Success in digital China

With more than 500 million Chinese internet users and five million new users coming online each month, the significance of China’s internet as a primary marketing channel cannot be underestimated.

However, many multinationals in China still spend less than 10% of their total ad budgets online. But since digital in China represents a huge mass-market opportunity for brands to engage with Chinese consumers, it is worth investing in it.

This post will cover the ‘smart engagement’ from Mercedes Benz with online Chinese consumers.

Mercedes Benz faced a challenge selling its Smart car. Several campaigns had resulted in high awareness and customer inquiries but did not covert into sales. The time between the initial interest and actual purchase was too long. The inherent nature of a ‘small’ car has limited appeal to the Chinese consumer, and coupled with Smart’s premium price tag, people wavered in their final decision.

China - challenges and opportunities

Some more challenges and opportunities that are coming up in China regarding people and their social changes. This articles also includes a section what all these gives to marketing people and how some brands are using this opportunities to create their own benefits.

Consumer power

Over the past decade a significant shift in personal values has been tracked. Chinese population is moving away from traditional people-oriented values toward more power-oriented values.

Drilling down even deeper, the most significant trend is seen in China's consumer segmentations, with a rise in the 'Achiever' type, which is characterised by a focus on ambition, wealth, status and power. This means that personal value related to the traditionalist and Survivor mind-sets decline in importance and we see an increased desire to display personal achievement through ownership of luxury and status products.

Eight years ago, only 9% of TV units bought in China were modern sets, such as flat screen, projection, plasma, and LCD or LED models. That had leapt to 99% by 2011. Likewise, units sold of multi-door and side-by-side refrigerators have jumped from 5% to 40%.

Trends and challenges in China

China is massive. It is roughly the size of the US but with a population more than four times larger. It consists of 22 provinces, has eight official languages, a population of 1.3 billion people and 25 cities with a population of more than three million. Diverse in terms of economics development, culture and living conditions, to say China is a complex market is something of an understatement.

 

Traditionally, global companies looked to China only as a source of cheap labour and a centre of production for their goods, which would then be exported to other countries for sale. But the scenario is now changing. Global companies are turning their eyes toward China as a new market opportunity, whose population is becoming wealthier and already enlarging its spending on consumer goods.

It is time to stop calling China an emerging market - it has emerged.

From a marketing communications perspective, the complexity of China - and how to effectively target Chinese consumers, from Shanghai to Datong - is one of the biggest challenges of the industry.

This post covers some trends and challenges that await marketers in China.