The document provides insights into consumer behaviors and cultural trends in China across various industries. It notes that Chinese consumers are increasingly choosing to customize their own products. It also discusses trends related to online shopping, healthcare, automotive, retail, and mobile device usage in China. Changes resulting from policies like the one-child policy are explored in relation to how families and generations interact.

1. China: Creators and Consumers of the Future
March 2012

2. The following is glimpse of our research efforts in
China.
Our ongoing goal is to understand the evolving
attitudes and behaviors in China across a variety of
topics and industries through the lens of everyday
life.
Cultural
dynamics Automotive Healthcare Retail Mobile

3. There is a growing trend of Chinese consumers choosing to
customize and even produce their own products. With easier
Alien access to both the raw ingredients of products as well as being
surrounded by factories, there are millions of potential new
Wang Chinese designers creating their own products, both for
themselves and to sell to their own customers and other like-
minded individuals.

4. Cultural dynamics
4

5. In China, everything from batteries to burgers is available for home
Delivery
delivery. This is an inherent response to the amount of people able
to work and the ability for businesses to leverage competitive
advantages for new forms of convenience.

6. Regardless of what is being bought online, goods are usually paid in
Payment cash upon delivery. This ‘concierge’ moment opens opportunities for
brands and services to create additional value.

7. The impact of the one-child policy means that both parents and two
sets of grand parents are focused entirely on a single child. This has
Policy ramifications on a number of behaviors - from healthcare to
education and retail to technology. As this policy shifts or loosens,
how will behaviors change?

8. Gaming is an integral part of the Chinese culture - as much for
communication and relationship building as for entertainment.
This is evident in the groups of young professionals playing
Gaming games on weekends as much as older folks enjoying mahjong.
The education industry has been able to leverage this behavior for
the youth, with the creation of games that focus on the history of
China.

9. In Western cultures, the well-being of a child is often measured by
their health & happiness. The focus is on being ‘good enough’ and
Education enjoying their childhood. In Asian cultures, parents emphasize the
need to compete and excel - starting from a very young age and
persisting beyond adolescence.

10. The dynamics of 3-generational households are immensely relevant
in modern day China. The question then arises - how can we keep all
Generations age groups engaged, and even more - enable better interaction
amongst the family members of different generations?

11. The flow of people and their physical boundaries are more dense
Scale
than ever before. The fastest and most massive urbanization in
the history of mankind has created new norms in how people and
information move through a society.

12. Automotive
12

13. 1977: 1 million
= 1.000.000 cars
In 1977, In all of China - there were only 1 million cars

14. 1977: 1 million
= 1.000.000 cars
By 2008, this had shot up to 51 million

15. And it only took 3 years for it to nearly double to 100 million by
100m+ 2011. 1 million
1977:
This extreme exponential growth leads to questions about trafficcars
= 1.000.000
Automobiles management, purchase consideration, the influence of branding,
environmental concerns, and various other factors.

16. Given the lack of trust within communities, people are often
Safety scared of being falsely accused of causing an accident. For this
reason, drivers protect themselves by using a special camcorder
Records attached to their windshield or dashboard to keep a video record
of their driving.

17. Post accident video footage. This is a 2 hour diversion to settle “out
of court” at a factory late at night after an accident in Beijing.

18. Given high congestion on most roads, it is extremely difficult to
drive up to the speed limits (e.g., fast) within major cities in China.
Safety For this reason, experienced drivers are not too concerned with
keeping passengers safe by using a seatbelt. Given the trade off with
Concerns personal comfort, they buy ‘belt buckles’ that can be plugged into
the seat belt holder to stop the sound of the safety reminder.

19. Online communities are a rich and trusted source of information for
Online car specifics. Prospective buyers turn to independent online forums
to research specific details about cars before making a buying
Communities
Online communities
decision.

20. Chinese consumers pay greater attention to detail when it comes to
Detailed the performance of their car. Young Chinese consumers take pride in
being knowledgeable and then sharing that knowledge in their social
Performance circles or online. This need for knowledge is partly driven by the
large number of new / inexperienced drivers on the roads.

21. Healthcare
21

22. 8.87
118 million
Aging and growing
Population
% over 65

23. American v Chinese patients
USA CHINA
8x
40 - 60
# of patients per
day for junior
docs
# of patients per
day for senior
docs
10# of minutes spent
with patients
High Patient As doctors grow in seniority, the number of patients they are likely
to see also increases. In fact, the average amount of time a doctor in
Throughput China spends with his patient is just ten minutes.

