Spotlight on the Chinese e-commerce channel, daigou

22 December 2016

Mike Arand / Business Development Advisor / China

A forum in Auckland in 2016 explored the growing Chinese commerce channel known as daigou. Literally translating to “buying on behalf of”, a daigou is a shopping agent buying products to send back to clients in China, and there are opportunities for New Zealand companies and daigou to work together.

Keynote speakers at the China Digital Forum, as well as a group of panellists representing New Zealand brands and daigou wholesalers, shared their expertise on navigating the daigou channel.

Livia Wang, CEO of ACCESS CN, a Chinese marketing firm based in Sydney, has been active in the daigou space and recently organised the Daigou Expo in Australia. At this week’s forum Livia focused on how to reach and engage Chinese consumers. Her biggest piece of advice? “Think about your brand story, how you position daigous in your whole export journey, and give the daigous information and collateral that will help them run their business effectively.”

Watch highlights from the event here:

Read video transcript here

Jerry Clode is Director of SMART@Resonance, a social media and strategy company based in Shanghai working with some of the world’s top luxury and lifestyle brands. Jerry zeroed in on how companies can build a strong brand story in China at last week’s forum: “The most important thing about building a brand story is that it’s truly differentiated from others. Quite often brands are focused on the idea of pleasing their consumers but they need to do be doing that from their own unique starting point.”

Daigou is just one part of the e-commerce system in China and shouldn’t be used in isolation. Instead, New Zealand brands wanting to connect with consumers in China should take the lead in building strong brand stories in China. Finding reliable partners and establishing the supply chain are just the first steps; regulation compliance and smart marketing strategies are also needed.

New Zealand brands also need to ensure their IP rights are well secured, including a Chinese name to use in brand messaging. Also, think about the consumer –what are their needs, wants, desires, now and in the near future. Ask yourself, how can you satisfy these needs better than my competitors?

How ready are you for the China market? 

Here are 20 things that ACCESS CN recommends you do to prepare:

  1. The China market - to go or not to go?
  2. Is your brand story related to Australia / New Zealand?
  3. Search your products on Baidu, Taoboa and Tmall. How many merchants are selling products like yours?
  4. Invite 10 Chinese daigou agents to trial your products and listen to the feedback.
  5. Choose 1-3 products / SKUs from your portfolio.
  6. Write down your points of difference compared to your competitors. Identify those items that are the most unique.
  7. Get legal advice about your products and IP protection.
  8. Understand how new policies could affect you.
  9. Consider the products' capacity and determine exactly how much you can sell.
  10. Consider the seasonal impact.
  11. Plan your marketing calendar. All cross-border activities require 3-6 months preparation, e.g. 11.11 registration starts six months early in May.
  12. Find potential distribution partners in Australia / New Zealand.
  13. Follow your successful competitors and find which merchants are currently selling their products in China. Those merchants are your potential partners. 
  14. Go to a daigou storeand get an idea of the shipping costs related to your products, including packaging.
  15. Prepare 30 questions and answers for your products.
  16. Create 360 degree product views.
  17. Prepare the pricing structure.
  18. Write five sets of the WeChat moments assets (<100 words with nine pictures)
  19. Consider how you would distribute your content and use social media.
  20. In terms of the Baidu basic package, what is the result of your search in China?