How Brands Can Break Into China

At the inaugural Remode conference in LA, ORDRE co-founder Simon Lock along with Emma Lee — Tmall’s head of fashion in the Americas — share their advice for brands looking to enter China.

At Los Angeles’ newest forum, Remode: a two day event bringing together fashion brands, suppliers, emerging technology companies, investors, and media for a series of talks, panel discussions and exhibits, ORDRE co-founder Simon P. Lock took to the stage with Emma Lee — Alibaba’s head of fashion at Tmall in the Americas— to discuss how best a brand can break into China's lucrative and rapidly expanding fashion market.

Below are the top takeaways from the conversation “Cross-Border Commerce: Opportunities in China” between Simon Lock, Rob Keve — co-founder and chief executive of Flow, Emma Lee and Marie Driscoll — managing director of luxury and beauty at Coresight Research.

Emma Lee’s Top Takeaways:

  1. Are you ready to expand into China?

“It takes time to really understand whether or not entering China is the strategy for your brand. You should be having internal discussions to understand your brand’s health, the opportunities, the challenges. How is your US market performing? Is there an opportunity to enter the international market?

"Those are some initial questions a brand should ask themselves. Do we want to stay local? Or should we focus on becoming global? I think the answer is obvious. The world is evolving so fast, everyone is on their phone, technology and information is so fast that a brand can’t be US-only anymore."

  1. Utilise the influence of KOLs

"Whenever we see a brand working with a KOL, you see sales spike. Chinese consumers are very well versed in “M-commerce”— it’s not even e-commerce anymore because it’s all done on mobile. We project by the end of this year that 75 percent of transactions on Tmall will be conducted through mobile simply because Gen Z and Millennials live on social media.

"It’s not about integrating social media into your business — China is so advanced in technology that they don’t see it as integration — they just live through what their KOL is telling them, and follow that recommendation through to purchase. KOLS will help tap into your brand awareness, and how you should be using your marketing budget. Brands must understand how to reach their consumers through influencers."

“The world is evolving so fast, a brand can’t just be US-only anymore.”

  1. Leverage China’s sales events

"Alibaba just had another record breaking Single’s Day, making US$30.8 billion in 24 hours, with over 1 billion packages shipped by 180,000 participating brands. Singles’ Day is an opportunity to build brand awareness — think of it as a marketing tool to start tapping into Chinese consumers. There’s another opportunity besides the volume of the sales you’ll be conducting on that day — it’s an opportunity to gain consumer insight, to learn about who your customer is through data."

Simon P. Lock’s Top Takeaways:

  1. Chinese consumers don’t just want big brands

"We were always led to believe that Chinese consumers are only interested in high profile luxury brands. In the past, the status symbol purchase of a Gucci or a Chanel has certainly driven a lot of luxury brand growth in China. But the marketplace is underestimated in how sophisticated it is. Consumers are looking to fashion — like everyone else around the world — as away of expressing their own individuality and of course, there’s an individuality beyond the major brands.

"People are looking to bring other emerging brands into their lifestyle to express who they are, so it’s a huge opportunity for many of the new and emerging brands from Europe and North America to make a foothold in China. There’s an openness and appetite among Chinese consumers to explore brands that they haven’t heard of before."

  1. Embrace China’s superior technology

"An area where the Chinese market is somewhat underestimated is its advancement in technology. We’re starting to see Augmented Reality — consumers are able to try sunglasses on virtually on Tmall — technology which has only been spoken about in the international market, is real in China.

"Not only does implementing this result in better translation rates in sales, but when consumers understand products better, the return rates go down and everybody wins. There’s some incredibly technologies that are world-first and leading the way. Now, a lot of Western brands are looking to China and saying, what’s happening in mobile? We have a lot of learnings from the Chinese market which are applicable to the international market."

“You need to surround yourself with expertise to come up with a fully integrated solution — those who don’t are destined to fail. ”

  1. Seek local logistical expertise

It can be pretty scary going into a new market. It isn’t English speaking, it has a different business culture, everything you thought about doing business is different in China. I have been doing business in China for 10 to 15 years, and all I know now is that I’ll never understand it.

It’s not enough to get your product on a great platform, to figure out your merchandise, pricing, distribution and manufacturing, because that amounts to nothing if you’re not going to drive traffic to it. You need to go there and surround yourself with expertise to come up with a fully integrated solution. Those who don’t are destined to fail. Consumers in China see what your shops delivery rating from customs is, so if you don’t get the logistics right, you’re not in the game.

Suggested Reading

Why China is Ahead in Retail

Singles’ Day: A Designer's Diary

Culture is Key to Chinese Retail