Chinese Brands Rising in China and Abroad
Back in 2011, most of the cool kids in China were sporting foreign-branded Apple, Samsung and Nokia phones, with the three brands accounting for 57% of all smartphone sales. By June this year, eight of the top-10 selling brands were Chinese. Local darling Xiaomi, which released its first smartphone just three years ago, now outsells every other brand – foreign and local – in the Mainland.
Similarly, 2012 research from the World Luxury Foundation found that 86% of Chinese consumers wouldn’t go near luxury goods labelled ‘Made in China,’ due to the country’s reputation for cheap goods. Research just released by Added Value, discovered that only 9% of luxury consumers now say they’d exclusively buy Western brands.
The rapid swing represents both Chinese brands upping their game and a growing acceptance from Chinese consumers for local goods.
Even outside of the Mainland, Chinese culture and preferences are becoming more a part of consumers’ lives; from the bubble tea sold at Western shopping malls, to big screen smartphones, to Chinese Zodiac symbols on products, to Chinese actors and backdrops increasingly starring in Hollywood blockbusters. This is being driven by brands hoping to appeal in China’s booming domestic market, cashed up tourists and migrants, but also a growing curiosity from Western consumers.
Yet most of the China-fication seen in the West is being steered by Western companies. Research last year found that just 6% of American consumers could name one Chinese brand. Things won’t stay that way for long.
Chinese brands are already making a big impact abroad. Xiaomi is rolling out its phones in Latin America, Russia, Turkey and much of South and Southeast Asia, as has just been named as the 35th most innovative brand in the world and the top up-and-comer by BCG. WeChat is popular in many Asian markets, and eCommerce companies in India, Africa and much of the developing world are looking to follow Alibaba’s business model – not eBay or Amazons’. Lenovo is the world’s largest PC vendor by units sold and Huawei is the biggest communications equipment maker in the world. Some of the world’s leading fashion houses now have production in China. Chinese cars, although not yet popular at home, are being recognised internationally for design, with manufacturers such as Hawtai selling more than three quarters of their cars outside of China.
Increasing confidence and growing revenue in the Mainland will undoubtedly lead to more Chinese companies expanding overseas, both organically and through acquisition. We will see also growing numbers moving from developing countries to take on Western brands in their own markets. So whether we’re targeting Chinese consumers or consumers anywhere, China should be on the radar.
One of the categories where imported brands will reign supreme for some time is premium food and beverage, due to a lack of trust in the local fare. For our readers in Shanghai, China Skinny will be presenting about Feeding the Masses: Trends in Food and Beverage Consumption in China next Thursday, November 13 – it will be worth the early morning. We hope you enjoy this week’s Skinny.
China Moves to Expand, Upgrade Consumption: The Chinese Government has announced measures to boost and upgrade domestic consumption to drive China’s economy. In the first three quarters of 2014, consumption contributed 48.5% of GDP, up from 45.9% in 2013.
China Rich List: Jack Ma leads the Forbes rich list in China, more than doubling his wealth from last year to $19.5 billion. Second and third on the list are also tech billionaires, Robin Li from Baidu, and Ma Huateng from Tencent. Just eight women made the top-100.
Here’s What It’s Like To Go Supermarket Shopping in China: Observations from a trip to a Chinese supermarket by an American visiting China.
Internet, eCommerce & Mobile
7 Key Differences Between Chinese and Western Consumers: 75% of online Chinese consumers post feedback on their purchases at least once a month, versus under 20% in the US.
Smartening Up Their Act: More than 100 million smartphones sold in China in the second quarter of this year – over a third of all phones in the world – and eight of the top-10 brands were Chinese. Now they are taking on the world.
For First Time Ever, Baidu Now Sees Most of Traffic Come From Mobile: Mobile contributed 36% of Baidu’s revenue in Q3, up from 30% three months ago.
China Considers Regulating Smartphone Apps: With ¥1 out of every ¥10 spent in China now being spent online, the Chinese Government is looking at ways to reign in privacy leaks and malware through apps.
