Economist Corporate Network Issue Research Report Sponsored by AdMaster - Using Big Data to Connect Business with Digitalized Chinese Consumer

Smartphone has become a seamless part of a Chinese consumer's overall experience with brands and purchasing experiences, regardless of age

As ubiquitous as the reach of China's Internet is, China's internet landscape is far from being integrated

Every interaction with customer is an interaction with an entire life-cycle, and that each interaction yields insights capable of enriching future interactions

Mar 15, 2016, 22:45 ET from AdMaster

BEIJING, March 16, 2016 /PRNewswire/ -- As mobile devices, best represented by smartphones, have proliferated, the reach of the Internet is practically ubiquitous in China. According to a research report released by the Economist Corporate Network (ECN), sponsored by marketing data analytics and measurement firm AdMaster, the rapid adoption of Internet technology and media has made online-offline mix in China more pronounced than in any other market in the world, and is reshaping the landscape of Chinese consumer market.

Smartphone has become a seamless part of a Chinese consumer's overall experience with brands and purchasing experiences, regardless of age

The dense and increasing penetration of smartphones in today's China and the versatile and constantly upgrading smartphones have made Chinese consumers increasingly sophisticated in their use of mobile and social apps for their shopping and retail activities, which, in turn, has reshaped the skyline of China's consumer market.

"The ubiquitous mobile Internet connectivity has placed the smartphone at the nexus of the Chinese consumer's commercial and media experiences," said Calvin Chan, Chief Operation Officer of AdMaster.

The report is based on a joint research effort by ECN and AdMaster, which surveyed more than 1,000 Chinese respondents. The research shows that smartphones have become a seamless part of a Chinese consumer's overall experience with brands and purchasing experience, which, however, is increasingly distinct from their American peers. 

According to the joint research conducted by AdMaster and ECN, while it's usually younger consumers (aged 18-24) who are most likely to conduct any retail-related function over their mobile phones, there is less of a demographic "digital divide" among China's smartphone users. The study shows 60% of the surveyed respondents say they actively use their smartphones for all pre-purchase and purchasing activities between 1-5 hours a week, and over 25% of respondents say they use their smartphones for 5 or more hours weekly. 

In the US, the most common function (used by 58% of those surveyed) is to locate stores or verify their opening hours, while in China, less 50% among Chinese consumer do so.  But for Chinese consumers, a purchase online is just a click away on their smartphones. While only 28% of Americans made purchase via their mobile phone phone across all age groups in US, nearly 70% of Chinese consumer made a purchase using their smartphones, regardless of ages and geographic locations. In contrast, only 5% of Chinese smartphone users say they never used their phones to buy online, while nearly a third say they do most of their online purchases through their devices.

The research paper also indicates that Chinese consumers, thanks to the smartphones in their hand, also like to stay connected even during their offline retail activities. The study shows nearly half of Chinese respondents are using their smartphones in stores 25% or more of the time they are doing bricks-and-mortar shopping, and around 15% use their smartphones on retail-related activities most of the time they are in stores or malls. In addition, two thirds of Chinese respondents use their smartphones to browse for products, or to compare prices. "Thus, brand owners are able to engage with their consumer in data-rich ways throughout their browsing experience, both online and offline," said Calvin.

The increasingly critical role of online "word of mouth" in Chinese consumers' purchasing decision

Another distinct feature that is redefining China's consumer landscape today is the vitally important role the online "word of month" plays in the brand interaction experience of digitally-enabled Chinese consumer.

As the study indicates, more than half (53%) of the surveyed Chinese consumers read reviews on their smartphone screens before their purchases. Another recent research on 50,000 Taobao transactions with over 2000 retailers by Prof. Luo Jifeng with Antai College of Economics and Management found that "recommendations from other consumers" had become a powerful driver in Chinese consumer's purchasing decision.

"Credible testimony from other consumers is becoming increasingly critical to the online retail experience in China, and in this regard, social media usage and e-commerce transaction have become highly correlated in China's consumer market today," Calvin said.

As ubiquitous as the reach of China's Internet is, China's internet landscape is far from being integrated

Thanks to the power of smartphone and mobile internet, today's Chinese consumer is connected everywhere. However, as the report points out, the ease with which consumers switch between different channels and platforms, make it difficult for brands to follow consumers throughout their journey online. 

"Multiple touch points, content providers, social media platforms and e-commerce sites all hold pieces of the Chinese consumer insight puzzle, and with the coming of Internet of Things, China's Big Data picture will likely become more fragmented and China's Internet economy is still far from putting this all together," said Calvin.

On the other hand, Ricky Yang, Vice President of Data Solution of AdMaster points that the direct input of data from Chinese consumer themselves, including increasing volumes of digital interaction from hundreds of millions of consumers, their input for subscription-based video, products and services, and their engagement on e-commerce platforms, "caused a doubling of data volumes that the average Chinese firms has had to manage".

"These all create rich veins of insights into Chinese consumers' preference and perception, also makes it possible for brands to 'connect the dots' between the initial interaction consumers have with advertisements and content and their post-sales experiences in their business," the whitepaper notes.

Embracing the Big Data to Connect Consumers with Business

While Chinese consumers switch between online and offline, the boundaries between advertising and purchasing, between a firm's brand values and the products and services themselves becomes even more blurry. The report argues that thanks to the traceable cookies and other digital fingerprints over consumers' online journey, the key to business success lies in an active engagement with consumers throughout their omni-journey across multiple devices, platforms and participants, and the use of relevant right content and strategies to keep interacting with them at every step of their journey, from discovery to experience, from pre-sale to after-sale.

"Before China's Great Wall of Data becomes a seamless entity, successful brand owners in China will be those that recognize that every interaction with Chinese consumer is an interaction with an entire life-cycle, and each interaction yields insights capable of enriching the next, making the omni-journey more valuable for business, and consumer as well," the report notes

Data sources:

1) Economist Corporate Network and AdMaster Joint Survey, Jan, 2015 n=more than 1000, aged between 16-65

2) 2015 Digital Shopping Report by the Interactive Advertising Bureau

About AdMaster:

AdMaster is the leading data solution provider specialized in data collection, analysis and management. By using cutting-edge proprietary technology, we create value for businesses by turning big data into smart data and delivering it to them through our software-as-a-service platform, enabling them to make more informed decisions and gain a competitive edge.

Our core services include third party digital advertising verification, social media and e-commerce measurement, and data management - including data obtained from personal computers and mobile devices.