Looking back at 2022 it has been a tough year for China

Lockdowns, uncertainty, closed borders all whilst the rest of the world opened up, travelled, met in person

It was hard to watch from the outside and even harder from within

This impacted many businesses – year 3 of not being able to travel in or out but also, more so the negative press coverage of China causing brands to put China on hold or reassess later

This is not how all brands have tackled China – some saw the opportunity to double down and are reaping the rewards

More are looking elsewhere – South East Asia has been a hot topic.

I recorded a podcast with Kelly Hazemans who has worked in ecommerce in both China and South East Asia as a trade partner and a brand ecommerce head and now as a consultant.

In this discussion we talk about:

What you need to have a successful relationship with your trade partner
1. Partnership
2. Transparency
3. Trust

*it is not all a one way relationship – hint hint

Online marketplaces in Asia. Exploring the differences between China and South East Asia market places – looking at costs, openness and integration
Importance of your own .com site in SEA vs. China
Explore the unique customer service landscape which is similar in China and South East Asia and demands the brands attention

Listen to the full interview to gain a real insight into Ecommerce in Asia

Do get in touch with Kelly directly on LinkedIn or her website

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This episode I talk to the founders Sophy and Joanna, of La Terapia a Chinese premium haircare brand

We hear about their story – why they launched the brands and the pain points that were not met by products on the market.

The difference with Asian hair but that within Asia brands were still not meeting the need.

Two major trends in Chinese hair care are:

1️⃣ Premiumisation – this is still immature, but we are seeing more western brands entering the market

2️⃣Segmentation – shampoo sells 4x conditioner but apart from conditioner consumers are starting to buy masks, look a scalp care and styling products

What struggles do these founders have

La Terapia is alone as a Chinese brand in the premium haircare space
The overall market is still quite immature and dominated by L’Oreal’s Kerastase
Building DTC brands in China is hard due to the ecosystem and the strength of the market places
Internal struggle with putting themselves forward as founders – culturally this is not so accepted and can be seen as limiting if your brand is too associated with one person

We talk about so many interesting topics. If you are a brand in or thinking about entering China or you are investing in Chinese brands LISTEN! And if you want to get in touch with the brand directly message them on Linkedin

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Chinafication is a phenomenon that has been creeping up on us. China is 1/5 of the world’s population so brands are adapting for this market. Since the onset of Covid 19 China has turned increasingly inward. There has been a real – a decoupling

Businesses have been forced to allow their China entities to be more independent.

There are key areas that are increasingly difficult:

👉Data – New regulations

👉Money – flows tightened

👉Products – increased border checks, reduction in Daigous

👉People – flow from international to China, foreigners leaving and Chinese not travelling

Successful International brands have been quick to recognize this and adapt to local trends

In this podcast episode I speak to Rachel Daydou from Fabernovel based in Shanghai about how brands are Chinafying their strategies.

What is Chinafication – it is brands becoming more sophisticated in the way they operate in China.

I have talked here many times about localizing for China – it is truly essential for success.

Here are 5 key areas where brands are adapting as identified by Fabernovel’s report:

1️⃣ Brand DNA – a local Chinese brand name

2️⃣ Product – adapting formulae or creating new products fit for local needs

3️⃣ Channels – need to use local channels

4️⃣ Communication – your story, hierarchy of messaging

5️⃣ Experience – O2O, pop ups and cooperations with Chinese brands

National Tide (国潮) the wave of nationalism that has led to the rise of C-Beauty has made foreign brands stand up and pay attention.

So if you are operating in China now or planning on entering what are the areas that are crucial to consider:

Brand messaging & Product story telling
Influencers to get your message out locally
Coops with Chinese local brands to amplify your message
If you are able O2O events

In conclusion: Why should international brands localise for China?

The days of Brands talking to consumer from the top down are gone. Successful Beauty brands all over the world are creating communities and conversations with their consumers.

China is no different. Over the past 5 years Guo Chao国朝 National Tide has exploded in popularity giving rise to many Chinese beauty brands. But International brands are still very much desired.

However to be a successful international brand in China now you need to prove you suit the local Chinese consumer’s needs. You need to appeal to their sensitivities and fully grasp just how different the China market is. Creating a tailored China strategy is essential – naming, messaging, assets, talent, social channels and NPD are all things that need to be considered.

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Sephora USA is a destination most brands want on their roadmap

Understanding their strategy is very important for many in the Beauty industry

Jennifer Carlsson has taken a step back and done an in-depth and highly informative report into Sephora’s Skincare category.

This 100 page report looks at 3 key areas

1️⃣ Brands

Full list of all Sephora stocked Skincare brands

Listed the brands that have been added and which have been kicked out

Looks at how these brands in Sephora perform on Instagram

2️⃣ Products

Analysed all products and pulled out those with the highest reviews/review scores/likes

List top 6 products across 6 skincare subcategories

Look at product trends – packaging & formulation

Overview of skin concerns and numbers of products to address them with average price

3️⃣ Statistics

Diversity of founders

Cruelty free and Vegan brands

Brand’s target audience

Pricing

Product packaging colours

It is a very thorough report which is helpful to brands in Sephora, aspiring to get into Sephora or investors looking to see gaps in the market.

I really recommend contacting Jennifer for more information on Linkedin or see her website.

You may also want to hear about Top Tips for PR in China and Cross Border E-commerce in China.

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K-Beauty has lost a bit of its shine

Over the past 10 years western consumers have fallen in love with the fast paced, innovative products coming out of Korea

But recently there has been less buzz

However Korea continues to innovate and set Beauty trends across the globe.

Here I talk to Holly Kim from Measure Commerce about the hottest Korean Beauty trends

CLEAN BEAUTY AND VEGAN PRODUCT TRENDS

Clean Beauty continues to be very popular in Korea but now Vegan is the hottest buzz word.

MZ Generation consumers in particular look for products with vegan certifications.

A few reasons why Vegan is so popular in Korea:

👉 EWG (environmental working group) has been popular with Korean brands as a sign of safety for several years and remains something brands use in their marketing

👉 Vegan has come up not particularly linked to food as very few consumers are actually vegetarian or vegan

👉 Vegan is synonymous with healthy living

👉 Vegan products are seen as mild and good for sensitive skin

👉 Vegan is thought to be good for the environment as well

PRODUCTS FOR SENSITIVE SKIN & BARRIER REPAIR

Koreans are very concerned about their sensitive skin. The sensitivity comes from overuse of products, procedures and surgery but it has spurred a demand for Skincare addressing sensitive skin.

