China eCommerce 101

China eCommerce 101

Haitao Experience: How Do Chinese Consumers Buy Overseas Products

Haitao Experience: How Do Chinese Consumers Buy Overseas Products

Chao Cheng

China Market Expert Expert, Senior Partner at SinoStep
Author of Sell Online To China (Your Opportunity in China’s Booming Cross-border eCommerce Market) andHow to Build A Right Chinese Website That Works In China.

Cheng Chao has extensive expertise in China market entry, global translation & localization, cross-border business development, and global digital marketing.

Chao founded ChineseTrans, where he led a team of senior linguists to establish ChineseTrans as the market leader in professional Chinese translation services.

Since 2011, Chao has served as the managing director of SinoStep, a consulting agency helping foreign investment enter into the China market. Backed up with a strong team of China business consultants experienced in different sectors, Chao has successfully introduced dozens of overseas brands into the China market, established their operations in China on early stage and adapted their businesses to the China market.

see Chao's Bio

Purchase From Overseas Shopping Websites

Consumers place orders directly on overseas shopping websites.

Reliable and “Best” way

Actually it is the best way of HaiTao in my eyes if you can have a fully localized web store designed for Chinese consumers.

It is reliable to provide authentic products.

But not every overseas shopping website is user friendly to Chinese consumers.

Poor Shopping Experience

Many Chinese users feel it difficult to read the text and follow the order process.

Chinese consumers need to

  • be the language expert to understand what the website tells.
  • be comfortable with the website display.
  • do a lot of homework to know how to buy.

Long Delivery Time

  • Long Shipment time to China
  • Many websites do not support direct shipping, Chinese consumers need to be the logistic expert to arrange a forwarding company to transfer the goods.

No Guarantee

No after-sales service for Chinese consumers.

Many Chinese  consumers feel it difficult to read the text and follow the order process.

No wonder many of those experts turned out to be overseas purchase agents.

 

Bergdorf Goodman, a luxury goods department store based on Fifth Avenue in Midtown Manhattan in New York City (Photo by Chao in Nov. 2016)

Bergdorf Goodman, a luxury goods department store based on Fifth Avenue in Midtown Manhattan in New York City (Photo by Chao in Nov. 2016)

Purchase Through “DaiGou” Agencies

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Find Target Customers in China for Your Online Store

Find Target Customers in China for Your Online Store

Chao Cheng

China Market Expert Expert, Senior Partner at SinoStep
Author of Sell Online To China (Your Opportunity in China’s Booming Cross-border eCommerce Market) andHow to Build A Right Chinese Website That Works In China.

Cheng Chao has extensive expertise in China market entry, global translation & localization, cross-border business development, and global digital marketing.

Chao founded ChineseTrans, where he led a team of senior linguists to establish ChineseTrans as the market leader in professional Chinese translation services.

Since 2011, Chao has served as the managing director of SinoStep, a consulting agency helping foreign investment enter into the China market. Backed up with a strong team of China business consultants experienced in different sectors, Chao has successfully introduced dozens of overseas brands into the China market, established their operations in China on early stage and adapted their businesses to the China market.

see Chao's Bio

They Are The Most Valued Chinese Consumers 

China Cross-border online shoppers are most valued pioneer consumers.

Compared to average online shoppers on domestic eCommerce websites in China, they are early adopters of new things and can afford to buy more from overseas.

Let’s picture them:

  • Elder
  • Higher income
  • Higher education
  • Mainly white-collar employees and business owners
  • More than half are parents
  • Most live in the 1st, and 2nd tier cities in the coastal area.
  • Lower frequency of purchase
  • Higher basket size

They are seed customers of cross-border eCommerce, they influence the market and lead the market.

The number of these people is still not huge, and has a full potential to increase.

 

Three Typical Types of Online Shoppers

We can tell three typical Chinese cross-border online shoppers as follows:

1. Trend-setter

They always know what is the fashion in the world.

Haitao brings all the possibilities for them.

