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The Market Research Industry in China
05:30 on 25.8.2020


To many companies outside China, the idea of conducting or commissioning market research in China can seem a daunting concept to grasp. Frequently, the perceived barriers of researching a Chinese market are seen as insurmountable and no serious consideration of the potential benefits is even made. Too often, research agencies and potential clients alike are beaten before they begin.To get more news about chinese industry and management practice, you can visit acem.sjtu.edu.cn official website.

The barriers to researching the Chinese market are substantial. In a country of this size and complexity it is difficult to even talk of ‘the Chinese market' as one coherent entity. And then there is the ‘information' issue: what are we allowed to ask, and how reliable will the information be?

Valid as these and other concerns are, the good news is that China is rapidly and inexorably evolving into a truly modern economy: for companies wishing to conduct or commission research, the opportunity in China is enormous. Here we have a huge, diverse, growing, increasingly affluent and innovative economy, which is eager to share its ideas with potential investors.

History and Development:

Prior to the mid-1980s, "market" research in China was limited to research managed by the State Statistical Bureau and conducted by government departments. The research was largely limited to statistics on expenditure and production in state-controlled industries. Indeed, there is still a highly statistical and quantitative bent to many of the agencies operating in China and to local research buyers.

In 1985 Procter & Gamble (the multinational provider of branded products ranging from snacks to washing powders) moved the sector forward by commissioning market information specific to the consumer markets in which it operated. This was the first non-governmental consumer research in China. The multinational's increasing need for market information resulted in the establishment of China's first research agency, in Guangzhou in 1988, the Guangzhou Market Research Company.

The insistence of Procter & Gamble on bespoke market information was the birth of the modern Chinese market research industry. The Guangzhou Market Research Company (no longer in existence) introduced a wide range of data collection and analysis techniques to the Chinese market. This resulted in a wave of highly competent Chinese researchers who would go on to form and direct some of the country's leading market research agencies. Today, Chinese agencies such as URC (United Research China), Acorn China and Research International (China) are all directed by former researchers from Guangzhou Market Research Company.
Today, the value of market research commissioned in China is worth (approximately) US $500 million, with some estimates putting it as high as US$700 million. These figures make China the Word's tenth largest research market, but bear in mind that in absolute terms this is still quite modest compared with developed economies. The market is however growing rapidly at around 20 per cent a year.

Estimates as to the proportion of Western market research markets accounted for by ‘business-to-business' research usually put the figure at around 10 per cent. In China, however, the proportion is estimated to lie at around 25 to 30 per cent. It is this ‘b2b' sector of the market that is expected to see most growth over the coming years, with Chinese companies increasingly open to the idea of obtaining the views of businesspeople, and Western companies ever more hungry for Chinese business opinion. This part of the market is growing by about one quarter a year.

In terms of business research, the level of work commissioned can be ranked as follows: automotive; petrochemical; IT; telecoms; pharmaceutical and medical; and financial services.

A high proportion of research projects (around three-fifths) are focused on market assessment studies, in which clients (often foreign companies) are asking for a comprehensive explanation of how markets are structured, who the key players are and what the market size is. Much of the research is about entering new markets, or indeed entering China itself.

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