Category Archives: China

A Facebook China Team Coming Soon?

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Sheryl Sandberg, COO of Facebook, was in Beijing yesterday. It is not the first time someone from Facebook is seen there since Mark Zuckerberg have been several times with his Chinese wife.

Facebook has been blocked in China since 2009. The change is the fact that Sheryl Sandberg met officially with Cai Mingzhao, the Director of SCIO, the regulator of Chinese Internet: see below a screenshot of the webpage.

Facebook in China would definitively change the industry of social media in the country. If Facebook enters the market, Renren, Qzone, WeChat, WeMeet would lose market share against Facebook. SinaWeibo shouldn’t be affected much.

The best interest of the Chinese administration is mainly the use of Facebook to advertise Chinese products and services all over the world while the best interest of Facebook is to get an easier access to Chinese users.

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The Social Media Strategy of Ritz / Carlton for China

As explained before, to succeed in China, a brand needs to go beyond the data and immerse itself in the culture in order to develop relevant marketing.

In the luxury world, the impression of high quality and dream is very important, so the chosen design should resonate in minds of Chinese.

The brand called Ritz-Carlton understood well they need a specific strategy for China. The firm, owner of 4 hotels in China, launched a new Chinese website  and a public account on Sina Weibo

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Chinese people have a high level of customer’s appreciation for History (traditions, History and heritage). The Ritz-Carlton brand took that into considerations with digital channels reflecting that tradition, while also demonstrating that the brand is speaking to the audience in a way that is culturally relevant.

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It seems the team who worked on the strategy knows China. For example, the blue color is usually associated with immortality and wisdom. This could explain the use of shade of blue for its richness (similar to the blue color found on Chinese porcelain). Ritz Carlon is doing good but should do better than that: they missed some important other elements for Chinese consumers.

The Promotion of a Foreign Brand in China must include Chinese Social Media

Getting to grips with social media in China means learning new platforms and methods of communication. But it’s a good way to build a brand, because the Chinese have a high level of trust in the Internet.

A foreign brand wishing to successfully launch its own products in China should absolutely benefit from the great potential offered by the Chinese social media.

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According to the China Internet Network Information Center (CNNIC), in 2012 the Chinese regularly using the internet were 564 million (42% of the population), with a 10% increase in comparison with the previous year. The Chinese Ministry for Industry and Information Technology has estimated that within 2015 there will be over 800 million Chinese users on the internet, i.e. the total of the inhabitants of the United States plus the European continent.

Why the Use of Social Media in China is more important than anywhere

Social media and search engine optimization is different in China. The same presence of social media marketing than the rest of the world won’t work. Having a social media presence is essential: a social media presence in China is a basic marker of legitimacy that reassures the consumer, when needed, that the brand is real and established. In China, online sources of information play a much larger role for consumers in China than they do in many more established markets.

Social Media in China are the most influential and interesting media for Chinese consumers, who believe what they see on the internet far more than they do in a newspaper, magazine, radio or television.

A Need for a Specific Marketing Strategy for China

Social media in China have a feature that is unique in the world: they are different from other countries. Global social networks like Facebook and Twitter are blocked and can only be accessed through VPN technology.

Even though Chinese users don’t have access to all American social media, they have at their disposal at least a dozen of virtual networks made in China and quite innovative compared to the United States.

Many foreigners are still making the mistake of licensing contents in English and not in Chinese. It is enough to do a search on Baidu (or Qihoo) or on Soku (main video search engine) to realize how ineffective is a strategy that does not aim directly at the use of Mandarin.

A strategic figure for an efficient promotion is the local community manager, a Chinese person expert in social networks who has the object to make the uploaded contents dynamic: she/he establishes relationships, creates debates, moderates forums, acquires information, and delivers contents from the official accounts opened on all social media.

In China the social networks are mostly … Chinese

Compared to many countries, Chinese Internet users mostly communicate with national services and not American services like most of the rest of the world.

“QZone” is a very popular social net created in 2005 by Tencent Holdings, the firm of the most popular program for instant messaging in China: QQ. the service allows  users to use avatars, write blogs, keep a diary, send photos and listen to music. At present over 600 million accounts are active.

“SinaWeibo” known as “Weibo” is the major Chinese website of micro-blogging, a kind of hybrid between Twitter and Facebook. With around 500 million accounts, 2 million of daily issues and 100 million of messages each day, it is the most visited social network in China after QZone (including QQ). On Weibo a public opinion has formed over time, which, having no other platforms where to express itself, brings its requests onto the Internet concerning themes such as TV shows, entertainment but also issues like pollution, and food safety, often with results.

