China Paradigm interviewed Charles Erickson and Jay Thornhill, who co-founded Baopals, to learn the story of creating a reliable shopping website for non-Chinese people in China, their entrepreneurial experience, clarify a business model and all the exciting moments and difficulties they experienced building e-commerce website in China.
Jay Thornhill & Charles Erickson, from teachers to entrepreneurs, who are comprehending Chinese e-commerce ecosystem
Before setting up the Baopals, Jay Thornhill and Charles Erickson have both stayed in China for years. After graduated from the University of Southern California in 2007, Jay started his career in English teaching. From 2007 to 2016, he made a big step from language trainer to the academic director at several English education agencies in China. As for Charles Erickson, who holds a bachelor’s degree in macroeconomics, he also first started teaching English and macroeconomics in Shanghai. Finally, once in 2015, Charles’s desire to change his career vector marked the beginning of the collaboration of these two people.
“I think a lot of expats have this feeling after teaching in China for a couple of years”, as Charles illustrated. At that time, they sat down and started to think about the business opportunity for foreigners in China. They finally come up with this idea of building a reliable shopping website for non-Chinese people in China, Baopals, which has exactly addressed for a major need for many expats in China.
Baopals, a reliable shopping website for non-Chinese
Charles firstly thought about building an e-commerce website in China for foreigners since he noticed many foreigners in China are not able to use Taobao or Tmall mainly because of the language barrier. Through Baopals, they are aiming to connect foreigners with those most well-known Chinese e-commerce websites:
“What our platform is: it is a bridge that makes every single product and seller from Taobao available on our platform with our interface and our customer service.”
Their objective is not only just to bridge the gaps, but also to build a reliable shopping website for non-Chinese. Many foreigners have come through weird experiences when they shop on Taobao. For example, some sellers are not responsible for their customers or sometimes the quality of the products doesn’t fit with what they expect. Therefore, Baopals also includes monitoring and selection in order to filter bad sellers and help foreigners to be confident and feel comfortable when they are shopping on Baopals.
Chinese e-commerce ecosystem, open to foreign start-ups
Jay and Charles’ shopping website has undeniably brought more foreign customers to Taobao: as all of the products and stores are from Taobao and other websites when customers shopping on Baopals, they are essentially shopping on Taobao. During its first year, Baopals experienced a high-speed development, especially on Double 11, when three co-founders couldn’t deal with the large amount so that they move into an office. From 2016 to now, sales have steadily increased.
Before their second Double 11, Alibaba’s PR came to them and welcomed Baopals in the Chinese e-commerce ecosystem. Charles said that, at first, they thought Baopals may not be welcomed by Alibaba because to some extent, they are competitors with Aliexpress. However, soon after that, they figured out that the Chinese e-commerce ecosystem is quite open to every start-up. Alibaba even made a post on their website about Baopals. What’s more, Didi, a giant company offering effective transportation services online, also invited them to collaborate. It’s also one of the reasons why Chinese e-commerce has developed drastically these last years: even the giants are open-minded and contribute to developing an open and healthy Chinese e-commerce ecosystem.
Soft advertisement through WeChat
“We don’t do a lot of traditional marketing. We rely mostly on word of mouth to grow.”
In its early days, Baopals mainly developed itself through customers’ relationships. It’s a good way to turn random customers to loyal and regular clients. They also tried other types of advertising, such as paid advertisements on Google. However, some of the advertisements on a web page could be too aggressive for customers to even look into Baopals. They also collaborated with other brands to promote their website and this usually ended up with a high new user registration rate. But for an e-commerce website, the most important thing is to turn users into customers. Therefore, a high registration rate doesn’t make much sense for them. To solve those problems, Jay and Charles have tried soft advertisement through WeChat:
“It’s kind of soft marketing. We want to put out a lot of good articles and a lot of good pieces on WeChat primarily, but also on Facebook.”
This kind of advertisement is also built upon relationships: when the advertising articles get shared in people’s moments or sent to their friends, it will be quickly spread among foreigners’ networks. Plus, it is also convenient for them to directly go to Baopals’ official WeChat account. Soft advertisement through WeChat is all about content creation and it may even not be strongly related to the website:
“It can be any content, whether it’s an article about living life as a foreigner in China (that gets a lot of comments going) or something like ‘Here are 15 very Australian products’.”
Soft advertisement through WeChat needs both high-quality content and marketing strategy. There is no doubt that it may be more tricky and time-consuming than a paid advertisement, but it will also bring more loyal and lifelong customers.
Listen to this episode here:
