Global Expansion Boom: Cross-Border Services as the 'Miracle Fix'

In recent years, the phenomenon of globalization has taken on an entirely new dimension, particularly for Chinese enterprises. As technological revolutions burgeon, the landscape of the global economy has undergone radical changes, placing Chinese businesses in a position to seize opportunities. After traversing a journey laden with technological, market, and cultural transformations, these companies are advancing towards a more expansive global stage, ready to showcase their competence and innovation.

Exporting, once viewed merely as a strategy for expansion measured by trade orders from factories, has evolved into a profound and unprecedented phase in the growth trajectory of Chinese businesses. The cross-border service sector, which had long adopted a strategy of strategic retreat, is now entering a period of explosive growth, showcasing its potential on the international arena.

Contrary to the aggressive competition of the past, the digital service providers that once thrived on foreign trade and cross-border e-commerce are now experiencing polarization. On one end, some are venturing out aggressively to capture market share, while others find themselves in a precarious IPO phase, grappling with profitability issues.

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A positive trend can be observed: amidst the ongoing challenges, companies that have been in operation for ten to twenty years are adopting more effective business strategies and service models than ever before, positioning themselves firmly against the tide of globalization.

One such company is Zhongqi Cross-Border. Its CEO, Chen Mingfei, emphasizes the evolving needs of clients engaging in overseas marketing, stating, “We realized that our clients are increasingly seeking specialized marketing approaches, revealing a new opportunity right at our doorstep."

Zhongqi Group became Google's first Chinese agent in 2005. From their beginnings with search engines, they have gradually expanded their services to include private domain website building, advertising optimization, and channel aggregation, successfully helping over 300,000 foreign trade enterprises reach international markets.

However, the simplistic ad optimization and marketing techniques that once sufficed for Chinese enterprises venturing abroad can no longer adequately meet the structural demands of this new landscape. Pushing Chinese manufacturing toward globalization mirrors the dynamic transformation occurring within the overall Chinese economy, particularly reflected in two main shifts in the cross-border services sector.

Firstly, the operational mindset of companies entering foreign markets has expanded to encompass social media and localized channels of traffic, transitioning from mere advertisement optimization to content marketing. Secondly, the global perspective and localized strategies are now reaching emerging markets in Southeast Asia, the Middle East, and Latin America, away from the more mature markets of Europe and North America. As a result, the landscape of the cross-border service industry is rapidly evolving.

This reveals a widening range of opportunities for enterprises venturing abroad, but practical execution remains fraught with uncertainty. Nonetheless, one thing is clear: the era characterized by crude operations and low-cost customer acquisition strategies is over. Companies expanding overseas now face a growing necessity for refined operations, while the cross-border service sector demands specialization.

Chen articulates a key point: "Only through specialization can we create value in critical moments, preventing our products and services from becoming mere options that can address anything and everything.”

The essence of achieving depth in services entails a full alignment of the offerings provided with the demands of clients. Failing to do so can result in a backward approach where businesses create products that customers have to adapt to instead of satisfying their needs.

Trust and focus in cross-border business have led Zhongqi Cross-Border to function as an independent brand with a fully dedicated team, serving its business clients. This strategic depth underscores what clients can expect from engaging with Zhongqi Cross-Border.

In truth, the rapid ascent of Chinese enterprises and their fast-evolving understanding, coupled with low standardization in operational processes, creates a strong demand for specialized tools and services within the industry. Without these, digitalization can easily become a burden on expenses.

The Zhongqi Cross-Border team consists of experts well-versed in various markets and proficient in diverse advertising and content channels. They can assemble service teams tailored to the needs of companies attempting to globalization, thereby expediting the establishment of local operations and facilitating global business activities.

A striking example is that Zhongqi Cross-Border's optimization team consists of individuals with international study backgrounds. They possess an in-depth knowledge of diverse cultures, languages, and customs, complemented by professional skills in overseas promotion, allowing them to bolster companies' marketing efficacy significantly.

In addition, a focused approach ensures increased openness in service and data aspects. The core logic behind their cross-border marketing services—such as website creation and overseas promotions—lies in enabling enterprises to establish direct interactions with consumers and B2B clients through private domain growth.

