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IRX 2013 PREVIEW Interview with Jonny Zhu, chief executive of Baidu partner CharmClick

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Ahead of our annual expo, we’ve asked some of our key speakers for a sneak preview of what they’ll be telling delegates to IRX 2013. Today we feature Jonny Zhu, chief executive of CharmClick, the exclusive European partner of Chinese search engine Baidu, and Sri Sharma, managing director of Net Media Planet and Baidu partner in the UK and Ireland. The two will be keynote speakers in the Online Selling and Merchandising conference.

Internet Retailing: You’ll be telling IRX 2013 about the opportunities that Baidu has to offer UK retailers. Could you tell me a little about those opportunities?

Jonny Zhu, chief executive of CharmClick: The opportunity is about targeting the Chinese-speaking user not in the UK or Ireland but in mainland China. Because of Google, search engines have already been confirmed as an online marketing channel. So although some UK brands don’t have Chinese websites or offline stores, people do search for the brand in China, for example Mulberry, Alexander McLean or even Asos. We need to be there to be shown or even deliver the products.

Sri Sharma, managing director of Net Media Planet: Baidu is the largest search engine in China, with 83% of market share. Baidu is, if you like, the Google of the rest of the world. It’s a massive opportunity for brands to be able to create awareness and also drive sales, creating new business. Where brands are looking to grow their business in China we can help to support that. We can also help them capitalise on their international brand reputation in China, and where brands are looking to explore accessing new markets, Baidu can be a great mechanism for that. You can get the results quickly, using display ads to create brand awareness and use SEO as well as paid search, as you would on Google.

IR: Are there particular tactics that UK retailers need to learn for the Chinese market?

JZ: It would be easy for UK brands to use a programme on Baidu – the Baidu advertising programme is similar to Google, in terms of acquisition, placement, and layout. If UK brands adopt the same strategy as Google AdWords, it’s easy to advertise on Baidu. Baidu do have other unique advertising formats but they’re not so complicated and easy to be adopted.

IR: What do UK retailers need to know about Chinese consumer behaviour?

JZ: We do have some unique user behaviours in China. For example, for UK brands, people do search Chinese names more in China. But even if the sites don’t have Chinese web pages they can easily add something on their source code to be found by Baidu. There are also Chinese keywords campaigns. Retailers who don’t have a Chinese website can purchase Chinese keywords and creatives to lead to the English language website.

SS: Giving Asos as an example, in China the user of Baidu or any search platform online would be able to say or spell the word ‘Asos’ very easily. But it’s much harder to write out ‘Marks & Spencer’. So you end up with key variations of how Marks & Spencer’s would be written in Chinese. It’s important that you rank for those variations as well so that when someone types in Marks & Spencer’s with a variation on how it’s written in Chinese characters, you appear at the top. There is variation in user bvheaviour there because even there straightaway you mustn’t just assume that bidding on your brand as you know it is the right way to drive search traffic. You must also be mindful that if your brand is more complex there will be other ways that people may search for it.

Internet Retailing: Is it very important to translate the site into Chinese to be able to deliver sales?

JZ: I think maybe that takes time and resources to make the site into Chinese. You can use the English version first, but I think that if you have time to translate into Chinese, the conversion rate will be much better.

SS: I’d add that when you try to launch in a new market, if you already have brand awareness in that market then it’s kind of straightforward. You can launch with a UK site. If you take the Asos example, they don’t have a Chinese site yet, and they transact in pounds, but people are willing to buy from them because that brand is pretty terrific even in China. Or, because they’re spending money building that brand through display advertising. But if you don’t have a brand and you’re trying to move into new markets you need to take an incremental test approach, with marketing activity that could be display advertising, SEO, paid search and then in bursts test how your brand is building. Are more people searching for your brand. You keep growing your brand bit by bit. If you’re launching your brand in the UK again you’d have to build your brand slowly, and it’s the same for Baidu and in a new market.

JZ: You can’t adopt the same keyword bidding strategy as in Europe, because the potential customer in China, or Europe, or the US, is really different. We have to create opportunities but we can’t adopt the same strategy and move it into China. We have to do some research and small adjustments.

IR: Would people find significant numbers of people searching for brand names using Roman/English characters?

JZ: Most keywords will be in Chinese. Some will be in English, where English brands are really simple. But sometimes there’s a combination. For example, with ‘Gap’ and ‘trousers, ‘Gap’ will be in English and ‘trousers’ in Chinese. We need to research behaviour more to produce more keywords to target the potential customer.

IR: What does the IRX audience need to know about the market?

JZ: China has an internet population of more than 500m but the percentage of online shoppers is growing much faster than the online population. We saw 25% growth last year vs 2011, so the online shopper has already increased to 242m users in China. That means we do have more users in China and more users trying to buy something online not only from the merchant in China but also the merchant outside of China. We’re also glad to see consumers are not only trying to buy something from eBay or similar marketplace platforms but more percent from the official stores. Data, comparing 2011 with 2012, shows the percentage of people buying from the merchant direct has increased from 6% to 22%.

People really do search for brands in China, so even if you don’t have a Chinese website, or a store, in China, because of search engines you do have a potential opportunity to tap what the volume of potential requests and online search volumes. Then it’s possible to expand to China with an actual or online store, or even a China team. You can test this with low risk.

Internet Retailing: What are you looking forward to at IRX 2013?

JZ: It will be great to talk to major internet retailing companies in the speech.

SS: We already work as an international paid search specialist. We know there is a rising opportunity heading east so we wanted to launch a partnership to provide an opportunity for British brands to be able to capitalise on that opportunity in the years ahead. We’re working together to do that.

Jonny Zhu, chief executive of CharmClick, and Sri Sharma, chief executive of Net Media Planet, Baidu partner in the UK and Ireland, will be keynote speakers in the Online Selling and Merchandising conference at IRX 2013. They are speaking at 3pm on March 20.

CharmClick is working in the UK in partnership with Net Media Planet. Find out more about online marketing and Baidu here.


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