inbound marketing in china

The State of Inbound Marketing in China

Findings and Recommendations for

Delivering Inbound Solutions

Presented by Gareth Jones

Technical Director, Oxygen 2.0

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The State of Inbound Marketing in China10th September

2014

Executive Summary

• In this presentation Oxygen 2.0 will highlight both the problems and solutions in delivering Inbound Marketing Solutions in China including:– Overcoming the Firewall– Dispelling the Fear of the Cloud– Educating the Market– Dealing with the Inherent Mistrust of

Outsiders– Using the Right Channels

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Agenda

• The China Opportunity– The Worlds’ Biggest Market– Transition from OEM -> Brands

• Unique China Challenges– Marketing or Sales?– The Great Firewall– Using the Right Channels– Influencing the Influencer

• Final Thoughts

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4 The China OpportunityChina is the world’s biggest online market and it’s only going to get bigger…

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The China Opportunity Cannot Be Ignored

• Growing by more than the UK population year on year• Already 2x the size of the US internet market• Has the capacity to be roughly 5x the size of the

US market!

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7 The China OpportunityThe inevitable transition from Chinese OEMs into Global Brands and what it means for

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OEM to (OBM) Brand

• Competition is getting more intense and margins are decreasing

• Korea once had 700 OEM toy manufacturers a few years ago- now it only has 1 OBM and 2 ODMs

• Similar disruption is likely to occur for OEMs in China from other markets like India and Vietnam

• This presents an opportunity to assist OEMs brand and market using marketing agencies with tools like HubSpot

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9 The China OpportunityWestern companies are now beginning to see Chinese as consumers, not just producers of Western branded goods

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West to China Marketing

• Increasingly, Western companies are attempting or have the desire to market to China– Given the irresistible market size, that’s

understandable!• Luxury brands have been particularly successful,

though with corruption crackdowns growth is slowing

• Increasingly however, foreign consumer products such as milk, beer and mid-range clothing are becoming more widespread

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West to China Marketing

• Western companies are as fearful, if not more so, of entering China than Chinese companies are of marketing abroad– China is HARD, that’s understandable!• Foreign-owned, China-based marketing

agencies offering “Inbound with Chinese Characteristics” in China can bridge that gap

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12 Unique China ChallengesMarketing or Sales? Why verbiage is important and how this differs considerably from Western concepts of sales and marketing

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The Differences Between Marketing & Sales

• Marketing in China is “Sales Support”– Fliers– Banners– Magazine ads– Generic website content– Promotional items

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Average Marketing Vs. Sales Spend

10%MARKETING

90%SALES

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What is Marketing in China?

• “Marketing” in China gives people connotations of:– Branding– Promotion

• Like branding, it is considered a “cost” – there are literally no connotations between marketing and:– Lead generation– ROI– Increases in revenue

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What is Marketing in China?

• Most Chinese sales staff have no idea that a website is more than “letting people know about their brand”

• Current (China -> West) marketing activities carried out by sales people in China:– AliBaba– Skype– SPAM emailing contact lists from CRMs – Trade Shows– Initial website set up

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Solutions to the Marketing Challenge

• All verbiage needs to be concerned with sales NOT marketing– The buyer persona is in fact a sales person

also performing what we’d consider “marketing activities” in the West

– Keyword selection and ‘branding’ of Inbound needs to be considered with “Chinese characteristics” in mind

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• Educating the Chinese market must start from the very basics of marketing and sales

• Blogs and content offers must use their existing channels as starting points (top of the funnel offers)

• Introducing something as simple as a blog as something that can gain leads and a measurable ROI is an alien concept– Blogs are generally used for describing personal feelings

rather than solutions to business a problems in China

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• It is very clear from the outset the preconceptions even about the very concept of ‘marketing’ and ‘sales’ need to be dispelled in order to be successful in China

• Similarly, any marketing or sales concept that works in the West MUST be re-evaluated in China based on local habits, technologies and knowledge

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20 Unique China ChallengesThe Great Firewall provides a hurdle for those companies attempting to market either in to or out of China, but also a golden opportunity to those that can offer a ladder

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Non-China Hosted Website Load Times

• Often over 2 minutes to load pages IF they load at all

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China Hosted Website Load Times

• Top websites such as baidu.com < 1 second

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Google is Blocked

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Google is Blocked!

• No Google Search• No Gmail• No Google Apps• No Google hosted services such as– Fonts– JavaScript

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Baidu is THE Search Engine in China

• Getting found in China (outside of social and other media) requires compliance with Baidu’s ranking criteria

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Ranking on Baidu

• Paying for ads means you gain credibility and thus page rank juice– Paid ads are also seen as ‘credible’ sources of

information in China since paying implies wealth and authority

• Meta keyword stuffing is encouraged• “Black hat” back-linking is encouraged since

back links from any site carry a similar weight• H1 and H2 is critically import

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Ranking on Baidu

• Website must be hosted in China to stand a chance for ranking (requires China company registration)• Website must be written in simplified Chinese

