Correction - China DTC Is Possible!

The benefits of DTC business models in terms of establishing a direct relationship with the customer, owning the customer experience and retaining more margin are well understood.

The multiple trillion $ size and growth of the eCommerce market in China, the Chinese consumers hunger for new, original, authentic products direct from source, plus the rapid expansion of the official cross-border route (15%-20% of all e-commerce in China) which offers lower taxes and faster customs clearance, has seen international brands and merchants rush to look for opportunities to tap this lucrative consumer market.

Yet there is a common misconception across the retail and consumer industry that China DTC is simply not possible, or at best too difficult to make work. As a result of this, many DTC brands, merchants and eCommerce retailers either completely ignore China in their strategy, or make it extremely difficult for Chinese consumers to buy from their site, thereby missing out on potential sales.

“Marketplaces are the only way in China”... so goes the traditional wisdom, meaning that many DTC brands and eCommerce retailers default to a marketplace approach such as Tmall, where customer engagement, control and margin are ceded to the all-powerful platforms and the network of distributors that serve them.

E-comm retailers and DTC brands are leaving the world’s largest eCommerce market un-addressed, missing the opportunity to generate controlled, profitable incremental China DTC growth based on direct relationships with Chinese consumers and a much-improved customer experience.

Many DTC businesses and eCommerce retailers have a material level of Chinese traffic on their global sites which can be quickly converted to sales with the right customer experience.

Tip - in our experience Google Analytics typically under-reports your Chinese traffic by 50% - so double your reported traffic to get a true sense of visitor numbers.

Other merchants are encountering major difficulties in processing and fulfilling orders from Chinese consumers causing internal complexity and delivering bad customer experience.?? Emerging brands may be unaware of organic interest from Chinese consumers seeking new international brands and therefore unable to capitalise on this latent demand.

In all of these scenarios businesses are leaving money on the table and missing the opportunity to make the world's largest e-commerce market and a vast and growing group of middle-class Chinese consumers an integral part of their DTC strategy.

China DTC is Possible...

Many forward-thinking brands are already leveraging technology to switch on China DTC. Our China DTC plug in Nomad Checkout removes many of the traditional complexities faced by consumers and merchants:

• Improves site speed by up to 10x for Chinese consumers
• Enables preferred local payment options, WeChat Pay & AliPay, shown to 2x revenue from China
• Uses trusted and cost-effective Chinese logistics solutions for trackable delivery within a week
• Automates China customs clearance to reduce the consumer's tax bill and eliminate customs failure rate
• Adds dynamic translation to your .com
• Ensures effective and fast delivery to consumers in China from your current inventory, with no need to place stock into the market

Leading brands and eCommerce retailers are beginning to realise the benefits of China DTC. Zita West, a specialist fertility supplements brand, is using Nomad Checkout to open up China DTC, converting Chinese consumer traffic on ZitaWest.com to orders - at the highest conversion rate and average order value of all markets, delivering profitable, controlled, incremental China growth - at higher retained margin than selling via marketplaces.

China DTC is possible – if China isn’t part of your DTC game plan it should be.

If you would like to explore China DTC further feel free to get in touch [email protected] or visit the Samarkand Global website for more.