Here are some of the examples of the most common questions:

• When it comes to China B2B marketing, what tools are the most effective?
• Is it critical to establish B2B company’s presence on Chinese social media and if so, which platforms are the must have?
• How can companies re-purpose their existing campaigns on traditional Western platforms for Chinese market?

In this post we have attempted to consolidate our answers to those questions in an easily digestible Q&A format.

China B2B Marketing Q&A

Q1: What is the significance of digital marketing in the China B2B (Business-to-Business) market?

Chinese workforce is very well connected digitally, hence reaching it via those channels is an effective way to engage with the decision makers at all company levels. A lot of communication is taking place within WeChat, both on one-to-one basis as well as in the groups. Taping into that space can prove extremely beneficial for brands selling products to other companies.

Q2: Are there any differences between B2B and B2C?

Yes, some digital platforms are less suitable for B2B, however that would also depend on the type of business you are in. B2B sales process is generally longer and involves more than a single decision maker while this is usually not the case for B2C. Since there is practically no impulse buying in B2B, the marketing should focus on stressing product’s benefits and establish trust rather than relying on the emotional appeal.

Q3: Should companies manufacturing and distributing industrial goods invest in digital marketing activities – in general and especially in the Chinese market?

Yes but, perhaps, not to the same extend as B2C companies. Depending on the niche, B2B companies should invest in quality content that can be distributed to the target audience via WeChat or company blog.

On the other hand, digital marketing helps to establish brand reputation which goes a long way in developing trust, a critical component in B2B sales.

Q4: What are the most important instruments of digital marketing in China in relation to industrial goods?

In our experience, the most effective tools for such companies are WeChat official accounts, search engine marketing and email marketing. They can target potential buyers at different levels of the sales funnel and, if done correctly, will complement and leverage each other.

Q5: Should all these instruments be used in parallel or does their use depend on product group and target group?

Depending on the niche, some channels can be more of less effective. It also depends on where the potential customer is in the sales funnel: SEM is best for finding new business while WeChat and EDM are best for getting repeated business and strengthening brand image and reputation.

Q6: What hurdles do B2B companies have to overcome if they want to start digital marketing activities in China to reach their target group?

It is unrealistic to only rely on digital tools to grow business in China B2B marketing context. Direct marketing and trade shows should be used in the combination with online platforms.

Both digital and offline methods should ideally complement each other and be a part of coordinated strategy. For example, a sales person meeting with a client should have that client’s email recorded in the email database that will be later used for targeted email marketing campaign (with their permission of course). At the same time, that same sales person should also encourage a client to follow company’s official WeChat account, so he or she will be included in a more extensive long term WeChat based marketing effort in the future.

Q7: What is your opinion on data protection with regard to the collection of personal data using digital marketing tools?

Chinese are generally less concerned with privacy compared to Westerners but there are relevant laws and regulations that must be followed. Cybersecurity law that was adopted about 1.5 years ago is very detailed and fairly complex. Companies who collect and store personal data must make sure to stay in compliance with the law or face heavy penalties.

Q8: Which digital marketing instruments should be part of a strategy for the Chinese market and why?

The big ones are WeChat, Weibo and search engines like Baidu and 360Search. WeChat presence is a must for most brands, but Weibo is more suitable for brands that have a social element in their marketing approach. Baidu and 360Search are used to target potential customers early on in their search or discovery stages.

Q9: Is there a need for a different digital marketing strategy for the Chinese market than, for example, for the European or American market?

There is no direct equivalent to WeChat in the Western markets, and there are no direct parallels with Twitter or Facebook in China. Each Chinese platform is a combination of some of those features. Therefore, copy and paste of Facebook/Twitter marketing to those channels would probably not work.

Brands should familiarize themselves with pros and cons of each platform and adjust their strategies accordingly. For example, the requirements for content size, style and formatting are different among those services and may be suitable for different purposes.

Q10: What approach do you recommend to newcomers to creating a digital marketing strategy in B2B for the Chinese market?

