There are a few simple actions businesses can take to prepare for a successful Singles’ Day, and bear in mind when selling to China in the longer run:
Know your customer and how to reach them
Even the largest, most successful Western brands have trouble selling to China as they often misunderstand the market and mis-communicate their brand. However, it does not have to be this way for small businesses. To turn any potential browsers into buyers, British businesses need to tailor the online shopping experience to Chinese tastes and engage Chinese consumers in the right places. For instance, almost everyone who owns a smartphone in China is an active user of WeChat. It can be a good place to market to Chinese consumers, as well as a smart way for them to convert straight from browsing to buying via integration with WeChat Pay. WeChat has 902 million daily active users and has an average of one million transactions per minute.
Have a coherent currency strategy
At the moment, the weak pound (tied to ongoing uncertainty around Brexit) means Chinese consumers are going to get more for their money when buying British, and so there will be an increased interest in British products during Singles’ Day. When selling overseas, retailers should be sure to have a strong currency strategy in place to maximise their profits. A virtual currency account, which offers the option of holding multiple currencies in one place, is a particularly valuable tool to use when selling to China. Forward contracts are also helpful, as they allow you to lock in favourable exchange rates to protect against unwanted volatility and secure the cost of doing business. Whilst a Forward Contract can be an excellent tool in your risk management strategy, there are certain risks associated with this product. You can find more information here. The right FX partner can help develop the best currency strategy for your business, and provide 24-hour expert analysis and insight on where the market is moving.
Tap into the special appeal of Brand Britain
A common mistake for British businesses is to dramatically change the look and feel of their products to better suit Chinese consumers, and to update their labelling to the local language. In fact, there is a real appetite amongst Chinese consumers for “Brand Britain”, meaning goods from British businesses that are of good quality, rich heritage and modern design. Over 130 UK brands took part in Singles’ Day last year, including Burberry, Marks & Spencer, New Look and LK Bennett. Any British business looking to cut through a very crowded Singles’ Day marketplace this year would do well to play up to their British origins in order to reach those Chinese customers looking for something different.Jake Trask is an FX Research Director at OFX, where he helps online sellers with overseas payments.