Although there is a lot of hype about soaring demand for premium imported food and beverage from Chinese consumers, many brands are yet to see a profit in the market. Some of this comes down to the hyper-competitive nature of China’s marketplace, but it often stems from limited due diligence and poor delivery.
It’s not uncommon for exporters to get the obligatory China Food & Drug Administration (CFDA) approvals, find an importer/distributor who seems professional and speaks English, and expect to see profits rolling in after that. Unfortunately, these are usually just two small steps in the long journey to success in China.
Trademarking should be one of the first steps you take for your brand, even if you aren’t sure if and when you’ll enter China. Although foreign businesses are increasingly aware of the importance of trademarking their brand, some overlook creating and protecting a Chinese brand name. And even those who follow the right steps should be aware of phony firms who provide a fake registration certification, meaning that their brand isn’t protected at all.
Another important step is understanding your target market and their unique needs. Chinese consumers can vary immensely by demographic and the region they live in. Even the biggest brands are unable to reach China’s 1.35 billion people, and most only target a portion of the 150 million-odd urban middle and affluence class. So it’s best to understand which consumers are most likely to want and be able to afford your products, and localise and position your brand and products to best appeal to them. Note that perceptions of your products and their origins can often be quite different than you imagine, as this interesting analysis of European countries by Baidu autocomplete results illustrates.
Understanding your target market is also understanding the channels to best market and sell to them. That may include digital and traditional channels, and even touchpoints outside of Mainland China, which brands as varied as Hersheys and Yashili are using.
Once you have determined your target market, regions, marketing mix and sales channels, you’re much better placed to find a distributor who will best meet your needs. Although many distributors claim that they have nationwide coverage and are experts in online and offline channels, almost all distributors are only strong in one or two regions, and very few have any marketing nous, particularly in the digital space. Understanding your needs first will ensure that you ask the right questions and increase the likelihood of finding a distributor who covers the regions and channels that you’re targeting. China Skinny can assist with that.
For our readers in Australia’s Northern Territory, China Skinny’s Nadja Rauscher will be the keynote speaker and workshop chair at the Deliver to China Ecommerce Conference in Alice Springs on 10 May and Darwin on 11 May. Learn from on-the-ground experience about how to use digital channels to grow sales in China. For more info about the Alice Springs event click here and Darwin event click here. Go to Page 2 to see this week’s China news and highlights.