About China

By: CBC Market Research

A Brief Look at China

• 1.3 billion population, 56 races
• 660 cities , 400+ millions urban population, top 100 each with
• population over 1 million, 4 over 10 millions
• GDP 2 .5 Trillions $ in 2006, 10% growth rate in the last 10 years
• 2 trillions $ of save, social consumption volume 760 billions $ in
• 2006, 13% growth rate -- Era of Consumption Upgrade
• The World's Factory

The Advantages

• Government's strong support to economy development
• People's strong motive to get rich since Deng's governing
• Cheap labor cost that enables China to compete with other
• countries on various aspects
• Improved labor force & product quality
• Open to the world

Problems and Disadvantages

• CPI goes up, real estates goes up
• Under the strong pressure of currency & interest rate
• appreciation
• Family planning that may cause serious problem -- Spoiled Kids
• Incomplete medical insurance system
• Incomplete education system -- the competition starts from
• kindergarten
• Village poverty
• Relatively low domestic consumption

The Trend...

• Catching up the western culture - whatever you can see in the US today, you can mostly see it in China tomorrow
• The main countries that has most impacts on Chinese:
  • USA: movies and soap drama, education, high-tech, automotive, Coke, Pepsi, KFC &
  • McDonald's, NBA, Disneyland...
  • Japan: household appliance, digital products, automotive, cosmetics, cartoon, pop stars...
  • Korea: digital products, pop stars, soap drama, pop stars, automotives
• Revolution in communication, up to now:
  • 420 million mobile phone users
  • 130 million internet users
  • Fast growth on automotive market
  • 7.1 million automotives sold in 2006, 25% up

The Future...

• May become the No.1 economy body of the world in the next 50 years
• Huge potentials on consumption market due to its population base and wealth growth

Marketing Research in China

A Brief Look...

• A 500 million $ market with yearly growth rate of 15-20%
• Dominated by international firms such as AC Nielson, Synovate, Research
• International, TNS, IPSOS, on 25- 60 million $ level
• Local players are far below the international firms, the biggest CTR with
• 15 million turnover last year
• (3-5) Thousands of small firms around the nation
• Big spenders in FMCG, automotive, IT and telecom, the biggest might be
• Coca Cola (on 10 million $ level).
• B2C research shares 60-70% of this market.

Effective Research Methodology in China

About Online Panel

• Not even sample distribution by region
  
• Not even age distribution
  
• More on high-educated side
  

• Concerns about quality from the clients
• Poor quality of the online panel
• Poor self-principal of the panel supplier, very few trustworthy
• Poor answering quality, especial y open-ends
• Expensive if high quality required

• Quick and dirty data
• Specific groups
  • IT, high-tech related products
  • Young people
  • Opinion leader

What might be wrong ...

• Huge differences in terms of region, urban/vil age, city tier,
• income level
• There is not a single or several national representative cities
• Big investment if you want to do it
• And normal y we can only do survey in urban

The city tier in China...

• Tier 1: capital, national level city
• Tier 2: provincial capital, vice provincial city
• Tier 3: Regional city
• Tier 4: county level city
• Tier 5: town

A monthly national brand tracking example...

• N=150 in 4 of tier 1 cities
• N= 50 samples in 20 of tier 2 cities
• N=40 samples in 25 tier 3 cities
• N=30 samples in 40 tier 4 cities

What else might be a problem...

• Social class? No existing classification on that
• Consumer segmentation? Huge topic, extremely hard, needs money and time
• B2B database with SIC code? Not exist
• Penetration of certain products? Normally based on experience

About India

A Brief Look at India

• Land Area : 3.29 million square kilometers
• 1.1 billion population
• the world's 12th largest economy
• A federal form of Government and is comprised of 29
• states and 6 Union territories.
• The second fastest growing major economy in the world,
• 820 billion $ GDP in 2006. Stable 8% Annual Growth --Expected to Reach More Than 9%
• 73% of India's population lives in villages and is
• dependent on agriculture.

Advantage India

• A Progressive Democracy
• Diversified Economy
• Sophisticated Financial Markets, Legal and Accounting Systems
• Rule of Law and Transparency
• Low Cost Highly Educated Human Resources
• Progressively Opening Economy
• Large Market
• Young Population

Disadvantage India

• Huge poor population although 18% are rich
• Democracy on poverty, slows down the development
• Less business sense -- isolated from commercial world,
• mentally rich
• Shortage of resource, especially power
• Infra-structure is not there yet

Marketing Research in India

• Industry size estimated at US $ 125-130 Million in 2006-07
• Business growth at 8-10%
• KPO, Business consulting, and Technology research witnessing faster growth
• Quantitative research is 75-80%
• PAPI predominantly used. CATI emerging fast for sophisticated products/services
• Consumer research leads the pack with 75% followed by B2B, Public Research

Contributing Company:
CBC Market Research www.cbcnow.com

Disclaimer: Views & opinions are solely those of the contributors and do not necessarily reflect SIS International Inc.'s opinions, views and methodologies. Under no circumstances will SIS, it affiliates, successors or assigns be liable for any loss or damage caused by anyone's reliance on information contained in this web site.