(Yicai) Sept. 5 -- The Internationale Funkausstellung, the world’s largest home and consumer technology event in Germany’s Berlin, has become a key occasion for Chinese companies planning to expand in European markets to connect with overseas media, partners, and industry resources, according to experts.

Events like the IFA are important not just for product showcases but also for building foreign customer trust and relationships, Chris Pereira, founder and chief executive officer of communications and business consulting firm iMpact, told Yicai. “When going overseas, you must go on visits, meet people, and build up a network.”

IMpact, which has supported over 300 Chinese brands in their global expansion over the past five years, will host a media connect event at the IFA to bring together over 60 leading European and US journalists and the IFA’s CEO to help them build a direct dialogue with Chinese companies, Pereira noted.

The IFA’s CEO plans to visit China after the event is over to further explore cooperation with Chinese partners, Pereira added. “He’ll join iMpact for a roadshow in China to meet more brands, showing strong support for their global ambitions.”

Europe as New Target Market

Amid rising trade barriers and geopolitical uncertainties, Chinese firms going global are turning their focus to Europe from North America to diversify their business outlook and are adapting a more collaborative approach to foster localized brand building.

“If the United States continues to impose tariffs on Chinese brands, Europe could serve as a viable alternative for them,” Alan Gu, founder and CEO of PartnerBoost, an end-to-end partnership marketing software solutions provider supporting brands in achieving scalable growth through integrated affiliate partnerships, told Yicai.

“Many Chinese companies initially targeted the US as a critical market,” Pereira said. “But since this year, many of them have started wondering about a ‘Plan B,’ which is likely Europe.”

Europe is an easier market to penetrate, especially through affiliate marketing, according to Gu.

“The US market is saturated with brands, and most Chinese companies overseas treat it as their main battleground,” he noted. “This makes the US media increasingly demanding and expensive. In contrast, Europe feels much more accessible.”

While many of PartnerBoost’s clients have a smaller presence in Europe than in the US, their marketing channels are more extensive in Europe, Gu said, citing data from his company.

PartnerBoost serves top Chinese brands, including electronics manufacturer Anker Innovations, home appliance giant Midea Group, and robot vacuum cleaner maker Roborock Technology, so it has extensive experience. “Despite diverse languages, as long as they can capture the core European markets, such as Germany, France, and the United Kingdom, they have essentially secured half of Europe,” Gu explained.

"Global AI-powered FinTech platform company that help merchants and marketplaces manage post-purchase Seel's expansion strategy targets markets with cultural similarities to the US,” Pyro Chen, vice president and general manager for Asia-Pacific, told Yicai. “When US-China relations face challenges, our APAC clients pivot to culturally aligned regions like Europe and Australia.”

Consumer pain points are also similar in these regions, according to Chen. For example, 86% of e-commerce buyers in the US review return policies before placing an order on an independent website, a trend that is mirrored in Europe and Australia.

“This allows companies to address consumer needs in Europe, the US, and Australia with a unified product logic and strategy,” he noted, adding that Seel introduced a ‘worry-free purchase’ model, where consumers cover the cost, enabling merchants to offer protections at zero expense.

This model aligns with tipping cultures in the US, Canada, and Australia, he explained.

Balancing ‘China Speed’ With Localization

A key challenge for Chinese firms expanding abroad is striking a balance between the China Speed, which refers to the rapid Chinese economic development, and the need for localization.

PartnerBoost creates WeChat groups for each client to enable swift responses, an approach that would be unimaginable overseas, Gu said. However, he cautioned that this Chinese-style management can face hurdles abroad.

After hiring over 30 local employees, the company realized that overseas markets have their own methods, and China has its own, Gu noted. “You can’t force one onto the other.”

Gu advises Chinese firms to hire seasoned local talents capable of delivering what Chinese teams cannot, such as localized expertise and brand building.

“We’ve concluded that the US has its ways, and Europe and China have their own as well,” Pereira explained. “We don’t seek uniformity, as each market develops independently.”

There is also a gap in affiliate marketing, Gu noted. In the US, 81 percent of the top 1,000 e-commerce platforms leverage affiliate marketing, compared to less than 10 percent among Chinese companies overseas.

“Chinese brands facing traffic challenges should adopt mature overseas models rather than applying domestic e-commerce thinking to global markets,” he urged.

Betting on Innovation, Building Trust

There are two types of Chinese products in the eyes of foreign customers, the ‘Made in China’ and the ‘Invented in China,’ Chen said. The former refers to traditional, low-price goods, while the latter refers to high-premium, tech-driven, and unique products.

“The ‘Made in China’ should focus on entry-level platforms and leverage their marketing channels,” he noted. “The ‘Invented in China’ is more suitable for direct-to-consumer independent websites.”

Beyond market selection and localization, addressing trust and efficiency is also critical for Chinese firms going global.

Communication and partnership can significantly boost efficiency, according to Gu. For example, a robotic vacuum cleaner brand working with PartnerBoost experienced a surge in sales after increasing its commission rate from 10% to 20%.

From an after-sales perspective, Seel’s products help Chinese brands build consumer trust overseas, Chen pointed out, debunking the misconception among Chinese firms that insurance is a cost by noting that Seel’s model transfers the expense to consumers.

Independent websites using Seel’s services see significant improvements in new customer conversion and repeat purchase rates. A 3D printer crowdfunding campaign demonstrated that shipping protection reassures consumers, thus ensuring more orders.

“We hope more Chinese brands go global,” Pereira said. “While you aim to capture Western markets, partnering with local stakeholders and aligning interests is crucial.”

Editor: Futura Costaglione