Find Target Customers in China for Your Online Store: 1. Trend-Setter

Find Target Customers in China for Your Online Store: 1. Trend-Setter (picture: Leo’s tour in MET, New York, USA)

Leo, business owner of a trading company, has a wide knowledge of all the famous brands, and he has a really good taste.

Online shopping is definitely a hobby for him.

His loves Lanvin and St Lauren from France, Prada from Italy, and many small designer brands.

He is also a father, now he starts buying apparels, toys for his son too.

What do they buy?

  • Cosmetics and skin care products
  • Makeup products
  • Apparel
  • Shoes
  • Hats
  • Bags and Suitcases, accessories
  • Perfume

2. Mommies & Daddies

Trust western brands considering safety and quality.

Find Target Customers in China for Your Online Store: 2. Moms and Daddies

Find Target Customers in China for Your Online Store: 2. Mommies and Daddies (picture: Chao and his daughter: Emily)

Chao, yes, it is me, bought many things from overseas websites, and visits a lot of foreign ecommerce sites.

What do they often buy?

  • Mother and Baby
  • Health supplement products
  • Milk powder and food supplement
  • Food
  • Toys
  • Apparels

3. Explorers

Willing to try new things, esp. new digital products, and they are early adopters of new inventions.

Find Target Customers in China for Your Online Store: 3. Explorers

Find Target Customers in China for Your Online Store: 3. Explorers

Yaya, A freelance writer, runs a small business in Beijng.

Her hobby is to travel around the world. She visits Amazon Global the most, and her favorite brand is Aigle from France and Keen from USA.

What do they often buy?

  • Digital products
  • Outdoors Sports

 

9 Market Trends of China Cross border Online Shopping

9 Market Trends of China Cross border Online Shopping

Chao Cheng

China Market Expert Expert, Senior Partner at SinoStep
Author of Sell Online To China (Your Opportunity in China’s Booming Cross-border eCommerce Market) andHow to Build A Right Chinese Website That Works In China.

Cheng Chao has extensive expertise in China market entry, global translation & localization, cross-border business development, and global digital marketing.

Chao founded ChineseTrans, where he led a team of senior linguists to establish ChineseTrans as the market leader in professional Chinese translation services.

Since 2011, Chao has served as the managing director of SinoStep, a consulting agency helping foreign investment enter into the China market. Backed up with a strong team of China business consultants experienced in different sectors, Chao has successfully introduced dozens of overseas brands into the China market, established their operations in China on early stage and adapted their businesses to the China market.

see Chao's Bio

Here are 9 Market Trends of China Cross border Online Shopping after the new policy released by the government earlier this year.

1. Regulated Market

We can see China Government’s efforts to head off the illegal gray-market imports and all the regulations will make the market more healthy.

Trade zones were set up to qualify for the new tax regime.  Established logistics operators are building new distribution channels to handle the expanding trade. Now products on cross-border e-commerce platforms can get instant customs clearance.

Read more: China Government Policy Evolution for Import eCommerce

 

2. Fair Play

The imports from cross-border eCommerce and general trade will be on the same arena.

 

3. Price Adjustment

Some platforms adjusted the prices of some products due to the import tax change.

Increase around 11.9%: Food, healthcare, mother and baby, daily consumption products

Decrease around 8.1%-38.1%: home appliances, personal washing.

No change: cosmetics.

 

4. Fierce Competition

Many existing players will be out of the game due to the fierce competition, and the challenge of the profit margin

Alliances will also be spurred among big players in the market.

Chinese consumers still buy a lot of foreign products from Daigou. This is a Mommy with her two sons in the supermarket in France, they are holding a sign of "European Daigou Agent"

Chinese consumers still buy a lot of foreign products from Daigou. This is a Mommy with her two sons in the supermarket in France, they are holding a sign of “European Daigou Agent”

5. From Poor Choice to Rich SKUs

The reality now is that popular best selling products on domestic cross-border eCommerce platforms do not exceed 500 SKUs, we can expect more SKUs and more new brands coming in to the China market.

