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Happy Marketer Blog

Want to Become the Next Chinese Marketing Officer (CMO) in your Company?

Posted by Terrence Quah on May 31, 2019 11:33:08 AM

While the USA is still the largest economy in the world, China is hot on its tail thanks to the astonishing growth it has experienced over the last few decades. Even with the cooling measures that the authorities have taken, the economy is projected to grow by 6.3% in 2019 as compared to the USA's 2.5%.

It is easy to understand why more and more companies are keen to expand their business into the burgeoning Chinese market but many of these companies will fall short of their targets or even fail because of one simple reason. They still believe that what works globally, will work in China.

If you are looking to enter the Chinese market or market effectively to Chinese tourists, here is a quick summary of what you need to know before making the next decision concerning China:

# 1 - China Is The Most Diverse Market & Demands A Nuanced Approach

During my visits to China, the one thing that I realized is that regardless of where you are, everyone who lives in China, even if you are an expat, speaks “Putonghua” and is obsessed with social media. This is why many companies make the mistake of treating China as a single market without taking into consideration that the behaviours vary drastically between different cities.

For instance, a quick search would tell you that 1st tier cities like Beijing and Shanghai generally have a GDP of over US$300 Billion while 2nd tier cities like Tangshan and Dalian, have a GDP of over US$68 billion.

What most articles fail to tell you is that residents of 2nd tier cities tend to earn nearly as much as their 1st tier cousins but have double the appetite for online shopping.

This means that brands need to focus on understanding the nuances of their targeted city. Across China, the largest group of online shoppers are aged between 24-36 years old. However, it may be more cost-effective for a brand to focus their efforts in capturing the 2nd tier cities due to the greater appetite for online shopping and a less saturated market environment.

# 2 - The B.A.T. has a Huge Role to Play in The Lives of Chinese Consumers

Baidu, Alibaba and Tencent are the 3 largest titans in the Chinese market and they each play a very different role in the daily lives of the Chinese consumer. Here is what you need to know:

Baidu — Google’s Equivalent in China


As of January 2019, Baidu dominates 65.96% of all desktop searches and 71.3% of all mobile searches. The closest competitors are Haosou 360 and Shema at 12.19% and 20.92% respectively.

For many global brands, if you do not appear on Google’s Search Engine Results Pages (SERP), you may as well not exist in the minds of the consumers. In China, the same can be said for brands that do not appear on Baidu’s SERP.

Alibaba — The Retail Juggernaut and a Retailer’s Best Friend

While many conversations tend to compare Amazon and Alibaba from a net-worth perspective, it is important to understand that the two largest e-commerce giants have largely avoided direct competition as they operate in different parts of the world.

While Amazon’s strategy revolves mainly around solidifying its position in North America and Europe, Alibaba has been aggressively capturing the China market while building a network of strategic partnerships and acquiring companies across Southeast Asia.

In China, it is estimated to have a market share of around 58.2% and had its best year ever in 2018 when it transacted over US$30.7 billion in sales during its 24-hour Singles’ Day sale. If your brand is looking at increasing its sales volume, this could be a good platform to start with while learning how to better use influencers in your marketing campaigns.

Tencent — The App for Life In China

Tencent may be known globally as the world’s largest gaming company but it is also the owner of WeChat, China’s most popular messaging app that has evolved to become the interface that enables life in China.

While its e-wallet system, WeChat Pay, needs no introduction, the diverse capabilities and potential that its mini-programs ecosystem can bring to a brand are vastly underrated by foreign companies. 

Many foreign brands tend to treat their websites as the final source of truth and a major conversion point in their sales process. What they fail to understand is that for most Chinese, the website is nothing more than a brochure and a checkbox that your company is reputable enough to be considered. Instead, Chinese consumers prefer to purchase directly from brands in the WeChat ecosystem.

As of end 2018, 18% of all mini-programs are devoted to e-commerce and the group-buying platform, Pinduoduo has successfully used its mini-program to lower the cost of customer acquisition from RMB $310 to just RMB $11.

#3 You Can Never Fully Understand Another Culture & That’s Alright

One of the main objectives for marketing teams is to obtain the emails of the consumers to create a lead-nurturing program and develop a lead attribution model to track the various touchpoints in their journey.

As a data-driven marketer who is always looking to optimize my campaigns through testing and learning, China presents a very unique challenge. While data attribution and tracking is still available, it is generally not possible, nor practical, for brands to focusing on building a full spectrum, cross-platform view of their consumer.

This is because for a platform to be successful in China, the platform has to place the consumer’s experience first, even if it means putting the brands’ needs aside.

This basically means that the way we usually conduct full funnel tracking and lead nurturing will not work in China for 3 simple reasons:

  1. The Chinese, in general, do not use emails for their personal lives, reducing the effectiveness of personal email IDs as a personal identifier.
  2. For the platforms, the consumers’ experience is the ultimate priority. This means that the users will always come before the brands, limiting the tracking and advertising options available.
  3. Data is the way to being relevant to the consumer and the platforms know this. That is why the various platforms will never allow their user data to be shared with anyone else, making a single view practically impossible.

On top of this, most platform algorithms are geared to prevent virality as part of their legal requirements to prevent gossip and the spread of false news. This means that for a brand to succeed in China, you need to build a real and individual connection with the consumer.

As the platforms do not allow for data to be shared, you need to first decide which platform you want to invest in before focusing on building your CRM database on that 1 or 2 platforms and expanding from there.

My advice for marketers looking to enter China is very simple. If you think you fully understand China, you don’t - unless you have been living there for the last 5 years.

To prove this, humour me and do the following:

  1. Take a pen and a piece of paper
  2. Using your dominant hand, sign your signature 5 times, as quickly as you can
  3. Do the same with your non-dominant hand

Found it difficult? We don't have to think when signing with our dominant hand but trying to understand the diverse market that is China is like signing with our non-dominant hand. While we can get better with practice, there will always be a cultural difference.

Hopefully, the tips above would help you to reconsider your approach in dealing with this amazing country. Do let us know your thoughts and experiences in the comments and stay tuned for our upcoming series of articles - Everything China!

Topics: marketing, cmo

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