Top 10 rules for Doing Business In ChinaComments Off
Doing business in China for Western firms is still hard in 2015.
Difference of Education
This is a primary function of Western business education in China today as much as, or even more, strictly business. I wonder if Western management in China really think one of his main tasks is education. If it does not, it should – because for a Western organization, doing business in China requires that he spend a lot of time educating and developing local talent to work in sophisticated Western business processes – and it requires that Western managers and workers allow themselves to be educated in the flexibility of the Chinese market
A general impression now is that Western governments – for example, the US and European governments – focus on short-term issues: basically ‘fight against fires and of lurching from crisis to crisis with little or no clearly discernible and coherent long-term strategy for how to do, much less resolve, the various crises. Examples include the unrest in the Middle East and North Africa, the tide of refugees arriving in Europe, and the threat of global climate change.
Beware of Chinese companies dynamics
A common cause of losses in China is that foreign companies are so focused on market growth rates that they neglect the basics of competitive analysis. In the beer industry, for example, more than 20 foreign brewers recorded in the mid-1990s, each plan to capture an average of 15 percent of their market segment. In a market lacking clear differentiation, they also found themselves competing with nearly 600 local brewers, many of them subsidized by local governments. Some of these issues should disappear over time, but almost twenty years later, the fundamental situation has changed little. Many industries in China resemble the wine industry, overcapacity, high levels of fragmentation, subsidized local competition, and foreigners are willing to absorb the losses of their “strategic” investments. Learn Chinese is a very good way to understand the way Chinese Things and react explain the founder of Taylor Made School a Chinese training center based in Beijing and Shanghai.
Time has different value in China
Many companies want to get on the ground quickly. In one case, the Director General told his head of strategy for operations in China will within six months. Time pressure like this can create problems later. It tends to result in sloppy planning and analysis. It shifts attention to finding the right partner to find any partner, regardless of adjustment partner. It also weakens your hand in the negotiations. Your Chinese counterpart will be how to use your time constraints against you, and you walk away with a worse deal.
The Chinese government, on the other hand, left the impression that he has a vision very long term, for example, by creating the infrastructure of the Asian Investment Bank (AIIb), take action to calm Volatile stock markets, which begin to fight against pollution, health and food security, and so on. While the asymmetry between Chinese and Western governments – short-term and long-western Chinese term - is obvious, directions of activity seem to be the opposite.
In a series of interviews I conducted, Western leaders indicated that while their companies are looking to make long term investment decisions in China, their experience of their Chinese counterparts are executives and employees looking to make a ” making quick death” source Forbes
Chinese executives also identified the following strengths of the Western business: management, technology, clarity and stability of its processes, a history of technical innovation, standardization systems, R & D, global reach, and strong brands. They also highlighted the following weaknesses: lack of flexibility, high costs, slow decision making, slow responsiveness, rigidity, low business efficiency (as opposed to, it would seem, effective production process) shows a lack of flexible ways and innovative operating
However, Chinese leaders have also identified the following strengths of the Chinese company: flexibility, market knowledge, large market, low costs, aggression, large (and flexible) market Labour (practical and tactical) the business innovation (though not necessarily product innovation), fast, increasingly, a human touch, efficiency, and a general attitude of being willing to learn . The weaknesses of Chinese companies, as Chinese managers see them, include mismanagement, poor technology, short-term vision, poor governance, ineffective systems, a lack of professionalism, poor R&D, a lack of standardization , low brand recognition, and poor quality.
Interpersonal relationship called guanxi !
A common safeguard against opportunism is to build trust with the people who matter to your business. Unlike the West, the creation of personal friendship is a prerequisite to do business. Friendship building takes time, which is another reason to avoid rushing into things. Besides numerous invitations to sporting and other events, a key element of trust is long dinners during which all but business is discussed. In these, alcohol plays an important role. Learn to drink intelligently. Experienced negotiators have alcohol in their glasses of water or wet towels in most good restaurants make available.
Chinese negotiatons are long !
Chinese negotiators sometimes grow beyond what their Western counterparts consider appropriate limits. For example, representatives of a large Western company negotiated the distribution rights for one of their products. Their Chinese counterparts have closed their initial height by threatening to use their political connections to prevent the distribution of their products if they do not get the rights. In another case, China has drunk their Western customers to prevent them from being effective in negotiating the next morning (which the Chinese side, involved a completely different set of people).
