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Western Perception vs. Chinese Reality: The China Way


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Australian Business Forum helps Australian SMEs and businesses to understand the Chinese market and refine their China strategy.

Success in Asia is highly attractive, and fraught with challenges. What works in Western markets doesn't always apply to audiences in China. These markets ranging from the highly sophisticated, like Shanghai and Beijing, to those with 'Tier 3' millionaires who lack international experience.

This presentation covers surprising statistics on China and the pitfalls for foreign brands who fail to plan their China approach.

Originally presented by the China Way ( at Australia-China BusinessWeek 2015 Sydney

Published in: Marketing
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Western Perception vs. Chinese Reality: The China Way

  1. 1. vs. Chinese reality Western perception
  2. 2. Statistics are exciting
  3. 3. China’s millionaires increased 67.2% in 20144,000,000 households* *BCG 2014 wealth report 14 millionpeople play tennis of all consumption in China to come from young (G2) consumers by 2020 35% is the average age of super-rich in China 51 students went abroad in 2014 694,000 1.8% Luxury CPI 7 of the top 10 on the Hurun Rich List are popular bloggers 7/10
  4. 4. But when it comes to marketing in China, statistics can be a distraction
  5. 5. Behind the mind-boggling statistics China is a country as diverse as Europe, so you must consider: Regional culture levels of developmenttastes dialect Business opportunities may exist away from the highly populated megacities
  6. 6. New symbols & words every year On the Internet or mobile, ‘286’ means you are slow or unresponsive; ‘886’ means good-bye; ‘9494’ means yes, I agree. The most popular and powerful new word so far is the word Shanzhài
  7. 7. Until now, everything has a (Shānzhài) version, for it really symbolizes the vibrancy and complexity of the market.
  8. 8. What’s in a name? Auspiciousnameshave a practical application
  9. 9. 1.2 billion people are NOT your target audience GUANGZHOU SHANGHAI BEIJING
  10. 10. QINGDAO 9 million
  11. 11. CHENGDU 14 million
  12. 12. In the west, it’s pretty simple. In China, it’s not. We identify our target audience and focus our efforts on them. You need to consider and build relationships with multiple stakeholders because success or failure depends on a range of influences. Different regulatory regimes More invasive Government policy Heightened cultural influences Politics are considered when decision making
  13. 13. Where to focus your business and find the right market?
  14. 14. Opening the right doors to the China market In the west this would be undue influence; in China, take this approach or you’ll fail. Supporting a research chair at an influential university Participating in a regulatory committee In other words, ‘know the right people’
  15. 15. Red tape analysis You need to get a grip on what’s really happening R 34 Provincial regions 2862 County-level regions 334 Prefectual level regions 42,000 Township-level regions and even more at village level...
  16. 16. Hot topic on Baidu & new goverment policy • Newpoliciesandregulations creating business • Opportunities for international companies • Increasingcomplexity & compliance • Risk & reputation Tracking water pollution Go deeper & challenges are revealed
  17. 17. Competition is rising from homegrown brands Local brands have moved a long way from the negatives of ‘Made in China’ Chinese people take pride in their country’s achievements Understanding ‘who’ and ‘where’ competitors are is a major consideration International brands are trusted in China but...
  18. 18. Who is Xiaomi? It released its first smartphone in August 2011. By the end of 2014, Xiaomi overtook Samsung becoming the largest smartphone vendor in China and third largest in the world. With a valuation at more than US$46 billion it became the world’s most valuable tech start-up. What does this mean for us? Will Xiaomi crush Samsung and Apple?
  19. 19. K People believe in key opinion leaders, not the government or media.
  20. 20. Kai Fu Li 50, 228, 741 followers Ex Google and Microsoft head, Kai Fu Li is a very active and vocal technology blogger with over 50 million followers. Just a few positive tweets from Kai Fu Li can create a huge sway in shaping perception in the public. Most influential KOL?
  21. 21. You need to be there The pace of change is almost incomprehensible for westerners
  22. 22. The 3 key success factors Cairns Tourist Market | 15 April 2015 3 You’ll be invisible without a Chinese brand/company name Position for relevance: localise your brand experience and marketing, while maintaining your brand integrity Get local, up-to-date insights to base your strategy on1. 3. 2.
  23. 23. tThank you