(Re)Open for Business: China’s Strong Demand for Natural Products Spells Opportunity for U.S. Brands

UNPA has partnered with WPIC Marketing + Technologies (WPIC), a top e-commerce accelerator in Asia, to navigate the complex, dynamic, and unique sales opportunity in China.

According to WPIC Chief Revenue Officer Peter McMath, China is experiencing double-digit growth across the health and wellness sector. “Having been operating in China for the last 18 years, we’ve seen the waves of the geopolitical hurdles and challenges,” he said, but companies have continued “to transact in that market effectively.”

“There’s a huge, unmatched opportunity for companies as they look to continue to grow their business,” he added. “If China is not on a CEO’s top three priorities, it probably should be.”

How can companies capitalize on this opportunity? Cross-border e-commerce serves as the conduit for international brands, as China’s “Blue Hat” registration system for health foods and nutritional supplements is essentially reserved for Chinese companies.

In many ways, the natural products industry is “built for e-commerce,” said McMath. “Other verticals have challenges in e-commerce based on average price points, average order values, the size of products, efficient shipping, etc.”

Only about 16-17% of transactions in the West occur online, McMath noted. “In China, that number pre-COVID was 51% in consumer-product verticals.” For the dietary supplement industry, like many others, the figure today may be north of 80%.

Within China’s e-commerce world, “virtually all of the major platforms (Alibaba, Tencent, ByteDance) offer cross-border fulfillment options, which allows brands fast, easy access with U.S. products—with U.S. labeling, in English—to be sold and imported by a Chinese individual.”

Social commerce in general has been the biggest trend within the last couple of years, “really eating into the market share of more traditional marketplaces,” said McMath. “What that’s an indicator of is more consumer attention on content and storytelling and relationships, versus an algorithm. There’s definitely been a lot of excitement and a lot of energy in the market, so that’s been a super-positive indicator.”

Perhaps above all, quality is a best-seller no matter the geographical region, according to McMath. “When a mother’s looking to buy infant formula for her baby, she wants the best in the world, and the same is true in this industry within supplements and broader health and wellness categories.”