Newcomers should start off investing in SEM and WeChat marketing in combination with traditional direct marketing which is aimed at building networks of business contacts at traditional offline events such as trade shows.

If a foreign company is at the beginning of their journey in Chinese market, they will be better advised to outsource such efforts to professionals.

Q11: How important are defining the target group, analysis and selection of suitable measures and instruments for the creation of a suitable digital marketing strategy?

B2B companies usually have a good idea of who their customers are and what they are interested in. Therefore, detailed definition of target audience like it is common in B2C (psychographics, behaviors, interests etc.) is often less relevant when applied to China B2B marketing context.

Q12: Where do you see opportunities but also risks here?

Prevalence of digital tools in China presents a unique opportunity to have a direct access to customers and engage them on a constant and intimate basis as long as the company can offer good value with their content.

The risk is mainly over-reliance on digital tools neglecting traditional “offline” methods that are still the most effective in building business networks and develop brand trust in China B2B marketing environment.

The post China B2B Marketing Success: 12 Most Common Questions first appeared on Sampi.co.

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In the second part we are going to look at each of the remaining communication channels:

Email

Email communication is one of the preferred ways to communicate with your customers in China, also being the most convenient method to maintain contact with your existing clients. While many Chinese may feel embarrassed of the low level of their oral English communication abilities, they would feel quite comfortable discussing the same issues in the written communication.

In fact, most business people in China today have a very decent level of written English making it preferable to direct phone calls. Email is a great way to follow up on meetings and provide more details after initial contact. Make sure to write your emails in plain language and avoid long sentences to keep it more readable.

Websites

Having a localized website is essential for promoting your business in China, a country with the estimated 400 million email users. Localization of your website requires a well planned effort with the most important aspect of it, translation, discussed in our previous post.

 92% of Chinese internet users use some sort of social media platform making it essential to maintain your presence there as well.

Having professionally designed, modern looking website may also set you apart from most Chinese based competitors that tend to have messy and cluttered sites. Remember, that your website is probably the first place an interested client will go to after meeting your for the first time.

Social Media

92% of Chinese internet users use some sort of social media platform making it essential to maintain your presence there as well. Sina Weibo, Chinese micro blogging platform and WeChat, mobile network, are by far the most popular of those services. The great thing about Weibo and WeChat is the ability to spread your message instantly and directly to your followers’ mobile devices.

Once you’ve setup your Weibo account, make sure to put its URL and QR code on your printed and digital marketing material and encourage your customers to connect (WeChat is different from Weibo in that way).

LinkedIn is currently not as popular in China as the alternative professional networks, we will review those services in subsequent posts.

Face-to-face meetings

Personal connection still rules in Chinese business environment. Taking time to personally visit your customers is one of the best investments you can make.

Insist on accompanying your sales people, your agent or distributor on their visits even if you don’t speak any Chinese. If you make a presentation, make sure that someone from your company, who knows the material, provides proper translation.

Phone calls

While phone calls can be of limited use if your clients have a difficulty understanding your English (or your accent) they still can be an efficient way to keep in touch with those who do speak it well enough. However, with the proliferation of instant messaging, where one can control his/her availability, calling someone’s cell phone directly may seem less considerate.

Great mobile instant messaging services, such as WeChat, could be a great way not only to communicate but also to spread your marketing message as well.

Post (Regular Mail)

Mailing printed material is one of the least efficient ways to communicate in modern times and China is no exception. In B2B marketing settings, mailing information by post is quickly losing its value and I’d advise to avoid it;

Relationship and Networking

Chinese guanxi remains important in Chinese business environment, although the whole concept can be alien to many foreigners. Guanxi refers to one’s network of personal relationships in a business context. The concept of guanxi also implies that business relationships can often transform into personal friendships, and indeed many Chinese business people consciously spend a great deal of time and energy nurturing such relationships. This can take the form of banqueting, evening entertainment or gift-giving – activities that can seem onerous and unnecessary to many Westerners.

