The success of Chinese players such as Shein, Temu, and others geo-targeting international markets provides invaluable lessons for companies interested in entering China. The reason is that these companies have spotted the high growth rates of the demand for cheap products and have developed successful new concepts for supply chains, digital infrastructure, and marketing.
If you aspiring to enter the Chinese market here are steps to learn from Chinese how to adapt and create strategies for China market entry.
1. Harness China’s Manufacturing Power
China’s manufacturing ecosystem is unparalleled in scale, efficiency, and versatility. Both Shein and Temu have built this structure to enable them to sell their products at ultra-low price points while also ensuring they keep their production and delivery times as short as possible.
How to Apply:
- Streamline Supply Chains: Work directly with local manufacturers to lower costs and ensure scalability.
- Adopt Agile Manufacturing: Use techniques such as operational flexibility to meet future clients’ needs based on the current trends of the market.
- Leverage Special Economic Zones: Choose industrial hubs for production in China and take advantage of the friendly tax environment to minimize expenses.
2. Embrace Social Media and Influencer Marketing
While most companies have struggled to gain attention and successfully sell their products, Chinese platforms have thrived during this social media era. For instance Shein which targets young people has developed a loyal customer base with the help of influencers and apps such as Douyin or TikTok of China and Xiaohongshu.
How to Apply:
- Partner with KOLs (Key Opinion Leaders): Work with local influencers to amplify your brand’s visibility. Engage with local personalities to increase your brand’s visibility.
- Engage Through Livestreaming: Organise certain live streams to promote products and build up some anticipation.
- Focus on Localized Content: Tailor your campaigns to Chinese culture and current trends.
3. Prioritize Mobile-First Experiences
China is one of the world’s most advanced digital economies as most of its business activities are conducted using mobile gadgets. Social apps such as WeChat and Alipay envelop all facets of an individual’s life, from consumption, commerce, and payments, to social communication.
How to Apply:
- Optimize for Mobile Commerce: Ensure your platforms are mobile responsive and compatible with payment options of the chosen country.
- Use Mini-Programs: Leverage WeChat mini-programs to provide a seamless shopping experience.
- Focus on App Engagement: Encourage app downloads with exclusive deals and gamified experiences.
4. Offer Competitive Pricing Without Compromising Quality
The primary advantage that has created the Shein and Temu popularity is the availability of affordable prices for premium-quality goods. This is done through reducing intermediaries, improving the supply chain, and going for direct customer markets.
How to Apply:
- Adopt Direct-to-Consumer (DTC) Models: Simplifying the value chain to eliminate intermediaries and improve the firm’s margins.
- Invest in Efficient Logistics: Outsource with local logistic companies to reduce delivery time and cost.
- Implement Dynamic Pricing: Use data analytics techniques to adjust prices based on demand and market conditions.
5. Navigate Regulatory Challenges Proactively
The Chinese market is gradually becoming more and more regulated and hence, there is a need for these foreign brands to be very vigilant. Both Shein and Temu have faced scrutiny over labor practices and product quality, underscoring the need for transparency.
How to Apply:
- Understand Local Regulations: Consult with the lawyers on the client’s specific business issues that are subject to regulation in China.
- Demonstrate Corporate Responsibility: Ensure sound and safe sourcing, to create credibility when developing the products.
- Monitor Policy Changes: Stay updated on trade policies, tax laws, and consumer protection regulations.
6. Build a Localized Brand Identity
Chinese consumers are culture-sensitive, and thus they would prefer authentic products. Due to its localized marketing and more specifically, launching Mandarin language content and Chinese-themed aesthetics, more and more people are drawn to Shein not only in China but globally.
How to Apply:
- Invest in Localization: Modify products, packaging, and advertising to align with the local culture of the countries to which the products are to be exported.
- Leverage Local Festivals: Singles’ Day or Lunar New Year is good for creating promotions and increasing sales of products.
- Create Emotional Connections: Common themes like family, community, and sustainable living should be embraced.
7. Scale Through Global Expansion
Although China signifies an enormous market, Shein and Temu help underscore how using China as a home market can drive expansion globally. Through exporting to countries where the trends were already present they’d developed themselves into a system where they supplied fast fashion and cheap products that could be bought online easily.
How to Apply:
- Use China as a Hub: Build your operations in China and expand into Asia, Latin America, and beyond.
- Adopt a Dual Strategy: Balance a strong local presence in China with aggressive international marketing campaigns.
- Focus on Emerging Markets: Target regions with growing online shopping habits, such as Southeast Asia and Latin America.
Conclusion: Learning from the Giants
The success of Shein and Temu illustrates that penetrating the Chinese market requires a mix of innovation, agility, and cultural understanding. By leveraging local expertise, embracing cutting-edge digital strategies, and maintaining a relentless focus on consumer needs, businesses can carve out a niche in this competitive yet rewarding market.
For brands looking to make their mark, the key lies in blending global ambition with localized execution—a strategy that continues to drive the growth of China’s biggest e-commerce disruptors.