With the strategy of "light overseas expansion", Konka joins hands with Shopee to create "quality-price ratio" and lock in future growth opportunities

June 17, 2021, China - In the context of economic globalization, creating influence worldwide has become the vision of many Chinese brands. In the tide of going overseas, Konka, a domestic brand with a history of 40 years, joined hands with Shopee to find a new way in the fast-growing Southeast Asian market, and went overseas with a "quality-price ratio" strategy without price wars. After less than two years of deep cultivation, the leap in the number of promotion orders, store reputation scores, and the number of brand fans has verified the strategic foresight. The cooperation path jointly created by the two parties will provide a model of experience for more local companies to go overseas.

Strong alliance, Shopee helps Konka to expand to Southeast Asia

According to a report jointly released by Google, Temasek and Bain & Company, in 2020, the number of new Internet users in Southeast Asia reached 40 million, and the total number of users exceeded 400 million. 70% of the population has moved online, and the market size is expected to reach US$ 172 billion in 2025. The vast blue ocean opportunities have made Southeast Asia the preferred stop for Konka to go overseas . Niu Weidong, chairman of Konka Smart Appliances, foresaw that under the development of digitalization, the once popular offline agency distribution model will shrink greatly. For emerging markets, the best way is to go overseas with light equipment - professional platforms help companies improve their cross-border integration capabilities, operations, and management efficiency, and the brand itself only needs to focus on understanding consumers and polishing products.

"Under the light overseas model, brands and platforms can focus on their respective advantages, use good products and services, and walk on two legs, which will go more steadily and further." Niu Weidong's prediction has been verified by the data. After testing the waters in 2018, Konka stepped up its efforts to develop the Southeast Asian market in the second half of 2019 and established a deep cooperative relationship with the Shopee cross-border team. Subsequently, in July and August 2020, significant performance growth began to appear, and the store's daily sales far exceeded other platforms. By the 2020 11.11 promotion, Konka's orders on the entire Shopee site had soared to more than 20 times that of October.

Compared with traditional sales, brands also carry more strategic considerations . Faced with the division between low-price strategy and long-term brand development, Konka reviewed its many years of experience in the home appliance industry and chose a "difficult but correct" path for brand expansion overseas.

"Under the influence of vicious price wars, market pricing is chaotic, products cannot be iterated and updated, and the mass consumer experience is extremely poor... Every party suffers, and Konka has always hoped to achieve a win-win situation for all parties. Therefore, on the road to going overseas, we are determined not to engage in price wars. In addition, we have observed the huge consumption potential in Southeast Asia. Compared with "absolute low prices", more and more consumers are willing to pay higher prices for products that meet their consumption tastes and expectations. In order to include this group of people with consumption potential and brand loyalty into the target customer base, our "quality-price ratio" strategy came into being." Niu Weidong said.

Konka's new overseas strategy of "quality-price ratio" is to meet the multiple needs of consumers at the product level with performance, quality, appearance, price, purchase and sales services, and use this to enter the Southeast Asian market and build brand reputation. As early as 2019, a report jointly released by Bain and Facebook predicted that the middle class in five Southeast Asian markets, led by Malaysia, the Philippines, Vietnam and Thailand, will be close to 350 million by 2022, and the overall disposable income will grow to US$300 billion . Apart from the digital level, Niu Weidong's confidence in the long-term strategy of quality-price ratio comes from the recognition of his own brand value: "Konka always believes that in the future, 'quality-price ratio' products will gradually become the common choice of consumers, enterprises and market environment."

Comprehensive coverage to help boost brand power

How to sow the seeds of "quality-price ratio" in the hearts of Southeast Asian consumers who are particularly fond of new things and have not yet awakened to quality awareness at this stage , and how to settle them as Konka users as the economic environment in Southeast Asia continues to improve, has become the biggest challenge. Therefore, Konka's focus on cross-border integration in Southeast Asia through Shopee is to bring Southeast Asian consumers a quality and comfortable shopping experience in all aspects , from store presentation, pre-purchase inquiries , after-sales feedback, logistics services, etc., and to embed the Konka brand into the hearts of consumers.

