally in Cantonese) and can be found in Baidu.
WeChat has functionalities that combines Whatsapp (instant private messaging), Skype (free voice and video calls) and Twitter/Facebook (sharing content). Apart from your personal account you can set up a so called public accounts, both as a private individual or as a company. These public accounts can have many followers and it’s easy to share info, links, pictures and even offer products or services, WeChat even has a payment function.
The Chinese market can’t be reached with Amazon.com and other ‘Western’ internet platforms. But there is a whole ecosystem available with websites as Alibaba and Taobao as the front end, with payment options for the Chinese, feedback possibilities, and there are many service providers for the local storage, packaging and delivery of goods.
With over 1,5 billion people in one market, with more or less the same regulations and the same time zone, there is a huge supply and foreign goods and services are just a fraction of the total offering. So everything is in Mandarin, and you’ll have to provide all your information and commercial texts this way.
In Taobao you can have your own store and build your corporate identity there as an alternative for a Chinese website. Taobao has its own search system, and in general Taobao products can not be found in Baidu. In order to get your products promoted, there is a pay-per-click system to get them on more attractive spots.
The best preparation for doing business in any country is visiting it. This way you can experience the culture, check the shops and build your network.
Where it comes to hotels, research shows that if you check these platforms, in 80% of the cases you have the lowest room rates.
If you have a consumer product that you can’t sell directly from your home country to your end customer, you need at least one step in between. This can be a distributor (who also acts as wholesaler or importer), a big retailer directly, or it can be a large web shop. Let’s look at the pro’s and con’s of each option.
For a B2B product that is not a commodity or for customized solutions the story is different. Here sales needs to be done in alignment with the department that actually delivers the service or that determines the price case by case. Also then you have three different options.
As counts for any country: you first have to define the target group that you want to sell to. If these are businesses, then you can reach out directly through emails and targeted advertisements, e.g. on LinkedIn. If this arouses interest and gives a sufficient response rate, then you may have found an easy way to get the market’s attention.
If your target group is more diffuse, or is a consumer group, then you have to rely more on advertising such as on Facebook or Instagram.
With the tooling of our partner Instantly.ai you can define your target group, whether it’s 50 or 50.000 people. Send them a sequence of emails, directly in their inbox, for typically under 10 dollarcents per persoon.
First determine who are the end-users of your product or service. And where do they buy it now? The best way to determine the right entry strategy is to approach these parties. Would they consider your product or service as an alternative? Do they agree with the positioning that you have in mind? And what competitors are they buying from now? These data will help you determine the right strategy.