Barrier repair is very important in China as well but it is not linked to Clean Beauty like it is in Korea.

There are many highly successful niche Korean Beauty brands focused on Clean Derma – efficacy is still at the heart of the marketing strategy. And they are mainly positioned at an accessible price point vs. luxury.

CICA (Centella asiatica) INDREDIENT TREND

Cica is an ingredient that is being used in K-Beauty originally to fight acne but now focused on calming for sensitive skin. It is a plant ingredient and it is being added to many products. It is a popular ingredient in Chinese medicine to treat redness and inflammation.

K-BEAUTY’S POPULARITY IN SOUTH EAST ASIA

Korean culture is extremely popular in south east asia from K-pop to K-drama and K-Beauty.

Increasingly we are seeing Korean brands export to these markets and also locally brands being inspired by K-Beauty and creating their own products at a more affordable price point

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Most brands I work with are great at PR

They attract a lot of attention in their home markets through a strong PR strategy for FREE

Then they come to China…..

It is so different and this is a real point of frustration that the strategy at home can’t be replicated in China

Here I talk to Nicky Wang from We Red Bridge a PR and marketing agency who work with many International niche beauty brands like Aesop, Fenty, Lime Crime.

The key areas we discuss are:

How PR in China is different from the west
Understanding the difference between PR and Marketing in China
The parameters brands should set to be successful with PR in China
Niche brands must be focused on a specific audience to get cut through
Your PR strategy needs to reflect your audience
The pitfall of an activation only marketing strategy
Pay to play in China and ways of getting some content for free

The three main takeaways are:

Set your objectives, timeline and resources at the outset
Be Focused on who you are targeting, where you will reach them and how
Be Bold – try new things, be daring. This market won’t wait for you

It is a very interesting discussion. PR is closely integrated with marketing in China for niche brands but make sure you don’t forget it! It is essential for the long-term health of the brand.

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Hello everyone and welcome to this episode of my interview series.⁣

The rise of Chinese beauty brands in the last few years has been meteoric

But this has been within China and fueled by local consumers wanting to support local brands

What is stopping these brands from global domination?

Here I talk to Lisa Shiqi Yu about her recent thesis looking at exactly this. In this conversation we take apart where the real issues lie.

First reviewing the fundamentals of building a brand:

Supply Chain, product development is not a problem – the manufacturers who make these brands also make some of the world’s most sought-after international brands
Distribution Channels – whilst the western channels are different from the Chinese ones this is not a major hurdle with the right partners in place
Branding and marketing – this is where the problem lies

We dive into Branding and why most Chinese brands are not brand led. They are marketing and product led and this leads to issues of longevity as well as difficulty communicating what they really stand for.

In China these brands have seen huge success using all the activation methods available – livestreaming, KOLs, Private traffic communities etc but this does not = a true brand strategy

On top of this we believe that it is not yet clear what C-Beauty stands for. And without a clear proposition to communicate overseas consumers will not latch onto it.

We discuss Perfect Diary and what they are focusing on now as well as potential difficulties brands like Florasis with their very visible Chinese aesthetic.

Definitely recommend you listening to this episode there are lots of insights into how Chinese beauty is shaping itself to go global!

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Hello everyone and welcome to this episode of my interview series.⁣

Why does a foreign brand need a Chinese name?

Many brands enter China without a Chinese name

I have worked in the market for over 15 years, initially with big global players who all had their own Chinese names and often nicknames.

More recently working with niche brands entering the market I have got a lot closer to the naming process and wanted to highlight it’s importance with this interview.

Linda and Ching work at Red Ant Digital in Shanghai and have created Chinese names for many Beauty brands in the market.

So why is it so important:

💡Pronunciation – many brand names are difficult for Chinese to pronounce due to the completely different linguistic roots

💡Memory recall – It is harder for non-native speakers to recall your brand’s name. If it is in Chinese characters you have a better chance they will remember it!

💡Comprehension – your brand name may mean something in English or it might be a play on words. But these aspects will be lost without a Chinese name

💡Search – Search volumes on Taobao/tmall are much high for brand’s Chinese name vs international name – back to the memory recall;)

💡Competitive advantage – don’t put yourself at a disadvantage vs competition by not having a Chinese name

Now I have convinced you that you should have a Chinese name – what else do you need to consider:

When to create your Chinese name: Ideally on market entry, once you have your China strategy and trademark it quickly
What types of approaches are there to naming: Phonetic, semantic and contextual or a mix of all 3
Chinese names are usually 2 – 4 characters and you can pack a lot of meaning into those characters so whoever is doing the naming needs to really understand the essence of your brand that you want to convey to Chinese consumers
Your name will rarely be used on its own and mostly with your international name so it is not that your international name will be unrecognizable in China
Due to the complexity of the Chinese language you will always have a lot of opinions on your Chinese name – there is no perfect name for everyone
Some brands do not create a Chinese name – Charlotte Tilbury for example is known in China at CT

Have a listen to these lovely ladies talk about something they have done for many brands – creating Chinese names for brands is a true art form and a fascinating process.

If you want to find out more about Red Ant Asia

https://www.linkedin.com/company/red-ant-asia/

please drop them a note

enquiries@redant.com

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Hello everyone and welcome to this episode of my interview series.⁣

Today, we’ve got Patrick Rosevear who is an intellectual property lawyer and under cover counterfeit “detective” helping brands solve their counterfeit issues in China.

China has a reputation for fakes this mostly comes from the fashion industry but it is still a big problem for beauty brands as well

WHILST BEAUTY CUSTOMERS DO NOT KNOWINGLY WANT TO PURCHASE FAKES, SOMETIMES IT CAN BE DIFFICULT TO TELL THE DIFFERENCE

It is worth your while checking out the size of the problem – even for brands who are not in China, if your brand has traction the chances are there will be someone faking it.