Be alert and prepare appropriate measures against. For example, the negotiating teams must learn to drink without getting drunk, include women (because they are not supposed to get drunk), and know that excessive drinking can be delegated to a member of the team.
Understand Chinese society (hierarchical)
The decisions of the Company are generally achieved so top-down, with only the top of the pyramid involved in decision making. Distrust puts limits on the delegation, and at each level surveillance monitoring is high. Middle managers generally have little power to make decisions accordingly, and their main role is to transmit orders from the top and ensuring compliance.
Long term Business
The overall results give a picture of a Western long-term and short-term orientation Chinese to do business in China, with the strengths and weaknesses of Western and Chinese organizations somehow complementary. Even when the two Chinese companies from the West and are considered a force in “innovation”, the nature of this “innovation” is different – Innovation West is considered and technical innovation China is thought to be about adapting flexibly to commercial and conditions.That market is an important consideration which may be underestimated. Everyone believes that their main task is to do business and earn money, but the nature of what they actually do is somewhat different. It seems to me that if the Chinese education system inculcates the qualities basic obedience and discipline in his students and when students enter the work force, practical necessities requires significant ‘on the job training “to adapt the most sophisticated technical processes and management procedures needed in today’s economy. So Western organizations have come to serve as a kind of “graduate school” to develop the knowledge and skills of managers and Chinese workers
Be Flexible and Agressive
While most Western organizations familiar to those who responded to the survey were multinationals of some sort (hence the perception of sophisticated large companies oriented technology ) Chinese organizations come in all sizes and shapes. They ranged from large state enterprises, heaviness, to smaller, high-technology start-ups more agile (hence the perception of poor governance and management, but also flexibility, aggressiveness, and low cost-).
Western Companies need to invest on their Brand
One has the impression that the image of our Chinese leaders of Western companies is something of an aircraft carrier – a large vessel sophisticated technologically innovative, flexible operating processes and systems and extensive global reach – all led by experienced management with a long-term vision. This is a “strategic” image of Western business. Perhaps unsurprisingly, the weaknesses are inversely proportional to the forces – a large aircraft carrier is difficult to maneuver in tactical situations and not to change rapidly adapt and respond to other types of tasks. So things are moving too slowly – decision making, response time, and the pace of tactical innovation – and are too rigid. So with a technical platform very sophisticated, we are stuck with a rigid structure that seems to take some time to adapt. source
Electronic devices market in ChinaComments Off
The market for traditional products of consumer electronics in China is maturing, more than in the whole world. With the rapid development of information communication technology, China has become the largest manufacturing centre in the world for electronics, including televisions, computers, telephones and DVD players.
Here’s electronic devices market in China.
Market development in China
China became in 2013 the first market for electronic devices ahead of the United States. The spending in Asia reached $ 282 billion, and the world 1,068 billion dollars. The bulk of the expenditure was made by console video games, and televisions. In 2014, it is 1024 billion dollars that were spent in electronic devices around the world, including a three dollar spent in China. Shenzhen is the Chinese city that produces the more electronic devices in the world. In 2014, the city had a gross domestic product of 171 billion, largely due to its electronic production. Giants like Apple, Dell and HP make assemble and build their electronic components in this city.
The different categories
Filcontrol is the technology leader in equipment products for textile machine industries. It is present in the Chinese market since 2005.
Huawei was founded in 1988 in Shenzhen in China. It is a company that provides services in the information technology sector and communication including phones. Its services are present in 140 countries, representing one third of the population. It achieved a turnover of 28 billion euros in 2014.
ZTE was founded in 1985 and also offers telephone services.
Xiaomi is the start-up that had the best start in the world. It was founded in 2010 and was valued at $ 45 billion in 2014. It sold up to 61 million units last year.
Lenovo is a Chinese company founded in 1984 by Liu Chuanzhi. Lenovo mainly manufactures computers, telephones, workstations, computer servers and connected TVs. However, the bulk of sales of Lenovo is done through computers, especially since he bought the PC division of IBM. However, it wants to focus on phones especially abroad, where it is still not very present. He recently bought Motorola Mobility. In 2014, its sales in the last quarter business was 10.8 billion.
