Archive for ‘eCommerce’

14/05/2014

How Small U.S. Businesses Can Court Customers in China – Businessweek

Question: What are Chinese consumers looking for in an online shopping experience? What would you describe as the main reason websites aimed at Chinese consumers fail?

How Small U.S. Businesses Can Court Customers in China

Answer: News about Chinese tech companies making their way to Wall Street has been raising awareness about the vast potential Chinese market for U.S. small businesses. China is definitely interested in American-made goods. Here are some steps you can take to make sure your website is appealing to these new customers.

First, as I discussed recently, you need a website in Chinese. Make sure the site is created by a native Mandarin speaker who can convey the culture of your brand without a clunky verbatim translation that will fall flat, says James Chan, president of Asia Marketing & Management.

The main obstacle to selling online in China is the pervasive fear of being cheated or of buying a pirated product. “You need to find the best way of making a Chinese customer in front of a computer comfortable with the fact that you really have a brick-and-mortar company on American soil,” Chan says.

Pictures are a must: an exterior shot of your office or shop, a map showing your location, and pictures of you and your staff. A video of you talking about your business and its history (include Chinese subtitles) and giving a tour of your premises will go a long way. “Some companies ship orders with a certificate that says, ‘This product is made in America,’” Chan says. “Others will wrap the product in their city’s American newspaper for that day. Anything that authenticates you will help.”

Your site should also feature lots of good pictures of your products. “Use different angles, show different colors, and give detailed written descriptions as well,” advises Stanley Chao, managing director of All In Consulting, and author of Selling to China: A Guide to Doing Business in China for Small- and Medium-Sized Companies (2012). “Seeing is believing for the Chinese.”

Anything you can think of that would allow a wary Chinese customer to feel comfortable with your company will help: Your mailing address, your e-mail address, your telephone number. It will cost some money, but if you can, hire a customer service representative who speaks Chinese and can answer telephone queries or at least provide online chat support. “Also, always include 100 percent-guaranteed refunds, or even an added incentive where they get a small credit for the inconvenience of returning something they did not like,” Chao advises.

The piracy problem has prompted Chinese shopping sites such as Taobao.com to institute multilayered customer rating systems for every product, Chan says. You most likely cannot replicate that, but you can include comments on your site—in Mandarin and English—from your Chinese customers. “If others successfully bought your products, then [Chinese customers will think] maybe you are trustworthy.”

Being a small business will put you at a disadvantage in the minds of most Chinese consumers, Chan says, so if your company has any connection to a celebrity or an iconic American brand—such as a major corporation that buys your products, sells them in its retail outlets, or uses your services—trumpet that connection on your site, with pictures, if possible. “Maybe you make a food product that has been served at the White House, or your shoes were worn by an American celebrity,” he suggests. That will appeal to some shoppers in China. “Just make sure you’re being truthful,” Chan says.

Company websites fail in China for the same reasons they fail in the U.S.: They’re done on the cheap, so they are marred by misspellings, ugly design, bad photos, and technical glitches. “I’ve noticed that successful sites are updated frequently, so users want to come back to check for new information, special deals, or more products. This also shows that the site is active, it’s busy, and there are real people behind it,” Chao says.

The bottom line: Take care of your Chinese customers, and they will recommend your company to their friends, show off your products proudly, and visit your store when they’re vacationing in the U.S. When they do, get pictures and put them on your website, Chan says: “If you can build a history in China, where there are millions of people buying and selling online, you’ll win big business there.”

via How Small U.S. Businesses Can Court Customers in China – Businessweek.

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25/02/2014

Indian E-Commerce to Become $8 Billion Industry – India Real Time – WSJ

The outlook for India’s economy may be gloomy for now, but one sector looks set to boom: online retail.

As more and more Indians use the internet, revenues of e-commerce companies could triple over the next three years to 504 billion rupees ($8.13 billion), according to Crisil Research, a unit of division of Mumbai-based ratings firm Crisil Ltd.

There are around 200 million internet users in India currently and the number could grow to 500 million by 2015, according to consulting firm McKinsey & Co.

Over the last few years, dozens of websites have been launched in India to sell everything from books and appliances, to baby care products and flight tickets.

Online retail companies earned revenues of around 139 billion rupees ($2.24 billion) in the financial year that ended on March 31, 2013, according to the Crisil report. Though this is just 0.5% of the total revenues of brick-and-mortar retail companies, online retail sales have been growing much faster.

Revenue of e-commerce firms grew by 56% annually between the financial year that ended March 31, 2008, and the year ended March 31, 2013, according to Crisil.

The scope for growth in this sector has already attracted a lot of interest from venture capital investors.

Earlier this month, online retailer Jabong.com raised around $100 million from CDC Group PLC, a U.K. government-backed private-equity fund-of-funds that invests in some emerging markets, according to The Economic Times.

Clothing and accessories-seller Myntra.com also raised $50 million, this month.

Foreign companies have also been looking to get a piece of the action in India. Amazon.com Inc. launched its India website in June.

via Report: Indian E-Commerce to Become $8 Billion Industry – India Real Time – WSJ.

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19/02/2014

The Secret of China’s Taobao’s Success – Businessweek

Amazon has earned the moniker “the everything store” in the U.S., but in China Alibaba’s e-commerce sites, especially Taobao.com, dominate, with Amazon (AMZN) almost nowhere to be seen.

Image representing Taobao as depicted in Crunc...

Image via CrunchBase

Taobao really is the everything store: The Alibaba-owned retail platform sells everything from sunglasses to cadavers (for $21,000, to people claiming to be medical students). A friend in Beijing recently purchased the dress she would wear to her sister’s wedding from Taobao because “there are many more choices” than she could imagine finding in any shopping mall or bridal shop.

