• LITAO COVERED BY WORLD MARKET: A PRESTIGIOUS NAME IN CHINESE MEDIA

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    We are very proud that LITAO has been covered in a three-page feature by World Market, an influential Chinese-language magazine on international trade and economics. World Market, a government-run bimonthly, has been in publication for 35 years – almost since the beginning of China’s economic reforms. The magazine has won the Outstanding Chinese Periodical award and was the only Chinese economics magazine accepted during the APEC meeting in Shanghai. Nowadays, World Market is one of the few Chinese economic publications that you can find in front of you on overseas flights.

    World Market was intrigued by the ingenious official WeChat campaign that LITAO ran to promote Lithuanian businesses participating in the first China International Import Expo (CIIE). The campaign resulted in multi-million euro deals for companies with zero prior presence in China. Even though it has been some five months since the event, Word Market talked to us recently to find out how LITAO made it happen.

    A MULTIFUNCTIONAL WECHAT PLATFORM: RUN BY LITAO, EXCLUSIVELY ENDORSED BY THE LITHUANIAN GOVERNMENT

    The multifunctional WeChat platform 想掏完来立陶宛 (an edgy take-on nation branding, bringing Lithuanian national identity closer to Chinese consumers – a play on Lithuania’s name, it suggests the joy of discovery and exclusivity) , LITAO’s brainchild, officially represented not only 18 Lithuanian brands which participated in the expo, but the country itself. We received exclusive endorsement from Enterprise Lithuania, a government agency promoting entrepreneurship and supporting business, Ministry of Economy and Innovation, Lithuanian Embassy in the PRC, and top officials in the government.

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    Minister of Economy Virginijus Sinkevicius with LITAO team at the CIIE

    The WeChat account laid the groundwork for the success in CIIE of Lithuanian enterprises. Virginijus Sinkevicius, Minister of Economy and Innovation, even made a special appearance on the WeChat account. “It was a matter of a phone call,” remembers Lina, LITAO’s Founder and Managing Director: “We were in the office, bouncing ideas around how to really make Lithuanian delegation stand out. I said, how about we call the minister and ask for an interview? He was onboard with the idea immediately.”

    Understanding the importance of the expo, minister Sinkevicius agreed on a casual and fun video interview, promoting the bond between the two countries in the most accessible way – WeChat. In the interview, minister Sinkevicius talked about his passion for basketball and which Chinese foods he was planning to try once in Shanghai for the expo. It was unprecedented for a government official: no minister of any other country has done anything like that on WeChat before. It was therefore really appreciated by business representatives and consumers developing interest in Lithuania. We are proud that minister Sinkevicius went the extra mile to bring Lithuania and China closer together.

    This is one example how LITAO harnessed WeChat’s connectivity. The WeChat OA became a digital microcosm of strategic marketing and communications for Lithuanian delegation. Brand presentations attracted over 20,000 targeted B2B views and more than 6 million digital impressions, resulting in deals totaling over 10m euros for 2019 alone for brands with zero prior presence in China. The account promoted the brands not only B2B, but also directly to Chinese consumers: LITAO used advocate marketing and gamification to hook the increasingly picky Chinese audience. The most active followers of the account received gift baskets of products of the 18 brands we represented – competition was tough!

    GOLDEN AGE FOR IMPORTERS – BUT KEY IS TO KNOW HOW TO MAKE THE MOST OF IT

    The first China International Import Expo, which took place in Shanghai last November, was one of the biggest events of 2018 for both entrepreneurs and state officials around the world. Lithuanian President Dalia Grybauskaite was in Shanghai on November 5 to meet Chinese president Xi Jinping; we were delighted that she stopped by the expo to visit Lithuanian delegation.

    The expo marked an especially favorable time for Western importers: decades-long economic growth has created a Chinese middle class with unprecedented levels of disposable income. China’s government is putting every effort into increasing domestic demand and fostering growing consumption habits. While promoting import, China is also meticulous about who to allow in: only goods and services of the highest quality will meet the mark. This trend will only grow stronger. Our experience has shown that to stand out in an event like CIIE, you have to be ready to go the extra mile. “Smart selling” starts before the event – distributors are bound to seek collaboration with westerners who come prepared.

