Although Orange Branding focusses on Chinese cross-border ecommerce clients, our method, services and expertise can be applied also for retailers, traditional brands and for brands that want to enter the Chinese market.
China in 2019, counted 5 million e-commerce sellers of which 2 Million sell via Cross-Border Ecommerce (outside China) or called “CBE”.
Chinese CBE Sellers have the following general pain-points:
- Don’t have access to international knowledge and tools for digital marketing
- Don’t understand the language of foreign service experts
- Don’t understand the local culture of the DTC market (US/EU)
- Don’t have the skill to create relevant branded-content
- Can’r find affordable agencies in China or abroad
- Difficulty staying ahead of their US and EU competitor online brands
- Due to lack of brand strategy, they overpay up to 40% on ad-spend
These 2 million Chinese CBE sellers generate an estimated 5 trillion RMB revenue outside China in 2019. This represents 700 bn US$, or 20% of the 2019 export value of the People’s Republic of China.
On average, ecommerce sellers spend 10% on advertising and design services, which is low compared with US Sellers, which is often due to low profit margins or low customer life time value (CLV). We believe this will increase over the next 5 years to 50%.
At present, Chinese CBE sellers struggle for various reasons that are:
- Political; Anti-dumping, import duties, China image on quality, Tradewars.
- Economic; Covid-19 recession, Nationalism and local made branding in US and EU, Shift to manufacturing in south-east Asia, PRC GDP decline, PRC inflation, Brain drain, access to capital, No more trade-shows planned for 2020, New “anti-dump” policies Amazon .
- Social; Anti-China attitude, Low team working due to Covid, Business travel restrictions limited consultancy and new business development, Bad consumer reviews on Chinese products and impressions in EU and USA.
- Technological; Access to Chinese tools outside China, access to Western technology (Google, Facebook, Instagram, Youtube), skewed expectation from Western platforms based on the Chinese case: Wechat, paid media, influencers, Ali-Tencent traffic.
Orange Branding has created a specialized service for Chinese Ecommerce sellers to solve these challenges.
We call this method:
Branded Cross-Border Ecommerce, or BCE
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