Considering Launching Your Brand in China? 3 Ways to Know You’re Ready to Go Global

Rachel Olsen

July 14, 2022

Executives seeing success in their current ecommerce strategy view China as the next step to increase their profitability. When you look at the numbers, it is easy to understand the logic—the U.S. currently has a 22% ecommerce penetration rate, while China sits at around 50%. And when you consider that China’s population is 4 times that of the U.S., you can begin to understand the magnitude of the opportunity. It has the largest digital buyer population in the world, and in 2021, China contributed to over half of the world’s ecommerce retail sales.

It’s clear that achieving next level ecommerce success might require a brand presence in China, and, if you’re prepared to make a long-term investment in growing your product presence and sales globally, expanding into China can be a great move.

As you think about growing globally, brands typically find greater success when they have a partner guiding them through the process. As the expert in ecommerce acceleration, Pattern has the global resources and local market expertise necessary to make a successful transition into new marketplaces, including China. Partnering with Pattern means your brand has access to our global network of fulfillment services and logistics, top-level data analysts and insights, proprietary technology, and local experts to help with in-market regulations and customs laws—we can help you execute a profitable, long-term strategy tailored for your brand. 

3 Ways Brands Will Know if They are Ready to Expand into China

1. Understand the Required Investment

Most brands think of expanding into China as a quick way to boost their product sales, or something they can experiment with for short-term gains. This may be somewhat true when expanding into new domestic markets, but expanding into China requires a much bigger commitment and many more resources than brands usually expect.

Almost every brand that Pattern launches in China finds success on Tmall, Alibaba and other marketplaces, but starting with the right mindset is key to their performance. We like to ask brands, “Are you willing to lose money for the next five years in order to expand to China?” 

This certainly isn’t the standard timeframe that most brands experience, but it helps leaders understand that this move is about long-term strategy, rather than short-term wins. It takes a huge effort in acquiring resources, establishing a solid strategy, and staying persistent over time to really see improvement in your profits. 

Pattern’s local market experts provide brands with additional, crucial insights you’ll need to factor in as well, like understanding regulatory and customs costs, multimedia resources you’ll need for China-specific listings, product filing needs for your brand, and other hidden fees you haven’t considered yet.

2. Conduct Extensive Market Research

It’s easy to get excited about the profit potential in China, but the size of the opportunity also signifies the difficulty in taking advantage of it—the competitive landscape of ecommerce in China is much larger and more intense than it is domestically. It’s hard enough to compete in U.S. ecommerce when you’re on the second page of Amazon. How do you compete when you’re showing up on the 200th page of Tmall? 

Every brand must do its research. You’ll need to know things like: which comparable products already exist in China? Is your product already manufactured or sold there? Is there demand for this product? How does your product work with the cultural nuances of China vs the U.S.? What is your pricing strategy and promotional expectations?

Another big consideration is the dynamics of the products you’re trying to sell. For instance, many people don’t understand that most buyers in China don’t trust ecommerce sellers. There’s a huge amount of fake items, so every product you sell needs to have an authentic and informed customer service touchpoint. If you’re not prepared to provide the manpower and resources to execute exceptional customer service, implementing that support late in the game can be a big setback to your successful expansion.

3. Develop Strong Online and Offline Activation Strategy

Once you’ve done your research to understand the dynamics of your product in China and how it fits into the landscape, you’ll have to develop a solid activation strategy for going forward, both on- and offline.

The sheer volume of transactions in the China marketplace and the number of products available makes succeeding there much trickier than on U.S. marketplaces. Brands typically have a much harder time achieving consistent performance in China, especially if they’re already struggling with getting product to perform well domestically. So, before you expand to China, you’ll need to have a clear, foolproof online strategy for advertising, product listings, optimizations, and more to guide you on your way

An offline activation strategy is a must, too. For instance, the cost and hassle of distributing your products in China can be a big surprise to brands. In order to get product into China, you’ll need to decide if you’d like to establish domestic representation, which means working with a trading partner (which has its own additional costs), or using the cross-border distribution method, which requires setting up an expensive flagship Tmall store in China. 

