Uber may be having difficulties in various countries for various perceived local infractions, but it is standing tall in China’s strategic battle for taxi-hailing supremacy. Alibaba invested in local taxi competitor Kuaidi Dache while Tencent took a position in Didi Dache. Now Baidu, China’s search giant, is ready to invest in Uber. Source: Reuters
New Visa Rules Open Chinese Tourism Further
New rules governing visas will allow Chinese tourists and business men to upgrade their one-year visa to a 10-year visa, greatly reducing the bureaucracy involved in moving between China and the US. Students will get an extension from one year to five years.
Roger Dow, chief executive the U.S. Travel Association, commented, “This policy move will harness the colossal and growing Chinese travel market for the direct benefit of U.S. job creation, exports and economic growth.”
The White House said the visa policy could mean as many as 7.5 million Chinese visitors come to the US by 2021, bringing an estimated $85 billion to the economy. Note: Chinese visitors spend more than people visiting the US from any other country, approximately $7,200 per person verses a $4,500 average overall.
Real estate on the west coast and in New York City has already been affected by Chinese tourism and business travel. This change will only increase the impact. Source: LA Times
Health is the Top Concern Among Chinese Consumers
Health is a top concern among Chinese consumers according to the third quarter survey by Nielsen. Concern about health in general leads both income and the environment as an issue, but when added to concerns about health care, it is clear that the subject is very important. And when one looks at the preference for snacks with labels displaying the standard health food buzz words, it is clear the concern translates to action.
In a related story, Bloomberg reported that Google Fit, an app that tracks activity and connects to health-monitoring devices, was the number one app in China in November according to App Annie’s Distimo analytics service.
Western health-related brands should be aware of this purchase motivator when approaching the Chinese market. Sources: People’s Daily Online, Bloomberg.com
Interesting Take on China’s Growth Drivers
A Nielsen review of 2,000 cities and towns across China suggested that there are four super city clusters that are strategically important to China’s future growth. They are Shanghai-Hangzhou-Nanjing, Beijing-Tianjin, Guangzhou-Shenzhen and Jinan-Qingdao.
Patrick Dodd, Managing Director of Nielsen China, makes the point, ”Analyzing city clusters instead of separate cities will give retailers and manufacturers a new understanding of the market. People travel frequently within these city clusters to work and shop.” This approach to China can help western brands apply resources more efficiently. Source: People’s Daily Online
China to Double US Mobile Ad Audience in Three Months
The mobile advertising audience continues to grow in China. In July 3G/4G subscribers sat at about 40% of the total mobile subscriber population. By the end of November it had grown to about 45% of the base. At this run rate – almost 20 million new 3G/4G subscribers per month – China will have an advertising audience twice the size of the entire US population within three months. Sources: China Mobile, China Unicom, China Telecom, YoloBlog
Chinese Consumer Confidence Improves
Reflecting the economic reality of the US and China verses the near recession economy in Europe, consumer confidence found by Nielsen’s third quarter survey seems accurate. Levels above and below a baseline of 100 indicate degrees of optimism and pessimism, respectively. Source: People’s Daily Online
IAB Data Compares Mobile Interaction: China v. US
China’s Box Office Bonanza
With Chinese box office expected to reach $4.9 billion this year, almost half the size of the US, it is not surprising that big studios are making a big effort to enter the market. According to the Chinese Film Producer’s Association, 51.4% of the earnings came from films made in China while 48.6% were from foreign films – mostly from the U.S.
The pressure for entry comes from rules that allow a mere 34 foreign films per year to reach the Chinese audience. Noises are being made that suggest the market will open more by 2018. Meanwhile, the Motion Picture Association of America (MPPA) says that roughly 13 new cinemas are being built per day. That ought to bring some liberalizing pressure on the rule makers. Source: Forbes; Quartz
Chinese Shopping Boom to Continue
The Economist Intelligence Unit projects that the Chinese retail market will pass $8 trillion by 2022. In comparison, they project the US retail market to reach $4 trillion at the same time.
These Chinese projections are supported by numbers from the China Chain Store and Franchise Association, which estimates that about 300 new malls are opened in China each year and there will be 4,000 malls by the end of 2015.
To mobile advertisers these numbers should be thrilling. Though they represent bricks and mortar growth they suggest that the people who make big bets on these things believe that Chinese consumers will continue to be buyers well into the future. That makes China a good place for mobile advertising well into the future. Sources: Red Luxury; Statista