Skyworth or Hong Kong Skyworth Digital Holdings Company was founded in 1988 (From Bloomberg). It designs, manufactures and sells televisions and audio-visual products.
Maxpac is an electronics company including LCD TVs.
In the area of ??mobile operators we can find China Mobile, China Unicom and China Telecom.
China Mobile is the largest mobile operator in China. It was founded in China in 1997. It has over 720 million subscribers. This is the largest mobile operator in terms of subscribers which is normal given that China is the most populous country in the world, however it remains only used in China.
China Unicom is the second on the China market. It was founded in 1994 in Beijing. It serves over 80 million subscribers.
China Telecom is the third. It was created in 2002 and has a network of over 70 million people.
Haier was founded in 1984 by Zhang Ruimin in Qingdao. This is a home appliance company but it also manufactures TVs. It makes refrigerators, air conditioning machines and washing machines. Haier’s goal is to position itself as a premium brand but is in many countries a low-end brand. However, the company operates in several countries in Europe and also in the United States.
Hisense is a company of electrical equipment. It was created in 1969 in Qingdao. It is the result of the consolidation of brands Combines, Kelon and Ronshen. It is present in the whole world. Its turnover has exceeded $ 16 billion in 2014.
Development in the future
This will undoubtedly increase in the coming years due to the growing middle class: in fact, nearly 220 million households will be part of this class of 2022 according to estimates. China’s new middle class that have a lot of requirements and applications in the high-tech world: some products that they could not buy are now within their reach and they fully intend to enjoy it. So they try to have the latest electronic devices. New categories appear as 4K televisions that everyone is trying to produce and sell in bulk. The Chinese are particularly equipped to sell as much as possible: Chinese companies dominate the market for 4K TVs. Chinese company for Seiki example sells 39-inch 4K TVs for $ 499, which is low compared to what can be found in the market. Leading brands like Hisense, Skyworth and TCL are all trying to build televisions 4K high standard, always keeping the lowest possible prices. Connected objects are also on the agenda, and China hopes to equip its electronic products.
The electronic market is exploding in China since it is very tighly linked to online activities, something Chinese have come to see as part of their lifestyle. These past few years, numerous local companies have started challenging foreign companies on their own turf: High Quality reliable goods. However, the edge is still in favour of first. Why? Two reasons :
Simply put : trust. Too many scandals have gone between Chinese consumers and local companies in all kinds of industry and the electronic market is not an exception. Besides, it is also a matter of prestige. Foreign companies are often seen as giving more face, the typical Chinese social rule of showing how successful you are to be respected. In this matter for now, in the mind of a large part of Chinese mobile users, there is no possible comparison between Apple, Blackberry, Samsung and say Lenovo or Xiaomi. Ask a Chinese to exchange his iphone for a local brand, something still true even though you can find good phones sold by Chinese brands. Oneplus or the latest Xiaomi have received much praise for their features. Alas, the cliché is still present, much to the benefit of the Foreign brands.
Finally, promoting products via e-marketing and the latest inbound marketing strategies has
More about phone manufacturers on Business Internet in China here
Top 10 SEO companies in ChinaComments Off
I am working for a new ecommerce plateform(not online now), and to succeed I know that SEO on Baidu is of paramount importance. However competition is fierce. China accounts for half of the netizens worldwide, and it isvery hard to get visibility. The offer is as big as the demand; therefore you need to increase your visibility on the Chinese internet through SEO, Search Engine Optimization, on the main Chinese Search Engine in China.
From customer service to case study or pricing, let’s see together what is my top 10 SEO companies in China.
It is only my feeling based on the companies I have asked
1 – Gentlemen Marketing Agency
Located in Shanghai, it’s a medium-sized SEO company with 13 people. I have spoken with the founders and they are involved in their work and quite technical. They provide good services according to their case study, and they are quite good. They have worked with famous French Brands like L’Oréal, Avene, Rhodia, but their best case studies are with Tour Operators and in Industry. The only problem is the lack of experience with only 2 years of existence. This is my first choice.
This company based in Jilin city is well-known for its competitive price and quite technical. However, only 2 people seem to run the company with in total just a handful of people. This makes you doubt their claim about working for some of the very famous clients they list on their website like Adecco, Trip advisor, Lux and Microsoft. I think they outsource everything and it is difficult to know the quality of their work. It will be my Second Choice.