    That is why LITAO took the time to showcase the magnitude and opportunities of digital China to Lithuanian businesses. They are already reaping the benefits: apart from deals resulting from the WeChat campaign, we have also trained them to use WeChat and Alipay for business purposes and share first-hand insider information in WeChat groups – something that is still unheard of in Europe, but indispensable in China.

    When asked about what aspect of the multi-layered WeChat campaign and expo she is most proud of, Lina smiles: “LITAO managed to unite everyone – high-level government figures as well as entrepreneurs – making sure we were all directed towards the same goals as a single force.”

     

     

  • FILLING A NICHE NEED

    In 2008, it was years of sector specialization and research that allowed a local Chinese detergent brand called Blue Moon to succeed in breaking into a Chinese market dominated by UnileverProcter & Gamble, and other multinational companies. The smaller company succeeded because it noticed something about the laundry detergent sector that the big companies missed.

    UNEXPECTED FINDING: Hand-wash still in fashion

    While the multinationals focused on new products for washing machines, Blue Moon realized a significant portion of the Chinese population was more traditional and still hand-washed their clothes. Laundry powder was available for hand-washing clothes, but Blue Moon introduced a liquid hand-washing detergent that provided a better experience (no clumping!). Even after the other companies caught up, Blue Moon had snagged a steady 30% of the liquid detergent market.

    REPUTABLE & WELL-CONNECTED INVESTOR

    That’s what happens when you combine cultural sensitivity with careful observation of industry trends. Of course, it helped that they were backed by one of Asia’s top hedge funds, Hillhouse Capital, which makes investments and gives advice to Chinese start-ups.

    But even after their initial success, the company didn’t stop their momentum. They continued to launch the detergent that worked, focusing on their best-selling SKU instead of branching into various new detergents.Instead, they spent money on research and marketing. In 2011, a full three years after they successfully broke into the market, they spent USD 500 million alone for advertising.

    CROSS-CATEGORY EXPERTISE

    The executives of Blue moon together with Hillhouse Capital also met with a team from JD.com, one of China’s largest on-line marketplaces. They sat together at the table and designed ways to collaborate and build win-win solutions. The ‘pain point’ at the time was expensive delivery & packaging. Together, they redesigned their product’s detergent carton to fit with JD’s online delivery boxes and immediately saved lots of costs for “pick&pack”.

    GOING PERSONAL

    In 2012, they cut advertising but then hired salespeople to directly interact with customers in supermarkets, asking them to sample-smell patches of the detergent as if it were a perfume in a department store. They were constantly trying new strategies to present themselves not as the most affordable in their industry but instead “different and desirable.”

    KEY TAKEAWAYS

    Even small brands can beat huge multinationals, as long as they understand their particular consumers’ needs more than their competitors. Blue Moon proved that with its breakthrough liquid laundry detergent for the segment of Chinese population that still hand-washed clothes.

    It solved a problem that no other company solved for these people, and they won loyal customers. Even after initial success though, Blue Moon didn’t stop R&D and marketing: they kept striving to know more and to show it. Currently they are developing a concentrate which is supposed to help too in solving pollution.

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  • “Democracy” with Chinese characteristics

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    Yang Liu “East meets West”

    The Challenge.

    A few years back we got approached with an exciting challenge – translating a play. My country – Lithuania – selected an award-winning playwright to represent us in a festival in China, and for that, we would need to have a Chinese version of his play. Translating literature is probably the toughest challenge one can get in cross-cultural communications, and here someone will be expressing each line out loud, on a stage!

    The author chose his most famous play called ‘Democracy’ –  it was something around 100 pages, and we had just a bit over a month to complete the translation in order to make deadlines required for all necessary procedures that would follow to ensure the play is allowed to go on stage.

    The Narrative.

    The text was a deep, thoughtful story about a tall building where electricity frequently gets cut off. The neighbours believe it’s rats. They gather together and form a committee and design an action plan how they would resolve the issue. Soon it becomes a grotesque portrayal of democracy: a voting system is created, campaigning begins, one neigbour becomes the leader, and another neighbour is blamed for the ‘rat problem’, neighbours start developing hatred towards that neighbour and decide to teach her a lesson. The rat problem soon escalates to a war against parasites – and the neighbour suddenly becomes the embodiment of all parasites.

