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CHINA: Crossing cultures

Source: Marketing Week | Published: 28 February 2002 00:00

In the fashion stores svelte career women browse racks of designer labels; elsewhere the sales assistants are doing aswift trade in soft furnishings, white goods and the latest styles in mobile phones. It could be Knightsbridge, or NewYork's Fifth Avenue. In fact this is Wangfujing, Beijing's up-market main shopping street and the well-heeled consumersare members of China's rising urban middle classes.

Around the city, groups of students and office workers sit chatting with friends in Western-style bars, restaurants and theubiquitous KFC, McDonald's and Pizza Hut outlets. Less than a mile from the smart shops and fast-food chains, thescene in Beijing's old quarter is very different. Street vendors with weathered faces sell fruit and vegetables laid out onrough wooden tables. Men in padded cotton jackets squat aimlessly by the roadside, dragging slowly on thin roll-ups.

China in their hands

With its accession to the World Trade Organisation, China is widely perceived as the world's greatest marketing opportunity. But while it is easy to bedazzled by a population of 1.3 billion, the reality is that less than ten per cent of Chinese cit izens have incomes that can afford Western products. Andfor high-end goods, such as luxury cars, the market is more akin to that of a small EU state.

As foreign investors scramble to take advantage of China's untapped potential, one group of Western businesses looks set to prosper: internationalmarket research agencies. Some agencies have been locally established since the Chinese government embarked on economic reform in the Eighties.

But are these Western-owned agencies - armed with a battery of imported techniques - qualified to help incoming businesses acquire the deep culturalinsight that they need to make their brands appealing to Chinese consumers?

The issue of whether market research techniques can cross cultures extends beyond the specific case of China. With the growth in internationalbusiness, research agencies favour common methodologies that can be applied globally, allowing clients to compare markets. What this hasdemonstrated is that Western techniques, particularly those that use projection and visual imagery, can work well in most cultures. But there must bescope for local adaptation.

Research International qualitative global co-ordinator Jane Gwilliam gives an example of this, referring to the obituary technique, where respondentswrite an obituary for the f ictitious "death" of a brand.

She says: "The technique is a good way to examine brand values, but it does not work in some Far Eastern societies, because it is deemed offensivein some cultures. However, it is possible to obtain very similar results by replacing the reference to death with the question: 'What would this brand beif it were reincarnated?'."

With the greater emphasis on comparing markets across national boundaries, agencies have become more inclined to treat large and culturally diversenations, such as China, India, or indeed the US, as comprising not one but a series of markets. Gwilliam explains: "The variations between peopleswithin countries are often greater than those between nations. This reflects the huge differences that can exist within different regions, or between the

lifestyle of an urban versus a rural community."

China typifies the set of conditions that Gwilliam describes. Viewed objectively, the Chinese market is a conglomeration of regional markets, unified bya central government, but differentiated by local cultures that have their origins in the country's ancient sub-structure of provinces.

In economic terms, the provinces along China's eastern coast that are home to major cities are more affluent, more open to outside influences andmore developed than the provinces of the interior. There are also significant differences between the t raditions, diet and even the physical appearanceof people from the northern provinces and people from the rice-cultivating lands in the south.

What follows from this is that in some sectors, most notably food and drink, foreign marketers may be able to improve their sales by reflecting localvariations in taste in the products that they offer.

Taylor Nelson Sofres Interactive Asia Pacific director Chi-wing Chan cites US sports drinks company Gatorade as an example of a company that hasapplied such an approach with skill. He says: "When Gatorade launched in China, it offered different flavours in different cities to appeal to localpalates. It identified that in the northern city of Beij ing people like sweet tastes, while the Cantonese have a preference for sour flavours, such aslemon and lime."

Regional variations

Even within prosperous regions, vast contrasts exist between the l ifestyles and attitudes of people living in cit ies such as Beijing, Shanghai,Guangzhou and Shenzhen, and people inhabiting the multiplicity of small towns and rural communities that surround them. So at a sub-regional level,entrant businesses need to identify the communities they plan to target - and to develop strategies for marketing appropriately to, for instance, amanagement consultant at one end of the spectrum and a t raditional craftsman at the other.

A key issue in designing communications for developing markets is to know whether individual markets perceive advertising as entertainment, or as asource of information. Jamie Lord, business development director for market research agency Millward Brown Asia-Pacific, says: "In developedmarkets, such as Europe, the US, Japan and Thailand, communication has to be entertaining to grab people's attention. While this may be true for awell-developed city, such as Shanghai, many secondary and tertiary cities look to advertising to provide information to guide and reinforce purchasedecisions."

To illustrate the dangers of misreading the consumer's level of media literacy, Lord refers to the personal care market. "Western brands are a symbolof status to many Chinese, but they have to deliver on their promises. For instance, rural Chinese consumers consider shampoo advertisements thatshow girls with hair so shiny that it looks like a mirror to be misleading."

Cultural blunders of this sort are more likely to be avoided by Western businesses that employ market research agencies which recruit locally, or formjoint venture partnerships with indigenous agencies, instead of relying excessively on expatriate managers. The difficulty here is that while China hasan abundance of young people who would make competent researchers, very few of them are in the business.

In order to address this situation, multinational agencies have to invest in equipping local staf f with the skills that are needed to run projects to thestandards required by global clients. But while this skills base is being developed, there is the thorny issue of how to build cross-cultural teams thatcombine the expertise of incoming managers with the cultural insight of local employees.

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