Future Trends Of Chinese Brands Going Overseas in 2022

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When it comes to popular fashion in America, which brand is the biggest retailer in your mind? H&M? Zara? Or Forever 21? You might be surprised that in 2021, the most popular brand that surpassed all its competitors 28% market share Sheen, a Chinese e-commerce company founded in 2008, is into fast fashion sales. In 2020, Sheen completed its Series E financing with a . $15 billion The company is rated and has around 300 million fans on various social media platforms.

Sheen’s success is no coincidence. E-commerce and international demand for imported Chinese goods is increasing rapidly in the backdrop of the global pandemic. Even though overall global trade in goods decreased significantly in 2020, China’s cross-border e-commerce export growth increased 40%, For anyone who is familiar with China’s cross-border market, it is worth noting that many Chinese brands are taking their e-commerce products globally. For example, what most people don’t know is that ByteDance-owned TikTok has overtaken Facebook to become the number one most downloaded app. Ecommerce giants such as Alibaba, JD, Anchor and Didi in China are expanding their businesses around the world at an unprecedented rate. From mobile commerce, social media, livestreaming and digital wallets, the innovation ecosystem in China is currently at a unique juncture and is the first undeniable trend for 2022.

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The second trend is the increasing maturity of branding localization. on 1st Decemberscheduled tribe, 2021, The Chinese Brands Overseas Summit Forum was hosted online and localization became a ubiquitous catchphrase. It was agreed during the forum that defining the brand image and localizing products with branding strategies to align with the culture of the target audience is the key to the success of Chinese brands abroad. Using the power of e-commerce, Chinese brands are opening up a new market with localisation. As the brand with the most traditional Chinese style, Florasys, a domestic cosmetics brand launched in 2017, has carved a niche for itself in the global market including Western Europe, North America, Oceana and Russia. In 2020, Florasys plans to launch a new product line overseas. Florasys used the power of social media and marketing influencers to localize its products. Ahead of launch, it targeted @meredithduxbury, a micro-TikTok influencer with 200k followers, to do makeup tutorial videos with Florasis products. The first solo video quickly went viral and reached a showcase of the material. 5 million people, The influencer (@meredithduxbury) went viral with the products and now has over 14 million followers. The success of Florasys and other Chinese brands demonstrated how local Chinese brands have been able to gain a foothold in the US market in a relatively short time horizon, despite the turbulent relationship between Washington and Beijing.

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Although Florasys is not a large Chinese e-commerce company, its success overseas is a very good case study. Its success highlights the future trend that local marketing and operations, along with the ability to navigate a host nation regulatory environment, will be a core strategy for Chinese brands attempting to move overseas.

The third trend that we see is a change in operational mode. In 2021, China is increasing operating regulations by encouraging domestic companies that use . follow a series of File for Domestic Regulation and Local Registration, Since the end of 2020, Alibaba has been embroiled in a series of scandals that contradicted Chinese regulatory bodies’ guidance and was seen as a result of $2.75 Billions of dollars in fines for antitrust violations. The subsequent suspension of Ant Financial Group
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IPO, and a fundamental company restructuring also took place. Meanwhile, Didi Global Inc.’s shares declined. a record low After this, the Chinese also ran away from the regulatory environment. An ownership stake in the ByteDance Chinese version of TikTok—Douyin, which triggered Republican Senator Marco Rubio’s suggestion that President Joe Biden should ban TikTok in the United States, Chinese brands looking to do overseas business are looking to different operating modes to avoid further regulatory entanglements, following government moves to industry giants and reaching trade tensions between China and the US. For example, ByteDance is trying Decentralize your global business, Now, ByteDance’s new CEO Liang Rubo and a few other executives are working from offices in Singapore and Los Angeles. Meanwhile, although Douyin is controlled domestically, its other globalized businesses such as TikTok were registered as a holding company in the Cayman Islands. In the future, Chinese companies and their foreign brands will seek to grow in a way that betters comply with regulatory bodies, protect consumer data and leverage technology and social media platforms to increase scalability while at the same time reducing costs.

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Special thanks to Kexin Bian, who has contributed significantly to this article with editorial and research skills.

Earl Carr is Chief Global Strategist at Breakthrough Advisors based in New York City. His responsibilities include working closely with the firm’s CEO and President to manage the global research team and develop and execute the firm’s global thought leadership and cross-border business development mandate. Earl is editor of the recent book, “From Trump to Biden and Beyond: Reimagining US-China Relations”, Palgrave-MacMillan Press, September 2021.

From Trump to Bidenbook | From Trump to Biden and Beyond

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