Market Research in China

Market research is a key tool for companies aiming to expand their reach and understand consumer behavior. China presents immense potential for companies seeking new market opportunities with a population of 1.4 billion and a rapidly developing economy.

Consequently, market research in China has assumed a central role for companies striving to secure a competitive advantage in this intricate and constantly evolving market.

The market research industry in China

In recent years, China’s market research industry has been booming, driven by a flourishing economy and an insatiable appetite to learn more about consumers. This expansion is due to a number of factors such as the growth of the middle class, higher consumer spending, and the growing need for market research services in various sectors.

The Chinese market research landscape is marked by a strong preference for the consumer goods, automotive, healthcare, and technology sectors – and the market research sector is on the verge of considerable growth, offering a number of attractive prospects for organizations interested in gaining advanced insights to establish a competitive advantage in the marketplace.

Furthermore, China’s market research landscape presents a distinctive character, shaped by a mix of conventional and digital research methodologies. While traditional techniques such as focus groups and in-depth interviews remain dominant, the popularity of digital tools such as online surveys and mobile research apps are on the rise. This trend is especially evident in urban areas, where access to technology is greater and consumers are more receptive to modern research approaches.

The Importance of Market Research in China

You may be thinking about doing business in China. China is the world’s second largest economy with over 1.3 billion people. Gaining the information you need to succeed in that market is critical.

Secondary sources about markets and companies, or government census data are more difficult for foreigners to access in China. And even if found, much data may not be reliable nor properly collected.

It should be clear that to obtain more accurate and up to date information, it is quite important to find a market research firm in China that has a physical presence there (preferably in regions of interest to you). Such a company should have several years of experience, a multilingual and multicultural staff, knowledge about your industry, good references and reasonable pricing.

Because of its enormous size, the best way to obtain representative quantitative data in China is probably via phone surveys. After that, such qualitative techniques as personal interviews and focus groups can be used to complement the survey and probe for deeper insights into attitudes, perceptions, usage and other behaviors.

One major challenge is identifying a list or source to be used to contact respondents.
Working with a single entity should provide consistent quality and control over any market research project. It also reduces the number of instances when communications and language barriers can jeopardize a project.

Marketing, advertising, and market research are still relatively new to China.

In the past 25 years or so China has grown significantly as a global economy and market. Products are not just made there to be sold abroad, but increasing numbers are being imported. This has propelled the need for market research not only about consumers but B2B buyers and decision makers as well. Because of its relative newness, respondents may be uncomfortable with, or unsure about how to answer surveys and interviews. If someone says “yes” or “no” it might not mean either; a nod might mean “I agree” but equally could indicate “I understand what you are saying”!

Entering a new market is hard enough, but entering a new country with a very old history and culture can be daunting.

Here are a few hints that may help you to successfully enter the Chinese market.

The meaning of many product features may be quite different, and even offensive in China. It is important to understand that an awkward translation of a brand name or advertising slogan can result in rejection or lost sales. Likewise, the improper use of colors, images, and even numbers associated with a product can spell success or failure.
Concepts of family, respect for the elderly, trust, dependability and other aspects of a relationship have an impact on how business is conducted and how goods and services may be perceived.
Legal constraints may impact the sale and use of some products, both for consumers as well as in the B2B market.

There are also rules and regulations that impact logistics and distribution into, out of, and within China. Having a local presence and networking with the proper officials is a necessity to conduct business there.
Most significantly, Eastern and Western views may be radically different and create unforeseen problems if not identified early with the use of a market research or consulting firm familiar with all of these issues.
If not already evident, it makes good sense to hire an interpreter that is fluent in the local dialect. The last thing you want to do is draw an incorrect conclusion based on a miscommunication of words or gestures.

Today’s China Market

China is the world’s 2nd largest economy with an emerging middle class, booming luxury goods and e-commerce sector and large manufacturing base. Below are some of the trends happening now in the market.

Businesses face opportunities and challenges as they increasingly face local competitors, rising labor costs
Yuan opening to the world
Region becoming innovation hub

New emphasis on consumption
Chinese spending on property, companies and tourism
Opportunities in tier 2-5 cities

The benefits and opportunities of market research in China

Conducting market research in China is a highly commendable strategy for businesses seeking to establish their foothold in this market. Some of the main advantages of conducting market research in China are listed below:

Companies can gain valuable insights into consumer preferences, attitudes, and behaviors, enabling them to develop products and services that meet the demanding needs of the Chinese population.
With market Research in China, businesses can identify emerging trends, shifts in consumer behavior, and potential game-changers that could impact their bottom line. With the right data and insights at their disposal, companies can make informed decisions that enable them to thrive in the highly competitive Chinese market.
Creating successful marketing strategies requires a solid understanding of consumer behavior and market trends in China. It is key for companies to conduct market research to gain in-depth insights into the most effective means of reaching the target audience and to identify the most effective marketing channels in the Chinese market.

