Here are this week’s news and highlights for China:
How to Sell Your Products Into China: A slew of Chinese companies have recently been seeking to become distributors of foreign products via joint ventures, a structure that rarely makes sense for the foreign company. Sage advice on structural arrangements with distributors from China Law Blog.
How a US-China Trade War Would Hurt Us All: Trade barriers would not only damage China and the US, but would also disrupt global supply chains, raising prices for consumers worldwide. Subsequent rounds of tit-for-tat between Washington and Beijing is likely to see European producers of aircraft, telecoms equipment and whiskey benefit at the expense of their American cousins, which is reflected in stock prices on both sides of the Atlantic.
Opinion: Marketing to Women in China Is a Massive Brand Fail: After some successful and resonant Women’s Day marketing campaigns last year, and supporting developments in the 12 months that followed, 2018 Women’s Day campaigns in China took a step backwards promoting old fashioned values and the concept of feminist power being a Western concept.
Chinese Sperm Donors Now Have To Swear Loyalty to the Communist Party: Would-be donors in sperm banks in Beijing must be over 20 years old and show no obvious signs of hair loss, colour blindness or weight problems, as well as loyalty to the party. Donors who pass the test are immediately paid ¥200 yuan ($31.74), to be followed by another ¥5,500 ($873) for those who successfully donate. Less than 20% of sperm donated is considered suitable for use.
China’s Blockchain Ambitions are Revealed in the Sheer Number of Patent Applications: How hot is blockchain in China? “Even vendor aunties selling vegetables are talking about blockchain” is a saying spreading widely on social media. Last year more than half of the world’s approximately 400 blockchain-related patent applications were from China.
A Deal to Buy a Chinese Bike-Sharing Giant Will Accelerate the Rivalry for Consumer Movement Data: Chinese food-delivery/entertainment/dining app giant Meituan-Dianping is buying loss-making bike sharing firm Mobike, for a reported value of $2.7 billion. The news comes shortly after Meituan’s entry into the ride-sharing market to compete with Didi, which Uber failed at. This month, Ctrip also announced it would enter the ride-sharing market to tap into their traveller user base.
Walmart Brings its Partnership with JD.com into the Food Business: JD.com’s online and Walmart’s offline supply chains will extend to groceries. Beginning with a Shenzhen Walmart store, 8,000 items ranging from fresh fruit to seafood will be available for online orders through JD.com, with customers in a 3km radius able to get their food delivered within 30 minutes.
Anheuser-Busch InBev and the Fight for China Craft Brewing: “The way it’s going about it will inhibit the development of brewer diversity, localization, and personalization,” says Carl Setzer of Beijing’s Great Leap Brewing . “What’s best for Chinese craft beer development is for local, independent Chinese craft breweries to work together for the next five to 10 years, whether we like each other or not, and agree that ABI is not good for our industry… if you want to see Great Leap, Slow Boat, and guys here locally continue to thrive, then support us. Do not go to [AB InBev] breweries.”
Chinese Firms ‘Misled Customers Over Olive Oil in Products’: A CCTV report has identified three firms in Fujian province selling blended oil with a third or half the percentage of olive oil in products advertised.
Three Ways Destinations Can Cash in on the Chinese Tourism Boom: 67% of Chinese consumers who travelled overseas in 2017 went to Asian countries due to simpler visa procedures, more affordability compared to destinations outside of Asia, and convenient transportation. Chinese consumers spent an average of $762 on shopping during their most recent overseas trip, which is 1.5 times more than their non-Chinese counterparts according to Nielsen. Providing a familiar shopping experience; enhancing operations to provide a frictionless experience; and offering the right products at the right price will also help capitalise on Chinese visitors according to Alipay.
Alibaba’s Alisports Gets $191 Million At $1.3 Billion Valuation, Buys Fitness App Ledongli: Jack Ma’s Yunfeng Capital has led Alisport’s funding round of $191 million, announced at a similar to time to the acquisition of online fitness app and wearables company Ledongli which has more than 55 million users in China. Alisports hopes to use fitness as the entry point for “new sports retail” combining online and offline retail assets.
Tencent to Stream Major League Baseball in China as it Expands its Global Sport Offerings: Tencent has signed a three-year agreement with MLB which gives it the exclusive rights to stream 125 games. It follows Tencent’s similar deals with NFL, NHL and the $500 million 5-year deal with the NBA, as Baidu, Alibaba and Tencent are all investing heavily in digital content as they seek to carve out a slice of the growing subscription-based entertainment market in China.
Chinese Consumers Worried about Plastic Waste: 83% of Chinese consumers are worried about the environment because of plastic waste, with 63% convinced that avoiding waste is a task that concerns every consumer. However, just under one in three citizens is convinced that too much waste is produced in their own household according to a Messe München survey. It is a yet another survey that would indicate Chinese consumers are overwhelmingly conscious of environmentally-responsible consumption and individual accountability, whereas in reality, excessive packaging remains everywhere in China and services such as food delivery – with its many packages – continues its runaway popularity.
More Wealthy Chinese Shell Out for UK ‘Golden Visas’: Mainland Chinese took 116 of the 355 “investor visas” last year, having invested at least £2 million ($2.8 million) for residency. The number was up 56% from 2016 – outnumbering the second-placed Russian’s 250%. When the China figures included Hong Kong and Macau, 146 received them, 82.5% up on last year. Total Chinese investment into the UK reached $20.8 billion in 2017, up from $9.2 billion in 2016. Brexit appears to be having no impact on applications. Chinese currently make up 80% of America’s equivalent EB-5 visa scheme.
Can Digitalisation and Millennial Shoppers Sustain Luxury Market’s Rebound?: China’s millennials are a formidable force driving growth in China’s retail market, and have helped turn luxury brands’ fortunes in recent times. Millennials spend 50% more time online shopping – 6 hours a week – than older generations, yet online channels account for just 9% of China’s luxury sales according to Bain. This is expected to grow to 25% by 2025. 40 leading luxury brands in China have official WeChat accounts.