Your offline strategy also needs to include ways to introduce your products to consumers so they can physically interact with them to continue building trust with your brand and expanding your customer base. Pattern helps our partners to achieve this with product placement opportunities at in-person events, brick and mortar stores, and other locations.

Another consideration: it’s smart to avoid working with a Chinese trading partner as you expand to help you stay in control of your brand. Pattern’s brand partnership approach involves buying your inventory and managing all the logistics necessary to get your product into market and, ultimately, in the hands of your consumers.

Reach Marketplace Success in China with an Ecommerce Accelerator 

Expanding to China marketplaces is a great idea for brands looking to take their ecommerce success to new heights. If you’re prepared to make the investment, you’ve done the necessary market research for all aspects of your product’s performance, and you have a great activation strategy in place for both online and offline success, you’ll be set to take advantage of the huge opportunity with Chinese consumers.

As a Pattern partner, you can access our extensive expertise and resources to succeed both domestically and internationally. We have an established presence in China (with over 150 employees, 3 offices, and our own audit warehouses) and teams of highly experienced global experts to help your products perform their best and increase profitability for your brand as a whole. 

Contact us to learn how we can establish or improve your business on a global scale.

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Sept 27, 2022

Global Ecommerce Weekly News: 27th September 2022

Get up to date with this week's ecommerce headlines from around the globe. --- Amazon News --- Amazon drives renewable energy push with 71 new projects Amazon is planning to add 2.7 gigawatts of clean energy capacity through a couple of new projects as the company attempts to use 100% renewable energy by 2025. The ecommerce business will soon have a total of 329 renewable energy projects, generating 50,000 gigawatt hours of clean energy, which is equivalent to powering 4.6 million US homes every year. [Read more on Reuters](https://www.reuters.com/business/sustainable-business/amazon-drives-renewable-energy-push-with-71-new-projects-2022-09-21/) Amazon launches Prime Early Access Sale Amazon is launching a new 2-day shopping event for its Prime members only, beginning on the 11th of October. Across 15 countries, Prime customers will have access to the shopping event, with thousands of deals on offer globall, ranging from fashion to electronics to essentials. The event has the purpose of giving Prime users the chance to spread the cost of items over the winter months, 6 weeks ahead of Black Friday. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/26/prime-early-access-sale/) --- Other Marketplace News --- Shopify unveils new localisation tool Shopify is launching a new localisation tool, called Translate & Adapt, which works with Shopify Markets to offer localisation for sellers who are looking to expand into new markets. The tool translates a user’s online store into different languages, including product pages and information pages. Merchants are also able to create different shipping terms for each market using the new tool, which allows international expansion and offers a more localised consumer experience, unveiling new potential. [Read more on Ecommerce News](https://ecommercenews.eu/shopify-launches-new-localisation-tool/) Etsy is set to invest hundreds of millions into its marketing platform Etsy CEO claims that the company is on route to spend more than $570 million USD on marketing this year. Even during a time of macroeconomic pressure, inflation and rising interest rates, the company is preparing itself and its sellers for the upcoming holiday season and is focused on retaining interest from buyers. [Read more on Yahoo News](https://uk.news.yahoo.com/etsy-600-million-on-marketing-ceo-154054219.html) --- Other Ecommerce News --- Meta looks to cut costs by 10% in the coming months Meta employees are facing job redundancies as the company plans to cut its costs by 10% over the next few months. Meta reported a 22% YoY increase in costs and expenses, totalling over $20 billion USD. The cuts are expected to come in the form of job redundancies as a result of department reorganisations rather than formal layoffs. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/22/meta-to-slash-costs-by-10-over-coming-months/) DHL teams up with Quadient to offer smart locker deliveries in the UK DHL and tech company, Quadient, have partnered to offer smart lockers parcel pick-up throughout the UK. The new contactless, secure locker stations will give recipients more choice and flexibility to receive their parcels at a time and location best suited to them. The partnership plans to install 500 locker stations across the country by the end of 2022. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/21/dhl-partners-with-quadient-to-offer-smart-locker-delivery/) The online fashion market is set to be worth nearly $170 billion USD in 2025 The European online fashion retail market is set to grow 50% by 2025, with an online turnover of $170 billion USD, which is 33% of the retail branch’s total. Cross-border marketplaces prove to be the largest drivers of this growth, with online websites and apps like Vinted largely pushing the market’s online growth. Zalando recently became the largest cross-border fashion retailer/marketplace, responsible for 11.7% of the online market’s share. [Read more on Ecommerce News](https://ecommercenews.eu/online-fashion-market-worth-e175-billion-in-2025/)
Sept 22, 2022

