Working with a distributor in China is an effective and oftentimes necessary step for small and medium sized businesses to sell to Chinese consumers. And once you have put in the hard yards and found a Chinese distributor that you trust, it can be tempting to adopt a hands-off approach and just let them handle all your China marketing and sales activity from start to finish. After all, they said they’d take care of everything, right?
Unfortunately, if a solution sounds too good to be true, it usually also is. In my experience, distributors tend to be very strong on the sales side of things as well as exploring different channels, but lack in expertise in terms of brand messaging and marketing. This knowledge and skills gap could have serious implications for your company’s long-term success and growth in China.
This blog post summarises 4 reasons why you should support your Chinese distributor through digital marketing:
1. Become a preferred brand for Chinese consumers
2. Avoid entering discounting wars
3. Give Chinese consumers confidence in your product
4. Build a better relationship with your distributor
Reason 1: Become a preferred brand for Chinese consumers
Never in the history of modern China had consumers as much choice as they have today. This means that your product is competing for physical and virtual shelf space with hundreds of Chinese and international products that look exactly like yours. Why should buyers opt for yours over any of the others?
Even if your brand is well-known in other markets, it’s unlikely to be a household name in China. Generating brand awareness and taking control of your messaging is a vital first step toward becoming a preferred choice for consumers in your target market – and ultimately many repeat purchases.
Generating brand awareness and taking control of your messaging is a vital first step.
Because nobody can talk about your product benefits as well as you can, creating a fast-loading Chinese website to inform potential customers should be a minimum investment for consumer brands working with Chinese distributors. A well-implemented SEO strategy for your Chinese website will mean that consumers looking to learn more about your offering can easily find you.
Reason 2: Avoid entering discounting wars
Let’s be honest, unless you already have a very high-level of brand awareness in China, your product isn’t going to fly off the shelves when you’re first starting out in this market. Therefore, brands new to China who solely work with distributors often fall into fierce price competition with brands that have a similar offering. Distributors want to see fast returns on their investment and offer heavy discounts to move product.
This approach is neither sustainable nor a wise market entry move. Brands who position themselves as a provider of premium and high-quality products have a much better chance of long-term success. In fact, many smart distributors do look to partner with businesses who also invest in their branding because they can get a better margin.
Reason 3: Give Chinese consumers confidence in your product
Issues with counterfeit products are still rampant in China. In fact, the problem is so widespread that the national broadcaster CCTV leverages International Consumer Day (15th March) to expose brands that don’t do enough to combat it.
It’s therefore not surprising that safety and transparency are top priorities for Chinese consumers, especially when it comes to products in the food, beverages, health and cosmetics category.
Safety and transparency are top priorities for Chinese consumers.
Owning and managing your official brand website means that you can give your customers confidence in the authenticity of their purchases by listing your authorised online, offline and overseas stores and distributors. What’s more, you can also share any positive news such as awards you have won, quality assurance certificates or changes to your packaging to further deepen their trust in your brand.
Reason 4: Build a better relationship with your distributor
Your distributor’s loyalty to your brand will ultimately depend on how much and how easily they can sell your product. Setting up your own brand presence in China and running some WeChat marketing campaigns – even if they are on a small scale – will mean that both you and your distributor are more successful in the long run. On the one hand, an official Chinese digital presence will make it easier for your distributor to share information about your brand and leverage this information to support his sales.
New campaigns and collateral are also good reasons to check in with your distributor and offer a chance to benefit from their expertise and insight. After all, they have a very good understanding of the local market and will be able to work with you on further adapting your product to make it even more successful.
Finally, setting up and managing your official digital presence in China means that you stay in control of your brand, no matter how the relationship with your distributor will shape up. If they decide to switch to another brand - which is always a risk - you still own your digital assets and can leverage the brand awareness you’ve invested in. This will make it easier for you to attract a new distributor, give you better business continuity and ensure a consistent brand experience for your customers.