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Find here the Daxue Talks episode 29. Our guest Olivier Verot reminds us about the major differences when dealing with mainland or cross-border e-commerce in China. Here is a very quick and relevant guide to sell goods to China in 2020!

Full transcript below:

Olivier:  I am the founder of Gentleman Market Agency, we are a Digital Marketing Agency, focused on performance and we are based in Shanghai.

Interviewer: What are the key differences between managing cross-border e-commerce and mainland e-commerce?

Olivier:  It is actually very different. When you manage to cross-border e-commerce, you need to  basically ship your products from overseas, the time is different, the thing is different, you need to plan more, usually the products have more added value, for example, if you are marketing cosmetic brands, it’s better to have something with more value, with more things, but not too much, because if it’s too much, they will not have the right to import it.

When you are managing something basically in China is in a more mass market, it is more for almost everybody, so the audience when you market for something, for e-commerce, it’s more niche, it’s more for people who would like to buy some oversea stuff, it takes more time on sold to market it.

And for us, as a marketer, we see something very different is usually the conversion rate, it’s not the same. For example, if you market something oversea, it’s going to take more time and it’s more expensive, so the percentage of people going to the store and people who buy are usually quite low, which is less than 1 percent. But when you market the same product in China, you can see that basically the conversion rate can be 5 times higher.

So for us, we advise a customer who wants to free trade, just start with cross-border products, it is a good way to test the market, but as soon as they are registered, we advise customers to register the products and sent them to mainland China.

Some products that are suitable for cross-border, such ashealth supplements like vitamins and cosmetics. There are some products that are only suitable for China, such as food, drinks and something which is supreme complicated to markets. When a food brand or liquor or wine something base oversea,  it is better to register products in China.

When you market something in China, you need to know all the legal authorization to sell the license to make the importation of your product year right, so we believe that you will get more risk because you need to first import your products and stock everything and I think it’s easier, but when you use cross-border, it’s a little bit more flexible, so you just need everything you can ship it and put them in some free trade zone area like Shanghai, but the risk is basically the medium. For the conclusion that I have now the cross-border is a very good way of testing the water to know if it’s a good trade. At the time,  few brands were successful in cross-border, because it’s very complicated and if they are successful in cross-border then their market channels in China are extremely successful. So if you want to export, the best way to make big money is in the Chinese market.

Daxue Talks is a show powered by daxue consulting, a china-based strategic market research company founded in 2010! With Daxue Talks, you will stay up to date with all the latest business updates in China.