China’s enormous and growing e-commerce market offers huge opportunities for Scottish businesses, but the take-up is lagging behind our neighbours, reports Sandra Dick
Authenticity, heritage, quality and luxury: these are buzz words which are often found across today’s retail landscape and are increasingly high on many consumers’ agenda.
Luckily, they are also key features of a wide range of Scottish products. From hand-woven tweeds and soft-as-cloud cashmere to malt whisky and smoked salmon, Scotland more than holds its own when it comes to ticking the right boxes.
This is a good thing, because if you are going to crack one of the toughest marketplaces in the world – and, coincidentally, the biggest and fastest-growing – it pays to be armed with a strong national brand reputation for having some of the best and most trusted products going.
According to Lowell Wang of Glasgow-based e-commerce specialists Unineed Group, which specialises in taking companies into the Chinese market, consumers there have a voracious appetite for the kind of luxury, quality, authenticity and heritage that is naturally woven into many Scottish products.
And with Chinese consumers’ spending power growing ever stronger, gaining a foothold in a booming market could be one of the best investments a Scottish export business can make.
“Chinese consumers want to purchase Western brands because they are often seen as higher quality,” says Wang. “Native Chinese retailers are sometimes distrusted due to the number of counterfeit products available. And what’s driving them to Scottish retailers, is trust.”
According to a recent report from e-commerce research specialists eMarketer.com, China’s e-commerce market is set to expand by 27.3 per cent this year to $1.94 trillion – the largest in the world by far.
Indeed, it is more than three times the size of the second-ranked market, the United States. Even more impressive, the Chinese e-commerce market can easily eclipse those of the US, UK, Germany and Japan combined.
And while Chinese customers are adopting e-commerce on such a massive scale and rapid rate, they are also well placed to spend large. Real per-capita disposable income for the country’s population rose 6.5 per cent in the first half of this year, and although the International Monetary Fund predicts China’s economy will slow down slightly from 2018, it is still confidently forecast to hit 6.6 per cent.
It’s a thriving landscape which Wang believes Scots businesses should be taking advantage of. “Demand for western products among Chinese consumers is high and growing,” he adds. “Online retail presents the ideal route to respond to this demand. With retail e-commerce sales in China accounting for 42 per cent of the global total, the opportunities Chinese e-commerce presents are vast.”
That’s echoed by the eMarketer experts, who predicted cross-border e-commerce would become a particular growth area in China thanks to improving infrastructure, domestic demand for high-quality household products, luxury goods and fashion, and more small businesses around the world finding a route to global markets.
One of the first companies to explore UK-to-China cross-border e-commerce trade, the Unineed Group has stepped in with its
end-to-end e-commerce platform and support system to help a wide range of businesses achieve significant international growth into China and beyond.
Since launching Unineed, Wang – a Chinese national who came to Scotland to study for a masters degree in international marketing – has built a multi-million-pound e-commerce facilitator with almost all its sales coming from mainland China.
Among its most recent clients is Gretna Green, which has more than 860,000 visitors a year and online sales spanning 50-plus countries. In its quest to conquer the Chinese market, the retailer partnered with Unineed to take advantage of its expert knowledge and a support system which deals with everything from overcoming language differences to working alongside Chinese influencers and distribution.
Indeed, once a business signs a partnership agreement – there are no upfront fees – Unineed can build and translate a Chinese version of their website within two to four months, which is backed up by its range of technical support, in-depth knowledge and digital marketing methods to gain maximum results.
Removing the “fear factor” of entering a brand new arena could be the spur more Scottish businesses need in order to grasp the potential of the Chinese e-commerce market, adds Wang.
“Scotland is lagging behind in terms of general e-commerce but is also massively behind in terms of exporting to China,” he says. “Companies in England, particularly in places like Manchester and London, are seriously looking to China for growth opportunities.
“That is something that is not mirrored among Scottish companies.”
Dipping into the Chinese e-commerce marketplace isn’t as simple as setting up a website and waiting for the orders to roll in, warns Lowell Wang of Glasgow-based Chinese e-commerce experts Unineed Group. A unique culture requires a specific approach and the right support to make business happen.
Reaching Chinese customers
About 80 per cent of Chinese customers purchase through a mobile device, so it’s vital to develop mobile-first sites, rather than trying to squash a desktop offering to a mobile platform. Fast loading times are important too. A site which takes longer than 4.2 seconds typically sees less than 1 per cent of visitors go on to make a purchase.
Unineed operates a range of strategies that overcome technical delays, including the so-called “Great Firewall of China” established by the Chinese government.
It is possible to sell into China with an untranslated website, but a survey of international consumers found 75 per cent prefer to make purchases in their native language. And 59 per cent rarely or never bought from English-only websites. A properly translated site helps develop trust and is a strong signal that the vendor is well-placed to fulfil orders and offer a good aftersales service.
Chinese consumers tend to pay using renminbi through a mobile wallet such as AliPay or WeChat Pay, but it’s still important to offer debit or credit card options. Not offering the ability to pay in local currency will hit sales.
Fraud and payment issues can affect any e-commerce website. But Unineed offers reassurance by bearing the cost of any clawback from credit/debit payment gateways.
Influencer marketing or KOL (key opinion leader) marketing is one of the most powerful forms of marketing in the Chinese online landscape. Unineed works with thousands of different Chinese affiliates unique to China and offers access to key channels without the costs involved in developing them.
It’s also important to engage with customers through social platforms Weibo and WeChat.
For more information, visit the Unineed website