Take a page out of Alibaba’s marketing book

Red Credit Cards and Dollar Note in the Jeans Pocket - LargeWe just received a coupon we can use to take 15 RMB (about $2.50) off of a purchase on Alibaba’s Tmall or Taobao, but it’s only good on 11/11 — Singles’ Day. Last year Alibaba made headlines when shoppers spent an incredible $5.75 billion on Ali’s sites in a single day.

With Alibaba now listed on the New York Stock Exchange the value of another massive day of spending will be seen not only in profits, but also in a stock boost. Indeed, the stock boost has already started with investors expecting sales to reach $8.2 billion on Singles’ Day this year.

Alibaba does a great job of using this day to generate sales and headlines, and there’s an excellent growth hacking lesson to be learned here.

What can you do to set a fire under your users to get them spending money on your site? Or maybe for you it’s all about signups, or something else — how can you use the calendar to give them a nudge? Can you follow Ali’s lead and use that to generate press coverage?

Chinese studying abroad — an interview with Greg Nance (part two)

This is the third post in my series on Chinese studying abroad and the entrepreneurs serving them. This is the second and final part of my interview with Greg Nance, serial entrepreneur and CEO of ChaseFuture. As noted in the first part of this interview, ChaseFuture offers services like mentoring and essay proofreading for Chinese students aspiring to attend top schools in the US or UK.

In this part, Greg talks about ChaseFuture’s strategy in China, India, and Russia; co-founders and finding early employees; growing organically and creating a business that can scale; and gathering customer feedback as ChaseFuture considers expanding their services to better serve their customers’ needs.
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Increasing customer retention with discount cards in China

It had been a hectic week, and my back was not happy about it. My shoulders had locked up and my upper back was screaming. I decided to go to the spa across the street, a respectable chain with locations throughout Shanghai, for a 90 minute massage. They don’t offer the cheapest massage in the area, but it’s one of the best, isn’t shady, and is reasonably priced.

After my massage I stumbled to the front desk to pay; I was so relaxed it was hard to walk straight. With my defenses down, they decided to make the pitch I hear with surprising frequency in China: “Would you like to pay 3000 RMB today for a prepaid discount card, then we can give you 20% off this and future massages.” I gave my usual response, “Maybe next time.”

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Competing in China’s e-commerce market requires a startup mentality

Xin Wang of Brandeis University International Business School and Z. Justin Ren of Boston University School of Management wrote an interesting article about How to Compete in China’s E-Commerce Market for MIT Sloan Management Review. They analyze why companies like eBay, Groupon, and Google have struggled in China.

They offer advice relevant to both entrepreneurs and large companies: understand your customers, make decisions quickly, and pay attention to your competition. As The Startup Owner’s Manual and The Lean Startup point out, the entrepreneur’s mission is to understand their customers’ needs, test hypotheses by gathering customer feedback, and iterate quickly based on their findings. When doing this, you’ll have to discover how to solve your customers’ problems better than your competitors do. And since you are testing and iterating, you’ll have no choice but to create a culture of quick decision making.

As Blank and Dorf point out, “a startup is a faith-based initiative”. It’s important for large companies entering China, or other new markets, to remember they are also “faith-based initiatives” — even though they are market leaders at home, their approach is unproven in the new market. They need to think like a startup.

When entering a new market, make sure you understand the competitive climate and your target customers’ needs. Then, alter your offering to carve out your own piece of the market. Otherwise you may end up another example of large company hubris leading to failure in a new market.

Amazon in China — an example of localization


Amazon’s entry into China is a lesson in understanding the local market and catering to its needs. The most obvious difference is Amazon delivering goods themselves, or at least making it seem like they are. Not only do they understand the local market, but they may even be using a lean approach.

I suddenly started seeing z.cn (Amazon’s URL in China) everywhere I looked. At the time, we were still living in Hangzhou — a second-tier city about 100 miles from Shanghai — so the ads on busses throughout the city donning Amazon’s smile stood out. Advertising is pervasive in China and I wouldn’t be surprised if I found babies with logos on their foreheads; but the sheer volume of ads with z.cn and the Amazon smile surprised me.

Amazon seemed to focus on books and a few other key categories when I first noticed them making their z.cn push, though the range seems to have expanded since then. The similarity between their approach in China and the US isn’t what I find instructive, rather it’s the changes they are making for the local market that should interest entrepreneurs and foreign companies.

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How Chinese stereotypes could influence your business

“Shanghainese only care about money.” “Beijingers are really pretentious.” “People from Shanxi are really cheap.” These are a few of the numerous stereotypes I have heard Chinese people say about other Chinese people while living in China. I even often hear Chinese people use these stereotypes to explain their own views: “Of course that’s how I see it; I’m from Beijing.”

I used to just get frustrated and think of how detrimental stereotypes can be since, as an American, I have been trained to find them abhorrent in any form.[1] However, I have recently been considering how these stereotypes could affect businesses operating in China, whether foreign or domestic. Even if the stereotypes don’t apply to every individual, when people from a given area believe a stereotype is a cultural trait then it may just turn into a self-fulfilling reality as they play the cultural role expressed in the stereotype. This is something businesses need to be acutely aware of as they formulate their strategies in China.

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1.3 billion people drawing you in

I frequently ask business people why they are interested in doing business in China. The most common response I hear involves the promise of 1.3 billion Chinese consumers with rapidly rising disposable incomes. While this may be factually accurate, in my experience I’ve found that it’s safer for businesses to think of China as having many demographic subsets, rather than thinking of it as one country with a homogenous population.
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Monetizing apps in China – The Freemium model

There are many challenges facing web and mobile startups in China, including an incredibly dynamic market, keeping your staff from leaving you for one of your competitors and taking your Intellectual Property with them, and copycats that will appear within days of you gaining any interest from consumers or the press. But even if you are able to overcome these challenges and are able gain traction with your mobile or web app, it can be very difficult to get Chinese consumers to pay for your product or service.[1]

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Requiring Weibo users to register their accounts

According to new Chinese regulations going into affect on March 16th, all weibo (microblog) users in China will be required to register their real identities to continue posting weibo messages. With the pace of new user signups already slowing, there are predictions that Sina and Tencent, the two major weibo services in China, will see a significant drop in the number of users once we reach the deadline and that this will severely limit what has become a relatively open platform for speech in China.

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