Domestic Cross-border eCommerce platforms will eye on higher price mainstream cosmetics,  higher quality fast consumption products and home appliances.

We can foresee a consumption upgrade in the cross-border eCommerce in the near future.

 

6. A Wider Coverage

More and more Chinese consumers come to realize Haitao is a new lifestyle and not that difficult.

The customers are not only from first and second tier cities, but also from third or fourth tier cities.

 

7. Better Customer Experience

Consumers will enjoy better buying experience through the quicker arrival, easy return or change of goods, and the confidence in the quality.

 

8. Direct Shipping

Direct Shipping will be more popular than before.

Overseas brands or retailers can tap into the China market through official website with proper localization.

And it can be the first step of market entry trial before you spend huge dollars in the China market.

 

9. Localized Operations

Foreign merchants need more localized operations to satisfy their China customers.

Jobs include more localized team, better localized webstore, good Chinese web copy, local customer service, supporting direct shipping, return and repair service.

Read more:

 

Let’s Chat! if you want to talk more about selling online to China, and making a right market entry strategy.

 

When Would a Chinese Consumer Buy from Your Web Store?

When Would a Chinese Consumer Buy from Your Web Store?

Chao Cheng

China Market Expert Expert, Senior Partner at SinoStep
Author of Sell Online To China (Your Opportunity in China’s Booming Cross-border eCommerce Market) andHow to Build A Right Chinese Website That Works In China.

Cheng Chao has extensive expertise in China market entry, global translation & localization, cross-border business development, and global digital marketing.

Chao founded ChineseTrans, where he led a team of senior linguists to establish ChineseTrans as the market leader in professional Chinese translation services.

Since 2011, Chao has served as the managing director of SinoStep, a consulting agency helping foreign investment enter into the China market. Backed up with a strong team of China business consultants experienced in different sectors, Chao has successfully introduced dozens of overseas brands into the China market, established their operations in China on early stage and adapted their businesses to the China market.

see Chao's Bio

Attract Chinese Buyers to Your Online Shop

Now You can enter China market at a much lower cost with a significant number of potential Chinese cross-border online shoppers out there.

And it is pretty efficient.

It is true that China sells various types of goods around the world.

In the mean time, Chinese buers love western brands, esp. luxury goods, infant formulas, healthcare products, cosmetics, etc.

Chinese buyers want to access to more foreign brands in an easier way, and they are ready to pay a premium for high-end products.

It is the good timing to get more Chinese buyers.

You can fully localize your web store, you can provide direct shipping to China, you can support Chinese customer service.

When Would a Chinese Consumer Buy from Your Web Store?

When Would a Chinese Consumer Buy from Your Web Store?(Photo by Chao: In Southern Georgia, USA, Oct. 2016, I love the bales of the three little pigs)

When Would a Chinese Consumer Buy from Your Web Store?

Before expecting more orders from Chinese consumers, you need to ensure several things have been done on your web store.

Product

Is your product special or better than those already existing in the China market?

Price

Would the overall price be lower after the shipping, customs duty and foreign exchange losses?

Be clear and transparent in this.

Discount & Coupons

Chinese customers loves discounts and promotions.

Look at the amazing results of the past Singles’ day. See 2016 Singles’ Day: World’s Biggest Shopping Event

Experience

Would my shopping experience be as good as shopping with a Chinese merchants?

  • product display,
  • product description,
  • purchase process,
  • reviews etc

Language

Do you speak Chinese?

If you do not have a Chinese version, it is not a localized website from the very beginning.

Also, do you provide Chinese customer service?

A Working Chinese Website

Could I finish the registration and use the shopping cart without any troubles?

I could not even finish my registration in Delta Airline’s Chinese website. See Flying experience in My US Travel.

If customers can not use your website, how coule they buy?

You need to do the test all the time to correct the mistakes and improve the user experience.

Online Customer Service

Could I ask questions about products interactively while shopping?