Developed Asia Wearies of Tech: Koreans and Singaporeans are likely to believe that « too much technology can make you disconnect from people, » however most Chinese don’t agree according to a Y&R poll. Young Chinese are also much more likely to relate to « I love sharing my life via social media. »
Amazon Will Offer Global Shopping and Ultra-Fast Delivery in China Starting This Singles Day: Amazon is hoping to get its piece of next week’s Single’s Day by offering delivery within 3-days to Chinese consumers who purchase from Amazon’s US, German, Spanish, French, and Italian stores.
Food & Beverage
How Do You Say Sangiovese In Chinese? The Language Of Wine, Translated: It is much more effective describing wine in a way that is meaningful to Chinese consumers – geographically, linguistically, and culturally – such as using taste descriptors that Chinese can relate to.
Growing Seafood Appetite an Opportunity: Chinese average consumption of seafood is picked to reach 37.7kg this year, 57% more than in 2000. The global average is just under 20kg.
China Eases Monopoly on Handling of Credit-Card Payments: Domestic and foreign firms such as Visa and MasterCard can now apply to settle payments between banks and vendors in China, without requiring branding with UnionPay.
Meet Yang Li, a Designer Putting China on Fashion’s Biggest Stage: China is shaking off negative connotations that “Made in China” is poor quality; even brands such as Prada, Michael Kors and Coach have set up production in the Mainland. We’re likely to see more world-class designs come out of China with initiatives such as the Council of Fashion Designers of America establishing an exchange program that has sent New York-based designers to China and brought Chinese designers to New York.
Design Passion Grows Alongside China’s Auto Industry: Although Chinese consumers are yet to warm to local auto brands, some of their designs are being internationally recognised, such as Chery TX’s Shanghai-designed concept SUV, named Concept Car of the Year for 2012 by the UK-based Car Design News.
Chinese Brands to Storm Luxury Market: Just 9% of Chinese consumers only buy Western luxury brands. 51% bought Western brands first, but also considered Chinese brands. Authenticity is the most defining element of a luxury brand according to 61% of luxury consumers, customer service 58%, craftsmanship 56%, quality 53%, sophistication 53%, great design 52% and heritage 48%.
That’s the Skinny for the week! On the to-dos this week, why not contact China Skinny to discuss how we could help with your marketing, online initiatives or research to take advantage of China’s opportunities. Just email us at firstname.lastname@example.org or call us at +86 21 3221 0273 so we can learn more about your objectives and let you know how we can help.
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Conference « Popular Memory of the Mao Era and its Impact on History »
French Centre for Research on Contemporary China in the framework of the ANR‐RGC
collaborative project “New Approaches to the Mao Era” (CEFC‐HKU)
Dates: 15‐16 December 2014 日期：2014年12月15-16日
Venue: Maison Suger (Fondation Maison des Sciences de l’Homme, FMSH), and Centre d’études
et de recherches internationales (CERI, Sciences‐Po), Paris.
Languages: English and Mandarin with consecutive translation
Since the 1990s, a series of remarkable forms expressing the collective memory of the Mao era
has appeared in China, against a background of amnesia and explicit restrictions in the official
media, academia, and public commemoration. While some of its expressions may seem
anecdotal, it has also produced a crop of unofficial testimonies and investigative studies, on the
margins of official channels. Some are about the Educated Youth movement during the Cultural
Revolution, others pertain to the political movements of the 1950s, such as the Anti‐Rightist
movement and the Great Leap Forward (Yang Jisheng). In a similar way, literature has played a
key role in documenting alternative views of everyday life in the Maoist era. While writers of the
“scar literature” school of the 1980s were easily co‐opted into official narratives of the Cultural
Revolution, in recent years more radical works have appeared, documenting the 1950s and the
Cultural Revolution (Yan Lianke, Yang Xianhui). Unofficial journals like Lao Zhaopian (Old
Photographs, edited by Ding Dong), Jiyi (Memory, edited by Wu Di), Kan Lishi (Looking at
History, edited by Yang Xiaodong) or Hei wulei (The Five black categories, edited by Jiao
Guobiao) are disseminated via the internet. The last 15 years have seen an outpour of
independent documentary films, made by ordinary individuals thanks to cheap equipment,
documenting family histories and personal memories of various moments in the Mao era, from
collectivization to the Cultural Revolution (Hu Jie, Ai Xiaoming). These literary or filmic works,
made by ordinary citizens, and published or disseminated through various channels including
the internet, also contribute to challenging the existing historiography.