Many Chinese enterprises now see going global as a core strategy from their inception, presenting a rigorous challenge for depth in cross-border services. In this context, efficiency, sophisticated ideas, and operational completeness become necessary, yet many of the advantages observed in domestic SaaS models do not effectively address the real pain points encountered abroad.

Chen candidly states, “Whether service providers or suppliers, making money is simple; the trick is figuring out how to help your clients make money.” The goal for Zhongqi Cross-Border is to align with the fundamental motivations of companies expanding overseas.

The secret to implementing a strategy of depth lies in the capacity to provide long-term services. The value of sustained engagement not only contributes to a renewal rate exceeding 90% over three years for Zhongqi Cross-Border but also aids in weaving the fabric of Chinese manufacturing deeper into international markets by reliably reaching more end users.

While business models that revolve around white-labeling and order fulfillment are undeniably in vogue, globalization and branding remain the unrivaled preferred choice for most enterprises venturing abroad, especially in B2B foreign trade. Without building brands, these companies risk facing a “burn and plow” scenario when the current traffic boom ultimately peaks, leading to a stark realization that yesterday's flow has evaporated overnight.

Building a brand means more than just mastering e-commerce mechanics regarding orders, traffic acquisition, and sales; it centers around the key issue of how to convert customers into long-term patrons.

In addressing this matter, Zhongqi Cross-Border’s approach is exceptionally service-oriented, aiming to more accurately meet customer needs through elevated service. They have established 22 branches nationwide, ensuring that they are well-positioned to tackle the specific pain points faced by their clients.

“Through long-term engagement, we can truly understand customer needs that they may struggle to articulate. This understanding is crucial for adopting the customer’s perspective,” Chen explained.

For instance, consider the collaboration between Zhongqi Cross-Border and a steel pipe manufacturing company. Traditionally, steel manufacturing—considered a backbone of the manufacturing sector—rarely ventured into C-end channels, such as social media, for B2B business under conventional foreign trade logic. However, with the trend of B2B branding rising, a new communication strategy emerged, necessitating such companies to participate in social media marketing.

Prior to meaningful dialogue, the company lacked the expertise needed to establish a brand presence, curate content, determine appropriate user profiles, and convert social media followers into viable leads. Defining marketing strategies for various international markets had yet to be addressed, nor had they established a clear promotional approach across regional niches.

To address these gaps, Zhongqi Cross-Border designed an integrated overseas promotional and marketing framework across platforms such as independent websites, Google, Facebook, and TikTok, while continuously supporting the company's operational strategies.

They opted to target regions including Pakistan, the UAE, Southeast Asia, and South America after thoroughly analyzing the company’s product positioning and competitive advantage along with investigating comparable competitors’ marketing strategies. By incorporating instant lead forms into advertising initiatives and rationalizing account structures and budget allocations, they increased synergy.

The results have been remarkable; advertising on Google and the launch of the company’s Facebook and TikTok accounts lead to not only immediate conversion on the first day but also an average of over 300 monthly inquiries—a 43% increase compared to prior volumes.

This reinforces that Zhongqi Cross-Border’s management approach is detail-oriented and necessitates substantial upfront investment. This model is largely uncharted territory for SaaS enterprises that focus heavily on sales tools. However, as Chen observes, given that 95% of Chinese enterprises fall into the category of small and medium-sized businesses, nurturing longevity with clients mandates such a comprehensive service ecosystem.

Compared to simple sales and procurement, Zhongqi Cross-Border seeks to cultivate a partnership with clients focused on co-developing a sustainable business model.

As other service providers fixate on how much cost they can save or lead volume they can generate, Zhongqi Cross-Border is far more attuned to metrics such as opportunities converted to business and customer retention rates—indicators reflecting long-term revenue.

The independent websites built for client companies focus not merely on product presentation but equally on shaping brand identity to foster better connections with global consumers, thereby enhancing brand reliability. In contrast, Zhongqi Cross-Border emphasizes translating marketing strategies into tangible order growth, standing accountable for expanding overseas business for clients.

The long-term service philosophy embraced by Zhongqi Cross-Border presents a compelling reference point for businesses navigating conversion challenges elsewhere. The impressive three-year renewal rate of over 90% substantiates the efficiency of their focus on sustainable service.

In an increasingly challenging environment, transitioning to sustainable business practices emphasized by long-term strategies is critical across all industries.

