In January 2018, the then US President Donald Trump initiated a trade war against China with the goal of eliminating “unfair trade practices”. China fought back and both countries retaliated back and forth before finally reaching some form of agreement in 2020. As we ride through the pandemic, tensions are still apparent as their relationship remains prickly, with both parties doling out occasional jabs toward each other.
However, amidst their current tumultuous relationship lies significant opportunities for business owners and entrepreneurs. With the US electing a new president and the pandemic far from over, no one can be certain how the relationship will unfold between the two countries with the world’s biggest economies. What we can see, however, is that despite the uncertainty, the current economic situation is showing an upward trend.
Some experts are advising businesses to consider seizing this opportunity by reaching out to the Chinese consumer base. According to the U.S. China Business Council, just the Chinese middle-class alone is expected to exceed the entire US population by 2026. By 2028, China is forecasted to overtake the US as the world’s biggest economy. In fact, China’s economy is actually growing faster now than before the coronavirus pandemic, demonstrating an impressive turnaround.
As an owner of a small online business, should you be jumping on this opportunity? Some might feel that their online businesses are too small to even think about expanding internationally. Many are content with catering to communities and audiences closer to them. However, the nature of having your business completely online is actually an advantage should you want to reach out to geographically further markets, since you are not tied down by physical constraints. If you wish to grow your business beyond your existing customer base, now is a great time to start.
Luck is Not A Strategy
The most important step to take in any business venture is to do extensive market research. Before deciding to step into the Chinese market, the first thing to do is to find out whether or not there is a customer base for your products or services. For smaller businesses, keyword searches on Chinese search engines such as Baidu and Sogou are a simple way to determine the demand and interest for what you offer. At the same time, take note of other similar companies to have an idea of your competitors should you decide to join the market.
Another aspect to consider is the differences between their customer base and your current one, and whether you can adjust accordingly. Does your work require providing instantaneous responses? China is 12 hours ahead of the US, so tech support, remote assistants, and services that require real-time interaction like tutoring or coaching should keep this in mind. Do you have a cross-border payment system set up? China has their own set of payment systems like WeChat and Alipay. Adding these to your website makes it much more convenient for Chinese customers to make a purchase.
Another obvious disparity is the difference in language. If your business is product-based, having plenty of pictures, visual tutorials and a straightforward web page design might help overcome the language barrier. However, if what you offer requires the customer to read more than basic English, consider hiring a translator. Having an option to browse in their native language increases the chance of visitors staying on your site longer.
Lastly, an often overlooked point is the differences in culture. The things to look out for can vary tremendously depending on your business. For example, certain holidays are highly commercialized in the US such as Valentine’s Day, Halloween, and Thanksgiving, but in China, buyers tend to spend more on Chinese Single’s Day, Chinese New Year, Mid-Autumn Festival and Dragon Boat Festival.
Work Less, Accomplish More
Any form of business expansion is sure to take up more resources. Time taken to conduct market research, hiring more staff, adjusting your webpage and so on requires effort and funds. Ensuring you have the necessary manpower and funding required is essential to prevent any major losses. Take this time to streamline your business model and increase efficiency by removing unnecessary workload.
Consider selling through virtual malls such as JD Worldwide, Suning Global and Tmall. This method can help to boost traffic and sales, however the competition may be more stiff. For service-based businesses, using an online scheduling calendar not only takes the load of manual scheduling off your shoulders, but also provides customers with a 24/7 easy access to making appointments. Business accounting softwares can also help by reducing the need for tedious housekeeping. Using these softwares to automate your workload allows you to manage your resources better and maintain profitability as you venture into the new market.
Lastly, regardless of what you are offering, do not underestimate the use of social media when appealing to the Chinese consumers. Social media marketing, especially live streaming, is a big trend in China right now, and is a major influencing factor over consumers’ purchasing decisions. However, instead of the platforms we are familiar with such as Facebook and Instagram, native platforms are where they spend most of their time on. Popular apps include WeChat, Weibo, Douyin, Meipai and Taobao. In your quest to appeal to the Chinese audience, do check out these different platforms and use whichever suits your business best to your advantage.