When you ask people about China, one of the first things that will come up is the Great Wall of China. This huge defensive structure, totalling more than 21,000 kilometres, is indeed a very impressive structure. The Great Wall of China has been very effective in defending the borders of China.
The Great Firewall of China is the modern equivalent, and it’s just as impressive. It combines legislation and technology, operated by the Peoples’ Republic of China to have full control over internet usage within the Chinese borders.
The Chinese have several reasons for their desire to control the internet within their borders:
By keeping foreign companies out, domestic companies can grow bigger.
The Chinese government wants to strengthen its position by controlling the flow of information
The Chinese government have banned certain content, such as government criticism, military information, sexual explicit content and religious content.
The authorities state they keep a close eye on consumer safety, fighting the sale of unsafe or fake products.
What does the Great Firewall do?
The Great Firewall of China blocks certain foreign websites and slows down international internet traffic, thus making domestic websites more appealing to Chinese citizens. It also blocks many tools we take for granted (like Facebook, Twitter and Google) and mobile apps. Chinese platforms and applications have, as a result, become dominant within China. Most notable names are Tencent (social media), Alibaba (e-Commerce platform) and Baidu (Search engine). So if you want to do online business in China, you’ll need to adapt, and learn how to operate on these local platforms.
Virtual Private Networks (VPN) also blocked
It used to be possible to use a VPN to circumvent the Great Firewall of China. But nowadays, Chinese telecom providers can detect, and block, VPNs. Apps using VPNs are also blocked, the Chinese authorities ordered Apple and Google to remove all apps containing VPNs from their App Store. As a result, thousands of apps are no longer available to the Chinese.
That doesn’t mean a VPN is illegal in itself. Some uses of VPN are still allowed, encouraged even. Chinese companies are using VPN to be present on platforms which are blocked to most citizens, using Facebook to target foreign customers. And of course, for secure data transfer. Using a VPN to sneak past the Great Firewall, though, is cracked down upon.
China: a completely unique economic ecosystem
Companies who want to sell their products in China have no choice but to learn how to work with the Chinese platforms. This will cost time, money and effort, but it is totally worth it. The Chinese economy is huge. According to the China Internet Network Information Center, the country has well over 800 million (that’s 800,000,000) internet users, a number confirmed by Xinhua. Of those on the internet, 25% live in rural areas and 98,5% (788 million) users use mobile internet.
That is a lot of purchasing power. But there’s still room for growth, as only 58% of Chinese has internet access. Furthermore, 71% of internet users (569 million) use the internet for online shopping, buying goods worth $ 570 billion ($ 570,000,000,000) in 2018, which is an increase of 30% in comparison to 2017. Just take a moment to let these numbers sink in, and then imagine what it would mean if the other half of the Chinese population would come online too, and a higher percentage would start shopping online!
Getting past the Great Firewall
Entering the Chinese online economic arena is very worthwhile for international companies and brands. But how do you get past the Great Firewall? First, you need to get a permit to operate online, which is issued by the Chinese Ministry of Industry and Information Technology. Obtaining such a permit can take anywhere between 5-20 days. Hosting a website without this permit is impossible.
You can either obtain a permit for non-commercial websites or for commercial websites. If your goal is to sell goods in China, you will need the commercial website permit.
Entering the Chinese market is difficult. Apart from the enormous cultural differences, you have to learn how to operate a whole new set of platforms, making up an unique economic online ecosystem. This means you cannot just assume that the things that worked in the past will also be successful in China. This means you will need to invest heavily in market research. And, of course, there is the bureaucracy you need to navigate through.
It’s a daunting task, indeed. And you wouldn’t be the first to be slightly overwhelmed by the challenge. In order to be successful in online sales in China, you need to get serious. Only when you take a professional, dedicated approach to entering the Chinese market will you be successful. It’s difficult, it’s exhausting, but keep the eye on the prize and you will find the motivation to persevere.
AsiaAssist is here to help
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China may already be the world’s largest e-commerce market but predictions are that by 2020, it could be worth more than that of Japan, Germany, France, the UK and the US combined. Unless you actually live or travel in Asia, you’ll probably never come into contact with any local websites which is why it’s easy to underestimate the immensity of China’s digital economy. The Chinese digital landscape isn’t to be taken lightly and many western internet companies have been unsuccessful in their attempts to conquer the Chinese market.