Konka smart appliances participate in the 6.6 promotion on Shopee platform

1. Gain in-depth insights and accurately identify consumers’ real needs

Home smart appliances are undoubtedly the products that are closest to consumers' daily lives. They allow consumers to enjoy and recognize the excellent experience brought by the price-performance ratio in their high-frequency daily use, which has become the beginning of the concept transmission. Konka believes that the first step is to be "user-oriented", respond to consumers' expectations with user-oriented products, and enable consumers to have unique interactions and connections with the brand, thereby enhancing everyone's recognition and sense of belonging to the brand.

To this end, Shopee used its own coverage advantage of Southeast Asian user behavior data, combined with in-site communication tools such as Shopee Chat and one-to-one platform customer service, to help Konka establish direct contact with local consumers through inquiry feedback collection, and collect first-hand feedback from users on existing products. This provides Konka with rich information support for customizing multi-price product lines for different audiences and expanding its product matrix in the direction of multiple categories.

2. Widespread seeding and multi-angle marketing tools to boost

Even the best wine needs a bush. Exposure and traffic, so that products appear frequently in the public eye, is also the key to building brand power. On the site, Konka uses Shopee Live and Shopee ads to bring sufficient traffic and stable orders to the store; outside the site, through Shopee x Facebook ads, Shopee x Google ads and affiliate marketing, it plays the "brand" card well, so that external traffic can still recognize Konka products and buy them after entering the platform.

"From the visitor numbers and sales data before and after Shopee's advertising investment, it is clear that the store has achieved a quantitative growth. In the future, Shopee advertising and live streaming will continue to be the focus of online marketing," Niu Weidong added, "Shopee is very keen in marketing. Live streaming was particularly popular during the epidemic. Shopee quickly opened up live streaming tools. Konka also caught up with this wave of popularity and used relatively cheap traffic to bring a good input-output ratio. In the future, we will continue to explore new ways of live streaming. Although the live streaming preferences and ecology in Southeast Asia may be different from those in China, we believe that Shopee will help us grasp it accurately."

3. User accumulation to build Konka's overseas brand power

With the simultaneous efforts of user insight and marketing, if you want to attract more consumers to the "quality-price ratio" camp in a market where quality awareness has not yet sprouted, the brand needs more powerful support. Konka's superior "quality-price ratio" is reflected in both products and services. Shopee's perfect infrastructure in Southeast Asia has brought consumers a good buying and selling experience. SLS has completed low-cost and efficient cross-border logistics and delivery, and cooperated with overseas warehouses to help Konka flexibly optimize transportation between daily operations and promotional stocking, ensuring that each order can be delivered to consumers at a stable speed, greatly improving local users' experience satisfaction with purchasing Konka products.

With the help of Shopee, Konka successfully achieved a leap in store traffic and word-of-mouth ratings. The repeat customers cultivated by Konka in the Southeast Asian market have also become potential brand KOCs.

Talking about Konka's next move, Niu Weidong said that the development relationship between the brand and the platform will be closer to a "community of shared destiny" , so Konka will continue to deepen its strategic partnership with Shopee. "In our overseas strategy, Konka and Shopee have always been moving towards the same goal - to serve overseas consumers well. In the future, we hope to work more closely together and enhance each other's competitiveness through strategic cooperation. We look forward to working together to create more remarkable overseas achievements."

Shopee Chief Business Officer Zhou Junjie said: "We are honored to join hands with Konka. In the future, we hope to help more Chinese brands and sellers go global and tailor the best overseas solutions for their business concepts. Shopee is willing to become a community of shared destiny with more brands and sellers who are eager to enter the international stage and jointly achieve every possibility of going global."

Shopee

Konka