While western retailers and brands worry about the threat of Chinese competition in their home markets, targeting China itself offers an enormous ecommerce opportunity for ecommerce players of all sizes.
The Chinese ecommerce market is forecast to hit $1.62 trillion in 2020, over double that of the US. Rapid urbanisation and the rise of the middle class means there are now over half a billion online shoppers in the country.
These consumers have a growing interest in, and affinity for, western brands and products, and with current travel restrictions and concerns around the virus preventing them leaving the country, they are increasingly looking to purchase them online. Demonstrating this, China’s 2020 Single’s Day shopping festival generated £56 billion in sales, with an increasing number of western luxury brands taking part, many for the first time.
Statistics pinpoint food, mother and baby, men’s and women’s fashion and cosmetics as the fastest-growing sectors for Chinese ecommerce, all of which are seeing annual sales increases of over 25%. This makes China key to growth for a wide range of retailers as they look to expand outside the UK, Europe and US.
China is a complex market and western ecommerce firms must negotiate a variety of hurdles if they want to succeed. Clearly, the sheer size of the country requires efficient logistics operations that can deliver quickly and safely to consumers. Local competition is fierce, and rivals are often quick to resort to discounting. This means that retailers need to start by understanding Chinese consumers and what drives them. You need to create a strategy that builds trust and reassurance, particularly if your brand or products are new to the Chinese market.
However, on the positive side Chinese consumers are very digitally-aware, meaning that building a solid online presence and marketing programme enables you to reach them – you don’t need to invest heavily in physical shops to get noticed.
Search is a key channel for Chinese consumers – but simply replicating your existing Google-centric UK strategy won’t deliver results. With Google banned in China, consumers rely heavily on top Chinese search engine, Baidu, which currently accounts for around 70% of all searches in the country, for product discovery.
Ensuring you are being found on Baidu is therefore the essential first step in driving traffic to your site. Based on Searchmetrics’ analysis of 50,000 Baidu search results, and my experience in the country, there are six key areas to focus on if you want to rank on page one of Baidu.
1 Choose a .com domain over a local domain
Just over three-quarters of websites that rank on page one of results (excluding Baidu’s own sites) are on .com domains. Contrary to popular belief you don’t need a local domain (such as .cn, or.com.cn) to rank highly – these achieve just 9.36% of all top 10 ranking positions. However, don’t use an unusual or obviously foreign domains – Baidu – and Chinese consumers - are suspicious of these, as many are used by spammers and therefore less trusted which impacts how highly they rank.
2 You don’t need an official licence to rank – though it has advantages
It is seen as mandatory for any website aiming to reach the mainland Chinese market to have an Internet Content Provider (ICP) licence. However, Baidu still indexes and ranks pages without an ICP if they are accessible in China.
While you can succeed without an ICP, our findings show a clear correlation between better rankings and companies who publish information about their licence on their website. Communicating to consumers that you have a licence clearly builds trust – and also bear in mind that not having an ICP risks your site being blocked by the Chinese government.
3 Invest in localised website translation
Of course, to appeal to Baidu, you need your website to be written in Chinese – but simply translating content is not enough. You need it to be checked by a local, native speaker who is up to date with the right terms for products to avoid it sending the wrong message.
Importantly, almost every page ranked in the top 10 on Baidu for common ecommerce search terms is written in Simplified Chinese Characters, rather than the Traditional Chinese Characters used in Hong Kong and Taiwan. Essentially this means you can’t expect to successfully target the Chinese market with the same content and translations as your Hong Kong/Taiwan site.
4 Reference Chinese social media to aid ranking
Chinese consumers are heavy social media users and the data suggest it is important to reference or mention at least one Chinese social network (such as QQ, WeChat or Weibo) – 99% of websites that rank on page one of Baidu results have at least one such link. Given the popularity of these channels in China, ensuring you build a presence on them is vital for giving consumers a way of communicating with you - as well as being positively correlated with higher rankings.
Interestingly, Searchmetrics’ analysis suggests having links to Western social media sites that are blocked in China such as Facebook, YouTube or Twitter doesn’t have a negative effect on rankings busting a common myth that many digital marketers have believed. But avoiding links to blocked websites is still good practice, as you do not want to confront your visitors with bad user experience (when the links won’t open for them).
5 Bear in mind that Baidu could be your biggest competitor
As a company Baidu covers much more than search, with offshoots that include the Baidu Zhidao Q&A platform and the Wikipedia-style Baidu Baike site. These properties are often favoured by Baidu when it comes to search – on average there are two Baidu-owned sites on page one for most results. Key to overcoming this challenge is to optimize for secondary and long-tail keywords to drive up visitor numbers, rather than relying solely on ranking via the main keywords.
6 Understand the technical requirements
In the past Baidu had a reputation for search results being easy to manipulate, with spammy backlinks to other sites driving up rankings. This is no longer the case as the search engine now detects such artificial tactics. Instead, what correlates with high rankings is having a large number of backlinks from a variety of good quality websites that are themselves highly visible in results. Like Google Baidu views backlinks from other trusted and relevant websites as a positive signal (they are a vote of confidence for your website)
Penetrating the Chinese market is not easy – but its size, growth and increasing appetite for Western brands make it a key target for UK retailers looking to expand outside traditional markets. Understanding its specific needs, particularly when it comes to search, is therefore the first step to scaling the Great Wall and accessing the opportunity on the other side.
Marcus Pentzek is Chief SEO consultant, Searchmetrics