eBook: Chinese online markets and copy-catting

National markets beg to differ: it's not only about languages, but about the subtle cultural differences which make the difference between top and drop. That goes especially for Asian markets. And there is another specialty about the largest Asian market: Chinese government strictly controls all internet access. This kind of censorship not only influences the political but also the economic sphere. Juergen Hoebarth, who knows the Chinese online market like the back of his hand, wrote a white paper about Chinese start-ups which is definitely worth a look (especially since it's a free download!).

In Don't forget China, Juergen talks a lot about the copycat situation – when it comes to net business, in many cases the copycat does a lot better in China than the original competitor:

As we can see in China there is definitely a copycat of every success story form the west and they are doing very well. This last case concerning the video portal sector in the Chinese market is really interesting, because it is a battle where an international site like YouTube has more or less no chance to win. Bureaucratic restrictions by the Chinese government just kick them out of the market. Once there is a copycat brand for a service that is better known, it is hard for the original to get into the market again, even when the restrictions are removed and an agreement is reached between Google, who owns YouTube and the Chinese government. The reason, for censorship at the moment, is that there have been regime critical videos between the millions that are offered on YouTube.

The Chinese government announced that in 2010, broadband net access will be available in every single village. If you're founding an internationally oriented start-up today, you cannot afford to overlook China, argues Juergen:

As we live in a global world we are in a global competition as well, and so I would say the fast, smart and clever one will win the race and those who are thinking from the beginning on about a global strategy when they found a company will survive and if they are well prepared and know the rules of the Chinese internet market and adapt some issues, they definitely will have a chance to survive in this country as well and will not get kicked out as easily as the big global net giants have been before by their Chinese copycats.

eBay had to learn this lesson the hard way: after their total failure they completely abandoned the Chinese market. apparently, the company had overlooked two major problems: credit cards are not too widespread in China plus the direct contact between buyer and seller (via messaging services) is a vital trust-factor.

So if in the future you do not only want to reach Mary, John and Jack but also Bao, Fang and Wei, take a look at Juergen's whitepaper: Direct Download: Don't forget China

3 replies
  1. anirban pansari
    anirban pansari says:

    As we can see in China there is definitely a copycat of every success story form the west and they are doing very well. This last case concerning the video portal sector in the Chinese market is really interesting, because it is a battle where an international site like YouTube has more or less no chance to win. Bureaucratic restrictions by the Chinese government just kick them out of the market. Once there is a copycat brand for a service that is better known, it is hard for the original to get into the market again, even when the restrictions are removed and an agreement is reached between Google, who owns YouTube and the Chinese government. The reason, for censorship at the moment, is that there have been regime critical videos between the millions that are offered on YouTube.
    thanks for the post.

    Reply

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