Marketers from the US are keen on investing in China, but they have to be wary of the knowledge gap between their perception and the reality of government regulations.
Marketing consultancy Lewis surveyed 351 US marketers and revealed that there is a perception of overconfidence in regards to marketing in China among US senior marketers which leaves brands open to risk in the world’s second-largest economy.
For example, 80% of US marketers reported that they completely or mostly understand marketing practices in China, while only 23% felt it was either extremely or very difficult to market in this country. And 88% felt very confident in their ability to accurately measure marketing campaigns in China.
In contrast, 23% of respondents felt it was either extremely or very difficult to market in China as they possessed insufficient knowledge in the Chinese market. 41% of respondents applied the same marketing plans in China as they did in the US, despite the vast difference in platforms, demographics, and culture between the two markets. 19% felt they had little-to-no understanding of marketing practices in China, with 77% citing a lack of transparency in the marketing industry as a barrier to their marketing efforts.
China has a different social media landscape, yet almost a third (30%) were only somewhat or not at all familiar with Chinese social media and eCommerce platforms. 69% of respondents used Bing as part of their search marketing efforts compared to 59% using Baidu (59%), a stark contrast with the platforms that were most used by Chinese audiences.
“China is a giant and constantly changing market. Whilst it offers great potential for overseas brands, it also demands a deep understanding of local habits and channels to successfully reach audiences," said Emma Jenkins, senior vice president, APAC, Lewis.
When it comes to the reason for the biggest challenges for their companies marketing in China, the top three challenges included; increased regulation within the country (37%), political relations between the US and China (32%), and growing competition from local Chinese brands and businesses (23%).
Lastly, US marketers were increasingly looking beyond first-tier cities, with more currently marketing in second-tier locations than any other segment. When asked about marketing priorities for the future, 88% of respondents believed expanding their marketing and communications programmes outside of first-tier cities was very or extremely important.
“These findings were in-line with growing incomes and government strategies that are attracting talent to new locations. The survey findings revealed that emerging second-tier and third-tier cities were proving to be key drivers of China’s growth. This presents a great opportunity for brands that are looking to grow beyond first-tier markets and build up a presence in less competitive locations," said Jenkins.