Posts Tagged ‘China’

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China: Where Bargaining Is A Way of Life

In China on July 31, 2011 by dariguti Tagged: , , , ,

I go gaga over sales (and I’m not talking about the singer).

This appreciation for sales probably goes back to a very young age. My grandmother would pick me up everyday after school and often she would take me shopping. She introduced me to the wonderful world of consumerism. But, she was not only an avid shopper she also had a sixth sense for sales and bargains. She was skilled. Thanks to her, successful bargain shopping was a fundamental part of my formative years. Today, sales are my addiction. My appreciation for items has a direct correlation to the percentage off regular price that I paid for it. Nuts? Not really, everybody likes stretching his or her dollar or in the case of China, their yuan.

CNN’s Eunice Yoon couldn’t have said it better. In a country were labor rights are forbidden, the term collective bargaining takes a whole new meaning.  The new trend is group buying or, as known in Chinese: tuan gou.

CNN REPORT: Group Buying in China

You might be thinking, where is the innovation in that? The United States has Groupon, Living Social, Buy With Me and tons of others group buying websites that offer great deals. Well, this is a somewhat different approach.  I bet you’ve never seen a Groupon with a $1,500 discount on a new Audi. If you see the report by CNN linked above, you will meet office worker Jin Fen, 26, who says he spends an hour and half every day looking for bargains on the web. Last October he grouped with four other strangers and managed to save over $1,500 when buying a new Audi.

This is basically a flash-mob-meets-shopping strategy that stems from the Chinese tradition of bargaining for the purchase of goods. It’s simple one buyer connects with other buyers who want to purchase the same product and agree approach the vendor as a group. These groups are sometimes acquaintances or can also be groups of strangers that connected through online forums. By “bulk buying” consumers are able bargain a lower price and businesses simultaneously can sell multiples of one product. Everybody wins.

Chinese online innovators are leveraging this trend as a business opportunity and developing group buying sites much like the ones we know. This new business model is now a huge trend in China and it’s getting massive consumer support.

In fact, according to SinoTech Group, group-buying sites grew dramatically in just two years (early 2009 to December 2010) going from four to nearly 1,700 and quickly increasing in numbers. Most of these businesses will quickly tank because of lack of consumers, lack of vendors or lack of credibility but quite a few have managed to become emerging leaders in the industry.

The real innovation on this new business model is that Chinese consumers are known to prefer cash-on-delivery or checks to online payment systems. Online shopper Fang Hua said: “I usually opt for cash-on-delivery. But I have succumbed to impulsive buying on group purchase websites, because the prices are so low!” Today, one in 10 Chinese consumers are shopping online, changing consumer behavior in China.

Will this trend live on in China? I think e-commerce has taken its time but is now steadily developing in this country. Plus, a good deal is a priceless commodity that never gets old, no matter where are you from. Will it substitute the in-person bulk buying approach that the Chinese consumer has mastered? Highly unlikely. Bargaining in China is more than a strategy; it’s a way of life. Take it from a bargain aficionado, there is nothing like the thrill of a negotiation and the control you feel when you walk away from what you consider a bad deal.

It’s about increasing your purchasing power.  Many consumers around the world are no longer satisfied with the usual retail experience. This consumer behavior will continue to influence the market and new business models will be developed considering this. Consumers need to take the power and run with it. It’s about time the weight starts shifting in our favor.

Lessons learned? The Chinese have a point…don’t buy retail.

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Its Game Time and NBA China came to Play

In China,USA on July 31, 2011 by Nicholet123 Tagged: , , , ,

Chinese basketball icon and eight-time NBA All-Star, Yao Ming, recently announced his retirement from the NBA. The announcement of Ming’s departure from the league has left many questioning whether his decision will severely impact the basketball market inChina.

My intuition is no.

The sport will continue to have the mass appeal within the Chinese market as the fate of basketball does not simply lie in the hands of one national All-Star. In fact, the institution of basketball has traditional roots in Chinathat can be traced as far back to when the game was originally created in the US. In 1892, YMCA missionaries journeyed to China, carrying “The Thirteen Rules of Basketball” and within short time, basketball was declared a Chinese national pastime.

