Mark Tanner
2 March 2016 0 Comments

Here are this week’s news and highlights for China:

Overall Health

Test on Rats Shows Air Pollution Increases Risk of Obesity: A Duke University-led study shows laboratory rats that breathed Beijing’s highly polluted air gained weight and experienced cardiorespiratory and metabolic dysfunctions.

Xiaomi Air Purifier Fails Quality Inspection, Has “Serious Problems”: The Shanghai Quality Inspection and Supervision Bureau found Xiaomi’s first-generation air purifier to be the worst of 36 evaluated, and one of four that failed tests. Major issues included failing to process a sufficient amount of air in the room and excessive noise.

Foreign-Made TCM a Hit with Chinese Consumers: Premium, foreign-made Traditional Chinese Medicine products have taken a large share of China’s domestic market. Although many of the ingredients are sourced from China, foreign brands are perceived to have higher standards and better production supervision.

Consumers,  Chinese Consumers

Beijing Becomes the Billionaire Capital of the World: Beijing minted another 32 billionaires last year, to total 100 – 5 ahead of New York. Greater China cities accounted for half of the top-10, with Hong Kong (4), Shanghai (5), Shenzhen (7) and Hangzhou (9) all on the list. Since 2013, the number of billionaires in Greater China has grown 50% to 568 versus 535 in America. Of the 124 self-made women billionaires globally, 93 are from China.

Here’s Why Walmart Stumbled on The Road to China: In addition to economic, cultural and political challenges, Walmart struggles to find the right product mix to offer in the 117 cities and 25 provinces in which it operates. This makes it challenging to sell a core set of products nationwide. Walmart is opening 30 new stores and upgrading 60 in China this year.

In Pictures: China Bans ‘Bizarre’ architecture: The Chinese government has made another anti-foreign jab, issuing a new directive banning “bizarre architecture”, and criticising some of the “oversized, xenocentric and weird” buildings in the country.

Online: Internet, Mobiles & Ecommerce

Cross-Border Ecommerce is Luring Chinese Shoppers: Cross-border consumer ecommerce amounted for an estimated ¥259 billion ($40 billion) in 2015, over 6% of China’s total consumer ecommerce.  It has been growing at more than 50% annually according to McKinsey. 68% of shoppers buy for product quality and 66% for price.

This is How Alibaba is Helping Boeing do Business in China: Boeing expects to sell 1,000 737-800 freighters globally over the next 20 years, with about  a third going to China due to the voracious demand from online shopping. China’s domestic express cargo business in China grew an average of 50% per year from 2009 to 2014. Growth in express delivery is also giving a new lease of life for older passenger planes, which are being converted for freight to extend their working lives.

While it Defies U.S. Government, Apple Abides by China’s Orders — and Reaps Big Rewards: Since the iPhone was launched in China seven years ago, Apple has overcome a national security backlash by censoring apps to keep Chinese authorities on side. It has moved local user data onto servers operated by the state-owned China Telecom and submits to security audits by Chinese authorities.

Premium Food & Beverage

UK Food Gets Mixed Reception from China: Chinese consumers believe the UK is trailing a number of western countries in key areas such as food safety standards, the integrity of producers and the use of advanced technology in food production according to DDMA. 81% of study respondents would consider buying food from the UK – the sixth-placed country behind Japan, Germany, Australia, the US and New Zealand.

Can “Potato Sister,” a Singing Peasant, Convince the Chinese to Eat More of the Lowly Spud?: As potatoes consume 30% less water to grow than rice or grain, Beijing wants to endear consumers to the humble spud. One challenge is that most Chinese consumers associate potatoes with poverty. Already the world’s largest producer, the Government hopes to nearly double potato production by 2020.

Overseas Chinese Tourists

New Draft Raises the Standards for Public Restrooms: Further evidence of the importance of WIFI for Chinese tourists – it will now be included for free in public toilets in many tourist areas by the end of the year. Restrooms will also be equipped with Western style toilets, soap (finally!), big screen televisions, ATMs and even relaxing sofas. What will that do for queues?

Domestic Duty-Free Boost on the Way: The Chinese Government has approved the opening of 18 new duty free stores at airports and ports for outbound travellers. Allowances will also be increased to ¥8,000 ($1,225) from ¥5,000 ($765).

Designers and Fashion

Hugo Boss to Reduce Prices to Boost Sales in China: Hugo Boss plans to reduce sale prices in Asia to Europe’s level due to lower-than-expected sales in China.

Banking, Investments

China Home Prices Seen Rising 4% in 2016 on Government Support: China’s average nationwide house prices are expected to rise 4% in 2016 according to a Reuters poll of 13 analysts, helped by the lowering of down-payment requirements. China’s housing market accounts for 15% of GDP.

That’s the Skinny for the week! See previous newsletters here. Contact China Skinny for marketing, research and digital advice and implementation.


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