In continuing efforts to expand PMG efforts globally, we come across China’s digital marketplace many times over. Often I find there are more questions than answers when it comes to how to approach the market and the consumer. Fear not, it can be done. It’s key to remember: I’m writing this from a digital marketing perspective. Establishing a business in China, fulfillment, taxes, distribution, etc. are outside of my scope, and are always a challenge regardless of the market. So for the time being, let’s focus on ways to test digital marketing ideas within the market.
Taxation without representation. The first big barrier, is understanding how media is bought in and outside of China. One of the biggest factors being taxation. As a foreign entity, buying media within China is subject to a rather hefty tax (can be up to 30%). In order to avoid this there are a number of Chinese-based services, based within China, that can buy media on behalf of foreign entities. Do your research on these offerings and make sure you’re comfortable with any fees, charges, ways of working, etc. Happy to help here.
SEM. The easiest barrier to overcome, setting up a Baidu account is actually fairly easy and turnkey (with the service mentioned above). It’s also easy to test smaller budgets and really get an idea of what kind of brand equity you have within the market. As always, launching is easy, but there are definitely considerations for launch.
- Watch out #1: Baidu is massive. The largest search engine, in one of the largest economies in the world, and money can go quick. Make sure you have a very structured test to try and get as much out of your money as possible.
- Watch out #2: Mobile First. China is arguably the largest, mobile-first country out there, so be prepared for that. If your mobile experience isn’t great, chances are your results will suffer.
- Watch out #3: Counterfeit Product. You need to keep a watchful eye on the SEM landscape. There are more counterfeit items / resellers in China than many other markets, especially when compared to the US. You are able to submit these counterfeit sites to Baidu as you would other search engines. Response is typically prompt.
Baidu Brand Zone Advanced. There are various offerings from Baidu that allow for a more immersive experience within the landscape, much like Google, with one of the most eye catching being the Brand Zone Advanced Product. If you’re seeing success in your initial SEM test and want to really see the results soar, try rolling out Brand Zone or Brand Zone Advanced. Side note: the ‘advanced’ portion costs more but allows for more options. We have tested this a few times here at PMG and are seeing CTRs upwards of 70%! That’s not a typo: 70%. We checked for bots and fraud as well. There are some logistical set up like: banner sizes, copy limitations, authorization letters for any celebrity mentions, and desktop / mobile versions. BUT, once you get through set up costs, it’s amazing to see the results. You also get to control the keywords you’re bidding on + no one else is allowed to show ads against those keywords during your flight times. Flight times are a minimum of one month, and it can be pricey, but the impact is incredible.
In the end, though this is one of the tougher markets to enter from the US (from a digital marketing perspective), there are a few easy steps that will make your life easier, nights longer, and revenue grow.