4 pieces of advice to get on top of the problem:

Own your trademark in China – to understand more about this see a previous episode with Mark Schaub
Get on top of counterfeit issues early by taking down links before anyone is making too much money!
Monitor it regularly every 3-6 months so you can act quickly
Many Beauty products are sold in private groups on WeChat which are impossible to search so you need to go to the wholesale platforms where the resellers are buying

You want to have a counterfeit problem in China

At least a small one but then you need to do something about it

Fake products happen in all categories and Beauty is no exception. These products can end up all over the world. Patrick Rosevear is focused on helping brands sort out this problem.

AS BEAUTY BRAND S A BEAUTY BRAND WITH SOME BRAND AWARENESS IN CHINA YOU WILL LIKELY HAVE SOME LEVEL OF COUNTERFEIT ISSUE.

So what should you do:

Make sure you own your trademark in China
Get on top of counterfeit issues early by taking down links before anyone is making too much money!
Monitor it regularly every 3-6 months so you can act quickly
Many Beauty products are sold in private groups on WeChat which are impossible to search so you need to go to the wholesale platforms where the resellers are buying

China is ever-changing to stay up to speed sign up for my newsletter on Cleanbeautyasia.com⁣

If you want to get in touch with Patrick Rosevear connect on

Linkedin: https://www.linkedin.com/in/patrick-rosevear-7878a846/

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Hello everyone and welcome to this episode of my interview series.⁣

Today, we’ve got Ivy Shen, who has been working, operating brands in Cross Border since it started at Azoya who run many multi-brand retailers and international brands in China.

Azoya is a borderless commerce group that helps international brands & retailers expand to the world’s largest e-commerce market: China.

This is a great episode – some of the super interesting topics we cover:⁣

⁣▪️ Where Cross border is heading – it is not going anywhere and has government support

▪️ There is still high demand for international brands but the need to differentiate is

essential – showing functional value through technology as well as emotional value

▪️ Tips on how to compete with the strong local C-Beauty competitors

▪️ The importance of listening to the consumer – how to do this better through private

traffic on WeChat

▪️ Key trends and super important advice

This really is a great episode – Ivy knows her stuff. A must listen for brands in China or thinking about entering

THE DEVELOPMENT OF CROSS BORDER E-COMMERCE IN CHINA HAS BEEN METEORIC It all kicked off in 2014 with milk powder…. and today….

Despite the changes in animal testing Cross border is still extremely relevant for Beauty

brands.

HOW TO COMPETE WITH CHINESE BEAUTY BRANDS This is a question that should be on everyone’s minds as you enter China

Ivy Shen and I discuss some key tips for brands to incorporate into their strategy:

📌 Know and emphasize your point of difference – make it relevant for your Chinese

consumer

📌 Look at your functional value – is it your technology or efficacy of a particular ingredient

📌 What is your emotional value to your target Chinese consumer – this is often forgotten

and a huge differentiator for foreign brands

📌 Flexibility on product development – find ways to really listen to your Chinese consumers

this is hard for brands on Cross border because there are so many layers but you need to

find a way.

TMALL HAS BEEN THE DOMINANT ECOMMERCE CHANNEL FOR FOREIGN BEAUTY BRANDS IN CHINA But that is changing there are new players shaking things up….

Ivy Shen and I talk about how Cross border ecommerce has evolved and where it is headed.

Some key takeaways that are essential for every brand to know:

👉 The line between Cross Border and general trade shopping is blurring – consumers hardly

see any difference in service or experience now

👉 Government policy continues to support cross border ecommerce

👉 We Chat is an increasingly important sales channel through private traffic groups

conversion rates can be 10x higher than normal channels

👉 On We Chat brands get much more access to data, intelligence and can personalize their

message and hence influence customers more

👉Douyin livestreaming and ecommerce is content driven and increasingly personalized a

refreshing difference from Taobao/Tmall promotional model

China is ever-changing to stay up to speed sign up for my newsletter on Cleanbeautyasia.com⁣

To connect with Ivy Shen and Azoya and hear more about the work they do - reach out:

Linkedin: https://www.linkedin.com/company/azoya

Ivy: https://www.linkedin.com/in/ivy-shen-azoya/

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Hello everyone and welcome to this episode of my interview series.⁣

Today, we’ve got Iris Chan, Partner at Digital Luxury Group (DLG) which is a full service digital agency supporting luxury brands, helping them find their luxury consumers. They primarily work with Chinese consumers.⁣

This is a great episode – some of the super interesting topics we cover:⁣

⁣🕵️‍♀️ Finding them – Start by looking at unprompted, peer to peer conversations social media about your brand, niche or competitors.⁣

Little Red Book and Zhihu are great sources of insight.⁣

👛 The pandemic has accelerated digital confidence but in China it has integrated online and offline more than ever before for example empowering Beauty advisors to live stream.⁣

👯‍♀️ Engaging with them – so many touch points for your brand. Don’t neglect customer service, even as a Cross border brand this is essential – make people feel special and answer them quickly!!!⁣

We also spoke about two big and important trends 💹that all beauty brands should consider:⁣

📈 The rise of the individual – consumers wanting to be treated by brands as the diverse and different people they are. This has really not been addressed in the Beauty industry in China yet. Brands have treated it as a homogenous group in many ways –⁣

THIS IS CHANGING 💣💣☄️⁣

👉Brands catered to the majority, often treating China like a homogeneous society⁣

👉KOLs did not specialize and few had strong points of view focusing more on a category like skincare or makeup⁣

👉Hair products focused on straight hair vs. tackling curly or wavy hair⁣

👉Only really 1 or 2 shades of foundation “because everyone has the same skin tone”⁣

These are some of the sweeping generalisations that I’ve heard but of course in a population of 1.4BN there is a lot of diversity⁣

📊 Duty Free – Hainan but other places will open as well and there is a huge opportunity for Beauty brands here. This will not disappear when international travel opens⁣

👉 New Retail is more advanced in China than anywhere else in the world – the mixing of offline and online.⁣

👉 Giving consumers a reason to go into store is important but also empowering in store Beauty advisors to be mini brand ambassadors online through live streaming has been a great shift⁣

👉 Customer service is one many CBEC brands neglect. China has strong service expectations when it comes to online purchasing. It is rarely a no contact transaction – they expect their questions to be answered fast and knowledgeable⁣

⁣

Cross Border e-commerce is currently a much simpler route to market but there is concern that next year once this process is fully established the government will start to regulate cross-border more closely.⁣

China is ever-changing to stay up to speed sign up for my newsletter on Cleanbeautyasia.com⁣

⁣

To connect with DLG and hear more about the work they do – reach out:⁣

Linkedin: https://www.linkedin.com/company/digital-luxury-group-dlg-/⁣

Website: https://digitalluxurygroup.com/⁣

Iris: https://www.linkedin.com/in/irisivychan/⁣

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Hello everyone and welcome to this episode of my interview series.