As Matthew Harrison and Mark Hedley of B2B International write in their white paper: “Although such networking and relationship-building is clearly important to the sales process in China, there is a tendency among some commentators to overemphasize its importance when trying to penetrate the Chinese market.

As in any market, building strong relationships is extremely important to achieving market success, although guanxi is no substitute for a strong product offering or a trustworthy supplier. What Western companies sometimes have difficulty coming to terms with is the way in which this trust is gained, and the time it often takes to convince the customer that yours is the product or service that meets their needs. The overriding piece of advice for Western companies would be to understand the importance of establishing relationships when targeting Chinese companies, and to be prepared for the patience required for this.”

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Information in today’s digital milieu has always been a double edged sword for sales and marketing. It works for you if you can control it. Information comes from your sales team, your website and your press releases. Outside that – it’s a free-for-all.

As we all know, the latter is the reality. What we often have to deal with is a highly-evolved B2B buyer, someone who’ve searched across several online platforms. And, according to The Digital Evolution in B2B Marketing, a 2014 research conducted by the Marketing Leadership Council of CEB (now known as Gartner) in partnership with Google, this person will not face a sales rep until 57 percent of their buyer’s journey is done.

So, it pays to ask: How do B2B buyers search for tech solutions and how can you ensure you’re there, at every stage of their buyer’s journey?

B2B Buyer Behavior

There have been several studies on today’s buyer behavior, and one stand-out commonality is that B2B buyers go online first before reaching out to a sales team (if ever they do).

A 2014 research by the Acquity Group, a digital marketing company under Accenture, pegs the number of B2B buyers who do online research at 94 percent. This is further broken down to the top go-to sites. Business websites lead at 84.3 percent; this is followed closely by 77 percent who turn to Google search. Other notable online resources include third party websites (34%), such as blogs and industry websites, and online user reviews (41%).

Analytics Advocate at Google Adam Singer confirms this at a ClickZ Live conference in San Francisco and adds that a person, on average, checks out 10.4 online resources before reaching out to a sales rep.

The Digital Age Buyer’s Journey

The fact that a buyer faces a sales rep only at 57 percent into the journey is perhaps not the most disconcerting finding to come out of these recent B2B buyer studies. It also raises a red flag that a lot of people are looking for a self-service buying experience. 31 percent say they prefer an unassisted online purchase, with phone support only as a just-in-case. Another 10 percent say they want zero assistance; while 12.5 percent say they want to be walked through the purchasing process.

You can’t help but wonder where in the digital age buyer’s journey would the sales team figure in?

According to the CEB study, you only get a 12 percent mindshare (public awareness) for each typical buyer who goes through the buyer’s journey. This share spans across a variety of channels.

The Salesforce’s Pardot survey, 2013 State of Demand Generation Report, claims that 71.7 percent of buyers start with a Google search. This is followed by personal networks at 15.6 percent and social networks at 2 percent.

This brings us to a familiar B2B scenario, typical in today’s buyer’s journey: Say that your company is looking for a CTI solution that integrates your phone systems to your CRM. You get on the project and do an online research. This leads you to a variety of business websites, such as Salesforce and Tenfold. You also look into industry forums to see what your peers have to say about the many vendors in the CTI market. You read blogs, reviews and how-to’s to see if the system suits your requirements and has the flexibility that you need. Through your research, you come up with the top 3 vendors, which you then invite to present and bid.

This might sound like a good deal because a sales-ready buyer comes to you. But, consider too that in no part of their buyer’s journey are you able to influence and educate.

Instead, you function only as an order taker. Your buyer already has a preconceived idea of what you offer. It can be hard to sway them otherwise – unless you can overcome the three main hurdles in B2B marketing and sales: ineffective digital integration, unfocused content and an unoptimized mix of online channels.

Know the Modern B2B Buyer

But first, let’s get to know who the modern B2B buyer is.

The Millennial Influence

Forget what you believe in when it comes to the B2B buyer. He or she isn’t middle-aged and working a managerial or executive position. In fact, the B2B buyer is getting younger!

