Authors Chiara Ciaccia and Chiara Vinzi
Introduction
With over 940 million people connected daily, China is the most digital country in the world and one of the leading markets for the jewellery sector. On this front, Italy is recognized as excellence, with its "Made in Italy" perceived as a synonym for quality, creativity, mastery, elegance, and refinement. Therefore, it is reasonable for Italian entrepreneurs to take the opportunity of entering the Chinese market.
In this guide article, we will give advice based on data, case studies, and the experience of experts in the field.
Marco Carniello, director of VicenzaOro, the major jewellery fair organized by the Italian Exhibition Group, confirms the importance of China as the final destination of Italian jewellery's overseas sale.
"A study conducted by Bain & Co. relating to the pre-COVID period shows that the Chinese population will reach a 46% share of global luxury goods consumption by 2025. During the pandemic, consumption in China continued to run at a fast pace, which is significantly outpacing those of other geographical areas. Therefore, it's an absolute priority for us to consider it for our export"
In China, just like it happened in Italy, the pandemic undoubtedly accelerated the digitization process. However, the difference is that China was already five years ahead of Europe regarding online habits. An example is the widespread use of online payments among the elderly. Another is Tiffany's "live teleshopping on social media" concept, which ended as a 28.3 million dollar sale conducted through a live-streaming show. This case proves China's great potential and power in the luxury sector.
How to position an Italian brand in the Chinese market to increase its sales?
Although the Chinese market is known to be a distant and complex market, many foreign companies are drawn to it. Therefore, exporting a considerable quantity of local products to this growing dominion is the most effective strategy to expand trade beyond national boundaries. So, what are the tips for implementing the export strategy?
Premise: China's digital ecosystem is very different. We are all probably familiar with Google, Facebook and Instagram, some of the channels where Italy nowadays promotes its brands. However, people cannot access these platforms due to the Great Firewall. Therefore, the local population has to use different social media, often more advanced than ours.
Consequently, if we want to learn more about these people and their media, keeping in mind that we are dealing with the most digitally developed nation, it is essential to study and monitor them closely.
Here are five tips:
1. Online positioning and information gathering. Also called Brand Localization, this is a set of strategies and processes to 'localize' the brand. This step is fundamental to approaching the Chinese market: starting with translating the website into Mandarin and then moving on to creating a campaign that is conscious of Chinese culture (to avoid well-known blunders made by brands in the past) up to the management of social profiles.
These channels have a double strategic function: to test consumers' interest in your style, values, and product while satisfying the curiosity of the Chinese public, which prefers to collect a large amount of information before making a purchase. Therefore, it is worth starting from the most used social platforms, namely WeChat, Little Red Book, Weibo, Douyin, and Baidu, their primary search engine, to achieve this goal. How to approach it?
Several companies have tried to delegate communication and marketing to local distributors, but they often come back with negative experiences. Why does this happen? Some of the most frequent reasons are ineffective communication between the internal marketing team and the distributor, infrequent publications, a need for more information on perception, and the type of interactions with the public. Therefore, changing the partner you have entrusted with creating and managing these channels could mean risking losing all the work done.
2. Selling online is not a given: Chinese people are "always" online: this belief might be accurate, but it does not imply that selling on their platform is easy and immediate. Chinese customers show an apparent inclination toward purchasing the "Made in Italy"; however, if a brand is nowhere to be found offline, the sales process will be pretty tricky, primarily if exporting a non-cheap trading commodity. Furthermore, if Chinese customers cannot find valuable information on their social platforms, they might start doubting the origin and value of the product they initially wanted to purchase. Therefore, it is worth "breaking into" Chinese social platforms to usher in your product's "weaning" phase. Once feedback from Chinese internet users has been collected, it is advisable to elaborate on a development plan for an offline channel where it is possible to find specific products
If you are interested in learning more about how to manage Chinese communication, our team supports several Italian companies that want to effectively convey their values, position their brand, and increase sales.
3. Elaborate on a development plan: It is vital to work on offline brand awareness, preferably by targeting specific areas of the country, if the goal is to increase exports to China significantly. Again, trade fairs play a vital role in "testing" the market. Gianluca Mirante, the director of Italy, Cyprus, Greece and Malta in the Hong Kong Trade Development Council, validated this theory by emphasizing:
"The presence of an offline network is crucial, especially if we are talking about brands that are not known yet in China, and we need to consider a gradual approach by implementing a strategy over a period of no less than three years. A relevant novelty concerning Italian brands is the GBA project (Greater Bay Area) which provides for the integration of Hong Kong with the Guangdong
Province and Macao, and guarantees a large number of buyers from one of the richest areas in the whole of China."
4. Calls: recently, there have been many opportunities to gain investment support, particularly regarding internationalization, export management, and digitization. This way, agencies fully assist a brand by dealing with its strategies and goals. What indeed makes a difference is having a consultant or an internal figure check what calls are published and are quick to apply for.
5. A look towards the future: even if China is not currently part of your short-term goals, we can offer you two more great tips to make sure you do not entirely deprive yourself of a future opportunity. The first one is to protect your brand on Chinese territory. Several Chinese companies register appealing European trademarks before the legitimate owners do and then ask companies to pay large sums of money to sell them. The second tip is to keep an eye on China. China is a producer of marketing and sales methodologies often emulated by American social platforms and, more broadly, by the western business world.
Thanks for the valuable contributions:
Marco Carniello - Director di VicenzaOro
Gianluca Mirante - Director of Italy, Cyprus, Greece and Malta in the Hong Kong Trade Development Council
To stay updated on data and tips for working effectively with the Chinese market, you can follow our LinkedIn page or contact us at cdm@chinadigitalmarketing.it
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