China Routes to Market: Wechat Retail and Marketing

Wechat and Mobile Commerce: Dipping the Feet in China's Markets

• Wechat is like a digital swiss army knife .....it's China's most important mobile app and combines messaging, map services, flight and ticket purchasing , online shopping, online payment, official business services, business marketing and promotion, product return, tracking and logistics, personnel and bill payments, ticket purchasing, financial services, in-app development, stock purchasing, mobile games etc. Its literally years ahead of anything similar available in the west and makes Facebook's mobile interface and functionality look stone age.   
• Mobile ecommerce in China accounts for roughly 50% of all ecommerce sales in China.
• Wechat has now 700 million users. 200 million users have connected their credit card to their Wechat account and over 200,000 enterprise in China now accept Wechat payment. 
• Wechat media and content are now rivalling traditional mainstream media in terms of overall engagement.
• Wechat payment is now the most used mobile payment system in China and is almost universally accepted throughout China 
• Wechat retail and Wechat marketing offers a cost effective way for international food SMEs (and most other businesses with tight budgetary constraints) to enter the Chinese market, engage in marketing and promotion campaigns and assess the feasibility of further expansion and investment. 

Wechat Market Entry: What Wechat Official Business Account Can Do for You ? 

• Open a Wechat shop to sell your goods in China
• Interact with potential customers through content marketing or paid Wechat advertisement (free - limited to 20 articles a month on basic plan)
• Post content on personal Wechat pages. (articles, photos, videos etc)
• Process payments and returns 
• Develop following and loyalty programs 

The Process: Mandatory Requirements 

• Establish a wholly owned foreign enterprise (WOFE) or branch of company here in China i.e a legal Chinese entity with requisite food import license 
• Rent an office 
• Rent a warehouse compliant with CFDA food circulation requirements 
• Obtain food distribution license (warehouse audit dependent) 
• Register with Wechat as an official Wechat account 
• Register for Wechat Payment 
• Register a Wechat shop

The Digital Swiss Army Knife

I guess it must amuse my Chinese colleagues and friends when i get excited about ordering, paying, tracking and collecting my goods using my Wechat account....... but everytime i get that message on my mobile telling me to go and collect my goods at the electronic lockers at the bottom of my apartment block, where I scan the QR code using my wechat account (the same account i purchased and payed for the products with) and then see a random locker pop open with goods I ordered the day before yesterday i cant help but get a little excited. Its the same feeling i get when i'm in the taxi and i realize i've not gone to the ATM but don't need to worry because I can just send the driver a Wechat red envelope or transfer him money using my Wechat. Its the same feeling i get when Im in Walmart and i realize i can get a 10% discount on my purchase If i just pay using my Wechat account, or when im chatting in a group and Im the first to open a big Hongbao （红包) 。。。谢谢老板 

Reverse Innovation Lag

The convenience of Wechat is only surpassed at just how integrated into China's supply chain it has become. I guess I find it so remarkable because I'm from Ireland. That's not to say Ireland is backward... far from it .... but compared to the level of supply chain integration here in Hangzhou it feels that way in many respects. Its not just Ireland either .......I haven't seen anything close to Wechat in routine use in Japan, the US, Australia or Europe. Beyond just making my life a little easier the biggest excitement for me as a food analyst is the fact that Wechat offers a low cost, low investment market entry option for food enterprise particularly SME's (and all enterprise for that matter) to enter the Chinese market, engage in marketing campaigns, sell products and all with minimal initial investment and startup fees. To my mind it is the single most efficient route to market . 

The China Conundrum: Huge Appetite but Discerning Tastes

 The market data and forecasts on continued upward trends in China's demand for imported foods are compelling. On the flipside the list of high profile casualties that invested heavily in China but ultimately failed is equally off putting...

What are the Ingredients to Success ?

If you want a more perfect example of the key ingredients to success in China's food markets look at how Swisse inadvertently became one of the greatest success stories for international companies operating in China's food sector. The story of how Chinese haitao/daigou business and word-of-mouth transformed Swisse's fortunes is nothing short of remarkable. No discernable official promotion/marketing channels within China yet huge sales and ubiquitous distribution despite Swisse products being essentially illegal. 

Safety, quality, reputation.......these are the keys to China success. Regulatory compliance, logistics, retail etc. all ensure smooth uninterrupted supply but without demand this supply is meaningless.  Wechat content and retail strategies are a low risk answer to the China conundrum and offer a unique way for SMEs and larger companies alike to engage with Chinese consumers, foster trust and grow demand for products. 

* If you are interested in learning more about Wechat as a route to market for food enterprise do not hesitate to contact me on [email protected]