Assessing the competitive environment is crucial for companies operating in China, where a fiercely competitive market is dominated by a variety of domestic and international players. Through comprehensive market research, entrepreneurs can gain a better grasp of their competitors, their strengths and limitations, and devise strategies to distinguish themselves in the marketplace.

Luxury Market Opportunities

One of the largest luxury markets in the world, Chinese consumers are looking for the following:

China is the world’s top consumer of Luxury Goods
Luxury consumers tend to be younger
Considered a reward
Luxury market expected to grow rapidly

Champagne sales have grown significantly each year for past 3 years
Growth despite high import fees and markups
Chinese traveling abroad
Conspicuous consumption

Technology & eCommerce Opportunities in China

Did you know about China?

World’s biggest smartphone market, overtaking U.S.
China currently building world’s largest 4G LTE network
Over 800 million internet users
Cloud computing, ecommerce & mobile payments on the rise

Many organizations see China as sources of competitive advantage.

As an innovation center
Serving low-income consumers in the developing world
Cost advantages

Asia is increasingly becoming the focus and priority of global economic activity, presenting opportunities and Challenges. Given China’s diversity, different approaches for data gathering and insight are needed. SIS, a Market Research Firm in China, provides advantages with extensive experience and skill sets.

Challenges and considerations for market research in China

Although conducting market research in China can be profitable, businesses must carefully take into account the various challenges and factors they may encounter in this market. Therefore, companies must consider the following challenges when conducting market research in China:

Conducting market research in China requires an in-depth knowledge of the country’s language and customs, which can be a formidable obstacle for companies. The complexities of cultural differences and linguistic barriers can significantly hamper the accuracy and reliability of research results.
Collecting reliable data in China is a challenging task due to the intricate regulatory landscape and the prevalence of fraudulent data practices.

The challenges associated with obtaining a representative sample for research studies in China are exacerbated by the vast and heterogeneous nature of the country’s population. As such, sampling poses a tremendous challenge that must be addressed with precision and care to ensure the credibility and validity of the research results.
Despite China’s impressive technological advances, some rural areas still have limited access to its benefits. This poses a challenge for research in these regions and may compromise the reliability of the results obtained.
It is crucial for companies to have a thorough understanding of the regulations and guidelines to ensure compliance and mitigate potential liabilities. Keeping abreast of the evolving regulatory landscape is an absolute must practice for companies striving to achieve seamless compliance and minimize risk exposure.

The future outlook for market research in China

The proliferation of technology in China has positioned the country as a formidable force in the global technology landscape. This will encompass the utilization of digital and mobile technologies for data gathering alongside the deployment of cutting-edge artificial intelligence and big data analytics, which will serve to scrutinize and decode research insights with greater precision and depth.
Given the growth of China’s middle class and increased consumer spending, it is expected that companies will continue to emphasize consumer insight. This includes acquiring a thorough understanding of consumer preferences, behaviors, and buying patterns to gain and maintain a competitive advantage.
Safeguarding data privacy and security has emerged as a critical concern in China. It is imperative for organizations to adhere to the local statutes and protocols pertaining to data protection and privacy to maintain compliance.

As consumers increasingly prioritize social and environmental consciousness, businesses must elevate their commitment to comprehending these trends and integrating them into their market research endeavors. A heightened emphasis on responsible practices will be crucial in maintaining a competitive edge and meeting the evolving demands of conscientious consumers.
As first-tier cities such as Beijing and Shanghai reach a point of market saturation, there is a growing recognition of the emerging importance of second- and third-tier cities in China. These geographic regions have become increasingly attractive to businesses due to their untapped growth potential and the opportunity to gain valuable insights into consumer behavior. As such, there is a shift towards a more strategic focus on these areas, as businesses seek to capitalize on the opportunities that they present.

About SIS International Research in China

SIS International Research is a leading Market Research and Strategy Research firm with over 40+ years of experience in providing Qualitative fieldwork, Quantitative Data Collection and Strategy Research solutions. SIS International offers Quantitative, Qualitative, and Strategy Research. We provide data, tools, strategies, reports and insights for decision-making. We conduct interviews, surveys, focus groups and many other Market Research methods and approaches. Contact us for your next Market Research project.

Our key solutions include:

New Product Concept research
Loyalty & Segmentation research
Advertising research and testing
Focus Groups & Customer Interviews
Surveys and Data Collection
Competitive Analysis
Branding Insights
Market Entry & Opportunity Research
Strategic Repositioning research
Ethnography
Market Assessment
Surveys

Our key points of differentiation include high quality project management, extensive experience in China, cost competitiveness and our strong reputation.