Most China studies done by western companies focus on collecting data and then pattern-matching to what we have seen in developed countries. I love data, but I don’t agree with the assumption that China is the western world but 20 years behind. We’re different. Here are three reasons.
- China has 5000 years of history.
5000 years of history bred a rich and unique culture. The history and culture impact how people think. We don’t think the same as westerners think. For example, Chinese people are crazy about luxury brands, but not for individual expression or the premium service that comes with the actual product. A research done by Fudan University in China showed that this behavior is rooted in the Confucius teaching that “thou shall respect your family and ancestors.”
When a Chinese person carrying a Louis Vuitton walking in China, he/she is upholding the family name. The bag is telling everyone else, “My family is doing great. We can afford this!”
If you understand this consumer psychology, you can market a luxury brand in China accordingly. You will put the brand logo front and center on the product. You probably don’t need to invest too much in services after sale because that’s not why Chinese people are paying a premium for.
- Changes in China are happening with unprecedented speed.
Look at this set of pictures of Shanghai. The spot in Shanghai in 1990 was a green pasture, nothing on it. 2010, it’s a concrete forest.
Now imagine yourself witnessing the change from a kid, to a teen, to an adult, what do you feel? That’s exactly what my generation in China went through. Now tell me it doesn’t have an impact on my view of the world.
Change is the norm for us. It’s always 90 miles an hour for us on the road of economic growth. The interesting effect it has on Chinese people is how we expect to see results immediately. If buildings can be done in a year, so should the return of my investment.
- China has unique political policies
I’m not here to talk about political scoops that you don’t know. I’ll point out some consumer behaviors that’re a result of political policies. For example, Chinese people place a huge value on education in China. The amount of money spent on education is dis-proportionally high of the dispensable income. iPad is selling like a hot cake in China as an educational device for kids. We go out of our way to give the kids the best. Why? There’s only one kid thanks to the one-child policy. So you got the parents and two sets of grand-parents focusing on one single kid, the apple of their eyes. Of course they are going to pour money all over him/her.
To recap, Chinese users are different. The culture impact, the rapid economic development and the political climate all contribute to the different way we think. Sure, it’s converging to the western world. You can choose to sit it out till it becomes America or you can invest now and grow with it. I will definitely choose the latter, which will help build a long-term strategic relationship with 1.3 billion people. And guess what, no matter when the convergence happens, it will not be exactly the same as the western world anyways.
China will always have its accent.