Empire du milieuThis Paris-based company is French, small and efficient. It is a very good choice for small and medium projects. They have good rates, and it is difficult to know if their solution is efficient in China. They are working with ExtraFilm, Manitou, Jsitek or ECTM companies.
My Third choice.
This company located in Shanghai is very professional and perfect for industrial companies. The founder is an experienced man with a strong personality. They provide other services like consulting and event planning. They have very good rates, but according to their size it is also difficult to know if they do the job by themselves or outsource.
Their website Mkt-China
Nanjing marketing group
This company is based in Nanjing. They are not so professional in SEO but you can only work with them from 10 000 rmb per month. I like the way they introduce themselves. Evolis, Papa John’s, Rbbi and Kenes group work with them. However they haven’t done SEO for those, only social media campaigns.Difficult to know their SEO case studies.
This is one of the most expensive SEO companies in China. They brand themselves as the expert of SEO but are not very professional on Baidu. They are mostly experienced with Google SEO however Google has recently been completely banned from China so how it is difficult to know clearly about their expertise.They are part of Altima group, a Digital agency based in France. They are hard to reach and their case studies are few in number.Impossible to have information or any good meetings. I know that this company is not for me.
Market me China
The company has an impressive list of customers and hase quite good rates but it seems to be a very small-sized company outsourcing everything it does in China. It is doubtful that they truly work with Sephora for the SEO as they claim or any other Top brands. It is sure that this Chinese lady has their partners.
Company located in Beijing, they should be a reference but dig deeper and you realize that it is not the case. The company is a typical Chinese company talking big and making lots of promises but totally quiet when asked the question: what do you really do for Chinese companies? They have a very long customer list but few clear case studies explaining what they really did. They are super pushy, send you email almost everyday.
This company stationed in Shanghai is famous for its website design services, which are good. Sadly they don’t have a lot of case studies in SEO, and I can advice them in design but not in SEO. The founder David is friendly and nice person.
Located in Honk-Kong and Shanghai, it’s a typical Chinese company with a huge list of customers without any explication of what they do. Beside the fact that their website is not really user-friendly,when you browse its content, it is very difficult to find their former client list, case study or any other relevant information. Plus, you often find 404 errors, making it harder to browse your way through the website.
TOP 10 CHINESE SMARTPHONE BRANDSComments Off
Over the last years, the smartphone market has grown due to the increase of disposable income and the falling prices of smartphones.
In China, the smart phone market share is dominated by a few companies, however, most of these brands are locals.
Here we will have an overview of the main Chinese smartphone brands meeting success in both their domestic and the global market
Huawai is a Chinese telecoms equipment giant founded by Ren Zhengfei in 1987. Nowadays, is one of the largest smartphone manufacturers worldwide since 2013. As a result of its growth, this year its market global share rose to 6.9% from 4.3%…
During the first half of 2014, Huawei shipped a total of 64.21 million devices of which 34.27 million units were smartphone. Due to its popularity, Huawei has experienced a growth of 62% in comparison with the same period of 2013.
ZTE is a Chinese company of telecommunications equipment, network solutions and mobile devices, which was founded in 1985. These days is considered as the world’s fourth-largest mobile phone manufacturer.
Xiaomi is the world’s third biggest smartphone maker after Samsung and Apple and due to its powerful digital communication equipment has become a worldwide revolution. This Chinese brand was created in 2010 by Lei Jun.No doubt that the little rice (Xiaomi means small rice in Mandarin) has grown big!
In China, Xiaomi sells more devices than Apple and it expected to rise up to 60 million unit sales in 2014, which mean double’s 2013. The first half of 2014, Xiaomi sold up to $5.5 billion, which means more than the whole sales of 2013.
Mi3 is its flagship smartphone and which has been sold in China, Hong Kong, Macao and Taiwan.
Coolpad is one of the top smartphone brands in China founded in 1993 by Yulong Computer Telecommunication Scientific Co. This brand has realized a big inversion in R&D in order to develop inexpensive but powerful and sophisticated smartphones.
Lenovo has become the largest computer company in the world with 20% market share of the PC industry. Recently, the brand has began to sell smartphones around the world and now due to the mobiles devices reaches up to 45 percent of the world’s demography. Nowadays, the company sells more smartphones and tablets than computers, becoming the world’s third-largest smartphone manufacturer in terms of market share in the third quarter of 2013.
