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

2
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
The State of Inbound Marketing in China 10th September 2014

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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

4
4 The China Opportunity
China 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!

7
The 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

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

10
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

11
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

12
12 Unique China Challenges
Marketing 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

15
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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The 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

27
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’)

28
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

29
Using 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
• SinaWeibo, 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

39
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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Influencing 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

42
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

45
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

46
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

47
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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Conquering the Chinese
Market
Final 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?

52
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!

Inbound Marketing In China

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