Today, we’ve got Johannes Walch who founded Sober Beauty with his partner Valentine.

Sober Beauty is a pioneer in Chinese Clean Beauty. Johannes and Valentine’s backgrounds are in management consulting and L’Oreal Product development and in 2019 they launched their own Clean Makeup brand in China.

They are passionate about Clean Beauty and optimistic about it’s growth potential in China

This is a great episode – some of the super interesting topics we cover:

💥 Clean Beauty is at a tipping point – more people know what it is and are curious about it

💥 The interest is pragmatic vs. ideological – it is focused on product safety, ingredients, and skin irritation

💥 Do not underestimate how informed your consumer is – don’t hide anything, talk to them as peers

💥 To succeed you need patience, money and careful planning

What are the key aspects of Clean Beauty that are resonating with consumers right now:

💥 Product Safety

💥 Lack of skin Irritation

💥 Specific ingredients and what that will do for my skin

💥 Is it safe for pregnant women to use

The awareness of Clean Beauty has grown both from abroad but also from the increase in Chinese brands talking about it.

Here is Johannes’ top tips for Clean Beauty brands entering now:

💥 The consumer is informed – don’t talk down to them, don’t hide anything from them

💥 Do not over charge for your products vs your home market. Value is important to the Chinese consumer

💥 Money – need to establish your brand

💥 Patience – gold rush for foreign brands is over but there is still a big prize

💥 Management attention – not to be taken lightly. Need time to carefully select the right partners.

I totally agree with all these tips – Clean Beauty has potential in China but it is not a copy-paste model – you need to tailor and design your strategy to set yourself up for success.

China is ever-changing to stay up to speed sign up for my newsletter on Cleanbeautyasia.com

To learn more about Sober Beauty

Website: https://sober-beauty.com/

Instagram: https://www.instagram.com/soberbeauty_official/

Or contact Johannes on Linkedin: https://www.linkedin.com/in/johannes-walch/

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Hello everyone and welcome to this episode of my interview series.

Today, we’ve got Lisa Yu from @genuinegerman.

Lisa Yu is a digital beauty native, previously working at L'Oréal China. She now works at Genuine German helping International Brands enter the China Market successfully.

In this interview we discuss the rise of C-beauty – have you heard of HomeFacial Pro? The speed we will see global Chinese beauty brands and how they are developing.

WHAT ARE THE FEW REASONS LISA & I ARE OPTIMISTIC:

Capital has flooded to homegrown Chinese Beauty brands. Not just Chinese capital but investors all over the world have piled in.

Government Policies favour local brands and this will only continue

There is a shift from Chinese brands towards longer-term brand-building tactics vs short term sales focus

More focus and investment on product R&D vs just using OEM. Will we see a Global Chinese beauty brand in the next 5 years? YES OR NO let me know below

COLOUR COSMETICS FOR FOREIGN BRANDS – THERE IS STILL OPPORTUNITY!

Lisa Yu & I discuss how some of the youngest girls in the workforce today use makeup

It is not uncommon to see girls coming to work bare faced in China (there is nothing wrong with this) - in the past many girls just didn’t use make up

Now

You see their social posts and they are out with their friends in full, incredible makeup but in the office still bare-faced

Why

Time, inclination and skills. Many feel they don’t know how to do “office makeup”

Whilst the use of makeup has grown a lot in China there is opportunity. Lisa and her team operate two very low price point European makeup brands in China hear more about their success

BODY CARE CAN BE FUN – NEW INTEREST IN THIS CATEGORY IS EXCITING FOR BOTH DOMESTIC AND FOREIGN BRANDS

The body care category in China has been dominated by large, mass market players. But things are changing – younger consumers are looking for brands to have more personality.

Lisa talks about rocking zoo a Chinese hair and body care brand doing well which was set up by a L’Oreal China alumni.

There is lots of great info and food for thought in this episode – China has plenty of opportunities and of course threats. The more you can inform yourself before you dive in the fewer mistakes you are likely to make!

To get in touch with Lisa:

Her website: lisashiqiyu.com

Her Linkedin: https://www.linkedin.com/in/lisashiqiyu/

Genuine German: https://genuinegerman.de/

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Hello everyone and welcome to this episode of my interview series.

Today, we’ve got Carol Zhou from Shiseido.

Carol Zhou currently heads up Innovation and investment for Shiseido in China. This is a great discussion about the latest trends in Skincare.

Key Highlights

👉 The rise in holistic beauty – beauty foods, supplements and more

👉 Medical Beauty boom still has a long way to go vs. Japan & Korea

👉 Sensitive skin market is increasingly important for care post medical treatment

👉 The importance of experts – dermatologists and plastic surgeons as KOLs

👉 The struggle with truly personalised skincare in China

Advice for niche brands

✅ Define your consumer target carefully – make it niche

✅ Tmall traffic has decreased recently as alternatives pop up – look carefully if it is right for your brand

✅ Create a story and tell it so people remember you

If you are a beauty brand or an investor this really is 20 minutes of insights that is definitely worth a listen.

To get in touch with Carol connect on

Linkedin:https://cn.linkedin.com/in/carol-zhou-5a53472/zh-cn

Shiseido website https://corp.shiseido.com/en/

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Hello everyone and welcome to this episode of my interview series.

Today, we've got Mette Knudsen from Knudsen&CRC.

Mette Knudsen is the CEO of Knudsen&CRC who runs a consultancy supporting brands through the registration process – she shares her on-the-ground experience of the new laws.

This is a great discussion about Animal testing regulation changes in China that came into effect on the 1st of May.

