mardi 30 juin 2020

Multiple milk scandals in China led to great opportunities for foreign brands

The new powder milk scandal in China

According to The Economic Times, China appears to have been hit by another baby milk scandal as officials from southern Hunan province are probing a fake powder milk that has resulted in serious health complications for babies.

Officials from Yongxing County in Chenzhou are investigating the sale of a protein drink known as Bei An Min allegedly passed as a milk formula at an outlet in China.

Parents of five children have advised the county market surveillance authority that: 
  • their children have developed eczema, a condition that makes the skin red and itchy,
  • they have had dramatic weight loss,
  • they developed a swollen head after drinking milk.

According to Hunan TV, parents went to the store to buy amino acid-based milk powder for their children who were allergic to the normal formula and the store staff recommended Bei An Min, saying it was the best formula in the store and she had been fed many children with allergies.

Foreign brands are the first choice

Due to the current scandal, the 2003 scandal in Fuyang, when 13 babies died and 171 required medical treatment after being fed substandard milk and the 2008 Sanlu group milk scandal, when six babies died and 300,000 others were taken ill by baby milk laced with melamine, a toxic chemical used to make plastics. Chinese parents rely mostly on foreign baby milk powder brands like Aptamil, Globemilk and others.

Cross-border e-commerce is the new opportunity for brands

Due to the increase in costs and risks, more businesses could move towards cross-border e-commerce, where retailers and international brands ship the products one by one directly to Chinese consumers.

How to best sell on cross-border e-commerce platforms?

A good e-reputation is crucial to sell in China

In China more than everywhere else the reputation of a brand is what will make the difference. Chinese consumers don’t trust new brand and are not risk taker, resulting in a very low conversion rate. Therefore, e-reputation should be the base of your marketing strategy when doing cross-border e-commerce in China, whatever platform you choose.

How to create a good e-reputation in China?

A presence on Baidu help you to get visibility

A presence on Baidu, the Chinese search engine, where people go to find brands and products information is the first step.
You should focus on Baidu Seo, knowing that Baidu knows only Mandarin and gives priorities to websites hosted in China. In addition, the website culture is different, therefore you need to adapt your content/design to the local expectations.

Moreover, Baidu PPC is also a great tool to use in your marketing strategy because it gives you credibility and also bring your first visitors to your website.

PR, KOLs and Forums create brand-awareness

Let others talk about you and your brand. KOLs and communities are powerful and widely listen to the Chinese internet, in fact, their opinion matters the most.

Social media are the best place where to interact with consumers

Social media in China are the best place to work on your branding and storytelling.

The most used Chinese social media are Wechat, Weibo and the short-video platform Douyin.

Cross-border e-commerce channels

Cross-border websites allows consumers to buy products online from merchants located abroad. This kind of online shopping is more and more popular in China because consumers can buy foreign products that have not a physical presence in China.
The main cross-border e-commerce in China: JD Global, Tmall Global, Ymatou, Vip international and Kaola.

For more insights about opportunities for international brands in the milk market in China, read the article below:

jeudi 28 mai 2020

Why many famous brands are using Tmall Global flagship store business model?

Tmall Global is a dominant cross-border e-commerce platform, the first choice for many well-established international brands to land on if wish to sell in China. 
Tmall Global allows foreign brands without a Chinese business entity to sell to consumers directly by opening their exclusive flagship stores. It is extremely popular among global brands that already have a recognizable brand in China, but why?

How Tmall global flagship store works?

Through this business model, participating brands can manage their flagship store on Tmall global through the help of a tmall partner.
It is a self-managed flagship style business, where the brand can use the shop to promote new products and drive traffic to its top sellers.

Within tmall global stores, merchants can open a:
  • Flagship store that allows foreign merchants to sell directly to consumers without a Chinese commercial entity. TPs help foreign brands open their tmall store.
  • Specialty store, this type of shop exists for merchants who have received distribution rights from foreign brands to sell their products in China. The trader is able to sell products in up to two categories.
  • Authorized shop that can sell multiple products in a range of different categories, but you must receive the rights to sell the products from the owners of the brands.

Sephora Tmall Global Flagship Store

On May 20, 2020 the famous beauty retailer Sephora also has launched the Sephora Tmall Global Flagship Store.

The opening of the Sephora Tmall Global Flagship Store offers Sephora a great opportunity to continue strengthening its commitment in the Chinese market, satisfying the changing trends of the Chinese consumer and the evolving needs to improve its beauty power.

In addition, this partnership helps to:
  • introduce overseas brand into China market
  • connect Chinese customers to the world
  • synchronize the local community with global beauty trends
  • bring together numerous emerging and popular overseas beauty brands
  • offer the benefit of breaking geographical and time barriers through cross-border e-commerce

In fact, the store provides Chinese consumers with 600 products from 25 overseas brands, that cover make-up, skincare, fragrance and hair care products, enabling them to turn on their beauty power without national boundaries.

Other Tmall global business models

Anyway there are other options on Tmall global for western companies entering in the Chinese market.

Tmall overseas fulfillment (TOF)

This is a way that has a relatively low risk. It applies a direct import shipping model allowing brands to place a small batch of products at the nearest Tmall global fulfillment center for sale on the platform.
Imported goods can be stored without import duties until the items are shipped, thus reducing costs for suppliers.
This approach allows brands to perfect product selection for the market without the need for a physical retail presence in China or significant investments in the development of a logistics network.

Tmall direct import (TDI)

It functions as a B2B2C wholesale model. The TDI team would buy products from brands and sell them to the Tmall direct import store. Unlike the TOF which places unsold products in overseas warehouses, the selected products will be shipped in bulk directly to the warehouses bound in China.

If you want to know more about how to sell on Tmall global read the following links

For further information about Sephora’s launch of Tmall global flagship store read the following link

lundi 4 mai 2020

Guideline to Open a Store on Tmall

How to open a Tmall Store? Tmall Account? How to negociate with Alibaba B2C platform

We try to explain everything in this article + video

About Tmall 

Tmall guideline 

Here you will find details on the entry process, the different types of stores that can be opened via, and the documents required to get started and launch your store.

 Be sure you're ready to invest the necessary time and resources into your store launch, as opening and running a store on will require strong commitment.

Read more 

Ask a partner to Open Tmall Account 

Tmall Global, a B2C platform

It belongs to Alibaba Group, is a very popular e.commerce site among Chinese consumers and is the place where many international companies are selling their goods. Currently, Tmall has over 50% market share of B2C business in the Asian giant and in a short time will become the biggest online marketplace. More than 5.400 overseas brands coming from 25 different countries and regions have already set up an store on Tmall Global and more vendors are interested to do it

Read on ECommerce China Blog