Australian Companies Profit From Local Chinese Shoppers
Chinese students, and other Chinese living in Australia, are helping local business by shopping for customers back home in China.
These shoppers are called “daigou”, a Chinese phrase meaning “buying on behalf”. They advertise products like baby formula, vitamins, and other non-prescription medicines on the Chinese social media app WeChat.
One “daigou” said she began just buying things for her family, but soon friends of the family joined her “market”. Many of the “customers” believe that Australian products are better than Chinese products. She sends $2000 worth of products to China every week.
Benjamin Sun, from digital marketing agency Think China, told SBS News the number of daigou shoppers has doubled in the last few years to about 80,000, and is likely to double again.
Mr Sun says this market is becoming more sophisticated. In the past, daigou shoppers simply went to supermarkets and budget chemists to buy up their stock. Now “daigou stores” supply the stock, and even ship it. One such business has five stores in Sydney and is about to list on the Australian stock exchange.
Australian suppliers benefit from the arrangement, because their marketing is being done for them by the local Chinese community, costing them nothing in promotion. They can avoid the long and difficult process, often taking two or three years, to set up their own direct marketing link to China. Daigous also have the power to influence brand choice.
Some top level daigou wholesalers are turning over $300 million in goods a year. For lower level daigous, it can still be as much as hundreds of thousands of dollars a year. A marketing expert from AccessCN, a consulting firm for companies wishing to do business in China, says the industry is potentially worth $100 billion.
Chinese law considers the practice illegal, because it avoids customs duties and tariffs, and has made efforts to curb it. Under Australian law, the government has no power to restrict retail sales.