How to enter the Chinese market

An expectation that average disposable income in China is set to double by 2015, with news that New Zealand exports to China jumped by $590m, or 92 per cent, to $1.2b in January 2014, all suggest that China is set to be a very lucrative market for Kiwis going forward.

But simply plunging in with both feet is not a shortcut to successful entry, considering that from a business perspective at least, China may be viewed as nine different 'countries' each with its own characteristics and tastes – with more than 7,700 unique market segments (segment averages 183,000 people).

As a graphic design, branding and website development agency with a permanent link to China, gardyneHOLT is well positioned to advise on what works, and what does not.

General Manager, Malcolm Dale, says that it is important to design your product, brand, packaging and website for the Chinese market rather than looking to rehash what works in New Zealand.

“When designing a product for China, you need feedback from people in-market.

“You also need to be prepared for conflicting views and reactions, as products designed for one market segment won't necessarily appeal to other segments. At the end of the day, you'll make an informed leap, and choose which advice to accept and which to ignore. You need to be prepared to make mistakes and learn from them.”

Malcolm points out that New Zealand’s distance does still pose a problem.

“Our opportunity is to use technology to answer this challenge. In the distance-less digital realm, we can make full use of strong websites, digital marketing and retailing to transcend distance, as well as make use of social media monitoring and engagement to augment the work you do in person.

“The Chinese consumer is changing at a much faster pace than consumers in New Zealand, so you need to design not just for what appeals to that market now, but for where they will be headed in the near future. If you have to make a choice between a design that is more conservative and one that is more adventurous, you may find that the adventurous option is actually longer-lasting,” says Malcolm.

China is going through a major and extremely rapid cultural change in family dynamics, economic growth and Internet use - consider that Twitter has 200 million accounts, compared to the Chinese equivalent Sina Weibo which already has 250 million accounts.

By 2015 there will be “700 million Chinese citizens with Internet access—more than in India, Japan, Russia, the United States, and Indonesia combined” – Boston Consulting Group.

Some characteristics to watch out for include:

  • Chinese consumers respect good Chinese brands, but 63.5% of participants in one recent survey said they prefer foreign brands.
  • Point of sale, event marketing, and below the-line advertising are still effective for brand communications.

“The market is always changing and we need to approach it without fixed views,” says Malcolm. “Depending on the product category and target market, tastes in your chosen market may be entirely different to your market in New Zealand - or might be exactly the same. There is no option but to do the research and find out - and take advice.”


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