The same holds true with many other countries around the world and the sport has further gained increased popularity within the past several decades, in particular. While they maintain a presence in multiple other markets worldwide, NBA China, by far, leads the way in regards to audience reach and popularity. First established in 2008, the league serves as a catalyst for accelerating the nation’s already growing basketball popularity and culture. It has been estimated by the Chinese government that 300 million people in Chinaplay basketball—nearly equivalent to entire population of the United States. Not only does this giant market have strong interest for the sport, fans are also engaged across multiple different traditional and digital media outlets.

The allure of 300 million basketball players ultimately led to the NBA establishment the NBA China entity. However, the approaches used for reaching the Chinese audience is what made their strategy worth taking a closer look into. For example, there are several professional basketball leagues already in place in China, such as the Chinese Basketball Association (CBA), which is almost entirely regulated by the government. NBA China, on the other hand, is built more off an aggressive business model in which audiences are engaged through broad media play, along with sponsorships, promotions, events and an arena-management venture. This open approach will allow the NBA brand to grow, but also serves to increase popularity for the sport of basketball in partnership with a number of key players in the Chinese market.

Key Partnerships:

1-      Social Media: Last year, the SINA Corporation announced that were to become the official operator of the NBA’s Internet site inChina, NBA.com/china. SINA isChina’s leading online and mobile news and content provider and also has a growing social media presence as well.

However, arguably the most vital aspect of this partnership involves NBA China’s access to China’s most popular micro-blogging platform, Sina Weibo (akin to Twitter in the US). The functions of Sina Weibo far surpass that of Twitter by allowing users to create threaded comments, groups, audio messages, IM and direct video uploads. Its is because of these functions, the social media platform has become increasing popular in China currently with more than 100 million registered users and expects to keep growing rapidly. Currently, the NBA has 4.35 million fans on Sina Weibo and clearly has the potential for more as the brand continues to grow inChina.

The strategic alliance makes SINA an Official Internet Partner of the NBA inChinaand will provide a interactive user experience giving fans inChinaunprecedented access to their favorite teams and players.

2-      Government: Since the government of China has a strong hold over just about every industry (including broadcasting and professional sports), the NBA’s decision pursuing business within the Chinese market was undoubtedly difficult. Although several limitations existed, the NBA has so far been successful in China. This can be attributed to the fact that the NBA choose to work in mutual partnership with the heavy-handed government, rather than in competition.

Financially, the motivation for the NBA pursuing business within the Chinese market is clear: China has become the NBA’s largest international market, and the NBA’s revenue in Chinais growing at a rate of 30% to 40% per year.

However what’s in it for China? The CBA already 17 teams andChinacompetes internationally in the Olympics as well as in other regional events.

Well, some would argue that the Chinese government views their sports as a projection of power, strength and obviously, national pride. Anyone remember the elaborate spectacle that was 2008 Beijing Summer Olympics? Many Chinese athletes are “bred” from a young age using a soviet model for athletic development, in which selected children are sent to special state-sponsored “boot-camp-style” training centers.

 Therefore, both the NBA and the government want basketball to succeed in China, but for different reasons. So much so, that both parties have invested valuable resources on increasing the love of ‘game’ within the heart and minds of the Chinese in efforts meet their own intrinsic goals.

Future of NBA China:

Now, although Ming retired from the NBA, that does not mean the end of basketball fans in China. He still maintains deep ties to both the league that afforded him worldwide fame and to the nation gave him the foundations to build his international career.  It is the hope that other Chinese athletes will do the same. With an average 30 million viewers per week, the NBA brand continues to be strong and new focused efforts in the Chinese market are a great step in the direction of building brand loyalty.

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Show China What You Can Do Liverpool

In USA on July 30, 2011 by msjasminerenee Tagged: , ,

China is probably one of the most conservative nations in the world. Governed by a very structured government, China has slowly made strides to conform to the way of the more liberal world.  Thanks to advances in technology, Chinese people like many of us in America, have come to learn that there is power in sharing information especially online and this is something that he Chinese government has also learned.  In fact, some say that social media has facilitated opposition towards the government and historically, this is something very foreign to the Chinese government. Social media has allowed Chinese people to become more informed, has provided more options, and has provided them with a platform where they can talk freely about social and government issues.  Just recently, there was a train crash that killed about 39 people.  It took over 5 days for the Chinese government to release a statement regarding this tragedy and eventually they did so but only after pressure from the media, public outcry, and the mass amount of content generated globally through social media.  What is the point here?  The Chinese government and Chinese businesses must get on board with the premise behind social media to help maintain control and success.                            