OPPO Electronics Co, is a Chinese technology brand founded in 2004. This brand is considered as one of the most important smartphone manufacturer in China, with a market share around 15.2%. OPPO has launched the Find 7 series with high- quality image-capture functions and rapid charging features. Thanks to its technologic progress, OPPO has a strong presence in the Chinese smartphone market.
Meizu is a well-known Chinese smartphone maker created in 2003. Its designs are focused to provide to the costumer a simple and intuitive mobile experience. While being among the pioneer of the Smartphone industry in China, in 2010 the company has faced legal problems, due the similarity of its devices with the IPhone. Since then, Meizu has developed new designs in order to differentiate them.
Gionee was established in 2002 as one of China’s largest mobile phone manufacturers. The Chinese brand is considered as a high tech enterprise which is focused on the R&D, production and sales of mobile devices. Since 2005, the brand has the mobile phone production license of GSM and CDMA. In comparison with last year, Gionee has increased its market share from 1.5% of 2012 to 4.7% of 2013 in China.
Established in 1981, TCL is one of the biggest consumer electronics producers in China. TCL has a global presence and the brand cover many areas in the Smartphone industry like: design, development, manufacturing and product sales (mobile phones, computers and multimedia electronic s amongst others).
In 2010, it was the world’s 25th-largest consumer electronics producer and third-largest television maker.
K-Touch was created in 2002 and is recognized as one of the most well-known consumer brands in China. This mobile phone manufacturer has its own R&D centre in Beijing and has developed a global top lab for mobile research.
Because of its top of the line R&D department, the brand is considered as a local smartphone brand with the most growth potential in China. K-touch is expected to experience the fastest growth in the coming years
K-Touch sells its mobile devices in 22 countries over the world.
We can talk about China as a connected country where people have developed a kind of mobile dependence.
Companies, particularly Chinese brands are tapping this tendency and they are developing modern smartphones to satisfy the Chinese people needs and therefore be an important part of the Chinese market.
The reality is Chinese shoppers prefer homemade brands, due to its high quality and its lower price.
5 key players of the e-commerce market in ChinaComments Off
E-commerce is about to reach 10% at the end of commerce market in China this year. It has easily become the largest online market place in the world since it China’s online B2C exceeded the American one in 2012. The online B2C is indeed the more important part of the market in China.
Here are the most successful players of the e-commerce in China:
The e-commerce in China is clearly dominated by the Alibaba group. It was founded in 1999 by Jack Ma, the original website of Alibaba offered a B2B platform for Chinese companies. Alibaba owned a 44.82% market share in the B2B online market in Q2 2014.
Over the years, several websites and services were created to meet the needs of the Chinese citizens online.
The group therefore created Taobao, a C2C website in 2003 which benefited from an enormous success among the online Chinese shoppers. Mostly because the website adapted to the Chinese way of shopping. Taobao therefore allowed its customers to bargain online and to pay only after they had received and inspected the quality of the goods they ordered.
A B2C website came in 2008: Tmall, which owed a 57, 36% market share of the Chinese B2C online retail market in Q2 2014. The B2C platform allows local Chinese and international businesses to sell quality, branded goods to consumers in mainland China.
The Alibaba group also created its own payment system, Alipay, in 2004. The group is owned by Yahoo at 40% since the American internet giant helped them develop in the mid-2000s by investing one billion dollars in Alibaba in exchange for a 40% stake in the company. A good bet since Alibaba is now famous all over China.
As for this B2C retailer, it was created in 1998 in Beijing under the name of 360buy.com, which changed last year in JingDong. It was ranked second largest player of the Chinese B2C online retail market with a 21.22% market share in Q2 2014. The e-tailer offers to its 60 million registered users a range of 12 categories of products from home appliances to clothing. In 2013 more than 500 000 orders were placed on the website every day. Chinese online shoppers like this website because it is like a wholesaler, they can address directly to JingDong if a problem occurs. Which differs from Tmall where sellers are all individual companies.
In March this year, the e-tailer signed a partnership with Tencent, to allow users on both platforms to transit from one to the other directly allowing JingDong to enter the mobile market more easily.JingDong also owns a C2C platform called PaiPai.com that is currently planning to launch a mobile app enabling individuals merchants to create micro-shops directly from their smartphones.
