Canada embassy backs Alibaba lobster success in China
Seafood marketing executives gasped recently when 90,000 live lobsters from Canada were sold by website Alibaba in a special promotion for China’s so-called “11-11” singles day on 11 November (the day is in fact largely a creation of Chinese e-commerce giant Alibaba).
Alibaba’s feat was helped by intensive promotion and research on e-commerce by Canada’s trade office in China.
“Online sales are becoming increasingly important in Canada’s shipments of seafood to China. We expect online sales numbers to grow as e-commerce in China continues to develop and more Canadian seafood products become available through this channel,” explained Andrew Maharaj, trade commissioner at the Canadian embassy in Beijing.
Maharaj’s office expects growth of 5 to 10 percent in Canadian seafood exports to China this year, in part due to strong online sales. Aside from lobsters best sellers are crabs and coldwater shrimp. A recent online promotion supported by Canada’s Shanghai consulate drummed up CNY 8.5 million (USD 1.38 million; EUR 1.1 million) in sales from around 30,000 orders, over one and a half months, with sales concentrated in whole frozen lobsters, blue mussels and Arctic clams. Likewise, explains Maharaj, the embassy “was a key partner in the organization of a 12-day online promotional activity of Canadian coldwater shrimp, which resulted in more than CNY 1 million (USD 162,000; EUR 132,000) sales of Canadian shrimp over the period of the promotion.”
Online campaigns have been so successful that Canada is adjusting its marketing presence away from more traditional marketing campaigns.
“We have been doing less direct promotions and are increasingly involved in supporting the initiatives of our industry,” said Maharaj. However, online promotion is still an “emerging field” for Canadian seafood companies in China, he added. The importance of retail and restaurant sales means “we encourage Canadian associations or companies to continue to build the brand directly through this channel.”
So far Maharaj’s office has done promotions with Taobao (owned by Alibaba) and JD.com but has not yet tried Yihaodian.com, a site controlled by Walmart. “Sales volume turned to be bigger with Taobao.com when doing promotion due to its large custom base. Imported pre-packed food works better on Yihaodian while seafood works better on SFBest.com (operated by the Shunfeng logistics company) due to good cold-chain distribution.” Maharaj’s office tries “to drive sales year-round, but around festivals are the main targets.”
A sound reputation for food safety helps shift Canada seafood in China but the cost of online marketing sales on sites like Taobao or is borne by the online retailer, which takes a small commission on each sale.
“We will support them together with the relevant seafood associations involved in the promo. Lending our name in support of a promotion can have an impact, since many consumers are concerned about authenticity and related food safety and quality issues,” said Maharaj. “So for example, in the past we have had a video message from the [Canadian] ambassador displayed on the website and we have hosted a media event at the [Canadian] embassy to launch the promotion.”
One drawback to online sales: Logistics are not yet sufficient to cover sales across China, thus making it very difficult for consumers in the far western city of Urumqi to buy a small box of Canadian lobsters.
“Xinjiang and Tibet are not covered by most e-commerce companies yet, indeed not most of the courier services either,” said Maharaj.
No one has the exact data online sales is still a small percentage of Canadian seafood sales in China as most of the products went to processing and HRI. But, added Maharaj, “We’ve seen good results with products such as lobster, coldwater shrimp, surf clams, scallops and snow crab.”