What you know to be true of your home market, EU and US may not be the scenario where China is concerned. China, as an economic ecosystem and a universe of its own, so to speak, is far more complicated than you imagine it is. It pays well to do your research and homework. What worked for you years earlier when you’ve done business in China and outside of China’s market may not be the case anymore today. Plus, you’re up against the best and the biggest industry players inside.
Our guest today is Josh Gardner of kungfudata.com. With his extensive experience working in and out of China for many years, he has the most significant and detailed perspective on China’s eCommerce and digital marketing climate.
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According to him, what’s happening in Southeast Asia now has already occurred in China five years ago. They’re way ahead in the eCommerce space. He suggests taking a closer look at the ground, studying and seeing what they do in China that worked out. And then charting a design for your eCommerce business that would make sense for you and the Southeast Asian market.
- What brought him to China, the jobs he had before ending up in e-commerce [02:29]
- Talking about KungFu Data, what it is about, and the many iterations happening before finally making it (including valuable thoughts on how to make it in China) [8:23]
- Taking a look at China’s digital ecosystem now and the factors that impacted the different brands’ performance [26:48]
- The overall business climate in China and how foreign businesses coming in are affected[36:07]
- The mindset of most businesses entering China that’s headed for failure[42:04]
- Eye-opening critical differentiators of the Chinese market from the EU and US markets[53:09]
- Valuable tips and advice any startup and current business owners in Southeast Asia should pay attention to[01:01:12]
- How to stay updated with developments in China (helpful resources you can use) [01:08:32]
- Where to find Josh and get updated about China[01:11:54]
What was mentioned:
Ideas worth sharing:
“Humility and respect for where you’re going in are the two most profound traits; an open mind and change are the other ones. That’s what I see with people who do well in China and probably any other market they’re going into that’s not their home market. That should lead you to good things in your life, especially in business expansion in the Asia Pacific.” – Josh Gardner
“It’s very muted, which is a great word for China eCommerce right now, It’s hard to plan, It’s hard to buy, It’s hard to sell. Everyone is being cautious. There’s huge demand, huge energy, all pent-up, waiting to be released, but just sitting there.” – Josh Gardner
“People are really considering holding off or finding solutions that don’t involve outlay and risk. Many people already in the market are thinking about an exit or finding a way to offload China. It’s created this uncertainty, and this questionable future, in terms of their own business that they don’t feel confident or comfortable.” – Josh Gardner
“On my side, because my business, before COVID, conveniently moved over to this online brand development accelerator and distribution model, we see a huge demand for our services because we take the market and inventory risks.” – Josh Gardner
“The digital integrations and merging the worlds completely to protect your core commerce, your business, whether online or offline. That’s a significant movement right now and on the ground.” – Josh Gardner
“These are the basic misconceptions, and they get everyone into trouble — over assuming popularity, brand strength, underestimating resources, cost-commitment level, infrastructure, talent. On the grid of everything from visibility to localization, cost, complexity, and talent, I’d say 99% of people coming in [to China ] don’t have a clue. And I mean that in the nicest possible way.” – Josh Gardner
“China is a high-risk market because most people going in have truly a low level of understanding of what needs to happen to make China viable. Even the conditions for success are not well understood, and that’s really where people get into trouble.” – Josh Gardner
“Instead of working on P&L, what I tell people to work on is category leadership. Can you be a top-five brand in a subcategory or multiple subcategories? The answer to that question is everything. Because everything you do down the line to get that leadership position is about building an unfair advantage.” – Josh Gardner
“Three-quarters of our brands are in their top five, and at least most of their subcategories are top 10 in bigger categories. But they didn’t start that way. And that’s because it’s not like status and success in China. It’s not a birthright; just because you’re famous outside China doesn’t matter. Building unfair advantage and defendable positions in China is a process that is hard-earned.” – Josh Gardner