Key highlights

🌟 3 reasons why animal testing would still be required:

Efficacy Claims – whitening
New Ingredients – to add any ingredients not already on the safe list, animal testing will be required
Special use cosmetics – sunscreen, hair dye, children’s products

🌟 3 struggles brands are currently encountering:

GMP certification authorized by the government of manufacture
Responsible agent
Time to market

Advice for brands

✅ Get your documents ready – this is the main thing to hold up the process. Efficacy claim support is crucial

✅ This new process requires brands to give a lot of information- your raw material suppliers, source of ingredients, production process, etc

✅ Do not appoint your distributor as your responsible agent – get a 3rd party to support until you set up officially in China

China is ever-changing to stay up to speed sign up for my newsletter on Cleanbeautyasia.com

Listen to the audio for all her tips and if you want to get in touch, Mette is reachable on:

LinkedIn:https://www.linkedin.com/in/mette-knudsen

Email: mette@knudsenchina.com

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Hello everyone and welcome to this episode of my interview series.

Today, we've got Charlie Gu from Kollective Influence.

Charlie Gu is the Founder of Kollective influence. A marketing agency that focuses on helping brands reach Overseas Chinese Consumers mainly through working with Chinese influencers in the US and Canada. Is your business a beauty brand and wants to operate in China? Are you looking to build demand in China prior to market entry?

Create consumer demand for your brand in China BEFORE you enter.

Don’t just dive straight into the world’s most competitive beauty market.

In this interview with Charlie Gu, we discuss the importance of the overseas Chinese community living in the US.

This is a great discussion where we dive into tactics of how your brand can start its China journey

Key highlights

🌟 Overseas Chinese living in the US are a powerhouse in terms of spending and influence

🌟 Leverage this community on your doorstep to gain feedback and awareness for your brand in China

🌟 Do your homework – work through your brand story and work out why Chinese consumers will be interested in your products

**🌟 Think about your customer journey – how will they discover you? Not all channels are made equal.

A friend's recommendation holds a lot of weight!**

**🌟 KOCs – Key opinion consumers in the US are really important to build authenticity.

Product seeding is key for awareness, feedback, and testing your message BEFORE entering China**

**🌟 Chinese KOLs living in the US play an important role do drive awareness.

Many Chinese influencers look to these KOLs to find out about up and coming US brands**

🌟 It is crucial to target your message for your specific audience in China

👉 Why is the product suitable for Chinese skin, hair,

👉 Don’t be afraid to “Geek out” – Chinese consumers love the details of why it works and what ingredients help with specific issues

The overall message is, do not rush this. China is a big opportunity but set yourself up for success with a detailed plan and with enough demand before launching yourself in!

**Listen to the video for all his tips and if you want to get in touch he is reachable on:

Linkedin at:** https://www.linkedin.com/in/xiaofenggu

or through Kollective Influence website https://www.kollective.world

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German Torrado is the managing director of Genetisis E-commerce which focuses on supporting International brands by using their unique data analytics model. Genetisis use multiple sources of data to help shape the strategies for E-commerce operations and Digital Marketing activities in China in real time.

Thank you so much German for sharing your knowledge here at Clean Beauty Asia.

Is data informing your market decisions in China?

Gone are the days of investing and easily getting a great return. Now everything a brand does needs to be optimized.

Data is a crucial part of this process. Many people tell me access to reliable data in China is very difficult. This is only part of the issue.

In this episode, I talk to German Torrado from Genetisis which is a data analytics model that aims to help brands optimize their plans and investments in China.

What pain points is it solving:

👉 Growing cost of marketing in China. Costs on e-commerce platforms have increased 4x in the last 4 years

👉 Conversion rates are low and ever-increasing numbers of competitors

👉 Unfocused promotions because of blind investments with lack of information

👉 Real-time data so you can analyze in China time!

How does it work?

👉 Brand dashboard – tracking all your own data from anywhere you are sold online, your social media accounts all in real-time

👉Competitor dashboard – you define your competitor set and the dashboard will keep track of their promotions, pricing, product bundling, social media activity

This is a comprehensive tool and well worth brands investigating to optimize their brand strategy as well as daily operations in China.

If you want to get in touch with Genetisis and German Torrado connect on linkedin https://www.linkedin.com/in/germantorrado or see their website at https://www.g-commerce.cn

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Want to know what to watch out for when negotiating with a distribution partner in China?

In this interview I talk to Charlotte Mantoux a partner from LEAF law firm. LEAF specialise in Mergers and Acquisitions supporting clients with their China market entry.

Charlotte has a lot of experience helping brands navigate the legal side of partner agreements.

Her first piece of advice BEFORE you do anything – Protect your IP.

We look at 3 types of structures to enter the China market:

Distribution
Incubation
Trade partners

TRADITIONAL DISTRIBUTOR – What to watch out for:

Protect your IP 😊
Adapt internal decision making to China speed by giving distributor clear guidelines so they can act fast and stay on brand
Wechat account registration – If you are Cross Border you need to get the distributor to do this for you but have a clause in the contract to make it easier to transfer ownership if you change partners.

INCUBATOR – distributors or trade partners want to take a stake in brands

WHY?

📌 They want a distribution lock in so you won’t be able to change distributors in the future

📌 OR They want a strategic investment that will be lucrative in the event of future sale 💰💰💰💰💰

The distributor builds the brand in China but ultimately doesn’t benefit from the upside if the brand is sold so they want to fix this!

Charlotte shares lots of watchouts if you are considering this approach as well as 3 structures:

1️⃣ Invest directly in the holding company for equity

2️⃣ JV dedicated for China market

3️⃣ Non-Equity mechanism

Being careful about what information each structure will give the distributor access to is important – formulations and pricing for example.

Listen to the video for all her tips and if you want to get in touch she is reachable on Linkedin at: https://www.linkedin.com/in/charlotte-mantoux-1b88b054/ or through LEAF’s website https://www.leaf-legal.com/

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Mark Schaub and I discuss the details of the updated regulations for cosmetics in China & some key areas of concern:

A local responsible agent. A lot more responsibility is being placed on this party and with the unknowns of how this will play out means that brands may find it harder to find an independent responsible agent willing to take on this risk.
New Ingredients - the level of information that will need to be supplied and the IP issues associated
The QMS (equivalent of a GMP) from your manufacturer certified by your government authority and approved by the NMPA in China.

👉This is being looked at on a country by country basis so if you manufacture in a country where Beauty is not a top industry you may be waiting longer

But what with China there is always a long game and that may well be getting more brands to manufacture domestically. In 2014 Beauty products manufactured in China no longer required animal testing.