It is common that Chinese merchants provide live chat around 16 hours per day.

Also, Could I talk to your representative in Chinese?

Currency Conversion

Could I know how much it is in Chinese Renminbi (Chinese local currency)?

Payment

Could I pay with my most convenient payment tool?

Typical popular payment options in China:

  • UnionPay
  • Alipay
  • WePay

Delivery

Would the fulfillment/delivery be hassle free and quick?

Do you support direct shipping?

The only reason I did not buy the boostapak car seat from Trunki official store is that they do not support direct shipping to China. See Finally, I Got A Trunki Hello Kitty Boostapak.

Do you support shipping if I am in a third tier city in China?

Guaranteed Genuine

How do you tell real from the fake ones?

It is the major reason why they buy from you.

Returns and After Sales Service

Could I return or replace my product?

Ensure you will be responsible even when you ship directly from your country of origin.

A good example is Emily’s New 3Doodler Start Pen , I got the replacement from their Hongkong branch after reporting the issue when there was some issue with the one I bought.

Though I bought the start kit from offline store at Brookstone in Boston, I definitely would love to buy the plastic strands and other new products from their official web store in the future.

Website Speed

Can I open your website?

Some foreign websites are loading very slow in China.

Be sure to test your website and you might consider change your hosting if it does not work well.

 

Chinese Localization Strategy

There seems a lot of work to do, and it is.

Some New Game Players in China Import eCommerce have done a good job, while many still need a lot of improvements.

Do your research and prepare a localization strategy if you don’t have a good one.

I help foreign business owners make a right China market entry strategy, it is mainly about localization, either for marketing or for operations.

I will diaganoze your website store to see how to improve the Chinese version.

We will spend some time in the research and analysis, together with some tests.

A good localization strategy is worth your investment before spending huge money in the marketing.

Let’s Chat if you need any help.

New Game Players in China Import eCommerce

New Game Players in China Import eCommerce

Chao Cheng

China Market Expert Expert, Senior Partner at SinoStep
Author of Sell Online To China (Your Opportunity in China’s Booming Cross-border eCommerce Market) andHow to Build A Right Chinese Website That Works In China.

Cheng Chao has extensive expertise in China market entry, global translation & localization, cross-border business development, and global digital marketing.

Chao founded ChineseTrans, where he led a team of senior linguists to establish ChineseTrans as the market leader in professional Chinese translation services.

Since 2011, Chao has served as the managing director of SinoStep, a consulting agency helping foreign investment enter into the China market. Backed up with a strong team of China business consultants experienced in different sectors, Chao has successfully introduced dozens of overseas brands into the China market, established their operations in China on early stage and adapted their businesses to the China market.

see Chao's Bio

A lot of foreign brands cost more in China, and Chinese shoppers tend to buy many products from overseas.

With the attractive potential ahead, new players joined this game without hesitate.

This May, I attended the 5th Cross-border eCommerce conference China 2016 in Shanghai. The meeting lasted two days, the first day focusing on import and the 2nd day focusing on export.

The one sitting left to me is a senior director from a top newspaper in China,  they are also working on a cross-border eCommerce program. A big challenge for them is the difficulty in recruiting qualified talents with experience in this field.

Actually I’d been in the same event twice last year. We can see obvious changes in a short time, and more new faces in the market.

 

 the 5th Cross-border eCommerce conference China 2016 in Shanghai

the 5th Cross-border eCommerce conference China 2016 in Shanghai

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Emily’s New 3Doodler Start Pen

Emily’s New 3Doodler Start Pen

Chao Cheng

China Market Expert Expert, Senior Partner at SinoStep
Author of Sell Online To China (Your Opportunity in China’s Booming Cross-border eCommerce Market) andHow to Build A Right Chinese Website That Works In China.

Cheng Chao has extensive expertise in China market entry, global translation & localization, cross-border business development, and global digital marketing.

Chao founded ChineseTrans, where he led a team of senior linguists to establish ChineseTrans as the market leader in professional Chinese translation services.

