NZ-China trade: Trust is gold

In November, thousands of Kiwi products proudly displayed the FernMark in China. Sarah Morgan explains why.

New Zealand exporters had an opportunity the size of China in November to capture the attention of the world’s largest e-commerce market.

Trade commissioners and exporters had travelled to Shanghai for the inaugural China International Import Expo (CIIE); New Zealand Week – featuring New Zealand F&B brands – took place from November 1^st to 15^th; and Alibaba Singles’ Day – the world’s largest e-commerce shopping day – took place on 11 November.

A combination of China’s debt, trade tension with the US and regulatory uncertainty has been a concern for exporters recently. Encouragingly, following reports of a slowing economy, China has also shown robust GDP growth in the first half of 2018, stable leadership and society, and strong growth of domestic tourism and consumption.

One of our partners, Stephen Jacobi, executive director of the NZ China Council explained the China International Import Expo was designed to show China is open to business. “More than 90 Kiwi businesses made the trip to show off their homegrown brands and grow their market presence abroad. It was a unique opportunity to build new relationships with buyers and consolidate new ones.”

But how does New Zealand get cut through in such a huge economy and challenging environment? New Zealand business initiative, HUI Māori Collective featured the Government-accredited FernMark (alongside AsureQuality’s food safety verification mark) on its Māori-branded product suite of high-quality local food and beverage products at its launch in Shanghai, and via NZ Post’s Tmall Global flagship store. The New Zealand Government FernMark Licence Programme verifies that products are grown or made or designed in New Zealand by reputable New Zealand companies.

The chair of the Collective, Hayden Johnston says their products will hugely benefit from the FernMark’s association with brand New Zealand. “The FernMark offers a clear, visual stamp of provenance and trust. It enables Chinese businesses and consumers to authenticate a product’s country of origin and, combined with brand New Zealand, is a powerful influence on the purchase decision-making in-market.

“The FernMark’s IP protection service also monitors over 1,000 e-commerce markets in China, including Tmall and Taobao. This helps to ensure all products bearing the FernMark are licensed to do so, thereby providing a mark of trust and authenticity.”

The FernMark is inextricably linked to brand New Zealand. For many Chinese, New Zealand is a brand, not a country. And brands are important in China. A 2016 Nielsen Global Brand-Origin Report found 91 percent of Chinese respondents rated a brand’s country of origin is as important as, or more important than, other purchasing drivers such as selection/choice, price, function and quality. Safer ingredients and processing were the top reasons for choosing global brands (50 percent)^[1].  

“New Zealand’s trade with China continues to grow strongly as Chinese consumers value our reputation for quality, sustainability and safety,” adds Jacobi. “But New Zealand also faces growing competition in China, which means we need to constantly review our market position, understanding consumers’ needs and validating our claims. The use of the FernMark is a great way of enhancing transparency and trust in our products.”

November’s trade activity presented the perfect opportunity to change these perceptions and prove New Zealand’s worth beyond natural beauty. The FernMark, which really resonates in China – where food safety and brand prestige remain two of the highest consumer priorities – is invaluable to exporters to accelerate these conversations.

New Zealand exporters with trusted Government-backing will ultimately win – because trust is gold in this trade climate.  

Sarah Morgan is head of engagement at NZ Story Group. This article was first published in the December 2018 issue of NZBusiness.