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March 15, 2017

Why doing business in China is like the Tour de France

The process of marginal gains perfectly describes the way successful business is designed and conducted in China.

By

It is no secret that the concept of marginal gains has been the driving force behind Team Sky’s victory at the Tour de France. Championed by the team’s manager Sir Dave

China

Alex Nam, Managing Director, EMEA at CDNetworks

Brailsford, marginal gains describes the philosophy that small incremental advances cumulatively add up to a significant improvement. And of course, this is not only applicable to cycling, but business too.

Indeed, the profitable relationship between sport management and business has been clear ever since Clive Woodward applied business techniques to the England rugby team, leading to World Cup glory in 2003.

Similarly, the process of marginal gains perfectly describes the way successful business is designed and conducted in China.

With an internet population of more than 700 million, the Chinese market is an attractive one for European brands looking to expand their business. But while establishing and maintaining an online presence in China is invaluable for a business, European brands face a number of hurdles to reach Chinese consumers. Differences in culture, preferences, law and internet infrastructure create stumbling blocks. But it takes only small adaptations and considerations for success to be far more likely.

A marginal gains approach could help European businesses succeed in China – but only if they know what gains need to be aimed for.

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Not as easy as riding a bike

Before a company entering China can adopt the marginal gains approach, there are two crucial barriers to tackle. Overcoming the Great Firewall and obtaining the right licensing are essential measures to ensure your website stays online in China. The Great Firewall blocks thousands of domains and can impede the loading time of your website. Our research found that a European brands’ website on average takes half a minute to load – with many users abandoning the site during this time. Taking a closer look at how your website performs in China and taking the time to navigate the Great Firewall is the first step to success.

The second is to obtain the Bei’an license – a necessity for all companies setting up domains in China. And those that make money additionally need the ICP license. Without the right licensing your website can be blacklisted, with no way to appeal. Failure to acknowledge the Great Firewall and China’s strict licensing laws will let the air out of your tyres before you have even set off.

 

Setting the wheels in motion

Once the basics are met, you can begin to consider the small improvements that will ensure the expectations of Chinese users are met. Accommodating the preferences of Chinese online consumers will increase the likelihood of conversions – setting you apart from your competitors.

 

Offering local Chinese payment methods

A recent report by Minute Hack found that while half of UK retailers (55%) ship to China, only 22% offer the ability to pay using local Chinese payment methods, such as Alipay or Tenpay. It also found that only 10% of the retailers offer a Mandarin language option on the website – restricting access only to English-speaking customers. What may seem like an obvious issue to address, is more often than not overlooked by European brands.

 

Adapting your website design

In fact, not doing your research into the Chinese consumer’s user experience and local internet landscape can lead to huge technical mistakes when doing business online. Countless companies simply copy and paste content from their UK site to their domain in China. What could be the harm? But as a result of slow internet speeds in China, text-heavy sites are preferable to loading lots of separate pages. This makes the minimalistic design favoured by many European websites unappealing to the Chinese user. Taking the time to adapt your website could be the difference between Chinese consumers choosing your business over a competitor’s website.

 

Going mobile

While a fast, well-performing browser-based website is important to successfully reach China’s 700 million internet users – this is only half the challenge. With 695 million mobile internet users, effectively reaching mobile-first consumers is essential. However, simply implementing a responsive design won’t do the job – mobile sites in China are often separate URLs and are even considered the primary website. WeChat is also important for mobile-first consumers. Quickly becoming a mobile payment giant in China, WeChat is a necessity for European brands that want to accept payments via mobile device.

 

Social media behind the Great Firewall

And it’s not just WeChat that needs to be considered. Businesses also need to remove any traces of popular western social media platforms on their site to ensure all content is accessible. Many websites typically contain social media buttons, a sidebar of recent Tweets or even an embedded video from YouTube.

Each of these platforms is blocked by the Great Firewall of China and therefore run the risk of seriously slowing down the load time of a website. Instead, popular Chinese alternatives including, Weibo (Twitter), RenRen (Facebook) and Youku Tudou (YouTube) are all important social media marketing tools that should be considered to truly resonate with Chinese consumers.

 

Taking on China

There’s no doubt that businesses looking to conquer the Chinese market online will face a number of bumps along the road. There are a number of different factors to consider, many of which are unknown to brands. Businesses that take the time to do their research into the local internet infrastructure, cultural expectations and legislation will thrive in the market.

Every business that wants to grow into China will need to ensure they crack the Great Firewall and the local licensing laws. But they must also pay attention to the fine details. Team Sky became champions and have retained their Tour de France title repeatedly because they saw the value in small improvements that cumulatively have a momentous impact. A marginal gains approach will similarly help businesses to navigate the Great Firewall and give them an edge over their competitors.

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