Since 2011, Chao has served as the managing director of SinoStep, a consulting agency helping foreign investment enter into the China market. Backed up with a strong team of China business consultants experienced in different sectors, Chao has successfully introduced dozens of overseas brands into the China market, established their operations in China on early stage and adapted their businesses to the China market.

see Chao's Bio

New Present for Doodling

I bought Emily a 3Doodler Start Kit from Brookstone at Boston Logan International Airport last Sunday.

Emily was excited to have this new present and we started creating 3D names using the pen.

Emily was excited to have this new present and we started creating 3D names using the pen

Emily was excited to have this new present and we started creating 3D names using the pen

Emily's first 3D names

Emily’s first 3D names

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Finally, I Got A Trunki Hello Kitty Boostapak

Finally, I Got A Trunki Hello Kitty Boostapak

Chao Cheng

China Market Expert Expert, Senior Partner at SinoStep
Author of Sell Online To China (Your Opportunity in China’s Booming Cross-border eCommerce Market) andHow to Build A Right Chinese Website That Works In China.

Cheng Chao has extensive expertise in China market entry, global translation & localization, cross-border business development, and global digital marketing.

Chao founded ChineseTrans, where he led a team of senior linguists to establish ChineseTrans as the market leader in professional Chinese translation services.

Since 2011, Chao has served as the managing director of SinoStep, a consulting agency helping foreign investment enter into the China market. Backed up with a strong team of China business consultants experienced in different sectors, Chao has successfully introduced dozens of overseas brands into the China market, established their operations in China on early stage and adapted their businesses to the China market.

see Chao's Bio

Emily, my daughter dislikes her car seat since it becomes uncomfortable when she grows up. We also found it quite difficult to adjust and occupies too much space. So we decided to change a lite one which is easy to carry and set up. But all car seats in China physical store are quite traditional like our existing one.

4 weeks ago, Vicky sent me a shopping list before my travel in North America and stressed that Trunki Hello Kitty Boostapak is priority No. 1.

A Challenge But I Made It

Trunki is quite popular in UK and Hongkong. There are many fake ones in the China market too.

For this type of car seat, Trunki is not available in most American physical stores.

Though we can find standard pink and green version in many web stores, Hello kitty is quite difficult to find.

I failed to complete the mission in the United States and finally got the car seat from Taobao back home in China. Yesterday it arrived and Emily loved it.

Most important thing is, It took me less than 48 hours to get it.

Finally, I Got A Trunki Hello Kitty Boostapak

Finally, I Got A Trunki Hello Kitty Boostapak

In the Southern US

It was quite a busy business travel and I planned to go shopping in big cities like New York, and Boston, the last stops before going back home.

For the first two weeks, I’d been across all nine southern states of US and two states in north Mexico. We were driving all the way and it was quite convenient to be anywhere.

In Tuscon, Arizona, We stepped into a Walmart 24 hour store, I found many types of folded car seats. and they are not expensive at all. Actually, I thought I can buy any of them to finish my shopping task though I could not find Trunki products. However, I was not sure whether Emily will like it and I had plenty of time to find the one in the list.

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2016 Singles’ Day: World’s Biggest Shopping Event

2016 Singles’ Day: World’s Biggest Shopping Event

Chao Cheng

China Market Expert Expert, Senior Partner at SinoStep
Author of Sell Online To China (Your Opportunity in China’s Booming Cross-border eCommerce Market) andHow to Build A Right Chinese Website That Works In China.

Cheng Chao has extensive expertise in China market entry, global translation & localization, cross-border business development, and global digital marketing.

Chao founded ChineseTrans, where he led a team of senior linguists to establish ChineseTrans as the market leader in professional Chinese translation services.

Since 2011, Chao has served as the managing director of SinoStep, a consulting agency helping foreign investment enter into the China market. Backed up with a strong team of China business consultants experienced in different sectors, Chao has successfully introduced dozens of overseas brands into the China market, established their operations in China on early stage and adapted their businesses to the China market.

see Chao's Bio

This Thursday evening, the eve of 2016 Singles’ Day (Nov. 11, 2016), there is not much traffic on the streets.