The Pew Research Center has found that millennials are the biggest generation cluster in the American workforce today. There is more than one millennial in every three employees in the job market. And, they are working closer and closer towards positions of influence, when it comes to B2B purchases.

According to a 2014 survey conducted by Google and research company Millward Brown Digital, millenials make up 46 percent of prospective B2B buyers. This data is up from 2012’s 27 percent, which signifies the growing influence of this generation.

Director of Business and Industrial Markets for Google, Mike Miller, says that this represents a “big shift in a two-year time span.” He believes that this is partly due to the retirement of baby boomers. A new powerhouse generation is emerging in the lead.

This requires rehashing old B2B marketing strategies that usually target senior-level executives. While millennials may still not hold positions of power, their influence is clear. They make up 24 percent of non-executives tasked to help in B2B purchasing decisions. This is a generation who grew up at a time when mobile phones and the internet were readily available. You can be sure they will use these access and mobility tools in B2B research and recommendations.

The Multiple-Channel B2B Buyer

The multiple-channel buyer is always connected and researching online through mobile phones, tablets and desktops. They have mobility and access. They read your websites, reviews and blogs; and might have even downloaded one of your demos. They attend conferences and seminars – sometimes online – to learn about industry breakthroughs and innovations. They can cover multiple channels partly because they’ve fully integrated mobility and the internet into their lives.

According to the Google/ Millward Brown Digital study, by 2014, 34 percent of those involved in B2B purchasing decisions use their mobile devices at each stage of their buyer’s journey. This is almost twice the devoted mobile users/ B2B buyers of 2012. Mobile phone usage extends to work places and social gatherings; and includes requests for bids, product comparisons, video viewing and contacting the vendor.

The increase in video viewing is another metric attributed to the multiple-channel buyer. According to YouTube, more than 895,000 hours of videos viewed are those by top B2B brands. In fact, 70 percent of those surveyed by Google say they use videos to learn more about products before making a purchase.

Information Overload

The availability of seemingly limitless information empowers the new B2B buyer. And because they access content at each step of their buyer’s journey, you too must be on this content train.

According to the Content Marketing Institute and MarketingProfs’s 2016 Benchmarks, Budgets and Trends – North America, 88 percent of marketers implement content marketing strategies. 76 percent of these say that they will include content marketing allocation by 2015. On average, 28 percent of the marketing budget go to content marketing. However, those who are most effective at it spend around 42 percent.

So, remember that the modern B2B buyer is swimming in a sea information. Your share shouldn’t just be a forgettable drop.

Influencing the Digital Age Buyer’s Journey

Perhaps there are several strategies you can study and implement in order to influence the new B2B buyer. However, at the core of it will always be the actions you take in dealing with modern B2B marketing and sales’ main hurdles: digital integration, content and channel mix.

Comprehensive Digital Integration

Your effective presence online should cease being treated like an annoying fly buzzing and tweeting about. Traditional marketing campaigns have been rendered obsolete by B2B buyers who are empowered with information. Their product learning can’t coincide with your campaign plans because they go about it on their own, online.

Here are a few steps to take to start a comprehensive digital integration program, according to the Marketing Leadership Council of CEB:

1. Document existing campaign architectures. Make sure to take note of effective strategies and their output.
2. Review marketing practices to see what works and what doesn’t. A dialogue with the sales and marketing team is necessary to get to the real score regarding these practices.
3. Observe and analyze external practices that have worked to get you closer to your goals.
4. Select, codify and implement best practices.
5. Recreate the campaign architecture and refine practices that don’t work as expected.
6. Repeat the process until you reach your ideal.
7. Put together an implementation guideline, as well as an accessible resource center for the guidelines, necessary tools and other information regarding your digital integration.

Purposeful and Focused Content

Many B2B marketers have taken on content marketing like it was the latest must-have trend. This has resulted in content that’s highly unorganized and lacks a consistent and purposeful message. You then get a whole slew of problems, such as prospective buyers swimming in a sea of useless information. This type of information does not really teach them well; and, it does not engage them enough to take the next step in their buyer’s journey with you.

