Today, the Chinese birth rates have now increased to its highest level since 2000. This increase is explained by the easing of the one-child policy of 2014. It has once again been allowed to have two children, something that was banned for a large part of the population from 1979. And with more babies, there have to be more baby care products.
However, this is not the only ‘Buzz’ currently taking place in China; Also, spending on baby care products makes a sharp increase. According to the research by ‘Mintel,’ the market for baby and children’s products has grown by 256% over the past 5 years. This massive growth is due to the income increases and as a consequence of that, the purchasing power in China has substantially evolved.
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Why this sudden interest in baby care products?
Chinese parents and grandparents are constantly looking for original products that have been produced according to international safety standards. This is one of the success reasons of cross-border e-commerce platforms in China as it allows consumers to buy directly from abroad. This success is also reflected in the presence of brands on the platforms; Over the past 2 years, more than 90% of the world’s best-known baby brands have opened a flagship store. These brands offer a wide range of products, ranging from diapers to car seats.
The expectation is that the demand for the time being still continues to grow by 15 percent a year till 2020. Local dried milk scandals remain a persistent demand for products from the west; As a result, Dutch companies have been able to make a booming business in recent years. Popular Dutch brands like Nutrilon and Friso do very well on the Chinese market. In addition, Dutch brands have built up a good reputation in the sector of baby and childcare products, something where other Dutch brands could also profit from.
So why foreign brands?
If you are a Chinese parent, you will definitely have heard about the notorious baby milk scandal. That has affected the domestic baby milk and even the domestic baby care market of China ever since.
The domestic baby milk market had taken a huge hit due to the sandal of 2008. A decade ago, 300.000 babies fell victim of contaminated milk. Moreover, 6 babies died of kidney stones of another kidney failures and 54.000 babies were hospitalized. The main culprit was ‘Sanlu Group,’ but as investigation was developing more Chinese brands were involved.
Since this scandal, Chinese parents lost their trust in domestic baby milk brands, even if they weren’t involved in this drama. As a result, the market share of foreign baby milk brands rapidly grew. It met its peak when foreign brands were dominating the market with 80% of the entire sales.
On the first of January this year, 10 years after the scandal, history was going to repeat itself. China has removed 1.400 baby milk products from the shelves, because it was rumoured that the baby milk was contaminated with harmful substances.
So where to begin?
Know your target audience
What’s also important for a new brand, not to begin a price war with other players in the competitive market. You will lose for sure, because in the mainland market there’s always going to be cheaper brand. Therefore, you should create a product with a high quality so parents will recommend it to their friends who are also parents. Because this baby care market, it’s all about the quality. Your product will maybe not be the cheapest but will be the most recommended and thus the most desired.
WeChat: Word-of-mouth community
When parents purchase maternity and baby goods, they will often take the recommendations of another in consideration. And where else to ask questions than on WeChat.
As mentioned earlier, if Chinese parents recommend a baby care product, that brand will surely be successful. This market is highly depended on the opinions of their consumers, creating a word-of-mouth community.
It’s a good business idea to create an official WeChat account for your brand. Here you can promote your products to a huge audience. In addition, you can interact with your consumers and answer frequently asked questions. In return, Chinese parents will very satisfied with the good customer service and have a positive experience with your brand.
Offer your brand on e-commerce platforms
It’s a fact that the e-commerce market in China is a booming business. if you have decided to take your baby care brand to China, your brand has to be accessible for online buyers.
Instead of offering your own e-shop on your website, you can also choose to collaborate with popular e-commerce platforms. You will reach a lot of Chinese consumers and therefore more people will recognize your baby care brand. Moreover, some of your competitors already collaborating with huge e-commerce platforms such; JD.com, Tmall and TaoBao. So even more reason to collaborate with them.
As a parent, you want of course the best for your child. And after a notorious baby milk scandal that left the whole world in shock, Chinese parents don’t have any trust in Chinese baby care brands. And can you blame them? I wouldn’t put my faith in them either. So, in general Chinese parents have a strong preference for foreign baby care brands. As mentioned earlier some Dutch brands have already noticed this demand and have also made a name for themselves. Which make it easier for other Dutch brands to follow and to take their brand to China.
Despite all the big companies, there is still room left for more competitors in the Chinese baby care market because of the large demand. So, what are you waiting for? Just contact us
Need help to take your business abroad? Gentlemen Marketing Agency is the specialist in marketing to China. Feel free to contact us.