WeChat (called Weixin in China) is lately one of the most successful platforms. It is a mobile application of Tencent, launched at the beginning of 2011 and it is the first web application created for the Chinese market, but available in English since 2012. Presently, it has reached over 400 million registered accounts, and internationally it has 100 million users (of which a few millions are Chinese overseas and including mostly Malaysia and India). Competitor Sina launched a similar application called “Wemeet” (Weimi) and China Telecom with Netease “Yixin”.

Renren is a social network created in 2005 with a style similar to that of Facebook. Currently it has more than 200 million accounts and it is visited mostly by university students and people under 30 living in the first- and second-level.

It is also worth mentioning other social networks like  Pengyou (150 million accounts), Kaixin001 (100 million accounts), Douban (100 million accounts) and DianDian (5 million users).

In China there are also different types of video sharing websites (Youtube is blocked).

The most important one is Youku.com with 30 million single visitors each day (second in the world only to Youtube.com), visited in particular by young people and graduates living in the first- and second-level cities. The second most popular video sharing website is Tudou.com, which merged with Youku in March 2012, creating Youku Tudou Inc. At present Tudou.com has currently 18 million single daily visits and about 100 thousand videos are uploaded every day.

The third most popular one is 56.com with 10 million single visitors each day.

What type of Social Media should you use?

A good example with wines from Provence

We heard about the strategy of wines from Provence: it is a good example.

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Sina is back with WeMeet (Weimi), a clone of WeChat

After the failure of WeiYou (微友), Sina Inc is back with a new social mobile application called WeMeet (Weimi).

Sina invested in Hangzhou Kuyue Tech, the firm in charge of competing with WeChat thanks to the power of SinaWeibo.

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The chat and social app allows users to chat, subscribe to news and other forms of content, share content like pictures. Users can import contacts from Sina Weibo and mobile address book. Group chatting supports audio, text and location sharing. This is quite similar to WeChat.

2 competitive advantages:

1/ Interest-based public groups

There are dozens of interest-based public groups for users to join.

2/ The Grape, a Snapchat-like feature

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A Snapchat-like feature is included that messages shared in a group will disappear in 3 seconds after having been read and vanish from the group in 24 hours.

SinaWeibo was under pressure from WeChat, the mobile messaging app developed by Chinese Internet giant Tencent. Qzone, SinaWeibo and WeChat represent most of social sharing in China.

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TianTianAiXiaoChu Game: Tencent Success on Mobile

With the release of TianTianAiXiaoChu, Tencent shows to competition the firm is able to do well on mobile.

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Since the game has been available on August 5th, analysts are telling us that several million people downloaded the game in China.

The game can be accessed from both QQ and WeChat. This situation confirms our predictions for 2013.

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Source: sreenshot from Appannie

Yixin, New Entrant in Mobile Market

According to AppAnnie, the volume of downloads of Mobile app called Yixin is high in China:

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China Telecom and NetEase established a joint venture to create the application called Yixin, with the former controlling 73% of the company. Email and cloud music services provided by NetEase are integrated in it.

Yixin has the same functions as current chat apps on the market (Line, WeChat).

China Telecom has used its position of Telecom provider to include some differentiating features into the app: Yixin supports sending voice messages to any mobile or fixed-line numbers for free: this is a strong competitive advantage against leading app called WeChat. This is useful for communicating with the older-generation who may not be as mobile-phone-savy.

Line and now WeChat offers stickers to buy inside the application. On Yixin, stickers are all free. This offering of free stickers is powerful in Asia where stickers are very popular. But how Yixin will monetize the application?

Professional social networking websites in China and “Guanxi”

China has the world’s biggest online population. As a consequence, many Internet businesses are targeting the country. Several internet giants failed while others succeed like Amazon.

Professional social networking websites such as LinkedIn are not very used in China but the usage is growing. The way LinkedIn is built is a reflection of American culture with direct contacts. The website is not blocked contrary to Facebook.

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In China people do not want to meet with people they don’t know. Chinese people have a culture based on relationships among family members, colleagues, and close friends. This famous system of personal connections is known as “guanxi” and is reinforced by mutual favors, which plays a vital role in conducting business and navigating a huge country. In China, the boundary between private and professional life in China is not always very clear: for instance, an employee is able to go to karaoke and get drunk with her/his clients. This behavior is less usual in other countries.

French professional social networking website called Viadeo understood the users are very different from Europe and decided to acquire one of the leading Chinese equivalents called Tianji. Even the founder of the French company is located now in China.

The position of Tianji is to offer users a way to maintain “guanxi”. As of July 2013, VALUE2020 estimates that over 16 million users are using the service while Linkedin has only over 3 million users. Quite surprising, Linkedin offers versions in Japanese and in Korean but not yet in Chinese.

Chat Mobile App: Whatsapp, Line, and WeChat in the World

Whatsapp is still leading the world of free messaging being the first downloaded application in 10 countries on Google Play (Google store for applications). The application  is within rank #1 and rank#10 in 28 countries on July 27th.