There are several realities that might have factored into this situation. For instance, your web team may have been focused on ranking your website in search results, without being consistent and driving your true message. You might have outsourced your social media management, without providing guidelines on your corporate messaging.

It is important to rectify this, as soon as possible, because your customer engagement is centered on your content. It comes in at all stages of the buyer’s journey. It is at the core of your lead nurturing programs, and online and social media engagements. And, it is everyone’s responsibility – not just your copywriter’s.

This is where the so-called “coverage orientation” comes in. B2B marketers pinpoint topics that interest your target audience, and ensure that you consistently offer fresh content for each topic, through content development and curation. This can be a fruitful content marketing strategy, as long as you have a good understanding of your customers.

Make sure that you cover all your customers’ information requirements. This way, even as they learn about your product on their own, the information that they get still aligns with what you truly offer.

Smart, Targeted Channel Mix

Given several online channels, where should you invest in? Which channels will bring the most qualified leads? Should you invest in creating YouTube videos or simply blogging? Does your target audience need whitepapers or an online archive of manuals, issue reports and resolutions?

There are many ways to develop a targeted channel mix. However, the first step is to recognize your traditionally fragmented approach. The marketing team might be taking care of blogs and other creative text content. Your tech team might have been tasked with putting together your FAQs, whitepapers and other support pages. You might have outsourced your video production to an ad company, and your social media management to an SMM company.

However you’re doing it right now, it is important to account for your efforts, and assess your channel effectiveness. The metrics to use here are often readily available with the team tasked with each channel assignment.

Then, invest more in an expert analytics professional, someone who can accurately assess your channel efforts and audience response. Use your findings to put together a model channel mix, one that suits your target market and gets your messaging right.

Chase Davis is Account Executive – CX Consultant at Tenfold

The post How B2B Buyers Search for Tech Solutions first appeared on Sampi.co.

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There are several reasons for this trend:

1. First is the natural growth of businesses is driving the demand for office supplies. More offices, big or small, are being opened, existing offices expanded or moved to larger facilities;
2. Then there is a drive to save cost. Buying online allows making purchases fast and efficient. Products and brands can be easily researched and prices compared finding the best value;
3. Finally, proliferation of Chinese ecommerce and general public’s familiarity with it, is making the transition and acceptance of online procurement a more natural process;

Chinese B2B Ecommerce figures

As noted by China Internet Watch, enterprise online purchases have been growing particularly fast since 2010 when the government first introduced new policies to support ecommerce and e-businesses. As the trend continues, it is predicted that Chinese B2B ecommerce market will increase at the annual growth rate of 30% for the next 3 years.

Another interesting fact is that, as of H1 2015,  Jingdong (JD.com) holds the largest market share (39.4%) in this particular segment of Chinese ecommerce. It is followed by Alibaba with 18.1% and Suning at 10.9%. The rest is shared between Amazon China, Gome, Yihaodian, Dangdang and others.

This also shows that Jingdong has definitely been on the rise in 2015, taking even larger share of ecommerce away from Alibaba. They are focusing on their traditional strong areas such as appliances and electronics which, incidentally, are the products that businesses tend to purchase.

According to H1 2015 statistics, computers accounted for almost 40% of all online purchases in Chinese B2B ecommerce segment, followed by basic office supplies at 22.7%, mobile communication devices (16.5%) and other digital products such as electronic appliances and networking equipment (7.7% and 3.4% respectively).

This means that if your company is selling products in any of the above categories, Jingdong could be one of the sales channels to consider setting up. Targeting businesses through advertising within Jingdong is another element that should be incorporated with the overall B2B marketing strategy. Such ads should be tailored specifically to speak to the needs of office based businesses, stressing the overall utility, better service and cost savings.

