Sell on Taobao and Tmall: Foreign children’s products and the Chinese online market
K’Nex’s made-in-America toys on Chinese online platforms Taobao and Tmall
K’Nex, an American-based toy-maker started selling made-in-America products in China through Taobao and Tmall websites last year. Michael Araten, President and CEO of K’Nex Brands (whose translation into Chinese language is 积木, ji mu meaning piling up wood) is confident in attracting Chinese consumers with the brand’s Angry Birds, Super Mario Brothers and Mario Kart building sets. Indeed, Chinese parents who are preoccupied by the future of their children in the competitive Chinese society like building toys for they stimulate the development of imagination, problem-solving and thinking-skills. Export Now, an online platform which makes American companies enter the Chinese market through Tmall and Taobao will be K’Nex’s partner for the project. Thanks to its strong marketing strategy which includes social media and search engine optimization, Export Now will help K’Nex become known among Chinese consumers.
Chinese parents safety concerns: an auspicious context for foreign children’s products brands
Concerned by the idea of taking their children away from toxic stuff, Chinese parents pay great attention when it comes to buy food, clothes and toys for their babies and children. Foreign brands are regarded as safer and are popular among Chinese parents. The extent to which parents prefer buying foreign brands is such that when they travel abroad, Chinese tourists bring back many foreign products for their friends and family. The 2008-scandal of melamine in milk strengthened this trend for dairy products, with many families buying exclusively foreign infant formula. On Taobao, the phenomenon of shop owners selling products purchased abroad is described by the now widely-used expression “dai gou” which means “purchasing on other behalf”. The number of dai gou for children’s products is increasing dramatically. Chinese parents are becoming wealthier and as soon as they can afford it, they do not hesitate to pay more for better quality products. Only people with lower incomes purchase domestic brands for children’s products. Consequently, K’Nex’s made in America products can be expected to be very successful in China.
Taobao and Tmall e-commerce for a first contact with the Chinese market
Such a demand for foreign products encourages foreign companies to invest in China. For brands which are not already present on the Chinese market, online stores on Taobao and Tmall offer numerous advantages. The first contact they allow with Chinese consumers is less risky than opening a physical store (no logistic issue…). The growing online Chinese market is already the world’s biggest online market. Taobao and Tmall are its more important actors. Therefore, they connect foreign brands and vast number Chinese online consumers very quickly. Foreign brands can consequently test rapidly Chinese market and adapt their strategy depending on its reaction. Not only does e-commerce through Taobao and Tmall attracts brands which have not invested yet in China, it also turns out to attract already established companies which are willing to reach an even larger fringe of the population (namely consumers living in smaller cities and who do not have a direct access to stores). This is the case of Gap and Adidas which are available on Taobao.