24. There are dedicated services to help the elderly manage
Help With everyday life. China Telecom is leading the way in serving the
elderly by offering special packages, more basic phones, and
Daily Life phones with pre-installed services that allow people to reach out
for assistance with tasks such as paying bills, managing their
homes or even contacting relatives.

25. Extending Due to time limitations on face-to-face interaction with doctors,
hospitals and clinics use text messaging to provide pre- and post-
Advice visit advice to patients via mobile phones.

26. New mobile services such as 名醫導航 - aka “Ming Yi Dao Hang” or
Scheduling “Doctor Navigation” (114-91.com) allow advance registration for
medical appointments, to help ease the long queues and hours of
waiting in line.

27. Retail
27

28. In Q1 of 2012, Chinese shoppers spent USD $5.7 billion
The Rise Of overseas.This is not only more than any other country, it’s the
highest amount ever recorded. In parallel, sites such as USzCN.com
The Shopper have become immensely popular as Chinese look to purchase goods
which could otherwise not be found in their country.

29. Rather than collecting and clipping coupons, Velo allows customers
Coupon to check local deals at Metro stations. All you have to do is buy a
special card online and swipe it to get a coupon of their choice. This
Culture model allows local restaurants to build awareness and attract new
customers.

30. Negotiation One of the reasons Best Buy failed in China is that their advertised
premise of matching the lowest price advertised can be irrelevant in
vs. Listed China. Regardless of the price tag, bargaining is an expected aspect
of the purchasing process and retail assistants often keep a list of
Price the final lowest prices to help guide this process.

31. Taobao’s Taobao recognizes that bargaining is essential to the purchase
process. One of its most popular features allows buyers and sellers
Bargaining to connect and chat, in essence recreating the traditional bargaining
process.

32. IKEA’s From the outside there is very little to tell this IKEA apart from any of
Experience their stores worldwide, but step inside and patterns of behavior
differ significantly to western norms.
Hack

33. Families often make a special effort to dress well for the trip to IKEA,
Memories taking their cameras along to take photographs of their child in an
IKEA environment.

34. People will often take their newspapers or other reading material
At Home with them, and enjoy the comfortable environment of a display room
for an entire afternoon.

35. Takeaway In fact the meals at the IKEA canteen are so popular in China that it
has led to the creation of a unique take away service.

36. Dating With free coffee and air conditioning, there is even a thriving senior
citizens dating scene at IKEA on Thursday afternoons.

37. Made to Another phenomenon that is uniquely Chinese is the practice of
bringing a carpenter to IKEA to help you select and measure
Measure furniture that can be made for much cheaper elsewhere.

38. Mobile
38

39. 900 million by May 2011
1 billion by May 2012
70 % of the population
36 % on the mobile net*
*mobile is first, last, & everything

40. 12:00am Jan.13, The launch of iPhone 4

41. Xiaomi phone
100,00
Despite the booming popularity of Apple in China, the clear
The Year Of winners are the masses of people purchasing low end
smartphones powered by Google’s Android OS. This is the default
The platform on hundreds (soon, thousands) of cheap, low-end smart
phones and subsequently the first choice for many consumers
Android? beyond Tier 1 cities (whether or not they know the software is
Google).

42. 36
months
微信 (Weixin)
10
months
Above: time for each product to reach
Speed &
Scale 50 million registered users

43. Products like Weixin historically have been viewed as Western copy-
cats but this reality is shifting as they gain the ability to outpace
Setting New their Western counterparts in both time to market as well as a desire
to experiment with interesting ideas before they’re seen in the West
Standards (shown here: voice chat, shake to find someone, and message in a
bottle).

44. Token’s work to release an electric version of the Honda
Token Zoomer, dubbed X-Zoomer, in China before Honda could launch
the gas-powered version shows just how powerful one
determined person can be. He’s now gone on to create a new
Hu line of patented shoes based on DuPont’s Tyvek technology -
United.T, the lightest shoe on record.

45. Kajal Vatsa (@kaj186)
Brandon Berry Edwards (@bred)
special thanks to...
Jan Chipchase
Emily Chong
Ailadi Cortelletti
Shine Chu
Lydia Kuo
Leizhong Zhang
the frog Shanghai team
the Shanghai creative & tech community
photography credits:
Jan Chipchase
Brandon Berry Edwards
Token Hu
Lydia Kuo
Kajal Vatsa
Alien Wang
Leizhong Zhang
© 2012 frog. All rights reserved.