The Liverpool Football Club has an opportunity to show the Chinese Government and Chinese businesses why social media works

The Liverpool Football Club (LFC) (football is known as soccer in China and other parts of the world) has a chance to improve the perception of the Chinese government as well as show them and Chinese businesses how social media can aid in being successful through the use of their recently launched social media campaign that coincides with a tour of Asia that started last week.  Using Weibo (a micro blogging site) a Chinese hybrid of Facebook and Twitter, the fan page provides local language updates, football content, and encourages social interaction with Chinese supports of the Club.  In addition, this will be the first time in the former British clubs history where the club will tour mainland China.  They will also give fans an up close and personal view of their experiences while touring on the team blog.  Fans will be able to view video footage, interviews, and will get information on how to attend games and meet players while on their expedition.

 

Although this type of campaign may seem basic in nature compare to major US campaigns, this is a huge undertaking for the Club due to the tight political constraints that make it difficult for people to be opinionated in an open setting.  When LFC was first acquired it raised many eyebrows amongst most Chinese citizens.  This was because the club was purchased by a Chinese businessman who received funding from a mainland China investment fund which meant that it was being politically and financially supported by the central government.  For this reason, the club was afraid that Chinese fans would be hesitant to engage in the normal fan activities like attending games and smack talking.

 Because of this hurdle, LFC had to find a way to get people excited about the  club and to reach out to their fans through this social media campaign. With approximately 400 million social media users, launching this campaign was the perfect vehicle and hopefully other international clubs and the Chinese government will follow suit.  Here is how they could both benefit by invading the digital space:

1. The government can change how they are viewed.  The Chinese government’s involvement with this campaign will help shift the perception of the government specifically for the younger generation. Like many young Americans, online engagement with young Chinese people is very high with sports ranking 3rd for trending topics of discussion.  Millions of Chinese fans watched the World cup and have already been actively engaged since the campaign was launched.  As long as the fan page keeps up relevant content and remains true to a high level of engagement, the Chinese people will possibly begin to see the government as adapting to their digital way of life.    The government can use this platform to also help create more patriotism amongst the Chinese people.

2. The state of China will benefit.  LFC is a huge global brand with a huge international fan base that with success could help to attract international businesses and grow Chinese business through the means of partnerships and major advertising opportunities.  China could become a major tourist attraction and help boost the Chinese economy.  Soccer is a very popular sport in China and will also encourage local talent to become more involved in the sport.

3.  LFC can set the standards for club management.   According to various sources, the clubs that fall within FIFA, have drifted towards obscurity and under-performance at the management level.  This campaign can demonstrate how to effectively manage an international club (from the relationship perspective) and how to keep the fans loving the club.  This social media element will also show other clubs just how important the fans are to the world of sports and to the bottom line.

This social media campaign was a brilliant move for the club and the Government.  The football club will acquire more fans and business relationships.  Fans will talk online and create content while businesses will be starving to be affiliated with the popular club.  Ideally, the government will consider launching other digital campaigns for social and economic purposes and will learn that this is an easy and efficient means of communicating with the people of their country.

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A BabyTree Grows In China

In China on July 30, 2011 by Abby Tagged: , , , ,

I was excited to research China this week for our global social media class – my good friend Lucila is currently in Yanqing teaching English with an organization called Cultural Embrace.  I love reading about her adventures on Tumblr, and I was glad to have an excuse to do a little more research on social media in China.

The BabyTree homepage

One of the sites I kept coming across was BabyTree.  BabyTree is a social networking community for parents with children up to age 6 in China, and as of last year saw 12 million monthly visitors.  Parents can visit the site to ask for advice, read product reviews, chat with other parents, blog, share photos, and purchase products.  The site has been called the “Facebook for parents.”  My friend has shared that every host family she has met during her travels has been so determined to make well-researched and thoughtful choices for their young children, so it’s understandable that BabyTree has seen so much interest.

With so many parents interacting on one site, BabyTree positioned itself as a highly desirable advertising space with a captive and well-defined audience.  International companies such as Pampers, Huggies, Gymboree and Disney are among the advertisers who have launched contests and advertising campaigns with the site.  

How BabyTree Became So Successful

Targeted Outreach.The first way BabyTree was able to become so popular in China was founder and CEO Allen Wang’s approach to marketing.  Instead of spending a lot of money on advertising, he focused on getting people to talk about BabyTree in places where they already congregate, including online and offline communities and events.  The site also tailors recommendations and advice based on each user’s location and the age of their child, so users feel connected and get personalized, useful information.

