Foreign businesses with a view to carve a slice of China’s gargantuan and lucrative consumer market through digital marketing channels will no doubt come across myriads of obstacles more challenging than simply bypassing the Great Firewall with VPN. This article will provide you preliminary background of the development of Chinese digital tools and media channels plus an analysis of market penetration strategies in the years ahead.
Chinese digital channels have come a long way ever since the advent of Weibo in 2008, which was essentially a clone of Twitter. Due to the Chinese Government’s requirement of stricter control of mass information in 2009, services like TaoBao by Tencent, Jiwai, Fanfou were all terminated whilst Facebook and Twitter were also blocked at about the same time and these events inadvertently created a media vacuum in a growingly affluent society that was getting a taste of social media for the first time. It was not until late 2010 when Chinese regulators finally approved of microblogging that the first successful Chinese marketing tools were launched. When microblogging began in 2010, there were merely 8 million Chinese microbloggers on the digital scene. The number has exponentially been increased to 120 million by the end of 2016 with forecasts in the coming years far higher than this figure. The Chinese Government’s estimate that the total number of active internet users in China is 802 million people, or approximately 57.7% of the country’s population.
WeChat is noteworthy for being the current Chinese application which even users beyond the Great Firewall may be acquainted with, as it is a rapidly growing tool that is primarily mobile-centric. WeChat’s popularity may be owed to its multi-functionalities as it was designed to be compatible with most systems including iOS, Android, Symbian, Blackberry and even a switch option to desktop computers. WeChat’s extensive uses of the QR code in particular has transformed the transactional landscape with many Chinese now perceiving cash payment as redundant.
Q-Zone would be what many may consider the Chinese equivalent of Facebook and 635 million people are now subscribed to this platform. According to the company’s statistics, 150 million Qzone users update their accounts at least once a month and this may prove to be a potent media platform for marketing products and services much in the same way as Facebook’s Market and Event pages have been. The main drawback with Q-zone however is the fact that its users tend to be from a younger demographic with substantially less disposable income and therefore sales generation could be a challenge. Nevertheless, Q-zone may still have higher potential reach if it is used in conjunction with other marketing platforms and their synergistic impact must never be underestimated.
Renren is another extremely popular digital platform with features very similar to Facebook. Its focus is solely on the younger market segment consisting of college and university students. Renren is quite distinctive from other platforms in that it allows companies to establish their presences with customised brand pages in order to interact with potential customers directly and inform them of new product developments. Again, as with Q-zone, sales generation still poses a challenge but it could be argued that it would be effective influencing consumer tastes for the next generation.
Sina Weibo and Tencent Weibo are China’s two largest major microblogging platforms. Both provide similar functionalities but they differ in social focus, with Sina Weibo gravitating to services of urban and international white collar users in 1st and 2nd Tier cities whilst Tencent Weibo caters to more local users in 3rd and 4th Tier cities. Both applications can be used in tandem with QQ messenger and judging by the degree of media influence, it would be logical for any foreign businesses wishing to capture the Chinese market to establish a foothold in there.
Last but not least, no discussion of Chinese digital tools would be complete without the mention of Baidu, which operates as the number one Chinese search engine, which is as ubiquitous as its Western counterpart, Google. Baidu’s share of the domestic Chinese market is a staggering 89% and it operates by optimising a Chinese-hosted site (with a .cn domain extension) to appear on the first page of organic search results in combination with paid advertising campaign. It must be noted that Baidu’s competitive advantage lies not in the fact that the Chinese Government has censored Google, but in the complexity of the Chinese language. One Chinese character may yield several definitions and therefore it is arguable that it would be difficult for foreign search engines to grasp the linguistic nuances as effectively as a domestic Chinese search engine can.
In my analysis, the idea that Chinese digital platforms are merely copycat versions is untrue. Notwithstanding the protectionist stance the Chinese Government has towards digital platforms outside China, it must be noted that the Chinese market is extremely vast and sustainable to the point that it does not need to rely on foreign digital influences compared to smaller countries, especially those not within the Anglo-sphere.
On the contrary, Chinese digital tools are now in many ways far technologically superior to its Western counterparts. For instance, compared to WhatsApp, it could be argued that WeChat has a more sophisticated system of transaction whereby goods and services are more easily traded, as users can connect their banking directly into their WeChat accounts. The use of the QR code is also much more extensive in China than elsewhere. Whereas most users in the US and Europe found them pointless due to poor initial execution by their local application, it could be said that the QR code has become deeply embedded in the Chinese transactional psyche, as you can even see street vendors accepting electronic payment through this channel.
The reason for this peculiarly Chinese digital phenomenon may lie in the distinguishing Chinese cultural characteristic of family values. Strong family and social units in Chinese culture could be said to lead to a focus on mutual trust, the sentiment of which naturally extends to the digital sphere. This trust is inherent in how the Chinese market perceives tools to be protectors rather than competitors of their own interests, in contrast with other countries such as Thailand where the trust in the media is low, people would be more apprehensive of giving control of their finances to an organization and would prefer cash transactions.