• www.o2-v2.com doesn’t rank at all on Baidu– HubSpot COS Hosted in the US (with global CDN)– Few back links– No Baidu Ads– No keyword stuffing (plus keywords too ‘high level’)

http://www.o2-v2.com/

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HubSpot and China

• THE online marketing solution outside China• Doesn’t load inside China due to the reliance on

foreign CDNs and Google APIs• Works with a VPN (when the VPN works)– However VPNs are not widely understood or

in regular use in China

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29 Unique China ChallengesUsing the right social media channels in China is critical as conventional Western social media channels are all blocked

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Chinese social media channels

• Tencent - WeChat, Qzone and Weibo• Sina Weibo, Renren, Kaixin and Baidu iQiy

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DO NOT use these social media channels

• Chinese leads are not going to be using the following social media networks because they are blocked:

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Strong Preference for Mobile Devices

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Increase in Video Consumption

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Decrease in Microblogging

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WeChat and Mobile First

• WeChat is a: – Messaging app– Social network– Subscription service (for businesses to disseminate

content)– Payments service– Online store platform

• 75% of Chinese internet users prefer mobile…• WeChat is a massive opportunity for inbound

marketing integration

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Sharable Content

• Netizens in China are far more likely to share content than create content– This is a great opportunity for any

marketing agency creating quality, relevant content IN CHINESE

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The Power of Video

• Circa 70% of netizens are using their phones watch videos– Video marketing is a huge opportunity to gain

traction and thought leadership– However, this makes more difficult to capture

lead information if content is exclusively video

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The Illusion of Choice

• Browsing habits ARE DIFFERENT– Crowded pages are the norm– Netizens spend longer on pages (up to 60

seconds as opposed to < 10 in the west)– Users don’t often search for media content-

instead are happy to scroll and click based on categories and recommendations by the site

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Will Email Marketing Work in China?

• Work generally takes place reactively as opposed to proactively, thus:– Business communication is traditionally

conducted via meetings, phone calls and WeChat messaging

– Outside of people working at foreign or trading companies email isn’t always used

– Combining content offers and messages with WeChat would really provide a powerful inbound tool with “Chinese characteristics”

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40 Unique China ChallengesInfluencing the decision maker has different rules in China to the West…

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A Culture of Mistrust

• Business starts from a position of “I don’t trust you at all”

• Implications:– Sales cycles can be extremely long– Building trust involves “making friends” and

going out for dinners, karaoke etc.– Even if inbound has educated the lead on

inbound marketing they still don’t trust you and the cooperation is with you not the concept

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China Company Structure

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China Company Structure

• The company owner is THE decision maker• If you don’t have his (it’s usually a male) buy-in

you will not succeed

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Overcoming the Fear of Outsiders

• As humans we instinctively distrust what we don’t understand• Inbound and marketing platforms are Western

tools sold by Western companies• Making inbound as a Chinese concept and

marketing platforms in Chinese in China can overcome those fears

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Overcoming the Fear of the Cloud

• There is a legitimate and inherent fear of data being stolen if it’s in the cloud

• Staff stealing leads, starting their own companies or selling leads to their new factory fuels this fear

• Many Chinese CRM companies still produce installable versions of their CRM to be hosted on the intranet

• The truth however is that hosting software in-house on a cracked version of Windows XP is certainly NOT safer than being in the cloud

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Avoiding Competing on Cost

• Chinese companies often want the cheapest price at the expense of quality

• “ 差不多” - chabuduo is an often uttered phrase regarding quality meaning something is more or less acceptable, this leads to cost and corner cutting

• Leads will often ask for extended trials to prove ROI• Trials on marketing solutions could be

extended beyond one month in China to build trust

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Proving Tangible ROI

• Like every business globally, ROI spent on services and increases in revenue are critical in China

• In China this is often the only metric as many business owners and investors don’t understand their businesses or investments and are simply looking for quick returns

• In order to close leads, ROI must be proved quickly – Within 3 months is often deemed “acceptable”

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48Conquering the Chinese MarketFinal thoughts and conclusions on how inbound can succeed in China

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Conclusions About Inbound

• One does not ‘conquer’ anything in China, one must cooperate and submit to Chinese rules and cultural norms

• Inbound marketing in China does not exist as a concept

• Marketing itself is a very immature industry and poorly understood

• Education on marketing to the West can easily be provided, however, must start at a very low level in Chinese

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Conclusions About Inbound

• Marketing and selling in China needs to be re-learned by Western marketing agencies and marketing solutions providers

• Relationship building, long and expensive sales cycles need to be accepted, embraced and accounted for

• However, there is huge scope to be number 1 in China if inbound principles are applied and adjusted around how people think, act and do things in China – – “Inbound with Chinese Characteristics”

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Conclusions About Inbound Platforms

• Western marketing platforms must:– Be hosted in China– Use Chinese social media channels– Reconsider the entire inbound process and

channels of communication to fit with Chinese internet habits i.e. is email marketing the right choice for follow up offers?

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Final Thoughts

• China is a tough market, but it’s THE biggest market• It is not only possible to succeed, but much

like Jack Ma at Alibaba, be wildly successful providing:– Solutions and products are in Chinese and

tailored to local market conditions

GOOD LUCK!