China and India are highly frustrating markets for many businesses looking to expand internationally. On the one hand, they are both potentially enormous ecommerce markets, and on the other hand, they present such challenges that many have been left wondering, ‘is it worth it?’
It’s a fact that neither China nor India make it particularly easy for ecommerce businesses from other countries to penetrate the market. But for those that do, the pay-off is clear and the future is bright.
Here we’ve put together some practical tips to help ecommerce businesses of all sizes tackle these potentially lucrative, yet incredibly awkward, markets.
What’s so special about China and India anyway?
Everyone knows that the Chinese and Indian economies are growing. They are economies that are expanding, while their population becomes richer, more Western-facing, more tech-savvy and more consumer-focused. This all translates to growing online sales that foreign ecommerce businesses would be foolish to overlook.
Take India, specifically. The median age in India is 28 and there are 300 million smartphone users, out of 1.3 billion people. The economy is expected to be the third largest in the world in around 10 years’ time. This all combines with the fact that online sales account for just two per cent of purchases, but, at the same time, online sales are growing at four times the rate of retail in general.
This all means that the potential for ecommerce growth in India is extremely clear, and extremely compelling.
In China, it’s a similar story – although it’s a little further along in its ecommerce journey. In fact, China is already the largest ecommerce market in the world, with a value set to be worth US$1.8 trillion by 2022, according to research by Forrester.
Researchers have also found that around 40 per cent of the world’s ecommerce transactions take place in China, up from 1 per cent just 10 years ago. The potential for further growth is also clear here.
Standing up to the challenges
If the potential for sales is clear, then the challenges are perhaps even clearer. In China, a staggering 85 per cent of the online sales market is dominated by Chinese businesses. Even giants like Amazon are retreating with their tails between their legs, having been damaged by local ventures in China, where authorities often view outsiders with a fair amount of caution and even suspicion.
Then there are numerous practical obstacles that can make it difficult for foreign businesses to sell goods in China, such as online content being blocked and censored, for example.
India is also doing its utmost to make life difficult for overseas sellers by toughening its stance on foreign ecommerce businesses and changing its regulatory environment to reflect this. This means that foreign sellers are no longer even allowed to sell products through their own affiliates in India, let alone sell goods directly. Then there are practical problems, such as the millions of unbanked individuals.
If you’re not yet put-off, that’s great!
Dedication and perseverance will pay off when it comes to these giants.
Practical steps to tap China and India for online sales
Problem #1
Selling to online buyers in China is not straightforward. For a start, China has banned content from Google, Facebook, Twitter and WhatsApp. This is unimaginable to businesses in the West and you may be surprised at the extent of the censorship imposed by the so-called Great Firewall.
The solution – transcreation
One way to get around this issue is to launch a new site in China that is completely unconnected to your other ecommerce sites. This won’t be a case of localising and translating your existing content and site, it will, instead, involve transcreation.
Transcreation is the term used to describe the creation of tailored content for a foreign marketplace. This is not a translation of existing content, but the creation of a completely fresh site, dedicated to the Chinese ecommerce market, and which meets the strict criteria imposed by Chinese officials.
This may sound like a step too far, especially if you’re used to relying on tools like Google Analytics to track your success. However, a dedicated and approved Chinese website will be picked up by the local search engines, such as Baidu, which offer their own analytics tools to help you function as you do elsewhere around the world.
Problem #2
When selling to Chinese customers, you are also likely to come across major regulatory hurdles if you want to keep your inventory in China and ship locally. Although this might seem like the easiest option, the level of bureaucracy means you will need to jump through a whole line of hoops before having your goods approved, which can hold up the entire process.
The solution – cross-border shipping
Shipping from elsewhere can cut the amount of regulation applied to your products, particularly if you choose to hold your stock in Hong Kong or a designated Free Trade Zone.
Problem #3
The protectionist environments of both China and India make it difficult to establish a presence in these marketplaces, with native names like Alibaba taking massive market shares.
Solution – Selling through a marketplace
If you work alongside an effective language translation service, you should be able to adapt your content to a local marketplace environment reasonably easily. There are various requirements to deal through marketplaces like Snapdeal in India and Alibaba-owned Tmall in China. You’ll often need to create a business registered in China or India in order to sell through these marketplaces, but again, this is an effort worth enduring in order to gain access to hundreds of millions of potential customers.
Problem #4
You’re not a local business and it is going to be a logistical challenge to sell to local buyers
The Solution – cash in on your ‘foreignness’
Not being a local business can actually be a major selling point when targeting discerning consumers in India and China. Chinese buyers are increasingly paying well over the odds to have third-parties based in Australia ship products to them in order to access better quality goods from overseas.
In India, consumers are also growing weary of some sub-par goods made in India and the growing middle classes are looking further afield for high-quality products made in the UK, for example. When it comes to clothes, footwear and accessories, more than half of Indian online purchases were made on non-Indian sites, according to PayPal. They also look to foreign sellers for products like consumer electronics and cosmetics and beauty products.
If you’re looking to expand your ecommerce business to new markets around the globe, you cannot afford to ignore India and China. This is particularly true if you are selling high-end British-made goods that are in demand among China and India’s new wealthy population.
Yes, it will take some effort and it will be frustrating. But with the right translation, localisation and transcreation support to help you over the obstacles, the pay-off will be well worth it.
Contact the team at Bubbles Translation today to find out more about how our team can help you connect with these massive global markets.