How an Amazon SEO Agency Should Be Serving Your Brand

If you’re in the global ecommerce space, you are most likely aware of Amazon, and probably selling your products on the marketplace. With over $470 billion in sales in 2021 alone, Amazon stands as the third largest company in the world based on revenue. The ecommerce giant is a household name in the U.S. and working hard to grow its market share across five continents worldwide.

Having your products available on Amazon and being competitive there, though, are definitely two different things. If you want to really succeed on Amazon, you’ll need specialized insight into how Amazon works and how to make it work for you. So, for many brands, it’s a great idea to work with an Amazon Search Engine Optimization (SEO) agency.

At Pattern, Amazon SEO optimization service is one of our key competencies. We understand that technology, data-driven insights and expertise  are the most important tools brands can leverage to win top listing spots on digital marketplaces. With expert teams and years of experience, we help brands conquer the Profitability Death Spiral as they compete with other products and sellers online. We offer Amazon SEO agency services as a core solution to brands that need more resources to get ahead. 

What is an Amazon SEO Agency?

An Amazon SEO agency serves brands by improving their products’ rank and listing performance on Amazon. They make strategic decisions about ad spending and placement that lead to higher traffic, conversions, and revenue for ecommerce brands.

A great Amazon SEO Agency partner will:

Prioritize Your Success

Unfortunately, many Amazon SEO agencies profit in unfair ways from your brands’ perceived success based on the ROAS numbers they provide. This is done through including branded search terms in ROAS reports, which naturally skew listing performance

Let’s say, for instance, your brand is called “Annie’s” and you sell lollipops. Your brand has a very high likelihood of winning the top listing spots on Amazon for lollipop search terms that are paired with “Annie’s,” your brand name. So, SEO agencies will spend your ad money on those terms and report a very high ROAS. 

To avoid scenarios like these, it’s best to look for an agency that either calculates their profits on metrics other than your ROAS scores or weighs branded search terms differently in the performance metrics reports. Regardless of your Amazon SEO agency’s cost structure, you should align onbranded search terms before committing to a scope of work.

Provide Detailed Competitive Insight

A great indicator of a high-quality Amazon SEO agency is the level of insight they can provide into your competitors’ listing positioning and how it compares to yours. Data fanaticism is so important at Pattern that we’ve developed proprietary technology to display this exact information with precise detail for every brand we work with. In fact, you can find our free version here to see how you compare to some of your top competitors based on ASIN.

It’s certainly possible to improve your Amazon search performance with blind spending strategies. But a truly great solution will help you to know where your dollars are at their most powerful and competitive.

Reduce Your Ad Spend Over Time

Amazon’s A10 algorithm prioritizes customer satisfaction—it wants to show consumers the best products that align with their search intent to improve conversions and sales. So, the best way to gain momentum on Amazon is to work on incremental wins. 

Improving your performance on more obscure search terms that align with your customers’ search intent is a great way to increase ROAS for the long term. A10 will reward your success with better rankings on higher-volume search terms and the virtuous cycle can help you conquer your most-coveted listing spots. And the best part? This process of gaining momentum, if done right, will naturally decrease your ad spend over time as Amazon recognizes your value and works with you to keep your products at the top of consumers’ search results.

Amazon SEO Optimization and More

As an Amazon SEO specialist, Pattern knows how to help your brand win better success for long-term profitability on Amazon. With our data-driven tools and brilliant teams of ecommerce experts, we help brands with listing management, content optimization, Amazon ad strategies, and more.

Contact us to learn more about our SEO optimization services.

