Years ago, China’s sprawling network of street-noodle vendors began utilising the curious new commerce features of an app called WeChat. A willingness to embrace change signifies the innovative spirit that pulses through modern China. From those polystyrene bowls of late-night fry up all the way to billion-dollar-plus bike loan schemes a now near necessity in the lives of many Chinese, there is no shortage of inspiring innovation coming from the Middle Kingdom.
China’s rich history spans 5,000 years. Yet few periods have seen the velocity at which China has evolved as these 4 decades past. In a little over a generation Chinese consumers have seen mass urban migration, internationalisation, globalisation, a fast-track to modernity, the effects of a one child policy and steady episodes of cultural upheaval and redirection. Moulded by constant flux, the resultant consumer class is not only unfazed by change but expects and embraces it.
WeChat payment is one example. The seamless purchase of goods, services and content that can be integrated almost anywhere online and offline has opened the door for infinite new ways to buy and consume things. Similarly, live streaming, virtual reality and augmented reality from innovators like Alibaba has merged with ecommerce.
Yet innovation in China spans far beyond the well-known smartphone apps and ecommerce platforms. China Skinny is seeing it across every piece of the marketing mix. From packaging to pricing models, brands are localising best practice from overseas, and some even innovating in a way that is native to China.
One of the more interesting pricing models is subscription-based. Whilst we are yet to see any game changers like the Dollar Shave Club, burgeoning niches are constantly developing. Each initiative helps lock in consumers who are well known for their promiscuity.
Chinese consumers find subscription models attractive for a number of reasons. Van Diemen’s Land’s subscription to fly in fresh milk from Tasmania ensures a stable supply of healthy, tasty, fresh milk for those families aware of the benefits of drinking it. Another interesting initiative is the Drinking Buddies scheme which sends members a box of six different craft beers every month and offers access to tastings and workshops. It appeals to craft beer drinkers as they can try niche beers that they may not have been able to get elsewhere – something that China’s craft beer enthusiasts crave. It’s a great low-cost way for the brand to get in front of grassroots influencers who will gain social credit from sharing new undiscovered beers among their beer drinking friends.
There are obviously plenty more innovative and cost effective ways to reach and appeal to Chinese consumers beyond the traditional distributor model. Agencies like China Skinny can assist in developing such plans.
On the subject of milk, beer and food & beverage in general, China Skinny’s Mark Tanner will be joining a host of excellent speakers from the industry to speak about food and beverage trends in China at AmCham’s Future of Food Conference on Wednesday 24 May. More information here. Go to Page 2 to see this week’s China news and highlights.
Education is a major concern for Chinese parents who are eager to see their child excel in multiple disciplines. From an early age on, kids in China are attending English classes, practice calligraphy and learn instruments in order to be able to compete with millions of others. It is a rigid system that focuses on theories and teacher-centred learning with the primary goal being the big exams for the next higher school level such as the university admission exam gaokao. The pressure on the 9 million attendees is enormous with schools installing anti-suicide barriers to prevent students from taking their lives ahead of the exam.
In order to modernise the learning process, many parents are signing their children up for creative leaning courses such as Lego classes. As parents are becoming aware that creativity boosts inventiveness, sales of Lego rose by more than 50% between 2013 and 2015. In addition, alternative learning methods are becoming increasingly popular for subjects like English language.
Shanghai is one of the hubs for innovative education with many incentives for extracurricular learning. This not only entails subjects, but also communication and the learning process itself. “Chinese students are very limited in their way of learning – there is a skill gap that needs to be filled and many don’t recognise at the beginning that soft skills are as important to employers as is knowledge,” says Brian Heger, Content Development Director of TOK English, a program by Telford Education Group that combines traditional learning with interactive classes and online elements.
Cooperating with universities and companies in China, Heger also sees a need to change the way educators think in order to make an impact with Chinese students. “A lot feel threatened by online learning,” he explains. Rather than using online and interactive tools to compliment their traditional teaching, “educators wait to be told what to do instead of just doing something and taking initiative.”
New incentives are increasingly pushed by Beijing where a strong need for creative learning is seen in order to replace China’s image of a country of factories, to being perceived as an innovation hub and that can compete internationally. One of these initiatives is the Incubation Centre at Shanghai’s Donghua University which aims to connect students with companies and enhance innovations and entrepreneurship. “This trend already started five to six years ago, with the government as the main driver. Now companies are increasingly investing in students with good ideas and potential,” says Prof. Anselm Vermeulen, who is leading the program for Entrepreneurship and Innovation together with his colleague Dr. Nikola Zivlak. In a similar program, Prof. Vermeulen initiated at Shanghai Business School and cooperation with Rotterdam Business School, Chinese students are encouraged to create a business based on ideas developed during their studies.
“China’s private sector is the most welcoming ecosystem for innovations in the world.”, explains Dr. Zivlak, and names educational barriers as the biggest challenge to the development of creative thinking. “90% of our Chinese teachers are not willing to change their ways of teaching even though Donghua University is China’s 9th most international university,” states Prof. Vermeulen. Innovative minds are redirected to an exam-focused curriculum that leaves little room for trials.
But the change towards creative learning and thinking is underway in China, even within the country’s large enterprises. Training sessions with selected staff members has established new ways of managing and handling affairs that facilitate communication processes and enhance productivity. The demand for independent and inspiring graduates is increasing, offering multiple opportunities for foreign education companies and other businesses that are eager to train promising candidates into qualified staff. Contact us today to learn how.