The company based in Shanghai and created in 2008 quickly became one of the top online retailers of the country. The company developed quickly thanks to an always larger range of product classes.This rapid growth was made possible thanks to an agreement reached with Wal- Mart in 2011. The American distributor agreed to invest in the development of the Chinese online retailer against a 51% stake. Yihaodian since managed to build a base of more than 60 million customers. Those e-shoppers placed an average of 300,000 to 400,000 orders per day in 2014.
Apart from the affordable prices and the large range of products offered, the e-tailer is also popular thanks to the speed of its deliveries that is guaranteed within an hour in Shanghai. Its efficient customer service is also very appreciated by the shoppers.
Chinese e-commerce is therefore largely dominated by B2C websites such as Tmall, JingDong and Yihaodian but most of them also have C2C platforms of their own to play on the two branchs of the market. More rarely some have B2B websites like Alibaba, the market’s leader that is number one on every branch that e-commerce has to offer. Recently another battlefield has open for the different players of e-commerce to have fierce competition on: m-commerce. M-commerce indeed went from inexistent in 2009 to 10% of the e-commerce in 2013 and experts said it will reach 20% by 2016. The major players of e-commerce therefore have to adapt their strategies to this channel.
To go further:
8 tips on how to develop your online presence in ChinaComments Off
China is one of the world’s largest internet markets
China is far from the manufacturing country we’ve deemed it to be in the past century: nowadays, it’s safe to say China has one of the largest internet markets of the world, and with 54 million users added in 2013 alone, most companies are trying to enter the market thanks to new digital marketing strategies targetting smartphone users and netizens in general. However, in order to succeed, firms have to craft an entirely new marketing method specially adapted to the Middle Kingdom’s culture or user behavior, and that’s easier said than done.
1. Market study
As with any other strategy, you have to search for information on the market you’re trying to enter: research on your target market, audience, as well as your potential rivals. On top of that, make sure you accurately assess your own firm’s internal strengths and weaknesses in order to determine if entering China is a sustainable idea.
2. Speak Chinese in China
In China, not all people speak English, especially on the internet. If you want to reach local consumers, people expect you to communicate in Chinese : translate your content in Chinese, and make sure you’re adapting it to fit the views and concerns of the local customer, which will be different from what was written originally for a western consumer.
3. Secure your .cn domain
Increase your visibility by using a .cn domain that’s easy to remember and that fits your brand image and marketing strategy. If you want to rank higher in search engines relevant in China, like Baidu, make sure you’re optimizing your site according to a precise SEO strategy.
4. Choose a local server
As much as China is one of the largest internet markets of the world, it’s still a country where internet speed is lagging behind other more developed Asian countries (South Korea, Japan … ). Chinese internet speeds have improved drastically in recent years, but even like this it’s better if you host your site locally : offering a fast, user-friendly surfing experience is sure to make consumers remember your site.
5. Remember smartphone users are predominant
Optimizing your site for mobile use isn’t an option if you want to increase your online presence in China: 81% of Chinese internet users access the Internet using a smartphone or a tablet. You’ll have to make sure your site is user friendly on a Smartphone, and if you can, developing an app is even better:iOs, Android, Windows Phone Apps so that any smartphone user can use it. Just one quick point though: as most apps downloaded in China are free of use, don’t make your app paid!
6. Be present on Chinese social networks
Even if Facebook, Twitter or Youtube are officially banned in China, social networking is a big thing here. They have their own Facebook, their own chatting service, and their own video hosting network. You’ll have to be active on Chinese social networks if you want people to get to know your brand.
7. Target your customer
Using a smartphone to access data enables consumers to have personalized offers: for the firm, it means targeting the customer is easier. With customer data such as location, preferences, purchase history, and everything you can think of, developingpersonalized brand experiences becomes much easier! Think relevance, time and customization.
8. Develop a mobile strategy
Now that you have a draft of what you should and shouldn’t do, it’s time to formalize your online strategy and to carefully market it in order to achieve your objectives. Seeking help from a local consulting company can be wise, especially if you haven’t got any local help or view: they’ll help you get an idea of what Chinese consumers want, what they already have, and thus what they need; what you can bring them.