Whatsapp has been challenged for about a year mostly by Tencent with WeChat, and Line Corporation with Line.

Line and WeChat fit very well the needs of Asian users. Tencent is using stars and media to increase the number of users worldwide: social media like Twitter, Facebook has been heavily used for months but for aggressively since March 2013.

On July 27th, the Japanese application called Line was the most downloaded application on Google Play in Argentina and Chile. Whatsapp just behind ranked #2.

On July 27th, the Chinese application called WeChat was the most downloaded application on Google Play in Italy. Whatsapp just behind ranked #2. Lionel Messi, famous soccer player of FC Barcelona, signed an agreement to promote WeChat. The effect on Italian fans was very quick.

Below an advertising in Hong-Kong were people still prefer American social media like Facebook and Whatsapp than WeChat.

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Why China is a country of innovation

A few examples of China moving ahead:

-Research and growing number of patents
-Mobile Internet
-Cities
-Transportation
-Service to customers

Remember China invented paper and gunpowder…

China is back on the path of innovation. Here are a few signs.

Chinese manufacturers are skilled at “process innovation” incrementally improving the way they make things.

Chinese Internet shows a change: there have been few recent, major innovations coming from China. Among other firms, Tencent, an Internet giant in China in e-commerce and social networking, SinaWeibo, and Alibaba, an ecommerce company already demonstrated their power of innovation. Some of the staff of the WeChat team worked previously for Google Inc.

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While China is best in class at producing most of the world’s technology based products (for instance, iphone), it’s the marketers of the USA who continue to capture most of the value from those products.

Another example of Chinese innovation is giant Chinese telecommunication firm called Huawei, the largest telecom equipment manufacturer in the world with products deployed in more than 140 countries, covering more than one third of the world’s population.

Recently emerging as the third largest smart phone manufacturer behind Samsung and Apple, Huawei is moving from low end budget phones into the more premium market shipping 32 million smart phones during 2012 – up 60% on the previous year. In partnership with Google and its Android OS, Huawei is clearly targeting the proprietary, closed Apple products which to date have led the world but are now under real threat from the Korean brand and now the Chinese brand.

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To continue the economic transformation, China is pouring billions of dollars into innovation and R & D programs, attempting to move up the value chain. Tencent, Baidu, Alibaba, and Huawei built massive campus in Beijing or Shenzhen. Those companies want to lead in the future and know the importance of the state of the art R &D building.

Product innovation is visible as well with the increasing number of employees with a PhD degree among the R & D teams. For instance, Huawei is the largest applicant for worldwide patents, doing better than Samsung, Apple, and Google.

Haier, the world’s No. 1 white goods brand, has developed a range of design-led refrigerators and dishwashers, offering a palette of coordinating colors and finishes. In order to satisfy its customers’ various needs, Haier offers tailor-made design for its refrigerators: “your refrigerator, your design”. Haier already entered the Internet of things, connected home appliances. The 3D refrigerator has a built-in Wi-Fi connection with a touch screen offering many functions, such as being able to check the weather forecast. Thanks to RFID chips that are built into the packaging of the contents of your fridge, this product can even alert you to when food will pass its ‘best before’ date.

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How are Chinese companies successfully targeting its consumers in China? They do what every good company should do: listen to its customers’ complaints and deliver products that address their needs.

Can China innovate on a global basis? We think positive under the condition of understanding the differences in addressing the needs of other cultures. WeChat is an example of innovative product (both chat app and social network) which starts to succeed outside China.

What we are still waiting to see are products and services sold worldwide which are both innovative and disruptive.

Innovation in China: a day of an urban Chinese executive Part 1

Li Wang is Director of sales for a German brand in the Guangzhou area. He is the father of one son and his wife is working in the banking industry.

Wang is awaken by his latest Samsung smartphone.
He uses Baidu to check the weather and a new application from Google Play for air conditions. The weather will be good but air conditions will not be excellent: no wind is expected and more and more cars are on the freeways and streets of the city. Selling cars is the business of Li Wang, therefore he will not complain about this trend.

He waits for the lift and watch the frame screen telling him to scan the JD.com QR code to get a discount today. He doesn’t have time but while in the lift sends a WeChat message to his wife. Now that their son is using an ipad at his private school, his wife has downloaded WeChat to be in contact with her son. Wang stops a taxi and asks for a ride to work.

Meanwhile he is in the car, he buys a concert ticket thanks to the screen aboard the car. He also see that there is a new game application that looks fun and could be of interest for his kid. He takes a picture and sends it to his son.

Wang arrived the new city center. He is working on floor #52. There is no waiting time for the lift because the building is brand new and well equiped with 10 lifts. On the way up, he sends a message to his wife about the concert and publish a comment to a friend on Sina Weibo: they are going!