While Jack Ma’s e-commerce empire has triumphed in China for many reasons, including guanxi, business foresight, and good technology, its dominance was hardly assured.

In 2004, Amazon purchased the Chinese online bookseller and retailer Joyo.com for $74 million. The site failed to live up to its high hopes, and today Amazon commands less than 3 percent of China’s e-tail market. Similarly, EBay (EBAY)acquired once-popular Chinese e-commerce site EachNet, but market share quickly dwindled as Alibaba’s sites boomed. Even as U.S. technology companies flounder in China, McKinsey Global Institute predicts that China’s total e-commerce market could be worth $650 billion by 2020.

One of the secrets of Taobao’s success is its adeptness at understanding the quirks of “how Chinese shoppers want to transact,” says Barney Tan, a senior lecturer in business at the University of Sydney, who focuses on China’s e-commerce. “Taobao has catered to Chinese preferences for doing business—for example, it’s enabled buyers and sellers to negotiate and bargain on prices.”

Given common (often warranted) fears about being cheated online, Taobao has also “incorporated an optional escrow service to allow shoppers to pay for goods only after they’ve received and inspected them.” Its Alipay system, which somewhat resembles PayPal, can debit a Chinese bank account, so no financial card is required for online shopping sprees.

As Tan sums up a common sentiment in China, “If you want to sell something in China, you sell it on Taobao.” Not only wealthy urbanites seem to agree: Already more than 2 million Taobao stores are registered to rural IP addresses in China—a gain of 25 percent in just one year. China’s shoppers and entrepreneurs alike are turning to the ubiquitous platform.

via The Secret of Taobao’s Success – Businessweek.

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14/02/2014

E-Commerce Gives a Lift to China’s Rural Farmers – Businessweek

A recent series of food safety scandals has created a hunger in China’s big cities for natural or traditionally grown food, absent buckets of fertilizer and pesticide. Two beneficiaries of this new market are Li Chengcai, 83, and his wife, 76-year-old Cheng Youfang, who grow white radishes in fields shadowed by the Yellow Mountain range. They get orders online from distant urban customers willing to pay more for flavorful, safe food.

E-Commerce Gives a Lift to China's Rural Farmers

The couple lives in Bishan, a village of 2,800 residents, in an old stone home on a narrow street lined with crumbling mansions. Rich merchants built the homes more than a century ago when the village, in southern Anhui province, was in its heyday. Many villagers, including their four daughters, have left for the cities. In 2011, China’s population was more than half urban for the first time. But Li and Cheng, who are illiterate and speak only their local dialect, say they have no plans to leave. Fortunately, a new opportunity has come to them—as it may to many more farmers in the next few years.

About a year ago, Zhang Yu, a 26-year-old “young village official”—that’s her actual title—knocked on Li’s door. In the summer of 2012, as national newspapers carried heated debates about genetically modified organisms and food safety, Zhang and a few other young colleagues had an idea. In their capacity as village officials they launched an account on Sina Weibo, a microblogging site, to post items about the fresh, traditionally grown produce of the Yellow Mountain region. Soon afterward they began an online store through Alibaba Group’s Taobao.com platform to connect local farmers with urban buyers. The first order, for 5 pounds of sweet corn, came from a resident of the wealthy port city of Dalian.

via E-Commerce Gives a Lift to China’s Rural Farmers – Businessweek.

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19/04/2013

* China’s 2020 consumer is in a town you’ve never heard of

Reuters: “Wearing a floral brocade cardigan and toting a Huawei smartphone, Guo Qian, 22, gushes over her latest purchases on Taobao, China’s largest e-commerce platform. As an administrative worker, Guo makes only 3,000 yuan a month and spends most of it.

Customers selects hats at a street stall at the business area of Jiaozuo, China's central Henan province, December 20, 2012. REUTERS-Aly Song

Not only does she spend nearly all of her own money, Guo also fritters away most of her father’s 1,000 yuan monthly pension on trinkets and clothes on Taobao. “Sometimes I feel guilty using his money, so I buy him some clothes.”

Guo, a Zhengzhou native, already owns an apartment – her parents helped finance the purchase last year – and is on the upward climb to join China’s burgeoning middle class.

As Beijing tries to engineer a crucial macroeconomic shift– toward more consumption and less investment, the crucial “rebalancing” China’s new leadership is committed to, and the rest of the world is counting on — it is young consumers like Guo Qian who may hold the key to the transition.

Raised in an era of unprecedented prosperity, Guo, like many other members of what is known as the `post-80s’ generation (anyone born after 1980) has a very different answer than her parents when it comes to a central economic question: whether to spend the money she has, or save it?

“I don’t save at all,” she told Reuters. ” Why should I?”

Her “spend it if you’ve got it” attitude, some economists argue, may help unlock the surge in consumption that China urgently needs to rebalance its economy over the next decade, ending an era of lopsided, investment driven growth.

“This 18-35 group, for a variety of reasons, are much more optimistic and more open to risk, because they haven’t yet experienced bad times at all,” says Benjamin Cavender associate principal analyst with China Market Research. “They tend to have high disposable income relative to their earning power, and they tend not to be saving heavily.”

This generational change in mindset, harnessed to the sheer number of people growing more prosperous in once poor provinces throughout the country – such as Guo’s native Henan – is recasting China’s economic landscape: both the composition of growth, and its geography, are about to change significantly.”

via Insight: China’s 2020 consumer is in a town you’ve never heard of | Reuters.

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