First the Yangtze, then the World

If the stunning IPO of Alibaba was not enough, Sunday September 28th could have been called Jack Ma day on TV.   First came the running of “Crocodile in the Yangtze – A documentary” by Alibaba insider Porter Erisman, which follows the company from its beginning.  The Bloomberg Television showing chronicles Mr. Ma’s humble beginnings to his vast vision, his good fortune and his sheer audacity. It carries him through and it knocked eBay out of China.

In the evening Jack Ma turned up again, this time on CBS’ ‘60 Minutes’ to punch home his philosophy that the customer comes first, his employees come second and his stockholders come third, an idea in contrast to most in the corporate world.  His audacity is again demonstrated when he looks into the camera and says, (paraphrase) ”If shareholders don’t like being third they should sell their stock.”  Sources: Bloomberg TV; CBS

Q2 Mobile eCommerce in China Hits $7.2 billion

Mobile Growth

Second quarter revenue from mobile e-commerce in China was up 103% year-over-year reaching $7.2 billion and it was up 25% compared to Q1 according to iReseach Global.  The company’s report attributed the increase to more promotion and efforts by companies to improve their mobile services by launching shopping apps and adding product discounts.

At Baidu, mobile revenue accounted for more than 30% of total revenue in Q2, up from more than 20% in Q4 and 10% in the year-earlier quarter.  Source: Investor’s Business Daily

Amazon Enters Shanghai Free Trade Zone

All the noise in China, not to mention the IPO world, is about Alibaba, China’s biggest everything.  Meanwhile, Amazon, which has been in China for a decade, is making a bid to increase its position by signing a memorandum of understanding with the Shanghai Free Trade Zone and Shanghai Information Investment Limited.  This deal opens the way for Amazon to bring products from around the world into China.

To accomplish its goal Amazon will open its new cross-border e-commerce platform in the Free Trade Zone while establishing a logistics and warehouse centre in there as well. Source: BBC.com; Beijingcream.com

Another Month, More Growth for 3G/4G

Carrier Data-Aug 2014

More than 22 million new 3G/4G subscribers entered the pool of targets for mobile advertising in August – an impressive run rate.   Sources: China Mobile, China Unicom, China Telecom

Saving Face in China

According to Joanna Hutchins, current managing director of global brand consultancy Dragon Rouge, “In China, your face really is your card to the world and that’s the case for both men and women.”

The need for a flawless face leads white collar Chinese women to spend as much as 30% of their income on cosmetic products and treatments.  Whitening cosmetics are most popular, followed by an assortment of China-centric hydration products, which now account for nearly a third of all facial moisturizer sales in the country.

The focus is limited to the face.  Chinese women are still likely to wear several layers of clothing to preserve the paleness of their skin.

Women are not alone. China’s men’s grooming sector is second only to South Korea in the world.  It grew 29% between 2009 and 2014 according to Euromonitor.  Together the men and women of China spent USD $25 billion on beauty products in 2013.

Notable for the west is the success of home-grown products, especially natural skin care products that boast no chemicals, and products from South Korea.  This trend is based on the notion that Asian skin is different from western skin and suggests that western cosmetic and skin care products companies should adjust to the cultural sensitivities if they want to take advantage of the vast Chinese market for these products.  Source: Red Luxury

Accenture: Digital Revolution is Central to China’s Growth

Nowhere is the power and potential of the digital revolution more evident than in China. Consider the following statistics. At the end of 2013:

  • 618 million people in China were Internet users—47.5 percent of China’s population.
  • More than 80 percent of China’s Internet users accessed the Internet through mobile devices, an increase of approximately 6 percent over the previous year.
  • The number of Chinese people who shopped online topped 300 million, making China the largest retail e-commerce marketplace by far.
  • The value of products purchased via mobile shopping exceeded USD $27 billion, a 165 percent increase over 2012.
  • Some 600 million of China’s 1.3 billion people are active in social media —meaning that virtually all of China’s internet users are on social media (see bullet one).

Each of these figures, on its own, suggests that companies looking to conduct business in China must build their digital capabilities. Collectively, they present an absolute imperative.

Source: Accenture: The Allure and Challenges of China’s Changing Consumer Market

The Chinese Dream in Video

“Chinese Dream” became the new central motto of Chinese politics, when introduced by President Xi Jinping in 2013.  Its intention was the Communist Party’s attempt to recognize the aspirations of China’s people.  It may have had a more profound effect than originally thought, especially on the young.   The attached video is twenty minutes of insight into China’s future as seen through the eyes of three youthful Chinese aspirants.  They are the audience for western advertisers.  Source: www.chinafile.com

http://www.chinafile.com/multimedia/video/chinese-dreamers

 

Eight Chinese Consumer Archetypes Defined

Archetypes

Accenture defines eight consumer archetypes drawn out of its new China Consumer Survey of urbanites.  Basically, they identify those with money to spend and those without.  Recommendation: target those with money to spend.  Source: Accenture Strategy

China is a Mobile Purchasing Dynamo

PurchasesPurchases-Social Media

DigitasLBi confirms prior data – China is a mobile purchasing dynamo.  It is responsible for twice the purchasing incidents compared to the US, UK, Germany and Singapore.  Further, against the global average of 49%, Chinese folks announce their purchases on social networks 78% of the time. Purchase Proud. Source: InsideRetail.Asia

China is Third in Number of Merchants in the Top 500 Globally

Of the 500 leading retailers using mobile commerce globally, most are from the U.S. and U.K. Below is a list of the leading countries with the number of merchants in the top 500 based on the latest Internet Retailer Index:

mCommerce Countries

Index projection: Combined the world’s 500 largest mobile commerce businesses will increase their mobile sales by 80% to more than $84 billion this year.  Source: Media Post