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According to the latest infographic by Go-Globe that details Chinese exports industry, 25% of manufacturing goes to electronics and 17% to machinery with the rest split between smaller categories such as clothing, furniture, plastics etc.

Another curious fact is featured in the infographic: even though manufacturing is, by far, the larger sector of Chinese economy compared to that of US (30% vs. 8%), in terms of world’s manufacturing output, it is only slightly ahead: 18.9% vs. 18.2% of the US share. This, of course, demonstrates the fact that the productivity of a Chinese worker is still significantly behind an American one. Another explanation is that the level of automation in US factories is still much higher than in China.

Manufacturing for domestic companies is becoming increasingly visible as well: cellphone maker XiaoMi and electronics giant Huawei are ranked as 3rd and 5th respectively in total production.

Chinese exports in figures, infographic by Go-Globe

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This situation also presents an opportunity to overseas firms offering various financial solutions which could range from personal finance management software to books and videos on investments.

Not surprisingly, most action is taking place online and increasingly on mobile. However, foreign firms are often unaware of major sites and financial news portals that are popular in China.

In this post, I’d like to share some slides from the recent presentation by Sampi Marketing on this topic. The full presentation can be downloaded from SlideShare here.

Here are the largest sites in terms of traffic worldwide and in China:

With the average number of monthly visitors at around 4.7M in China alone, Sina Finance is the largest portal:

HeXun network represents another popular source and is run by a private investment company HeXun:

HeXun Network links to other services that the company offers which includes increasingly popular P2P lending and micro-loaning service:

Finance QQ is another popular financial news aggregator run by Tencent:

Sohu runs its own news service that is focused on stocks and investments:

Among publications, the sites with most traffic in China are Wall Street China and FT (Financial Times) Chinese:

For full presentation, please go here.

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First of all, B2B product selling can be classified into 3 main categories:

1. Selling of raw materials;
2. Selling of capital equipment;
3. Selling of machine components;

In general, B2B selling and marketing in China went through some changes in the last few years and still continues to evolve. As everything else in China, the rate of change has been rapid and sweeping. Basically, those changes have been around the decision making process and were driven by the need to increase efficiency.

In the past, the majority of Chinese companies were simply not profit oriented enough or at all. As strange as it may seem, making money and being profitable was not high on those companies’ agenda. How could that be? The truth is that, while making money was not a main priority of many companies, enriching of the top management was. This situation produced decision making that was not in line with company’s interests but based solely on which supplier provides most benefit to a manager making that decision.

The recent credit crunch has put even more pressure on companies to pursue profitability. This has further facilitated changes to decision making process, especially when it comes to which equipment, components or materials to purchase from suppliers.

Of course, a simple name for it would be “corruption” but things were not so black and white back then, they are still aren’t today. Many Chinese still think that it’s a part of new capitalist culture and enriching oneself on company’s account is nothing to be ashamed of.

Fortunately, such views are no longer mainstream today with vast majority of companies becoming truly profit oriented. The recent credit crunch has put even more pressure on companies to pursue profitability. This has further facilitated changes to decision making process, especially when it comes to which equipment, components or materials to purchase from suppliers.

Of course, there are still companies over there who stayed immune to this process, especially SOE (state owned enterprises) and other large corporations with ties to central or provincial governments. Unfortunately, while they are still enjoying unlimited supply of free money and continue to decorate their boardroom with redwood and chandeliers things are unlikely to change for them.

The good news is that the vast majority of companies did evolve and their decision making process adopted accordingly. Nowadays, the process is becoming much more in line with the idea of cost efficiency and looking for the best value. Those suppliers who have based their whole selling and marketing strategy around entertaining their clients and sending them expensive gifts are being squeezed out by more dynamic and value oriented competitors.

At the end of the day, companies in China are now seeking products that provide the best value and those suppliers who can communicate the right points in the clearest and the most efficient ways are consistently coming on top. It doesn’t mean that the era of guanxi is over but the importance of having a product that provides maximum value and the ability to communicate that value are becoming the main factors in determining supplier’s success.