This challenge to history has deep‐reaching consequences for a regime whose legitimacy is
grounded in the “correct” understanding of history. Since 1981, when the Party put an end to
historical debates previously encouraged by Deng, by adopting a resolution “On several points in
the history of our Party,” the Party’s monopoly on historiography has remained massive. In this
perspective, the struggle for the interpretation of history has potentially major implications for
the relations between society and the Chinese Party‐state.
By offering an opportunity to present findings from recent fieldwork on various forms of
unofficial or popular memory of the Mao Era (social organizations, unofficial journals, literary
reportage and documentary film, oral history), this conference proposes to discuss how these
various forms of memory can transform our understanding of Chinese history and perhaps
Chinese historiography itself.
16 ‐ 18 rue Suger, 75006 Paris
56, rue Jacob, 75006 Paris
« Breathe, walk and die » nous offre bien plus qu’une ballade au cirque car cette mise en scène haute en couleurs se veut en plongée totale dans le cirque de la vie,avec les oeuvres-installations de Ugo…
Au sortir de cette bulle de savon colorée…
soudain les clowns sont dans la rue,dans le métro, en train de se photographier,devant les oeuvres…
Marionnettes étriquées dans leur 2 pièces griffé,sac LV et Samsung de rigueur, obèses de l’intérieur, gavées de vide
Théâtre de la cruauté, désormais le quotidien ob-scène que nous partageons avec ce pays…
Petit poème en prose de Jean Sicard
Korea’s AmorePacific Poised for Success in China’s Booming Beauty Market
China’s obsession with Korean pop culture is fueling the success of Amore Pacific, South Korea’s largest cosmetics company according to sales.
Over the past year, AmorePacific’s share price has increased by almost 160 percent to around Won2.3m. One-fifth of the company’s revenue comes from outside South Korea, and overseas sales increased by 38 percent to Won382.7bn ($349m) during the first half of this year. AmorePacific’s overseas sales for all of 2014 “are expected to reach Won700bn as growing interest in South Korean drama and music helps boost sales of its skin care products in China and other parts of Asia,” according to FT.com.
China is of particular importance to the brand, according to its vice-president in charge of business strategy, Sean Kim, who calls it AmorePacific’s “biggest and most important market.”
“The Korea Wave has certainly been helpful in raising our brand awareness in the region,” Kim said. “We aim to become the Asian beauty creator by answering Asian women’s strong needs for clean and bright skin.”
Though AmorePacific is “still finding its feet in China” and only has a 1.2 percent share of the country’s personal care and beauty market, the brand has high hopes for expansion. AmorePacific already maintains about 3,500 shops in China. Also, around half of the company’s overseas sales currently come from China, and those sales are expected to “jump more than 40 percent a year to top Won3tn by 2020 from Won338bn last year.”
The company has also built a new research center and cosmetics factory in Shanghai, which is projected to increase its annual production capacity by 10 times to 100 million units, as the brand competes with “bigger western rivals such as P&G and L’Oreal.”
Kim emphasizes that high quality is essential in advertising AmorePacific products to Chinese consumers. The brand is tailoring new products such as ultra-hydrating creams, collagen drinks, and cleansing creams to meet consumer concerns about dry weather and pollution.
“While emotional communication is effective for Korean consumers, Chinese women often ask for more scientific functions such as whitening and anti-aging.”
image credit: amore pacific