Here are this week’s news and highlights for China:
The Pink Yuan: How Chinese Business is Embracing the LGBT Market: China’s estimated 70 million Lesbian Gay Bisexual and Transgender (LGBT) people represent a market worth $300 billion per year with companies like Starbucks, Alibaba, Nike and Adidas all hoping to tap into it. Homosexuality was illegal in China until 1997 but only declassified as a mental health disorder in 2001 – just 5% of 30,000 LGBT surveyed said they told any family, friends or colleagues about their sexuality.
Cashing in on Dystopia: Hundreds of tracking services offer privacy data on Chinese citizens, only requiring a phone number or ID for investigations. For ¥700 ($101) you can get yourself a full history of hotel rooms checked into, airline flights taken, internet cafes visited, border entries and exits, apartment rentals, real estate holdings — even deposit records from the country’s four major banks.
Alibaba is Buying Chinese Mall Operator Intime for $2.6B to Modernise Offline Retail: Alibaba is paying $2.6 billion to acquire Intime and its 29 department stores and 17 shopping malls across urban China. It bought a 28% stake for $692 million in 2014 in its first major foray into physical retail, followed by a $4.6 billion investment for 20% of retail giant Sunning in 2015. Alibaba plans to integrate online into the stores and better utilise big data.
China’s Millennial Consumers: What Victoria’s Secret Got Wrong, and Nike Got Right: Victoria’s Secret has shown a superficial understanding of Chinese culture which offended many Millennials. Nike on the other hand, plays well into how Chinese youth grapple with Chinese traditions and modern views, with a powerful but rebellious message that shakes the core of Chinese conventions.
Sales of Top-End Face Masks and Air Purifiers Soar as Smog Continues to Cloak Northern China: 3M has sold over 8,500 packs of signature “KN95” respirators on Tmall in the past month, even thought they cost almost ten times more than a regular mask sold at local convenience stores. The global indoor air purification market is poised to almost double to $21.82 billion by 2024, with China being the pre-eminent driver behind the growth.
Alibaba Offers Trump 1 Million US Jobs, Builds Bridge for Sino-US Ties: Jack Ma’s 40-minute meeting with Trump provides some hope that the almost-president may have some appetite for trade, after he said he had a great meeting with the Alibaba founder. Ma shared ideas with the US president-elect about ways to improve trade, and offered Alibaba’s platforms to support up to 1 million US vendors selling to China and Southeast Asia. America’s trade with China already supports more than 40 million jobs in the US, according to estimates by the US Chamber of Commerce, exporting over US$500 billion of goods to China in the past five years.
Chinese Retail is Obsessed with Donald Trump: Chinese retail has embraced Donald Trump in a big way, including a 10 metre-high Trump-rooster statue at a shopping mall in Taiyuan. A factory in Zhejiang is struggling to keep up with demand for giant inflatable Trump-rooster balloons, some standing 20 metres high. Trademarks have been registered for Trump condoms, paint, and even toilets – consumers are interested “because they want to sit on a toilet or use a urinal that has the name of a US president,” says the founder of the lavatory brand. Trump has at least 45 of his own trademarks pending in China, each of which could potentially violate the American Constitution.
As Cross-Border Buying Booms, So Does Tmall Global: The top-selling categories on Tmall Global last year were beauty and skincare, food and beverage and baby and maternity – with Japan, USA, Korea, Germany and Australia the most popular countries. 70% of shoppers were aged 24-32. International brands on the platform soared 169% from 5,400 in 2015 to 14,500 in 2016, with 80% of brands having no presence in China before listing of the platform. Product categories increased 85% to 3,700 from 2,000. In light of that, Tmall Global sales grew just 30% last year, a similar rate to ecommerce overall.
2016 WeChat Data Report: More staggering numbers from WeChat in 2016, including the 67% growth in messages sent per day from 2015, with the average user born in the 80s or 90s sending 74 messages a day. 50% of WeChat users are on the app for at least 90 minutes a day.
Searching for the Future: It’s Time to Upgrade the Baidu Business Model: Baidu performance has been notably poor relative to the other BAT players, Alibaba and Tencent. With declining online ads still accounting for 97% of it’s revenue in 2015, Baidu is hoping long term investments in Artificial Intelligence will deliver in the future.
China Not to License Pokemon Go, Similar Games, as it Weighs Security Risks: Pokemon Go and other augmented reality games are unlikely to be rolled out in China any time soon, while the state censor evaluates geographical information security, transport threats and the personal safety of consumers. China is the world’s biggest smartphone and online gaming market.
5 Things That Will Surprise You About Taco Bell’s Relaunch in China: After pulling out in 2008, Taco Bell is having another crack in China launching among the skyscrapers in Shanghai’s Lujiazui district in Pudong. Former NBA star Shaq munched on tacos to mark the launch of the relatively upscale joint. Japanese beer is on tap and the menu localised, to a point.
Chinese Tourism to South Korea Booms Despite Missile Shield spat: More than 3.8m Chinese tourists entered South Korea in the four months following Seoul’s July decision to host the US’s Terminal High Altitude Area Defence system – a 27% year-on-year increase. Beijing had warned that tourism would be hit by the fallout, with Chinese state media saying visitor numbers would plummet.
Chinese Consumers Can’t Get Enough SUVs: December sales of sport utility vehicles grew 36% year-on-year. SUVs accounted for 40% of total car sales in China versus 29% in 2015 and 21% in 2014. Chinese maker Great Wall Motor leads the market with a 3.3% share, with Geely launching its first SUV in 2016 and already gaining 2.6%.