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I’m going to examine such perception factors and the most efficient ways to deal with them.

Factor #1: Western Quality

One of the positive perception factors that a Western companies have been enjoying in China was a widespread notion that Western products are of generally better quality than the Chinese equivalents. Clearly, this reputation may not always be deserved but it definitely helps to Western companies to capitalize on this image.

Things have begun to erode, however, mainly due to competition between Western companies themselves and thanks to increasingly better quality coming from local competitors. Still, better quality image is something that Western companies should cultivate and nurture at any cost.

Of course, at the end of the day, it’s all about the value, and if perceived quality premium is offset by higher price, “better quality” advantage may quickly evaporate.

One of the main concerns Chinese buyers may have about Western companies is how well they are established locally.

Factor #2: Clear and Straightforward Communication

It is generally acknowledged by the Chinese that Western companies tend to be clearer and more to-the-point about their products and services. Marketing material designed by Western companies, from a websites to datasheets and brochures with the intention to communicate its message as clear as possible, are typically more informative and visually pleasing .

Many Chinese companies put out a lot of information about themselves that they consider impressive to potential customers and tend to put less emphasis on the benefits that their products or services deliver. Chinese buyers often feel confused about what the offer is all about and do prefer clearer and more effective style in getting the information they need.

Western companies should continue refining their message to be clear and concise with the combination of well designed and visually appealing medium as it is being appreciated by the Chinese.

Factor #3: Established Local Presence

One of the main concerns Chinese buyers may have about Western companies is how well they are established locally. Are they going to be stuck with your products without service if things won’t work out for your company in China? How can you prove them that you are here to stay?

Those are not easy questions to answer for a company who is a newcomer in Chinese market. Established legal entity, local office and employing local staff are the very minimum that are required. If you can’t have that, working with a reputable agent or a distributor could be a way to put your foot in the door. Either way, local presence is something that Chinese buyer will definitely look into and it will become the absolute must if you are selling service-intensive products such as industrial machinery.

Factor #4: Understanding of the Needs

One of the criticisms that can often be heard about Western companies is their apparent unwillingness to properly listen to what their Chinese customer really needs. In their view, Westerners may commit too readily to high standards of performance of their products without taking enough time and efforts to understand what are the exact requirements.

Chinese buyers don’t expect suppliers to understand their needs immediately and prefer those who listen carefully to the problems that the business is facing. Only after those needs are identified through a dialogue, a well thought out solution can be offered. Suppliers who claim to have a solution before they have a chance to get the entire picture risk coming across as untrustworthy and naive.

Factor #5: Personal Connection

Admittedly, it is more difficult to Westerners to establish the same type of personal connection with their local customers compared to the native Chinese. However, making such attempt will be always looked upon very positively and can go a long way in gaining trust.

Unwillingness to meet your customers outside of work settings, something that some Westerners may feel uncomfortable with,  will be seen as unfriendly and can prove fatal to your business. With the importance of guanxi, Chinese attach a lot of value to personal connection and every opportunity to socialize with your customers should be taken advantage of.

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A typical purchase cycle by a typical American or European company is a structured and accurately defined and documented process that can be broken down to the following distinct stages:

1. The need is identified and the requirement is raised;
2. Spec is prepared;
3. Potential suppliers are contacted and short listed. The spec may be further refined at this stage;
4. Suppliers’ proposals are received and reviewed;
5. Proposals are negotiated with the suppliers;
6. Decision is finalized;

Western companies expect the same process to be followed universally, however, in China case, things turn out to be quite different. It is important to realize those differences and adjust the approach accordingly.

The main difference is that purchase cycle by a typical Chinese company seems to be much less structured without clearly defined stages. The truth is, however, that there is an underlying structure to the process, it just doesn’t seem apparent enough.

The impression of an unstructured purchase cycle comes from the fact that Chinese companies tend to go through the same stages concurrently rather than sequentially.

Often times, the first contact with suppliers is made even before the need is clearly identified. Western companies who receive request to quote may not realize that they are still very early on the purchase cycle and far from the stage #3 of the Western process.

