Think BR: When the Chinese talk about air... what does that mean?
Western brands wanting to succeed in China need to shed their assumptions, writes John Coll, director, Ipsos MORI.
John Coll, director, Ipsos MORI
When the Chinese talk about air... what does that mean? This was a question posed by my client on the back of viewing groups in China discussing western medicines.
Viewed in context I thought that this was a great question, not least because it came from a European person.
Often we arrive in an Asian country and apart from the ethnicity of the people there we make all manner of assumptions that they are just like us; well, yes and no.
It is too easy to assume that everything we in the west understand, and the way we understand it, is true the world over: air, medicine, water, consideration, even the sun are all the same.
But this is not so. An English friend of mine tells the story from his time living in Tokyo of being warned by a concerned Japanese man to be careful with the sun, "The sun in Japan is different to the one in the west..."
Asia offers some tremendous opportunities to challenge ourselves anew about our accepted nostrums and fire our creativity to new and different solutions for our brands.
Asia is currently the economic engine of the world - and China and India the turbo chargers in that economic engine - but I want to focus on China.
Much has been written of its economic growth, its manufacturing capability and capacity, its ambitions as a country and the ambitions of its citizens.
As western economic growth slows, our economic ambition does not and many companies are looking to Asia in general and China in particular to fill the gap.
But just at this point in time this is a country that is experiencing a great deal of change, some of it fast, some of it slow and all of it current.
Politically it is a form of benign communism, its economic prosperity is built on the capitalist model and the benefits, or evidence if you prefer, of this capitalism are very visible.
The development of infrastructure and architecture is rapid and impressive, and includes some of the most stunning buildings to be seen anywhere in the world.
Occupying this are stores representing the brands that we admire in the west, as well as those of the east.
Allied with a growing group of educated, hard-working, middle-class citizens who want to spend their money to shop in them, how long will this political structure, at odds with the growing needs of its citizens, last?
For as long as the citizens of China will allow it to, I think is the answer. Actions that we have seen already, such as congestion charging to manage the traffic and pollution in our large cities, are ideas that have been floated for Beijing for example, where the pollution can be significant.
But the fear of the political class is that anything that stands in the way of the growing middle class being able to enjoy the benefits of their hard work and effort in educating themselves, working hard in their careers and becoming more prosperous and enjoying what they would naturally see as the benefits of this effort but be let flourish freely.
Economically, China is powerful and influential, and is looking to leverage that influence and secure additional benefits.
For example, it is investing in African nations with important mineral rights, thus ensuring its access and probably some control over the access of others too.
This investment helps underpin the economies of these nations and China is also offering some opinions on how they might be managing their economies. It has also proffered this advice to the USA, which funnily enough the Americans did not take too well.
But how sustainable is this? We have recently seen reported a ‘dip’ in production output from China for the first time in 32 months... is this a sign we should be heeding?
Culturally, it is in a significant transition with the younger Chinese aspiring to the lifestyle, brands and products coming from the west.
They look to realise the ambition for travel for personal and professional growth, but set against this is the expectation of the previous generation that their children will care for them as they age, as they did for their parents and grandparents.
This has the potential to become a divisive issue, first in the tier one cities and then progressively through the other larger urban cities and areas of China.
Based on current cultural structures I do not see this affecting the more rural areas for probably decades, but in Beijing, Shanghai and Guangxoi we will see it within the next decade.
There is an alarm bell we need to heed. The economy as we have all seen is volatile and while China seems to be sheltered from this volatility, it is not totally protected.
Recently it was reported that China had experienced its lowest production period for the last 32 months... so something is stirring there.
Putting this all together what should we do?
Being in China is not without risk, but not being in China is a bigger risk
Political change will not happen easily, changes will take place grudgingly and this kind of instability and turmoil will affect economic growth, not least depending upon how aggressive the battle for political change becomes.
It is this economic growth that is providing us with some momentum and it is a momentum we need, but we should probably be more pragmatic in our planning for it. Growth is there, but we should not use it as a mask to cover the other ills we need to be alert to and address
Cultural impact is a current and strong feature and an almost tangible element for anybody visiting China at present.
Having the privilege to hear young men and women talk about the challenges they face in realising their hopes and ambitions, balanced against the expectations of family members, is illuminating and reveals many of the tensions.
I suspect there are several older Chinese people who wish for things to be as they were.
It may be some years before we see the effects of these changes, but it may not be, and indeed it may not happen at all in the way I describe, but planning for China, or Asia, to fill all of the holes in our leaky economic model in Europe is not the solution either.
Know your consumers, don’t just assume, plan prudently and smartly and have a contingency option, be humble and open to learning and ideas leading to wider opportunities.
Please remember that not everything ‘great’ in the world came from the west. The east has provided huge influence and learning in the past, and it most certainly will again in the future.
Oh yes, the ‘air’ question. In the context we were discussing it, it is actually much the same as we think of it in the west, so that one was similar. It doesn’t mean it will be next time though, so keep an open and questioning mind.
John Coll, director, Ipsos MORI
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