Chinese consumers were busy collecting coupons, searching and adding products into their shopping carts.

Deep Discounts

Online shopping discounts encourage consumers to spend more on this special day, sales have already outdone Black Friday and Cyber Monday sales in the U.S. in the past years.

New Record on Sales This Year on 2016 Singles' Day

New Record on Sales This Year on 2016 Singles’ Day

Task of the Year Before Sleeping

After midnight, it was 24 hours fight to empty the shopping carts of different online shopping sites.

In less than 52 seconds, 1bn yuan (US$147million) of products had already been sold through Alibaba’s platforms. The same amount of sales had been sold through mobile devices took only 57 seconds.

It has been really like a holiday, entirely devoted to online shopping and sales.

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How Do Chinese Online Shoppers Buy From Overseas?

How Do Chinese Online Shoppers Buy From Overseas?

Chao Cheng

China Market Expert Expert, Senior Partner at SinoStep
Author of Sell Online To China (Your Opportunity in China’s Booming Cross-border eCommerce Market) andHow to Build A Right Chinese Website That Works In China.

Cheng Chao has extensive expertise in China market entry, global translation & localization, cross-border business development, and global digital marketing.

Chao founded ChineseTrans, where he led a team of senior linguists to establish ChineseTrans as the market leader in professional Chinese translation services.

Since 2011, Chao has served as the managing director of SinoStep, a consulting agency helping foreign investment enter into the China market. Backed up with a strong team of China business consultants experienced in different sectors, Chao has successfully introduced dozens of overseas brands into the China market, established their operations in China on early stage and adapted their businesses to the China market.

see Chao's Bio

How Do Chinese Online Shoppers Buy From Overseas?

 

Chinese shoppers have been engaged in cross-border import trade over recent years.

Buying overseas products is generally referred to as “HaiTao” in Chinese.

“Hai” (Sea) means overseas, “Tao” (Search) means find and purchase.

 

How Do Chinese Online Shoppers Buy From Overseas?

How Do Chinese Online Shoppers Buy From Overseas?

Official Brand Web Store

It is the most reliable way for Chinese consumers to buy if they know your brand.

In the beginning, most foreign e-Commerce sites don’t offer the direct shipping service to China. Chinese consumers bought through overseas e-commerce sites, and ship the purchased products back to China through intermediary shipping companies.

Language barriers, different payment, customer service and after-sales service are also obstacles for average Chinese consumers.

Customer service is critical for international buyers, I am sharing my story about Emily’s New 3Doodler Start Pen .

 

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China Government Policy Evolution for Import eCommerce

China Government Policy Evolution for Import eCommerce

Chao Cheng

China Market Expert Expert, Senior Partner at SinoStep
Author of Sell Online To China (Your Opportunity in China’s Booming Cross-border eCommerce Market) andHow to Build A Right Chinese Website That Works In China.

Cheng Chao has extensive expertise in China market entry, global translation & localization, cross-border business development, and global digital marketing.

Chao founded ChineseTrans, where he led a team of senior linguists to establish ChineseTrans as the market leader in professional Chinese translation services.

Since 2011, Chao has served as the managing director of SinoStep, a consulting agency helping foreign investment enter into the China market. Backed up with a strong team of China business consultants experienced in different sectors, Chao has successfully introduced dozens of overseas brands into the China market, established their operations in China on early stage and adapted their businesses to the China market.

see Chao's Bio

China Government Policy Evolution

The HaiTao market was not regulated in the early stage and had been operated in the gray area for several years.

Chinese government has launched several new regulations to bring order to this chaotic market.

New rules always bring different results for different players, and they are not always good news.

But we can believe all the policies are designed to support the market in the long term.

China Government Policy Evolution for Import eCommerce

China Government Policy Evolution for Import eCommerce

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