BabyTree has become of the largest photo-sharing sites in China

Integrated Content.   BabyTree provides a variety of tools and resources to parents all in one place.  Not only can they review the best products and talk to other parents like themselves, they can engage in conversations, share news, ask questions to medical professionals, and easily upload photos.  Because of the photo-loading tools, the site has become one of the largest photo sites in China.  Users never need to leave the site – BabyTree combines commerce, advice and social networking all in one site.

  Future Growth

BabyTree has recently partnered with Ogilvy & Mather China to launch the China Moms’ Happiness Index (CMHI).  The index provides in-depth analysis of factors that contribute to Chinese moms’ happiness, and market news. This tool will be extremely helpful for advertisers looking to reach (and understand the needs of) a very targeted audience, and will likely support increased ad revenue for BabyTree.  

BabyTree’s ongoing success, coupled with the new data from the CMHI, set the stage for even greater reach and engagement.  But to remain a trusted source and social network, BabyTree needs to stay true to their targeted approach and continue to offer tailored, localized content to its users.

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General Motors: Understanding Its Market in China

In China on July 30, 2011 by sdaniellebenjamin Tagged: , , , , ,

See that tall man in the middle? That’s my Uncle Ron. He works for General Motors (GM).

Just last week he and his team went to China to tour one of the plants.

To be completely honest, I’d never given much thought to the car market in China. That is, until I read “Volkswagen Wouldn’t Be Volkswagen Without The People,” by blogger Victoria Holms. In it, she highlights the VW’s “The People’s Car Project,” a digital crowdsourcing campaign to get consumers to contribute their ideas on how the latest VW model should be built.

Her blog got me thinking about my Uncle Ron. Well, really it got me thinking about my Uncle Ron AND whether or not GM is implementing a good digital strategy to leverage the market in China and engage consumers. And if they aren’t doing anything, what are some ways they can get in on the action.

General Motors on the Move

Just a few month ago, the Washington Post reported that GM has “emerged as one of the top sellers of passengers cars… surpassing Toyota this year and second only to Volkswagen.” In fact, the Detroit based automobile company sold more cars in China than in the United States – a trend that is sure to continue as more people in the heavily populated country are able to afford the luxury purchase of their first car.

The great thing about the Chinese market is that online social media conversations around cars are high – with some reports ranking automobile conversations number one above sports, computers and healthcare conversations. But how can GM translate general conversations to those specifically around their vehicles? And more important, how can they engage consumers in such a way to help them sell more cars? Simple: Learn from the best, then expand it and do it better.

Get in on Crowdsourcing and Gaming

The Volkswagen crowdsourcing approach was a good idea. But GM can take it up a notch by engaging customers in real-time conversations with Chinese engineers and executive staff that can answer questions and offer feedback on the recommendations they make. Also, with China standing as the leader in gaming application development, a GM micro-site that incorporates a gaming component can reward design submissions that are ultimately used in car productions  – either with a free car, a year of free gas or other cool prizes.

Find the Right Influencers

Reports reveal that 84% of all car purchasers are made by first time buyers and about half go to family and friends for advice on the type of car they should get. With this in mind, GM should focus efforts on engaging the right key influencers who can carry the message of GM to their broader circle. Reaching audiences through social media networks can be a great way to arm a core group of individuals who can then spread information like wildfire to their peers and family – a trusted source. Social media sites such as Tencent and Qzone rank highest in China and creating platforms on these sites can provide information on GM vehicles in an easy-to-share way that will get in the hands of millions as friends share with friends.

Use Search Engine Tools to Your Advantage

Some of those same reports mentioned earlier also note that Chinese users rely on the internet, particularly auto net search sites that feature commentary from car owners, to gather information on different types of cars. One example of these types of sites is www.Sina.com. Implementing the right search engine optimization tools can elevate the GM brand and advertisements to the top when keywords or phrases are searched on these various search engines. This can provide the right tipping point for indecisive car buyers who are looking to purchase more desirable, foreign made cars.

Thanks to the innovative work of folks like my Uncle Ron, GM is well on its way to establishing itself via the quality products it produces. By learning the purchasing behaviors of their audiences and using those insights to guide a developing digital strategy roadmap, they are sure to see GM drive on to even better results.