So despite seemingly making it easier for Cruelty-free brands to enter the market it may be a clever way of getting more beauty brands to produce locally in China. Have a listen to our discussion and tell me what you think.

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Want to launch your beauty brand in China but keep visibility and control?

In this interview I talk to Rob Robertson. He runs Star Brands Asia, they are a total brand partner for China.

They focus on 4D brand creation:

All channels – offline as well as offline,
Functional – legal, back office, sales force management, online TP services etc
Consumer Journey – moving consumers from awareness to loyalty
Changes – partner brands on the journey. Not just Tmall but look holistically at the long term strategy.

Here are some of the fascinating topics we talk about:

Why do some brands struggle in China – have a plan & do your research & FOCUS:
What do you want to achieve in China?
Chinese perception of my brand today?
What are people saying about you?
Choose your key messages that will resonate with your target in China
What are your star products?
Picking your brand partner in China
Distributors wanting to invest in foreign brands
- Discuss goals – how quickly do they plan to sell out
- Distributor 5x net sales value but ownership in a brand can get them sale price of 20x net sales!
- Example of a success: Profex in working with Kores
Animal testing changes
Cross border as a stepping stone to general trade
Retail environment is changing to adapt to more brands selling domestically
Your partner needs to have offline expertise to be ready for this change
Hainan
Travel retail booming
Productivity per door is extremely high
Star Brands Asia have established an office there with investor Bluebell
Trends
Douyin & Kuaishou Cross Border shops now open – enabling much better ROI
C-Beauty how can we learn from them. Not spending 300% of sales in marketing 😂

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Here I talk to Holly Kim, from Measure China – Measure China helps brands make Data based decisions to accelerate their growth in China.

We talk about a wide variety of topics from C-Beauty, to emerge trends that international brands can capitalise on.

1️⃣Premium Skincare continues to grow exponentially +40% yoy in China and international brands dominate here

2️⃣ Clean Beauty is growing but still remains niche. Consumers are looking for products that don’t contain certain ingredients like Fragrance and alcohol. Cleansing, masks and acne products are the most popular for Clean Beauty.

3️⃣ C-Beauty popular rise is mainly focused on colour cosmetics. The way they spend is different from International brands. Generally very little on R&D as they white label many products and focus on marketing and tech investment

4️⃣ Scalp care

There is a Chinese saying “Your scalp and your hair is one skin” - if your scalp gets saggy then the skin on your face will also sag 😱 It is becoming an important step in your anti aging routine

5️⃣ Hair care market in general is growing rapidly as consumers increase their level of sophistication and start multi step routines.

If you want to hear more about measure China please contact Holly Kim on Linkedin

https://www.linkedin.com/in/holly-jh-kim/

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Do you want to avoid making mistakes you haven’t made yet?

I am sure you do.

Josh Gardner has been operating International brands in China for many years and he is king of an example!

In this episode of my interview series we cover A LOT of ground but two highlights:

1️⃣ 3 tips for working with distributors

⏩ TRADEMARK: Your English and Chinese brand name ➕ any nicknames that the Chinese have given you!

⏩ EXCLUSIVITY: Very sticky relationship, hard to get out of. Take time to make the decision ! Demand transparency

⏩ REFERENCES: Do not skip this step. Talk to distributors current clients to find out their POV.

2️⃣ Success factors and example success stories

⏩ Full control, high investment model – Supergoop!

⏩ Distributor wholesale model using Daigou, 3rd tier cities and Social selling in wechat groups

⏩ Elements of success – brand recognition, consumers talking about you, being sold through resellers on Taobao as well as ample investment.

We talk about so many other topics too – it is packed full of great information. Don’t miss this one!

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Do you wonder how to manage your social media in China?

It can be pretty daunting:

All the channels are different 🤯

There are soooo many of them & new ones launching all the time 😳

Here I talk to Olivia Plotnick, founder of social media agency - Wai Social about how to manage this complexity for smaller brands entering China.

She gives lots of great tips. Here are a few highlights:

1️⃣Who is your target. This is crucial to narrow down to the most impactful channels for your brand

2️⃣ Some channels are non-negotiable like We Chat as consumers will always cross reference and need reassurance

3️⃣ Xiaohongshu 小红书 (little red book) is a good place to work with KOLs and to amplify your content through KOCs using product seeding.

4️⃣ KOCs want to be the first to introduce brands and discover them so if you pitch it in the right way you can get good coverage

5️⃣ Don’t overlook Taobao and Tmall – engage with customers there, look at it like a social platform

6️⃣ Instagram and YouTube are blocked but many young Chinese have studied abroad and still get on these channels through VPN. Use Chinese influencers on these channels!

7️⃣ Content strategy and management is extremely important to keep costs down and ensure you can use it across platforms as formats are very different.

8️⃣ We chat private groups are a great way to build a super engaged core community by offering them real value through tips, pre-launches and getting their feedback

Olivia is working with lots of smaller brands helping to build their social tribe in China, optimizing and maximizing their content and budgets.

To get in touch with Olivia add her on Linkedin or visit her website Wai social

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This episode of the Clean Beauty Asia interview series is with George Henein - head of business development at IMS, a leading digital transformation agency in China.

The focus of the interview is IMS’ new health and wellness platform Orghive.

It gives international brands in Beauty, health food and wellness quick access to targeted Chinese consumers.

What is Orghive?

Orghive is a Social & Content platform. It’s advantages:

✅ Strong purpose to help the Chinese make better, healthier, more informed lifestyle choices

✅Curated content and brand selection

✅Gathering consumers who are specifically looking for the best natural and organic options

✅Their scanning app on wechat allows consumers to verify the origin and authenticity of products which in turn gives them access to highly interested user base

Orghive is not a sales platform it is a way to get your brand to stand out and your Natural/Organic messaging to be given social proof without paying 1000s to KOLs.

Who are Orghive’s users?

Sophisticated Chinese consumers who are looking for a point of view they can trust specifically when it comes to natural and organic products for them and their families.

Most of their users come to them through their scanning app that uses blockchain technology to allow people to authenticate their products.

When in the brand’s China Journey should you contact Orghive?

There is no wrong time but if you are starting from scratch you want to build awareness in Chinese market at least 3-6 months ahead of your Tmall launch. Orghive is a good place to position your brand’s credibility in this niche.