The next evolutionary step for e-commerce in China is e-mobileComments Off
The day the e-commerce will go mobile
When the e-commerce industry in Western countries is becoming mature, in China, it is a huge market that has a lot of untapped potential! The opportunity of having a 600 million clients visibility is attracting businesses from all over the world so why not you ?
Maybe some numbers will help: in 2013, it is 618 million Chinese that were using Internet with a penetration rate of 46% of and it is not even half of the population. Within this population, 300 million of them were already shopping on-line last year.
Who is controlling the Chinese Internet?
The three giants on the Chinese Internet are well known in the Industry : Baidu (the favorite search engine of Chinese), Tencent (which owns WeChat and SnapChat) and Alibaba (which owns Weibo and Tango). They all have a net profit of at least 1,465 billion euros and enjoy a growth of sales and turn over very advantageous.
A huge potential in the B2C Market 2013
If Internet used to be the place where customers were making business with customers the trend is now turning around. In 2010, only 13.7% of transactions were from Business to Customer. And the Customer to Customer type of transactions ruled 86.3% of the Internet. Now, B2C represent 35.1% of the market and this is far from over. In 2017, experts expect that they will be more B2C transactions (52.4%) than C2C transactions (47.6%).
The opportunity of smart phone on e-commerce
In 2013, if the Internet users were 618 million, the mobile Internet users were already 500 million. The penetration on this sector has a 83% growth! It is the highest of the world(followed by South Africa and Hong Kong). Concerning tablet, it is the first one in the world as well with 39% (followed by Mexico and Singapore). What does that mean? It means Chinese will more likely buy through their Smart phone that any other nationality.
Indeed, there are already 69% of Chinese that bought a product on their mobile compared to 46% of American. China passed the hurdle mid 2013. By this time, more people were shopping through their smartphone (81%) than their computer (70%). On Double 11, which is on Nov 11 nicknamed Bachelor’s Day by Chinese, 127 million consumers spent 650 billion euros on Taobao Mobile. It is 560% more than in 2012 and convered 21% of all Taobao’s transactions. This website is one of the favorite of Chinese, 2/3rd of netizens (400 million) used it in 2013.
The mobile shopping market in China has showed incredible growth and opportunity. In 2011, it generated “only” 1.37 billion euros transactions, in 2012, already 7.44 billion euros and in 2013 almost 20 billion euros. In 3 years, this sector has experienced a huge boom and by 2017, transactions should reach 117 billion euros. How come ? Thanks to the new means of mobile payment, the penetration of smartphones in the countryside, the increase of the 3G coverage and the WIFI hotspots and the Offline to Online tools.
Who will be smart enough to catch this wave though ? Taobao Mobile already has 81.45% of the market share and Jingdong Mobile 6.67% but trend can still change.
What are the trends expected in the future?
In addition, the forecasts are all very optimistic when it comes to the evolution of this sector. In 2012, the total transaction value was equal to 354 billion euros and in 2013 over 218 billion euros. With a 40% growth, from one year to another, the sector should expect to reach 488 billion euros transaction by 2017. It is the biggest on-line e-commerce market in the world. Experts predict that by 2020, it will be bigger than the e-commerce of USA, Great Britain, Germany, France and Japan combined.
The rise of e- tourism in ChinaComments Off
Chinese tourists are more and more visiting other countries in the world, and this growth is expected to continue in the coming years. One of the key trends among Chinese tourists nowadays the e- tourism, i.e. using the internet for everything related to the Chinese travel and Chinese potential travelers. Why and how is internet used in this area? Here is some essential information when you are interested in this market.
More and more Chinese tourists in the world
Internet in China
David, specialist of Travel in Asia explain that “ 70% of Chinese travelers book online today! We must therefore be aware of the importance of the Internet in China, and also in the tourism sector.”
Major platforms booking
Social networks and KOL
Search on Baidu
To conclude we can say that e-tourism has become an integral part of the lives of Chinese and is an important means to adapt to this growing market. If you want to take advantage of the million Chinese tourists expected in the world in the coming years, it is essential to adapt to the habits of the country, including e-tourism.
If you are a company of the industry sector, don’t wait to increase your e- reputation on the Chinese web, and your notoriety in the country, in order to attract many Chinese tourists and increase your Chinese customer base.
