Chinese consumer brands look to Singapore as testbed to break into global markets | Wilnesh News

Chinese consumer brands are using Singapore as a cultural testing ground for their global expansion due to its unique blend of Asian and Western cultures.

In August alone, Chinese tea drink brand Chagee opened three stores in Singapore. Bubble Mart, a Beijing-based collectible toy retailer, held its second annual toy show on the island late last month, featuring more than 50 artists.

While Chinese companies have long coveted global ambitions, their latest strategy is to make a concerted effort to enter Southeast Asia through Singapore.

“We call Singapore the place where East meets West, right? So for Chinese companies, if they want to go overseas, I think Singapore is a good middle ground,” said Wang Xiaofeng, chief analyst at global market research firm Forrester. “.

Jeremy Lee, Southeast Asia marketing director of Bubble Mart International, told CNBC on the sidelines of the Bubble Mart Toy Exhibition at the end of August that Bubble Mart executives are considering setting up an international headquarters in Singapore.

“If they (Pop Mart executives) want to launch anything in Southeast Asia, they want to start researching anything or if it works, (Singapore) is a good test bed… to quickly see if the idea works or not. No, and then fine-tune it from there,” Lee said.

Bubble Mart sells its products online and in stores in 30 countries, according to its website. Its overseas sales in the first half of the year increased 260% year-on-year to 1.35 billion yuan ($189.9 million). This helped overall sales grow by more than 60% despite China’s economic slowdown.

After decades of producing only Western products, Chinese companies are increasingly launching their own brands.

The new generation of Chinese brands is different — they don’t try to hide their “Chinese identity,” Forrester’s Wang said.

Instead, new brands are embracing their cultural identities, using local features and designs to enter overseas markets and then stand out from the competition, she said. This “gives them a unique advantage”.

For example, the name Chagee was inspired by traditional Chinese opera. Chagee is the abbreviated version of the brand’s original Chinese name, pronounced “Bawang Chaji”.

Changji’s managing director Lu Mian said the newly opened Changji directly-operated store is part of the tea brand’s reform efforts to enter the Singapore market, which is a “springboard” to tap the huge potential in Southeast Asia and other parts of the world. Marketing Operations Supervisor.

“In the next five years, Chagee will focus on expansion in eight countries, namely Singapore, Malaysia, Thailand, Indonesia, Vietnam, Philippines, Japan and South Korea, with Southeast Asian countries being a priority,” Lu told CNBC.

Chagee will set up its Asia-Pacific headquarters in Singapore in 2023 and is expanding its Southeast Asia team, although the company did not disclose the specific number of people.

Some of these companies have been trying to embrace a Chinese identity, including smaller Chinese toy companies that participated in the Singapore Popular Toys Fair last month and launched exclusive toys.

For example, a new plush toy from Hidden Wooo (a three-year-old Chinese brand) was snapped up by $129 early-bird ticket holders just hours before the Aug. 23 show opened to the public.

But others find that despite Singapore’s fusion of Chinese, British and Southeast Asian cultures, selling goods is challenging due to the cultural foundation

Hangzhou-based Dodo Sugar, which participates in the popular toy fair, said it can be difficult to convey the concepts behind its products to international audiences because the designs are often rooted in Chinese culture or stories.

The company still plans to expand into Singapore and Thailand through local partners, open stores in shopping malls, and participate in more events such as popular toy fairs to promote their toys.

Other Chinese consumer goods companies are also looking to Singapore for global expansion. JingdongThe company, which has been slower than peers to expand cross-border e-commerce, last week announced enhanced shipping and delivery options to Singapore.