Sept 20, 2022

Global Ecommerce Weekly News: 20th September 2022

Get up to date with this week's ecommerce headlines from around the globe. --- Amazon News --- Amazon to raise pay and add extra work benefits for delivery drivers Following the rise in fuel prices and protests by Amazon workers, the ecommerce giant is raising its delivery drivers’ pay and adding more work benefits. Amazon has mentioned that it will be investing $450 million into rate increases along with an education program and a Delivery Service Partners program. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/14/amazon-to-raise-delivery-drivers-pay-and-add-more-work-benefits/) Amazon announces it will give away shipping software to merchants at no cost Amazon has recently announced that it will be giving ecommerce merchants free software to manage shopper orders on and off its platform as it extends its reach. The ecommerce giant will be ending monthly costs for sellers using Veeqo, a shipping software it recently acquired and instead offer to them a new, free shipping software. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/16/amazon-to-give-away-shipping-software-to-merchants/) --- Other Marketplace News --- Walmart unveils new virtual fitting rooms In an effort to drive clothing sales, Walmart has launched virtual fitting rooms while competitors reduce spending amid the cost of living crisis. The virtual try-on tool can be used by Walmart customers to virtually measure the clothing items and see how the products would look on them. Shoppers will now be able to see how over 270,000 clothing items on Walmart’s ecommerce site would look on their bodies. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/15/walmart-launches-virtual-fitting-rooms-to-drive-clothing-sales/?utmsource=Retail+Gazette+Subscribers&utmcampaign=2da7f0f8f8-EMAILCAMPAIGN202209150742&utmmedium=email&utmterm=0d23e2768b6-2da7f0f8f8-61040615) THG slashes sales and profit expectations The Hut Group has slashed its forecasts for 2022 as rising interest rates, inflation and energy costs take a toll on consumers. Previously, THG estimated its sales growth to be between 22-25% but after a recent evaluation, has lowered this prediction to between 10-15%. Initial predictions did not take into account the negative effects of ceasing sales in Russia and Ukraine along with the impact that the cost-of-living has had on consumer spending. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/15/thg-slashes-forecast-as-cost-of-living-crisis-hits-consumers-wallets/) --- Other Ecommerce News --- DHL and Post Office team up to provide click and collect services Through a partnership between delivery company, DHL and Post Office, a new click and collect service is to be tested at Post Offices before rolling out to over 1000 branches across the UK. Online shoppers will now have the option of choosing their local Post Office as a collection point, and DHL will fulfil the delivery aspect, opening up networks for both parties. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/14/post-office-partners-with-dhl-express-to-provide-click-and-collect-services/) US consumer watchdog plans to further regulate the BNPL sector The US Consumer Financial Protection Bureau (CFPB) has raised concerns regarding the collection of consumer data and the fast-growing nature of the BNPL sector, which includes companies such as Affirm and Klarna. The CFPB is worried that these companies could be negatively impacting consumers’ financial health and aims to put better regulations in place to ensure consumers are safe and empowered. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/16/us-consumer-watchdog-to-start-regulating-bnpl-sector/) Japanese ecommerce market estimated to grow by 6.9% in 2022 The ecommerce market in Japan, largely dominated by domestic online retailers including Reakuten and Mercari, is set to reach $194.3 billion USD in 2022, after seeing an annual compound growth rate of 5.2% between 2018 and 2021. This makes Japan the fourth leading ecommerce market globally, following China, the US, and the UK. [Read more on Charged Retail](https://www.chargedretail.co.uk/2022/09/13/japan-ecommerce-market-to-grow-by-6-9-in-2022/) Ecommerce brands are spending more on TikTok ads TikTok may soon be surpassing Facebook and Google as the most lucrative advertising channel, with ecommerce brands spending 60% more on TikTok ads in Q2. Facebook is still ahead as the top choice for ecommerce advertisers but only grew by 5.6% from Q1, while Google grew 20.5% in Q2, and Snap declined 10.8% in Q2. [Read more on SearchEngineLand](https://searchengineland.com/ecommerce-brands-spent-60-more-on-tiktok-ads-in-q2-387876)