China, with its growing internet population and rising consumer spending, is seen by many brands as a digital frontier with a lot of potential as a new market.
But breaking into the Chinese market is more difficult than just setting up an ecommerce shop there, as others have discovered.
Competition is fierce and brands have found that providing excellent customer experience (CX) is key to winning over Chinese consumers.
So when starting off in China, what do marketers need to know? How can marketers build a business case for delivering great customer experience ahead of a launch?
To find out, Econsultancy invited dozens of client-side marketers in Shanghai to discuss this and other topics at roundtables in April of this year.
The roundtables were moderated by volunteer client-side marketers and subject matter experts from Econsultancy and our event sponsor Epsilon.
Below is a summary of the main talking points during the day about the topic, Customer Experience – Building the Business Case & Best Practices.
In order to start building a business case for CX in China, delegates argued, it’s necessary to understand the current digital landscape.
Chinese consumers have high expectations
Participants felt that the biggest issue facing brands when developing their CX in China is that consumers have so much choice that their expectations of brands are at an all-time high.
One attendee said that in order to rise above the rest, companies need to be excellent at collecting data and then be able to use it extensively when interacting with their customers.
Social media in China is saturated
Until recently, brands could use social channels such as WeChat to engage with their customers and expect a decent response rate.
Lately, however, these channels have become saturated with marketing messages and so engagement levels have dropped significantly.
Marketing costs are rising
Finally, with so many companies competing for the attention of Chinese consumers, advertising and other marketing costs have risen significantly.
Because of costs being so high, companies expect to see return on investment (ROI) faster than ever.
When trying to address these trends, participants agreed that they came across a number of issues.
MNCs do not understand social media in China
Multi-national companies (MNCs) entering China usually have well-developed customer engagement strategies for Western social media channels (Facebook, YouTube).
What many do not realize is that those channels are not available in China.
So, MNC brand marketers need to become familiar with local social channels such as WeChat and Sina Weibo in order to use them for customer engagement.
Customer data is difficult to obtain in China
Also, in the West, brands are able to pull customer data from social media to enhance their CRM systems and advertising campaigns.
Customer data is not nearly as easy to access in China and the social networks are far behind those in the West with regards to helping brands ask their customers for their personal data.
Customer data is difficult to use in China
Once a brand has customer data, it is not as straightforward to use it in China as in the West. Integration with social platforms is difficult, if it is even possible at all.
This means that strategies such as social retargeting or mention tracking are not available in the most popular social channels in China.
Strategy mismatch leads to problems
Providing a great customer experience relies on being able to collect and use customer data and digital media.
But because social media in China offers so few opportunities, brands find it difficult to live up to their customers’ high expectations in the country.
This mismatch could be the reason that so many Western brands find it so difficult to use digital media to break into the China market.
Delegates came up with some solutions which they use in China to overcome these issues.
Use creative contests and event video marketing to build brand awareness
Participants felt that contests and branded events are great ways of building awareness. They also noted that these are under-utilised by Western brands in China and so may offer a great opportunity for new brands.
The reason that contests and events work well for new companies is that they do not require a lot of customer data to be successful.
Also, both offer opportunties for brands to collect and enhance customer data.
Use offers and promotions to get additional and accurate information
Customer data can also be collected when brands have promotions or special offers.
Attendees argued that Chinese consumers are typically willing to exchange useful personal data in return for special treatment or a particularly good offer.
Companies new to China should look at what their competition offers, however, and see if they are able to compete before deciding on this strategy.
Use email to engage
Finally, participants agreed that due to the issues listed above, social media may not be the best way for brands to engage with customers in China.
Instead, it was suggested that brands take another look at email. Some benefits of email include:
- Email addresses are relatively easy to get along with other personal data.
- Email is permission-based marketing, so engagement is high.
- Segmenting using customer data is simple and an effective way to deliver ROI.
Finally, participants noted, using email means that brands do not have to wait until Chinese social networks improve their customer data integration capabilities.
With email, brands can deliver a great customer experience from the moment they launch.
A word of thanks
Econsultancy would like to thank the client-side marketers who participated on the day and our sponsor for the event, Epsilon.
We would like to extend a special thanks to our moderator for the Customer Experience table, Daniel Pang, Online Marketing Director at Digital Clam.
We truly appreciate all of the effort participants put into making this an educational day for everyone and we hope to see you at future Econsultancy events!