Real Estate websites in ChinaComments Off
Real Estate websites in China
At first sight, the websites about renting an apartmet in China can appear messy. Let’s try to have a quick insight about what kind of actual site and services you can find there. Fist of all, the online Chinese real estate websites can be divided in two categories. The websites aimed at the Chinese public and the websites for expatriates. These two categories have quite distinct characteristics.
Real Estate Websites targeting the Chinese customers
Within the first category, you find the websites of the large real estate companies in China, like Century 21, or Wo Ai Wo Jia « 525j », that was successful and extended its internet site to home supplies. These are the standards websites advertising properties for a specific real estate company.
Apart from these websites, a couple of specialized webportals have been very successful advertising real estate in China. The most important of them are Soufun (), 58.com (58.com ) and Ganji (www.ganji.com). These websites have the largest selection of apartments available in China.
The general problem of real estate in China is that the market is wild and many frauds do occur. The general information is inaccurate since the agency’s target is to attract customers. The classifieds advertise appartements that are not available, some of them might even have never been available at all since the agencies actually collect pictures of any kind of apartment just to give the feeling of a large choice.
Often the agents masquerade as owners just to maximize their commission and get a supplementary commission from the tenant. Actually, if the monthly rent is over 4.000 RMB, only the landlord usually pays a commisionn if the price is under 4.000 RMB, they try to get the commission both from the landlord and the tenant. Overall, this is a market which is very poorly regulated, with very little means for the administration to control anything, so that anything can happen.
Actually, most of these websites are never used by foreigners since almost none of them are translated in english. This is one of the simple main reasons why the foreign customers/domestic customers are separated.
The situation is a little bit specific for the expatriate real estate.
Real Estate websites targeting foreigners
Just as it is the case for Chinese citizens, there is two kinds of websites, the general websites with classifieds and the websites specialized in real estate. The most popular classified websites for foreigners are sites such as City Weekend, (http://www.cityweekend.com.cn/shanghai/) , the Beijinger (http://www.thebeijinger.com/). The trouble on these websites are exactly the same than for the Chinese websites : everything is possible since there is very little control. Real Estate agents just try to get into contact with customers and rent them any apartment they actually have at their disposal.
This would have no tragic consequences if the agents you might get in touch with had a real sense of service. The trouble is that in China, many of them are unable to actually understand the expectations of customers, even less the expectations of a foreigb customer. Nevertheless, you can find very good renting opportunities and very professional agents on the general expat classifieds websites, but be aware that there might be diapointments.
Some agencies are specialized in real estate for foreigners, among those, there is Scout Real Estate (http://www.beijingrelocation.com/), Lihong … among others.
The big advantage of these agencies is that since they are targeting the specific market of expatriates, they have foreign staff, some of them are even foreign managed (Scout Real Estate) and they understand better the expectations of foreigners in China and are more service oriented.
However, this type of agency has very few low budget apartments and have almost no rental under 6.000 a month, and many of them are not interrested by rentals under 10.000 RMB a month. Be aware that if you are looking for this type of budget, they can be a real best choice, for they negociate the rent and commission in accordance with the actual market and are less likely to advertise apartments that actually do not exist, and you are more likely to deal with the legitimate landlord. One another thinbg can be noted is that these site benefit from a real large choice of apartments since the Chinese landlords appreciate to rent to foreigners that they perceive as more careful than Chinese tenants that can sometime turn apartments in a mess.
Whatever the solution or classified you answer on the internet, you should be careful enough to check the credentials of the person who is introduced as a landlord and compare the prices online, with some prudence you can avoid most scams and enter a truthful relationship with the agent or the landlord.
China Raises Mortgage Rates(0)
After Sunday’s move, the rate for mortgage loans longer than 5 years will be 4.30 percent, and 3.75 percent for those of five years and shorter. China’s central bank raised interest rates by 25 basis points on Saturday, the second time in just over two months, in a bid to contain the country’s stubbornly high inflation.
“This will further increase the cost of home purchases and will, to some extent, curb investment demand in the property market,” the official Xinhua news agency cited Chen Ming, marketing chief of real estate 5i5j, as saying.
Beijing started tightening the property market late last year, but house prices have remained out of reach for most middle-class families in many cities, although house price has slowed recently.
Land cost, a major contributor to high housing prices, have showed signs of rebound in recent weeks, triggering concerns of fresh tightening steps by the central government.
Source : Konaxis