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CityVille Future Success in China

In China on July 28, 2011 by pris0fcourse Tagged: , , , , , ,

Sometimes when I go through my Facebook (FB) news feed, I feel like I’m a minority when it comes to online gaming. It’s like all my FB friends are on Zynga’s games Farmville, CityVille, Café World or Mafia wars. I’ve never played any and honestly I think they’re annoying, they create (more) clutter on the news feed.

Just eleven days after launching in 2010, CityVille had already recorded over 22 million players in the US, which are more users than The Netherlands (where I’m from) has citizens. Currently the count is at 100 million users. I may have to join ’em, because I certainly can’t beat ’em.

Social network game developer Zynga is the creator of FarmVille’s beta version CityVille. Where in FarmVille players would raise livestock and harvest crops, in CityVille users build and manage complete cities. The company says CityVille is “the most interactive Zynga game board to date.”

Zynga and China’s largest Internet company Tencent announced the launch of the Chinese version of CityVille, named Best City Star on July 26, 2011 in Shanghai, China. Zynga isn’t just launching a copy of CityVille in China. The buildings, designs and activities will reflect the Chinese culture in Best City Star. They have incorporated Chinese festivals, news events and other relevant components into the game, which are developed to the rich story needs of the Chinese players.

Most people play online games due to boredom and addiction, but it’s also used as a way to interact and socialize. These are reasons why I think Zynga’s and Tencent’s launch of CityVille in China will be a continuing success.

CityVille Will Be a Success in China and Here’s Why

  • Reason 1.  High Number of Online Gamers

Online gaming in China is one of the largest and fastest growing internet business sectors in the country. There are currently 457 million internet users, which puts the country now as the largest online user base globally. Two-thirds of these internet users engage in online gaming.

The Chinese would die for an online gaming session, literally! A man died after playing video games for three days nonstop. Another horror story is that of a couple who sold their three children to support their online gaming addiction. In China 13% of the college students are addicted to online gaming. On average Chinese online gamers are between 18 to 30 years old and have at least completed a secondary level of education, most of whom live in larger cities.

  • Reason 2a.  Growth in Mobile Usage

There are currently 900 million cell phone users in China and rising, this number makes China the world’s largest mobile device market. Along with advanced data and emailing, gaming falls under 54% of the Chinese mobile users.

Overall China mobile phone Internet users are 50.7% between age 18 and 24. 75.1% of China mobile Internet users are between the age of 18 and 30. 61.3% are educated up to high school and 20% own a bachelor’s degree and above; mobile internet seems to be attracting more highly educated users.

  • Reason 2b.  Matching Demographics

Take notice that mobile users and online gamers share the same demographics in China, chances are they’re the same person. This is an even larger growth opportunity for the social network gaming industry, as more people are using internet on their phones.

  • Reason 3.  Chinese Socialize Online

The people of China have a need to relieve their pressures and communicate with others.They feel it’s easier to do so online where it’s more convenient than face-to-face. Socializing virtually also helps them to become closer with their friends.

Kaixin001.com for example aids the Chinese to create a more informal interaction with say a co-worker or boss. “In real life, we normally behave respectfully to our boss, but on Kaixin001.com, we can steal vegetables from our boss’ garden and joke with him. This is great!” said a user of Kaixin001.com.

  • Reason 4. Similar done before

Others that went before Best City Star:

Renren is a popular social network in China with over 30 million users and it’s also accessible through mobile phones. Renren Restaurant is a social network game with 3D graphics and high social interaction…not much different from CityVille.

Kaixin001 basically duplicated Facebook’s popular applications and penetrated in to the Chinese Market. Some social games they have are Friends for Sale: A game that users can price and sell their friends and Happy Farm: Users can grow their own vegetables and steal vegetables from their friends. Kaixin001 generated 10 million users within 6 months.

Final thoughts

The game creators at Zygna are geniuses when it comes to developing online games. I wonder if there are psychologists involved. They create successful online games, they definitely do their home work to get to know their target group. Launching the game in China was without doubt a brilliant idea. Chinese people love to socialize online and they love to play games online–combine that and you have CityVille. In this game you’re basically forced to interact with your online friends without using any actual words. Which is a fabulous component of the game, because the Chinese find it easier to socialize online rather than face-to-face. I’m curious to see how fast and large the Chinese version of CityVille, called Best City Star fan base will grow.

I admit I want to play the game now.