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
never been the Chinese companies’ forte. They are brilliant at doing business and getting the best deals but yet again, foreign companies have more experience in marketing. So, to be successful, a foreign newcomer in the Chinese market must use the services of a foreign inbound marketing agency that knows the Chinese market very well in order to get that big edge it would need (here for a list of good marketing agencies in China)
More about phone manufacturers on Business Internet in China here