Marketing Transportation in China

Here is a question asked of our expert panel of interim marketing executives. If you have a question about marketing or sales, you can submit it here.

Question: I have a US-based company that is launching a product into china into the city transportation space. How would this marketing effort differ from a similar marketing effort in the US?

The fundamentals of defining & finding customers and marketing won’t differ significantly from a US approach. The most important differences in doing business in China will stem from culture, patterns of consumption, & channels.

For example, in promoting Intel Inside into China in the ’90’s media and channel outlets we’re accustomed to in the US at the time didn’t exist or were pretty fragmented or cluegy. In that period one of the most reliable & significant channel’s of mass communications was millions of bicycles and riders that commute each day. So millions of the familiar Intel Inside logo were handed out as stickers,reflectors and decals to put on the bikes. Lots of media impressions during ‘ride time’ morning, noon, and night!!!

-Peter Klinge, Interim Management Executive

Marketing is much less defined and fragmented than in US. If marketing into governmental channels culture will become a dominant factor. Commercial channels are much more multi-layered and fractured than in US. Most essential ingredients for success are trusted partners with management talent who understand and operate comfortably and effectively in the Chinese market. Although the quantity and quality of the human capital in china is very strong the country still lacks good middle and upper – level managerial expertise thus necessitating expensive expats to support operations. Think long term and cultivate relationships for the long haul. Skimming strategies may work in the very short term, but the Chinese learn quickly. Consequently, penetration strategies will reap optimum benefits. In the US companies are accustomed to competitors who are focused on profit. In china, there is a mix of private companies, state-owned companies and hybrid businesses. Government businesses exist to provide jobs, rather than to create profits.

-Joe Heaney, Interim Management Executive

Is it a product that will be sold to the city or sold through advertising on transportation?

One of the most significant differences compared to US is the amount of government involvement that will be required. Here we think about he government only when it gets in our way. There, you have to have a deliberate plan to deal with the government and officials that are involved. At the worst case the Company will have to anticipate requests for direct payoff and should be very knowledgeable of the Foreign Corrupt Practices Act. This applies to how they deal with people and how their contractors or employees deal with people that ask for payment for influence.

Another consideration is who they work with in China. A common mistake is picking a contact based on relationship, e.g. a brother of someone they know in the US. This person may not know the market or vertical. It’s important that you recruit for industry and market knowledge and do the background checks.

-Dave Parker, Interim Management Executive

Like peeling an onion, Developing personal long-term relationships has to be one of the primary objectives to develop a lasting market presence in the Far East. Although placed at a arms-length at the beginning, once the trust and personal connection is established will the benefits of the launch will be achieved.

-Rich Hennessey, Interim Management Executive