Happy New Year!

Happy New Year!

A sincere “thank you” to everyone who made 2019 truly memorable. May 2020 bring you great happiness and prosperity!

#ChineseNewYear #YearOfTheRat

Is Franchising Still Feasible in China?

Is Franchising Still Feasible in China?

Recently, we’ve been working with one of our clients on how to make licensing and franchising sexy again in China. We are fundamentally reimagining what licensing & franchising means today.

The original models of licensing, franchising & distribution don’t work anymore. Often, people end up unhappy because they enter into a fixed structure & when you let someone squat on your IP in China it’s very hard to get out from under that. I don’t recommend it.

But, when you look at newer models they’re much more open and flexible. They might be exclusive, but they allow ways to get out of the situation if it goes awry, or if you simply outgrow the partner. You must be adaptive so that you can constantly absorb change. This is obviously easier said than done. Most companies have rigid legal structures, contract systems, etc. And I think for China most of those don’t work. The market is way too fluid.

Bottom line…don’t ever authorize anyone in China to control your company through a restrictive exclusive or semi-exclusive deal. Why do a margin share when you could do a service agreement? Why do either of those when you could do a joint venture and get them to put in half the money? Think creatively, protect your interests, and plan for flexibility.

#Licensing #Franchising #China #Flexibility #Adapt #Partner

Q: What do super fun brands, daily mentorship, freedom to create, personal growth and a flexible work environment have in common?

Q: What do super fun brands, daily mentorship, freedom to create, personal growth and a flexible work environment have in common?

A: KFD’s Shanghai Incubation Team

We’re looking for:

Channel Managers
Store Managers
Research Assistants
Account Managers

If you are a bilingual A player, please message me privately or forward to a friend like you 🙂

#Tmall #TmallPartner #Brands #Success #Alibaba #Management #China #HiringTalent

Do Chinese consumers trust online-only brands?

Do Chinese consumers trust online-only brands?

As with most things when it comes to China, the answer is “yes, but…”

Direct to consumer brands have been very successful in China. A recent example that comes to mind is an online-only brand specializing in shaving razors and accessories that we evaluated. They were EXTREMELY successful in China (I was even a bit shocked at their monthly sales numbers), but this was no coincidence. They had great brand awareness, were fully activated, owned their own IP, had excellent customer service, etc.

So just to give you an idea, the way you want to look at it is not online vs. offline. I want you to look strictly at point of interest and brand readiness. Do you own it? Do the consumers engage with you now? Are your current customers Chinese or do they have ties to China in some way? Do you have the brand assets and ability to provide the instant customer service that Chinese consumers expect? These things are the basis for the whether or not you can expect success in China.

#China #eCommerce #OnlineOnly #DirectToConsumer #Brand #Tmall #Alibaba #CustomerService #Taobao #ChineseConsumers

Taobao…The Land of Self-Trained Experts

Taobao…The Land of Self-Trained Experts

The Chinese consumer is the smartest consumer I know. They know the global price point for all of their favorite brands and are very sophisticated in their research. The consumer often starts researching their purchases months before they’re ready to buy.

We recently launched an international baby brand, and we found that the average journey before purchase started 12 to 15 months BEFORE the child was even BORN! When we launch a brand that isn’t already activated in China, we have to adjust expectations because we’re essentially going to lose a year. But if you know that in advance, you can plan accordingly.

Another complaint we hear from global executives and is that they can’t tie their social media investments and all their activation work directly to sales, and it’s because the journeys are much longer and more drawn out. So do the research. Find out what the “experts” who are buying your products are doing before they buy. What does their consumer journey look like? I really encourage you to do this. Understanding the expert nature of Taobao shoppers and their extensive research cycle is key to understanding how to succeed online in China.

#China #Taobao #Tmall #ConsumerJourney #Research #Experts

How to Fight Image Theft Online in China

How To Fight Image Theft Online In China

The easiest way to avoid hard work is to steal someone else’s. While designs may be tempting, most shops will have their own look and feel…at least merchants try to give the “appearance” of originality in their offers.

Not so in JD…

One of our flagships has to compete with semi-authorized dealerships who play dirty. Image and status hijacking causes extreme friction in the brand’s ecosystem. Dealers “fake” their authority by co-opting our designs and images.

To stop this, we complained to the platform and category manager to no end. But the most effective tactic of all was to bring hard evidence to the brand…with a clear indication of LEGAL leverage if they didn’t comply with our request.

I don’t like using such methods and I find it highly ironic that the brand’s GM was the real culprit, in cahoots with the bad guys. But when things aren’t right (and hurting sales), you have no choice but to do whatever you can.

Curious to hear if anyone has had similar experiences…and what worked (or didn’t.) Thoughts?

#China #eCommerce #Tmall #JD #Taobao #ImageTheft #InternationalBusiness