China Market Entry: Think local to sell local

As I was reading the paper this morning prior to starting my workday, I came across a story about Home Depot closing their last Beijing store, with only seven remaining in China and Best Buy closing up stores as well.

In the case of Home Depot, in some ways it is not surprising when you consider the culture in China for DIY – “do it yourself”. Here is a prime example of thinking local. In North America, going to Home Depot on a Saturday to pick up supplies for a project is common place, as most of us will do our own work at home, unless it is something major. In China, this is not so. Homeowners (apartment owners if you will) in China like having their residences upgraded on a regular basis, they just do not want to do it themselves, rather they will opt to hire a crew to do whatever is needed inside. I remember some years ago when Hua and I were living back in Shenyang, I informed her that the condo needed to be freshened up a bit, so I was off to the local B&Q (a British chain as we had no Home Depot there) to procure some paint and supplies for my weekend job. Horrified, she asked in we were in any financial difficulty because she wondered why we could not afford to hire workers to do this physical labour so I could save myself for more important things like writing reports and so on. I told her that all was well, it was just common in Canada to do this and because at that time, she had never been over here, she was confused. Later on, when she came to Canada with me and we settled in Guelph, she understood. She soon discovered that even people with means, did their own work at home. The local thinking and culture was different.

Many products and services are like this, which is why to be successful in your China market entry, you need to understand the local culture. In China, they do not always think like we do about many products and services. You need to study the market and understand why people do what they do. I remember last year while attending a wine tasting seminar in Shanghai, the CEO of the Australian winery explained to me that he struggled in the China market until he started on view his product from a local perspective and thus changed his marketing plan and found success, but it does not happen overnight.

Finally, I said the China market so I apologize for my error. It is the China markets as each area of China is different thus the thinking and culture is different as well and marketing needs to be altered accordingly.