Targeting China’s growth enterprises, Zhongqi Cross-Border adopts an unconventional angle by focusing on the long tail market, diverging from the well-trodden path of servicing high-profile clientele common among mainstream cross-border service providers.

The combination of a long-tail strategy and substantial investment in sustained service provides Zhongqi Cross-Border with a natural advantage, underpinned by the broader financial stability of Zhongqi Group. This advantageous position equips them with a robust capacity to weather financial demands and market risks over the long haul.

Conversely, most Chinese cross-border service providers operate independently, which limits their ability to establish such resilience. Confronted with their survival imperatives, they tend to focus on securing immediate return-on-investment or achieving capital commitments, which further inclines them towards servicing larger corporations.

However, with over 95% of Chinese enterprises classified as small to medium-size businesses, helping these innovative firms reach international waters while nurturing growth abroad remains the linchpin for future economic momentum in China. This embodies a profoundly ingrained commitment of a firm with 25 years’ experience specializing in cross-border services.

A glance back at China's recent history reveals that over a decade ago, major brands such as Lenovo sought to establish global footprints. Yet this endeavor lacked the multiplier effects generated by clusters; without cohesive industry networks, the benefits were far from impactful. This exploration into international markets did not align with a true wave of globalization.

Transitioning from a hub of manufacturing to a breeding ground for global brands, it becomes crucial to harness the explosive potential of SMEs and promote steady economic growth. It explains why, in recent globalization currents, consumer electronics and home appliances have emerged as pioneers among Chinese foreign trade enterprises making their mark internationally.

From Anker’s rapid ascendance in peripheral electronics to the consumer traction garnered by Ninebot's electric scooters and lawn mowers, these trailblazing brands have established themselves at the forefront of global market performance, continuously evolving and expanding their influence. Supporting their international journey is akin to investing in future landscapes.

Moreover, over the past two years, the presence of SMEs abroad has transcended consumption-driven categories—they are now honing in on sectors previously dominated by megacorp firms, such as high-tech industries and advanced manufacturing.

“During company visits to secondary cities, we frequently observe multiple enterprises engaged in semiconductor production, along with numerous players in smart mobility and robotics,” Chen notes. This sentiment has been echoed at trade fairs like the Canton Fair, where business partners from emerging markets like Africa and the Middle East have expressed growing interest not just in consumer goods from China but also in production automation equipment.

As the push for export sophistication continues, small and medium enterprises are embracing a long-term self-help strategy focused on elevating brand value and advancing technological capabilities. These two guiding principles are seen as pillars for sustainable development.

The competitive environment within Chinese manufacturing parallels that of consumer goods markets. Unlike prior strategies that regarded overseas expansion as supplementary, the current consensus acknowledges that significant productivity is essential for competing on a global level.

If the awareness of going global reflects intrinsic motivation, then the foundation of production capability and supply chain advantages embodies the lifeblood of small ventures.

In sectors characterized by high growth potential or long life cycles—such as chips, solar energy, new energy, and robotics—Chinese manufacturing holds a competitive advantage, offering superior cost-effectiveness compared to international benchmarks. In mature technical niches, price points can shrink to as little as 10% of foreign equivalents.

This reality implies that even in the short-term, without rigorous technological upgrades, substantial brand value can still be achieved from lowered production costs, distinct from the product selection paradigms tied to the previous foreign trade model driven by bulk orders.

However, it is essential to recognize that, presently, enterprises’ reluctance towards venturing internationally is less about willingness and more about the incapacity to harmonize critical technical edges with softer elements like cross-border marketing and localization strategies.

As a result, cross-border service providers indeed function as a “magic bullet” for addressing the commercial return challenges faced by Chinese manufacturers.

“The resilience of Chinese enterprises, coupled with the professional insights regarding production capacity transitions, shapes the reality: however many enterprises may be eliminated, new forces will continue to emerge,” Chen asserts confidently.

In the face of flat domestic demand, the axiom “If you don’t go global, you are out of the game” becomes the wave pushing for change, while the courage to embark on this journey emanates from the tenacity of SMEs and firms like Zhongqi Cross-Border—those well-versed in the enterprise service realm and keenly aware of market dynamics.

When courage and competence coalesce, abroad opportunities transform into structural advantages.

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