Chinese Gift Card Market Sees 12.8% Compound Annual Growth Rate
Following the end of Q2, we are seeing a clearer picture of how coronavirus is changing the global economy. Since the pandemic began in China, the country’s economy has been able to swiftly recover from the initial wave of cases. With infection rates now considerably lower than the average in Europe, the Chinese economy is beginning to pick up sharply.
The Chinese gift card market has ballooned in the last five years. The gift card market in China saw a CAGR (compound annual growth rate) of 12.8% during 2015–2019. The estimates for 2020-2027 predict a continuation of growth by 19% CAGR.
4 Factors Causing Rise in Gift Card Sales in China:
- Anonymity – many gift card providers in China do not require customers to give a name when buying a gift card. This has driven sales with people who do not wish their purchases to be traced.
- Corporate Incentives – there has been a boom in Chinese companies offering corporate incentives through gift cards. This trend is likely to continue and more and more companies in China expand and recover from the pandemic.
- Digital Payments – since enabling digital payment options like Alipay and WeChat pay, gift card sales have grown exponentially. The convenience of these payment methods mean customers can purchase gift cards in seconds on their mobile device.
- E-gift Cards – virtual gift cards are increasingly becoming the norm as more and more people turn to online shopping. As many are encouraged to stay indoors, there’s been a rise in e-gift cards that facilitate e-commerce.
UK Gift Card Companies and Chinese Customers
Chinese travellers and students are increasingly seeking to buy gift cards for their family and friends. British companies with predominantly Asian employees are also seeking providers of corporate incentives programs. However, many are stuck at where to begin.
Chinese Economic Restrictions
A major factor in deciding which company to buy gift cards from is payment options. China has strict economic policy that limits every Chinese citizen’s spending in foreign currency. As a result, many would much rather use Chinese payment options that have in-built currency exchange systems that bypass the strict policy. The problem they face is that a majority of UK gift card companies have not enabled these payment options. Thus, they seek elsewhere or give up on gift cards altogether.
Language and Technology Gap
Companies with majority Asian employees often face difficulty communicating with British companies and professionals. Not only is there a clear language barrier, there is also a gap in the technology they use to communicate. Asian professionals often use messaging apps from their own countries to contact others. They hardly use email to have a conversation. In contrast, everyone in the UK uses email to contact others, especially in business.
Can I use Google, Facebook, Twitter or Instagram for marketing in China?
No, people in China do not have access Google, Facebook, Twitter or Instagram. They use WeChat instead.
How to Sell Gift Cards to Asian People in the UK
Much like with any other B2B or B2C sales, you must build a relationship with the potential customers, or have access to a reseller who has this connection. Especially with Asian people currently living in the UK, they want to trust someone and their product before confirming a purchase or program.
Additionally, just because you move to another country, doesn’t mean you stop using social media from your home country. Many Asian people in the UK use social media from home to contact friends and family, not only at home but also in the UK. Thus, it is a good idea to build your presence on foreign social media platforms.
GlobePay is a fintech firm based in Canary Wharf, specialising in China-UK cross-border payments. Enabling Alipay and WeChat Pay at UK companies is vital to growing a Chinese customer base. Additionally, GlobePay offers multiple marketing packages to make connecting with Chinese customers easier than ever before. With a vast network of Asian travellers, student and professionals, GlobePay is equipped to help UK companies launch their business strategy to attract Asian customers.
