Transcript MKT221Hunan1

MKT221
Marketing in the Chinese Mainland
Market of China in Transition
HuNan Group
Ho Man Chi, Karen
Lai Tin Ming, Terry
Ng Yue Wah, Tracy
To Ka Yan,
Yammy
公司
標誌
Tse Ka Kin,
Stanley
Yu Hoi Ling, Daisy
Introduction
6 Key characteristics
 Economic sectors
 Work force
 Trade
 Communications and Infrastructure
 Foreign Direct Investment
 Economic growth
Economic Sectors
China economy
by sector
Agriculture
Industry
Service
1998
18%
49.2%
32.8%
2000
15%
50%
35%
•The Chinese government will inject more capital into large state-owned companies,
optimize their structure and make them more competitive,"
•China aims to build 30 - 50 large, internationally competitive companies by 2010
Work Force
Population 1.27 billion
Work
Force
700 million
People
350 million
work in
agriculture
Source : THE CIA WORLD FACTBOOK 2001
Trade
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Export (2001): $232billion
Import (2001): $197billion
Trade Surplus: $35billion
Exports of high-technology products:↑
Entry of World Trade Organization in
December 2001
Communications
US
China
Telephones
main lines in use
194 million
135 million
Internet Service
Providers
7,800
3
Infrastructure
The facts
US
China
Highways
3.98 million
miles
.87 million
miles
Railways
Airports
140,281 miles 41,960 miles
14,695
489
Foreign Direct Investment
 China's entry to the WTO
 Foreign investors poured $10.1billion into
China during the first three months of 2002
 Tax breaks to attract foreign direct
investment into China
 Preferential rate of just 15 percent
Economic Growth
 Economic growth rate:7.3%
 Average economic growth
rate:8.3%
 the sixth largest economy in the
world, in terms of GDP per
capita
 China's government spending is
12.5 percent of the Gross
Domestic Product
Discussion
1) How does the transitional nature affect
businesses?
2) Given the above, how should businesses
develop plans and strategies in China?
Economic Sector
 The businesses become
much more diverse
 Increasing the number of
FDI
 Technological improvement
is essential.
 Increasing the demand for
skillful and educated labour
Economic Sector
 Shift the investment from agriculture to
industry and service.
 Target market→ middle class of the
society
 Providing support services to the
customers
 Using Marketing research to identify the
trend in future
 Creating brand equity
Workforce
 Labour Intensive Industry
 Adjust wages Rate
 Improve the welfare system
Trade
 Cultivate concept of quality
& safety of products (esp.
high-tech. products)
 Carry out more marketing
research in order to open
up new markets efficiently
 Act ethically to increase
image & branding
Communication& Infrastructure
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1.Easy to distribute the product
More likely to attract the FDI
More channel to promote the business
Producer and consumer can be easy to
obtain the information
 more opportunity for the business (online
sale)
Communication& Infrastructure
 move the production line to the north of China
reduce cost
 distribute the product more far away
 A better supply chain management( just on time
production)
 make use of internet promotion
 Create a better customer relationship( a media
to contract with customer)
 Online sale( order, and after sale service)
Foreign Direct Investment
 More opportunities for businessmen
 Rapidly development in China
 Keen competition in China
Foreign Direct Investment
 General living standard increase, re
arrange the target segment. More high
income group
 Keen competition, companies should be
concern about quality of our products
 Set a reasonable price and promotion
strategy
Economic Growth
 GDP will rise
(economic growth is measured by GNP/GDP)
 investment will increase
produce better product/higher class brand
 Cost↑
forced to pay fees
upgrade their equipment or implement other
costly changes
Economic Growth
 Produce more profitable/high quality
product
 Have more diversify product
∵ ↑living standard
 Technology transfer through the import of
foreign equipment
better technology
reduce the cost
Thank You !!