The reason for an early contact with suppliers is the need to define the spec in the first place and then reconcile it with the technical need that the buyer may have. Clearly, this means that getting request for a quotation accounts to almost nothing in China as the actual purchase requirement may never materialize.

On the other hand, it also means that Chinese businesses expect their supplier to be a part of preparing a spec and may even require them to actively participate in defining the technical aspects of the requirements. To the Western companies, that are not familiar with such approach, this may come across as unprofessional or an indication that the company simply doesn’t know what it wants.

Clearly, in some situations this misunderstanding creates conflict that causes Western company to lose business to a more adaptable competitor, most likely a local one, that understands how things really work.

The impression of an unstructured purchase cycle comes from the fact that Chinese companies tend to go through the same stages concurrently rather than sequentially.

In addition, such approach prolongs the engagement with the suppliers and makes the entire purchase cycle generally longer than in the West. The key to succeed under such circumstances is to be as forthcoming as possible by providing all the help the customer needs in defining the spec and act as an expert in finding a solution to a specific business problem that raises the requirement in the first place.

The importance of listening to a customer can’t be overstated, and, in fact, inability to listen is one of the most common criticisms of Western companies in China. They are perceived to have high quality products but unwilling to customize it in order to fit local conditions. Companies who can turn this situation to their advantage by offering a solution rather than just a product are those who eventually succeed.

The final stage before final decision is the price negotiation which can be a long, back and forth process or can also be surprisingly quick. Negotiating in China could be a whole new topic which I will discuss in the upcoming posts.

The post Common Mistakes by Western Companies Dealing with Chinese Businesses first appeared on Sampi.co.

The post Common Mistakes by Western Companies Dealing with Chinese Businesses appeared first on Sampi.co.

1. Product;
2. Price;
3. Promotion;
4. Place;

Western companies typically run their marketing based on those four principles as an integrated effort. Since Chinese economy started to truly open up to the West only from the mid 80s, not surprisingly, the vast majority of Chinese companies haven’t reached the same level of sophistication and still view marketing only as a single P – Promotion. Traditionally, Product is considered to be the domain of R&D and the engineers, Price is the area of the sales people and Place is something to be decided by the boss.

The traditional Chinese view of a salesman as the most respected and the most important company employee, a true key person that everything and everyone hinges upon.

Although, things are slowly evolving towards more modern approach, most traditional Chinese businesses still view their Marketing department (if they have one) as more of a cost center, mainly in charge of generating brochures, presentations and other material for the sales to use.

Perhaps, one of the reasons that could account for this situation is the traditional Chinese view of a salesman as the most respected and the most important company employee, a true key person that everything and everyone hinges upon.

Another reason is the natural aversion and distrust many Chinese feel towards aggressive over the top advertisement that has been associated with fraud and numerous scams. This is why a personal connection is viewed as the only reliable way to establish trust and maintain good company-client relationship.

A good salesman is expected not only to entertain the customers but also forge a true and long lasting friendship with them, the only perceived guarantee of getting the business.

Does it mean that the famous 4Ps principle of marketing is not applicable in China? No, the theory still holds but the adjustments must be made in order to adapt the theory to unique conditions Western companies encounter in China.

In fact, I believe that better understanding of the 4Ps and their role in the integrated marketing plan may even give an advantage to Westerners as long as they are willing to tailor their methods to account for the local ways of doing things.

Moreover, China continues to constantly evolve and learn faster than anyone could have expected. Fresh MBA graduates and overseas educated returnees take more prominent roles in Chinese companies slowly replacing traditional approaches with moderns and scientifically based concepts.

In the subsequent posts I will discuss the specific strategy adjustments and methods Western companies should consider to their 4P marketing mix that fits best to the Chinese market.

The post B2B Marketing: the 4Ps in China first appeared on Sampi.co.

The post B2B Marketing: the 4Ps in China appeared first on Sampi.co.