Mobiles in China: Never Sitting Still
Anyone who has walked down the street in China, eaten at a restaurant, taken public transport, been in a shopping mall, or even a workplace, will be well aware of the significance of mobile phones in Chinese consumers' lives. 464 million, or 78.5% of China's 591 million Internet users, go online with their mobiles. Through apps and websites, mobiles now touch almost every aspect of Chinese lives. Amazingly, China Skinny still comes across countless businesses targeting Chinese consumers who don't even have their websites optimised for mobiles.
China's mobile landscape is changing even faster than China itself. With locally-branded smartphones going for as cheap as $100, they are not just the realm of the wealthy, but are in the pockets and handbags of virtually every Chinese consumer who buys Western products. Smartphones are replaced every six months on average in China, compared to every couple of years in developed markets. With each replacement mobile comes new specs and technology to consider. While your target market may have had an Apple with a 4" screen six months ago, there's a good chance they've now got an Android phone with 5+ inches of viewing pleasure.
Chinese consumers bought 150 million smartphones in the first half of 2013, with new features presenting all sorts of opportunities. There are few channels that are more personal and more likely to break through the clutter than mobiles, which smart marketers can use to win consumers’ hearts. Below you'll find more about mobiles and the usual roundup of marketing advice, views and news that's all related. We hope you find it helpful.
See below highlights of the news this week:
Chinese Consumers
Tackling China: Interview with CEO of Carat China: Words of wisdom from Carat China CEO Adil Zaim for businesses marketing in China.
Consumer Behavior Changing: Innovation and marketing are becoming more important than geographic expansion for multinational companies in China. Chinese consumers, particularly in Tier 1 and 2 cities, are seeking greater reliability, consistency and integrity in consumer products.
Wealth Report 2013: In 2012, the number of high net worth Chinese with a personal wealth of at least ¥10 million ($1.6 million) grew 3% to 1.05 million millionaires. 40% are in Tier 1 cities, 29% in Tier 2 and 31% in Tier 3 and lower.
Uber Arrives in China With Test Launch in Shanghai: Uber taxis have come to Shanghai, hoping demand in Chinese cities will help grow its current $3.5 billion valuation. More expensive than the cheap standard cabs, but good service and a nice ride.
Internet, Mobile & Social Media
Chinese Mobiles Get Bigger: 150 million smartphones sold in the first six months of 2013, making up 85% of total mobile sales. During this time the portion of sales with screens 5" or bigger increased from 5% to 12% over the half. No doubt the bigger screens are cannibalising some of China's tablet growth which slowed to 5.2% last quarter.
China's Domestically-Made Smartphones Take 60% Market Share: Chinese-made smartphones take 60% of the local market for the first half of 2013, with sales up 115% from a year ago.
Apple, iPad may be Losing Must-Have Tablet Status in China: As with smartphones, iPad appears to be following iPhone's slippery slope in China, accounting for just 28% of total tablet shipments from April to June. It was 49% a year ago. Small Chinese manufacturers' strength is that they cover all price points, and together account for 50% of market share, up from 36% a year ago.
How Much Chinese Consumers Are Willing To Pay For A Cheap iPhone: Morgan Stanley research found more than 50% of Chinese consumers think ¥4,000 ($486) is a fair price to pay for a cheap iPhone.
What Chinese Consumers Want in a Mobile Phone: Quality & performance are the most important factors Chinese consumers consider when purchasing a mobile phone. Even more would buy local if it wasn't for the questionable quality, poor usability and aesthetics.
HTC Will Reportedly Roll Out its Own Mobile Operating System Specifically for Chinese Consumers: Recognising the importance of Chinese consumers, HTC is developing its own China-focused operating system. Interestingly, there's a lot of talk about Weibo integration, and nothing about WeChat.
10 Charts to Tell You About China Online Shopping Market in Q2 2013: Advertising spending on Taobao is now 74% of Baidu's, and growing 20% faster.
China Online B2C Market Surpassed 30% of Total Online Shopping: B2C shopping is now a third of all online consumer spending, up 96.5% from last year and growing much faster than C2C. Tmall holds 51.3% of market share.
Baidu to Pay $160 Million for Stake in Chinese Group-Buying Firm: Further consolidation in China's online space. Not long after its $1.9 billion purchase of 91 Wireless, Baidu is coughing up more cash, paying $160 million for 59% of Group-buy site Nuomi to further its mobile aspirations.
Chinese Gov't Calls on Celebrities to Take Up Social Responsibilities: 3,300 Weibo accounts have more than a million followers on Sina and Tencent. 200 have more than ten million, and the Government expects them to keep in line.
Food and Beverage
Food Safety Tops Public's Concerns: Illegal additives, poor hygiene and unsafe materials in the manufacturing process were the major concerns of Chinese consumers in 2012. 52% were concerned about private companies and 17% about multinational companies.
Fonterra can learn from Yum's Woes: Although it now turns out that Fonterra's bacteria scare was just a false alarm, damage has been done to Fonterra's and NZ's brand. How Fonterra can learn from KFC's response to a crisis in China - a softly-softly approach on food scandals is not a good option.
NSW Farmers Cash in on China's Agricultural Import Boom: China's growing middle class is causing an agriculture boom in NSW as the clean image and low freight charges help make their products attractive. Australia's agriculture exports to China have more than tripled since 2001.
Environment
China Is Going To Embark On An Epic Attempt To Reduce Pollution, And The Business Opportunity Is Massive: China's intention to tackle air pollution will see 1.7 trillion RMB ($280 billion) over the next 5 years invested, bringing plenty of opportunities.
Tourism
China Becomes World’s Biggest Travel Spender: 96% of overseas Chinese travel has been for leisure purposes, although 52% of travellers have also travelled abroad for business or education.
Macau Developer Signs Deal for Versace Hotel: A Versace-branded hotel is to be built in Macau. Versace hopes it will help build their brand in China, given there is "nowhere that has a higher concentration of rich mainland Chinese consumers than Macau".
Ritz Carlton Banks on China Recovery: The Ritz is looking to double its number of hotels in China over the next three years.
Jewellery
Jade Ring Bid at $2.6 Million as Chinese Seek Green Gems: A jadeite ring sold for $2.6 million as Chinese investors drive the price of jade up almost 300% since 2005.
Luxury Goods
China to Place Consumption Tax on More Luxury Goods: China is looking to widen the scope of its consumption tax to include more luxury goods and goods that cause heavy pollution and use excessive energy.
Entertainment
China's Movie Market Booms with Local Content, Cinema Expansion: PWC picks Chinese movie takings will grow 15.6% a year for the next 5 years, although much of the growth is being driven by cinema's opening in Tier 2 and 3 cities. There are 15,000 movie screens in China, with 10 being added a day. Meanwhile, the 10th Beijing International Film Festival was canned last minute in a deal struck with the Government that allowed special guests to watch DVDs of the lineup, in groups of five or less.
That's The Skinny for the week! China Skinny would love to discuss how we could help with your mobile strategy, marketing, online initiatives or research to take advantage of China's opportunities. Just email us at info@chinaskinny.com or call us at +86 21 3221 0273 so we can learn more about your objectives and let you know how we can help.
If you've missed earlier news or need to learn more, there's a library of information about Chinese consumers in prior China Skinny Weekly's right here. You can have this delivered to your inbox each week by subscribing for email updates, or if social media is more your thing, please follow us on Twitter, Facebook, Linked In or Google+, or subscribe to our RSS feed. If you have any feedback or suggestions for future articles, please let us know.