Finally We talked about how long and how much investment it takes to be successful in China:

🥇 Do you have your China trademark? If not, this will definitely slow you down!

🥈 What budget are you able to commit to China in the next 2 years?

🥉 How dedicated are you to making this work – your time and flexibility?

Orghive is highly curated, targeting consumers who are searching specifically for the best natural and organic products.

Whilst choosing a highly targeted platform may not be the fastest route, it will allow you to balance investment and return.

You can burn cash in China to gain quick results (sometimes;) using high profile livestreamers and KOLs but if you don’t have a loyal fan base in the background the success will be short lived 🙀

So find a way to activate sales whilst you use your budget to build a loyal fan base then you will have a real chance of sustained success.

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Here I am talking to Jack Porteous from Samarkand Global. Jack is Samarkand’s Client service director. He previously worked at the Department of International Trade for the UK government and for the China British Business council. So has a wealth of experience.

Samarkand have offices in the UK & China and their mission is “To make Chinese eCommerce as easy as selling on your own .com”

We covered a range of topics starting from:

What are the 3 biggest hurdles for foreign Beauty brands entering China:

Partners
Competition
Animal testing

Firstly, partners - it can be very difficult to find the right fit:

Transfer of information is rarely smooth
Culturally it is less transparent so difficult to understand what is needed or what is being done
Distributors - you have less brand control but they may be willing to invest on their own to build you up.
Trade Partners - it is common for them to wow you with big sales forecasts but the reality can be very different

Competition is fierce in China

It is an expensive market to operate in. Even for Cross border e-commerce there are many areas that eat up your margins from fixed fees and commission for partners, to shipping and tax as well as platform fees and marketing.
Do not see China as merely a big sales opportunity. It is a big market but very complex and needs to be entered only when you are ready to invest your time and money.

Animal testing - Jack outlines the very latest info in regards to CSAR and how this will change animal testing.

The new regulations going into effect on 1st Jan will not immediately change anything
In order to file your products you need to have a GMP signed off by a government body but in UK and Europe no government body does that sort of thing so the UK government are still working with the Chinese authorities on how to manage this.
New Ingredients is also an issue. There has only been 30 new ingredients in 12 years. Lots of common ingredients today like Hyaluronic acid is not approved for use in China.
These new regulations will not apply to special use cosmetics (SPF, Hair colour, growth etc)

Samarkand Global are an e-commerce solutions provider for brands. They offer 3 main types of services:

Distribution - Beauty and Health products. They have a network of shops they distirbute to from KOLs, Taobao stores, wechat stores etc.
Trade Partner - Setting up and running market places and other online shops for your brand in China
Nomad Checkout - a simple solution to allow your own global website to be accessed in China, with checkout in Chinese and using Chinese payment methods. They also take care of the shipping & customs. Ensuring a good experience for your customers.

Contact Jack on Linkedin:https://www.linkedin.com/in/jackporteous/ or go to Samarkand’s website

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This interview is with Mark Schaub from the law firm King & Wood Mallesons. We discuss Trademarking your brand in China, animal testing regulations and trends in the Chinese beauty market.

Mark has extensive experience with the China market and has worked with numerous Beauty brands on their market entry.

The first area we discuss is trademarking for China and why it is important:

🎯 China is a first to file system vs. most western markets where it is a first to use

🎯 Relatively inexpensive to file around 700 USD per category/class

🎯It takes around 12 months to get the trademark – do it early

🎯China is the No1 Trademark country in the world – so there is a lot of competition

No1 Action – check if your trademark is available & file even if you are not ready to enter the market.

Trademarking your Chinese name is also important but that can be done down the track but BEFORE you start to market your brand to the Chinese inside or outside China.

For brands who run into problems where someone has filed their brand trademark already Mark’s advice is it is often quicker and cheaper to buy it back rather than litigate!

For English name trademark you can go through the Madrid treaty route but for Chinese names you will need an agent in China. It is safer to go through an agent for both to make sure there are no issues with classification.

Mark & his team very kindly put together a short presentation on trademarks so message me if you would like a copy of that. I will be happy to share.

If you are wanting to trademark your brand get in touch with Mark and he will refer you to the trademarking department. It is usually a pretty automated and straight forward process so the costs are within the range above.

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This week I am talking to Michael Norris from AgencyChina. Michael is a research and strategy manager, he and his team spend a lot of their time conducting fieldwork across China observing first-hand consumer behaviour and preferences.

This gives him a rare and highly valuable insight into the way many consumer sub-sets think and act.

A few insights that we covered:

GENERAL

💡The extending of the beauty category – beauty from inside out, wellness, gadgets to keep your products at the perfect temperatures

💡Mask factor – Needs to help resolve/avoid maskne (mask + acne) – daily care and emergency response to solve breakouts

INGESTIBLE BEAUTY

💡Ingestible Beauty – long standing tradition in China to use food to strengthen beauty health – skin, hair, nails

💡Smaller brands - can standout using a hero SKU approach to focus efforts and avoid confusion

💡Formats for ingestible beauty market have moved away from basic collagen powders and has rapidly expanded including gummies, fortified foods, hydration – infused waters.

MALE BEAUTY

💡Male Beauty market growing faster than female

💡Products – some consumer groups starting to move from pure cleansing and hydration to more sophisticated products

💡Assortment – bundles is the dominant way consumers like to purchase. But what to put in those bundles requires more research.

💡Packaging – Larger formats, reduce repeat purchase rates.

💡Ease – how to make it easier for consumers to repeat purchase could be a very important innovation

Michael is doing a joint research project in the new year on Male beauty in the China market. This is an innovative way of more brands being able to get access to the research without compromising confidentiality all whilst keeping costs low.

Contact Michael through his Linkedin

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This interview is with Byron Constable of Avenue 51. Avenue51 is an online retail solution for selling in China used by more than 100 British brands including Waitrose, Aspinal of London and the beauty brand ThisWorks.

Byron is working on a new project to make entry to China more accessible for smaller beauty brands called 10.10.

The 10.10 project is aimed at brands who want to either test Chinese consumers’ receptiveness to their products or who want to start building buzz as part of their market entry to China.

