Mark Tanner
Mark Tanner
13 June 2018 0 Comments

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

Chinese sport Sport

100,000 Chinese Tourists are Descending on Russia to Watch the Fifa World Cup: Flight bookings between China and Russia are up by about 400% from the same period last year, while hotel bookings for Moscow are up 10-fold according to Ctrip. Although 100,000 Chinese are expected to visit Russia for the tournament, many of them appear to be going just to soak up the atmosphere as only 40,000 game tickets have been sold to Chinese – 8,000 more than the English.

Why NBA Star LeBron James is a Player in the US-China Trade War Discussions: The NBA has more than a dozen media partnerships and licensing agreements in China, including a five-year, $500 million pact with Tencent. It contributes to the US’s soft power driving everything from high spending tourists to education – Chinese make up one third of foreigners studying in the US, a proportion that has tripled over the past decade. Such soft power tactics are helping drive a $38.5 billion services trade surplus in America’s favour.

Consumers,  Chinese Consumers

Beijing, Shanghai Become Relatively Cheaper Places to Live: Beijing is the world’s 46th-most expensive city to live in according to a UBS survey — down six places from the last report — while Shanghai ranks 47th, dropping 13 places based on the monthly spending habits of an imaginary three-person European family. Food prices saw notable declines from 2015.

Welcome to China’s KOL Clone Factories: Many of China’s newer female influencers are cute, inoffensive carbon copies of one another who have been groomed by incubators after earning a core audience on their own. One reason for this homogeneity is undoubtedly the narrow definition of beauty traditionally accepted within Chinese culture, but another is clearly the influence of KOL firms/incubators. There are an estimated 200 such firms who build their own brands and push their own products which take 50-75% of a KOL’s net revenue.

Does My Virtual Bum Look Big in This? The New Side of Chinese Ecommerce: The improved efficiency and ability for retailers to lower costs means China’s wow-factor new retail technology is being eyed by retailers across the world. US President Donald Trump is concerned about China’s increasing ability to dominate the world’s technology sector, but in Alibaba’s world the race is already won.

Chinese Consumers Embrace Automated Retail: Restaurant Wufangzhai’s new automated ordering system has helped to halve its labour costs, while the added efficiency has increased customer turnover leading to a sales boost of 40%. Hotels that check in guests using cameras and have robots serving bubble tea are examples of cost reductions from automation. The market value of automated shops in China is expected to rise to ¥950 billion ($148 billion) in 2022, or 30 times more than the estimate for this year.

Online: Digital China

Jack Ma Goes All-In on Smart Logistics Infrastructure Network: Cainiao Network, the logistics affiliate of Alibaba, is going to invest more than ¥100 billion ($15 billion) to build the technical backbone for a smart logistics network aimed at improving delivery reach and efficiency. Cainiao wants to eventually ensure single-day delivery across China and 72-hour delivery worldwide. 130 million parcels are currently delivered per day in China by about 5 million staff in courier and food-delivery companies.

Tencent to Cooperate With Walmart on Retail Business: Tencent has announced strategic cooperation with Walmart China on digital and smart retail, focusing on improving customer experiences, precision marketing, payment services and the efficiency of internal and external communications through WeChat Enterprise. It also aims to build a stronger membership system for Sam’s Club. Also in the world of WeChat, travel between Mainland China, Hong Kong and Macau will be streamlined over WeChat and people can even file for divorce on the app.

Overseas Chinese Tourists

Why Mobile Payments are an Integral Part of Chinese Consumer Culture: Advertorial, but a well summarized explanation about why mobile payments are so important for businesses in countries who get a lot of visiting Chinese tourists and students.

Premium Food & Beverage

Pernod Targets Chinese Millennials With Cocktail Kits: Pernod’s innovations have adapted to China’s fast-moving ecommerce market. They are providing smaller bottle sizes for consumers who get quick delivery from ordering online. The company is also selling kits that provide all the ingredients for classic cocktails, delivered to homes within the hour.

Chinese Firm’s Promises on Tasmanian Dairy Farm ‘Not Legally Binding’: Moon Lake Investments gained approval to buy Van Diemen’s Land Company by promising to invest $100m in Tasmania and create jobs. Last month, Australian board members staged a mass resignation after failing to convince the new owners to invest millions to make the company sustainable through drought-proofing and the improvement of animal welfare. The Australian Treasury’s foreign investment division have said the promises made before the sale were public undertakings, and not legally binding conditions.

Video and Entertainment

Americans Largely Won’t Pay to Win a Video Game — But Chinese Gamers Will: Many Chinese gamers were accustomed to shelling out recurring costs to game in cafes, while the “pay-to-win” idea was generally not accepted by Western gamers. Today, Chinese consumers have largely migrated to free games with micro transactions. Micro transactions accounted for 88% of PC games spending in China in 2016 including paying for additional features such as enhanced abilities, characters or content.

Overall Health

China Overtakes U.S. for Healthy Lifespan: Chinese newborns can look forward to 68.7 years of healthy life ahead of them, compared with 68.5 years for American babies. American newborns can still expect to live longer overall – 78.5 years compared to China’s 76.4 – but the last 10 years of American lives are not expected to be healthy according to the WHO. China ranked 37 globally with Singapore, Japan, Spain and Switzerland rounding out the top-4. The United States was one of only five countries, along with Somalia, Afghanistan, Georgia and Saint Vincent and the Grenadines, where healthy life expectancy at birth fell in 2016.

L’Oreal Connects With Chinese Consumers Through New WeChat Hey Tea Campaign: L’Oreal has partnered with trendy tea shop Hey Tea to launch Colour It Hey Tea, which are only available via Hey Tea and L’Oréal social media accounts.

Premium and Luxury

Chinese Buyers Crave a New Sales Pitch: ‘Experiential Luxury’: Luxury brands’ ability to provide “in-the-moment” feelings and vivid experiences, such as exclusive events or multi-sensory environments, is of greater importance in shaping the perception of luxury in China than in virtually any other region, a Kadence study has found. “Status” now ranks after “quality”, “brand heritage” and “timelessness” in importance for luxury consumers.

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

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