    The Scope of Work.

    The first week we outsourced the translation to a fellow Lithuanian, who had HSK6 and a Chinese wife – he helped us with the first round of word-for-word translation, while internally we were reading and re-reading the text, analyzing the details and discussing the approach with the author. Then we soon had the basic canvas to build on.

    The title of the play was a challenge. But we learned that the author used it ironically, just to intrigue the audience – as the play does not discuss political governance at all, so together with the author we soon decided to call the play ‘A House Where Electricity Gets Cut Off’ (停电大楼) – keeping the intrigue intact, yet staying away from any unnecessary assumptions that may arise from a name ‘Democracy’.

    The play also used a lot of cultural elements – each character was a stereotype representing a certain minority or archetype prominent in society. We asked the author if he would like to tell a story of Lithuania, or take a bigger picture and narrate the described social experience through a Chinese cultural lens. He chose the latter.

    The Process.

    The first task – then – was to give an appropriate name to each of the characters, as they were cryptic and incorporated many layers of meaning. The man who later becomes the leader of the neighbours we named 王金石. Mr Wang is probably the most common surname in China, yet it symbolizes a king – which the character so badly wanted to become. And that internal conflict was further supported by characters ‘gold’ and ‘stone’ in the name – typically in Shanghai around 1970’s people would name their children by choosing empowering characters & symbol, providing that which personality would be lacking.

    The second task was choosing representative archetypes with regional characteristics. In the original, the characters were ascribed to the national minority, yet we chose to play with Chinese regional identities instead. One of the characters is a Polish truck driver who has a drinking problem and had lost his kidney when a prostitute drugged him in some gas station, he also has a stutter. When translating his lines, we chose China’s Guangdong accent – apparently, there are many truck drivers there, also many poor people go there to find odd jobs, and during the time of translation, a similar incident had occurred with stolen organs.

    The third task was translating all the slang and cursing. “Every 4th word is challenging” – the author warned me in advance. So we had a map of archetypes and we talked to people we knew personally, coming from representative regions – to understand what expressions they use in everyday life, and what swear words are the most popular. Gradually we made the Lithuanian characters become thoroughly Chinese, yet the essence of personal characteristics survived.

    Lastly, there were many elements of Lithuanian culture we transformed to culturally familiar ideas: a poster of Jesus in neon lights became a shining Buddha, whereas a basket of apples (common in autumn in any Lithuanian home) became a rice container. We also included lots of metaphors (成语) and local jokes.

    The Result.

    In the end, the play was presented in a festival as planned and received strong support by the local actors and generated heated discussions in the audience – both for the narrative and for the translation. The author concluded “it was a thoroughly positive experience” and hopes to come back to China in the future.

    The Collateral.

    Through this collaboration, we learned that anywhere in the world people face the same social issues and tensions, and if we go deeper into the situation, the only difference is the choice of words to express our experience of the situation – the same phenomenon will be described differently in different locations. It is fascinating to see that it applies to business and art just the same.

     

  • Hello world of China enthusiasts and entrepreneurs!

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    Whether you’re an old China hand or simply dreaming about the Middle Kingdom, here’s some disheartening news: Forbes states that just under half of foreign businesses (including multi-national corporations) fail in China within two years of entering the market. Meanwhile, according to Bloomberg, 8 out of 10 start-ups flop in the first 18 months globally.

    LITAO is a Lithuanian-capital Wholly Foreign-Owned Enterprise. Since starting operations in December 2014 (we passed the four-year cut-off!), we have been following the fast-moving China trends on the news, through numerous books and reports, and most importantly of course, via our clients on the ground.

    Four years and many mistakes later, we’re stronger than ever—and we feel confident that our unusual methods of business work. Our secret? Strategy!

    To our surprise, we were unable to find a single blog that consistently provides quality content on the nitty gritty of East/West strategy: cultural, political, and logistical. We would like to fill that void with case studies of how others have succeeded or failed in the art of cross-cultural business—what we have learned and what you can benefit from learning.

    Every Thursday, you will find an original post here. Don’t miss out—this is high-level information presented in accessible story-telling and every post will have something actionable for your next venture. Join us—