Avenue51 has a database of 40,000 Chinese consumers who have used their shipping services – mostly based in the UK. These people provide a fantastic way for brands to get their products out to local Chinese consumers who will then advocate for them with friends and family back home (as long as they like the product;).

The idea behind 10.10 is it is an accessible and affordable way to get Chinese people to try your products and if they like them, they post about them on social media so therefore starting to create reference points and conversations for other consumers who may want to buy your products.

In this interview we cover several interesting topics:

Why using 10.10 community will give you an authentic start to your China journey
How it works – signing up and costs
Angel & Devil KOCs – Key opinion consumers & how they can be the make or break of your China journey
The importance of visibility and staying top of mind

If you want to find out more about Avenue51 and how they help brands in China, see their website: https://www.avenue51.com/ or connect on Linkedin with Byron directly.

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This interview is with Elisa Harca of Red Ant digital agency. We talk about lots of different topics from which social channel should beauty brands focus on to a key trend they see brands being able to leverage locally which is the “Tribalisation” of Beauty.

In just under 30 mins we packed a lot in! 10 different sections with lots of fabulous tips and tricks that brands in China should look at implementing.

SOCIAL NETWORK FOR BEAUTY - LITTLE RED BOOK
THREE TIPS FOR LOCALISATION
ORGANIC REACH
SEEDING APPROACH
DAIGOU – PRE MARKET ENTRY
IMPORTANCE OF HOME MARKET SUCESSS
C BEAUTY
LEVERAGING LOCAL TRIBES
FINDING YOUR NICHE FOR CHINA
TEST & LEARN & TRY - FAST

If you want to find out more about Red Ant and what they do in China have a look at their website: https://asia.redant.com and connect on Linkedin with Elisa directly https://www.linkedin.com/in/elisaharca/.

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Here I talk to Ker Zheng from Azoya about the different marketplace options that are available for Beauty brands doing Cross Border e-commerce in China. We take a deep dive into the biggest and best known platform Tmall Global.

In this video we talk about Tmall as well as the other key marketplace platforms to help you make a decision on what fits your brand best.

A few points going for Tmall that Ker points out are:

📌 It’s the largest cross border dedicated platform

📌 It has the broadest appeal in terms of consumer profile

📌 It comes up in Taobao search results – because Taobao is where everyone actually goes to search for products or brands

More details on what we covered:

1) WHY CHOOSE TMALL?

2) DIFFERENT STORE OPTIONS ON TMALL

3) OTHER OPTIONS FOR SMALL BRANDS

4) LIVE STREAMING

5) OTHER PLATFORMS TO LEVERAGE FOR BRAND AWARENESS

6) TREND TO WATCH - LOCAL BRANDS, SPEED OF INNOVATION

If you want to get in touch with Ker please contact him on Linkedin: https://www.linkedin.com/in/ker-zheng-121a2713/

tmall #tmallglobal #crossborderecommerce #china

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This is part of a video series for #IndieBeauty brands to educate yourselves on operating within the Asian region.

This is designed for Small to Medium sized 💄Beauty brands expanding in Asia.

The first series is focused on #China Cross Border e-commerce. This interview is with Jennifer Spark of Spark communication. An agency based in Australia dedicated to help brands tap into the local Chinese in Australia to help launch brand awareness before moving to mainland China market.

In this video we cover a series of topics - all extremely useful for brands in China or considering entering the China market.

1) WHO ARE THE CHINESE LIVING IN AUSTRALIA

2) MIGRATION AND THE CONNECTION TO THE MAINLAND

3) HOW TO REACH THE CHINESE IN AUSTRALIA – MEDIA WECHAT

4) LITTLE RED BOOK, BILLIBILLI & MICRO INFLUENCERS. DON’T OVERLOOK INSTA

5) TRENDS: GROWTH OF CHINESE BRANDS

6) WORD OF MOUTH

Please do get in touch with Jennifer directly reach out to her on Linkedin: https://www.linkedin.com/in/jennifer-spark-1abb436/

If you want to find out more about what it takes to be a successful Beauty brand in China and how to enter as a cruelty free brand have a look at my website for lots of free resources https://cleanbeautyasia.com

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For small to medium beauty brands coming into China through Cross Border E-Commerce your main choice is a distributor or a trade partner.

Here I talk to Michael Simonet from Qingdao Alea about being a trade partner, finding the right one for your brand and what it takes to succeed.

Michael outlines his process for deciding to work🤝 with new brands including market research, forecasting and launch strategy✍️.

We cover a series of topics:

1) WHAT IS A TP?

2) FINDING THE RIGHT TP – HONESTY, REALISTIC FORECASTS

3) CBEC STEP 1 & DISTRIBUTOR OR WOFE

4) INVEST MONEY DIRECTLY INTO THE MARKET

5) SPEED OF MARKET

6) HOW TO STRUCTURE WITH HQ – NEED TO SUPPORT CHINA PARTNER

7) INTERESTING TRENDS FOR BEAUTY BRANDS

If you want to get in touch with Michael please contact him on Linkedin: https://www.linkedin.com/in/michael-simonet/

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This is part of a video series for #IndieBeauty brands to educate yourselves on operating within the Asian region.

This is designed for Small to Medium sized 💄Beauty brands expanding in Asia.

The first series is focused on #China Cross Border e-commerce. This first interview is with @LucyZhang of @Feelunique, the European Beauty E-retailer.

In this video we cover a series of topics - all extremely useful for brands in China or considering entering the China market. Lucy comes with a strong background understanding both the brand and the retailer sides of the business.

The Key Topics that we cover are:

1) HAVING THE RIGHT TEAM SUPPORT AT HEAD OFFICE

2) WHAT TO LOOK FOR WHEN FINDING PARTNERS – CULTURAL DIFFERENCES AND PACE OF WORK

3) WHAT DO YOU NEED TO BE AWARE OF -TIME & MONEY

4) IS THERE SUCH A THING AS A QUICK WIN?

5) A KEY CONSIDERATION IS THE SOPHISTICATION OF THE CONSUMER

6) SOME CONCRETE TIPS & TOUCH POINTS

If you want to get in touch with Lucy directly please reach out to her on Linkedin: https://www.linkedin.com/in/lucy-x-zhang-976713a/

Clean Beauty Asia: Recent Episodes

Allie Rooke

tmall #tmallglobal #crossborderecommerce #china