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Wednesday, January 18, 2012

The Chinese Reaction to Taiwan's Election

I recall the time in November, 2008 when I was watching the live news reports of the results for the United States Presidential Election. Given that I was in Shanghai, it was morning and I was at my office desk. As Barack Obama was speaking after the election results had been announced an American co-worker had tears streaming down his cheeks. This amazed several of our Chinese co-workers, and one of them asked him why Obama's speech was affecting him so much. Seeing democracy in action, especially unfiltered, isn't a common experience in China.

I've sometimes heard people in China express a desire for democracy or a reduction in censorship only to then argue that the Chinese people as a whole aren't ready for it or that it can't work in China's current culture. As I've shared before using access to Facebook as an example, awareness of the freedoms available in Taiwan can have a significant impact on whether some people accept such arguments. Therefore, it comes as no surprise to me that Taiwan's recent election process has caused reverberations in China. As noted by Andrew Higgins in The Washington Post:
Taiwan’s example has raised a prickly question for a leadership [in China] that rejects elections as an alien and chaos-prone Western import, said Zhang Ming, a professor of politics at Renmin University in Beijing.

“Why do all the neighboring countries and regions have direct elections but not China?” Zhang said. Taiwan, he added, “shows that Chinese people can handle democracy, although it’s not perfect” and has “vigorously refuted a fallacy that democracy is not suitable for Chinese.”
Andrew Jacobs in The New York Times shared other reaction in China:
As the election played out on Saturday, a palpable giddiness spread through the Twitter-like microblog services that have as many as 250 million members. They marveled at how smoothly the voting went, how graciously the loser, Tsai Ing-wen, conceded and how Mr. Ma gave his victory speech in the rain without the benefit of an underling’s umbrella — in contrast with the pampering that Chinese officials often receive.
Another sign of the interest in the election process is a photo of a Taiwanese ballot that the Shanghaiist reports to have gone viral on Weibo, a leading microblog service in China:


While China didn't fully clamp down on reporting of the election (see the NYT story quoted above for more details), the election was apparently enough of a worry for China that it constrained travel to Taiwan during the election. Mark MacKinnon reported on The Globe and Mail that there were even restrictions placed on Chinese traveling in Taiwan during the election:
The 26-year-old tour guide said she has been instructed – by mainland Chinese authorities – to keep her charges indoors until the final results are announced. They’re not allowed to get too close a look at Taiwan’s democracy in action, lest all that choosing proves infectious.

“There are sensitivities,” Ms. Geng explained with a shy smile as her group toured the vast Chiang Kai-shek Memorial (a Lincoln Memorial-style shrine to the man who fought a losing civil war against Mao Zedong’s Communists more than six decades ago) in central Taipei this week. “On Election Day we are not allowed to go out into the street. We have to stay in our rooms [on Saturday] until the results are announced. Then we can go out.”
The identity of the "authorities" requesting the sequestering of tourists does not appear to be totally clear, and such measures may have only applied to tour groups (it's also not clear to me whether all tour groups followed the same policy). Other Chinese were apparently not as shielded from the election process. Andrew Jacobs noted cases of Chinese traveling to Taiwan and leaving with positive impressions of the election process:
Interest in the race snowballed in recent weeks and a number of high-profile mainland businessmen decided to travel to Taiwan to see the contest up close. Among them was Wang Shi, one of China’s biggest real estate tycoons, who sent out regular microblog dispatches from political rallies. “Everything went orderly and there were no surprises,” he wrote over the weekend to his four million followers. “The political environment has really matured.”

Another mainland businessman who spent several days in Taiwan said the election had a profound impact on his understanding of politics. Seated on a plane bound for Beijing on Sunday night, he described how he had been led to believe that Taiwan’s democracy was chaotic and shallow, its elections prone to violence. Not anymore, he said.

“This is an amazing idea, to be able to choose the people who represent you,” said the man, who asked to remain nameless so he could speak without restraint. “I think democracy will come to China. It’s only a matter of time.”
Whether or not democracy is in China's future, it appears that the elections and in particular their peaceful and orderly nature significantly influenced some in China. It has even had an impact in Hong Kong, where people enjoy many freedoms not found in mainland China. As an example, I'll share a short video that was introduced to me by a friend who is a Hongkonger. I don't have a translation of the text in the video, but I'll provide an introduction to the video and a rough summary (not a formal translation) of the text accompanying it on Vimeo (thanks to Yaping Wang for help in interpreting).

In short, the video "Unhappy Hong Kong" is from the viewpoint of a Hongkonger expressing admiration for the elections in Taiwan. While Hong Kong is supposed to receive democracy-like rights in 2017 there is much that remains uncertain in the eyes of many Hongkongers. The accompanying text asks whether Chinese people need to be controlled in order for their countries to succeed and considers it a shame that a city as developed as Hong Kong can't enjoy democracy. It also says that Taiwan doesn't desire to become a 2nd Hong Kong, and that the KMT (the party that effectively won the election) is paying more attention to the ideas expressed by the opposition party given the numbers of people who expressed their views peacefully through voting. It also asks the question of whether Hong Kong will forge ahead alongside Taiwan as a pioneer in establishing democracy for Chinese people or will give up and become a puppet of China.

Here's the video (all scenes appear to be from Taiwan):

香港不高興 from MagicHour Studio on Vimeo.

If anyone can provide a formal translation to the video and the description accompanying it on Vimeo I'd be happy to post it.

While there exist a mix of feelings in Taiwan regarding the results themselves and some believe more political reform is required, the election process showed that many valued the opportunity to voice their opinion freely -- whether through speech, voting, or other forms of expression. Their actions have not only had an impact in Taiwan, but in mainland China as well.


UPDATE: Translated version of the video can be found here.

Monday, January 16, 2012

Guangzhou Subway: Scanner and Balloon Free

In an earlier post I commented on the apparently ineffective use of scanners and the ban on all balloons in Shanghai's subway stations. Several readers made comments regarding a possible (and curious) source for the scanners. If you wish, you can explore the issue on your own.

Anyways...

Guangzhou, Guangdong province also has a very extensive and quickly growing subway system. So, imagine my thoughts when I saw scenes such as this one:

entrance to paid area of Guangzhou subway station

Yes, that's an entrance to the paid area of a subway station, and there aren't any scanners in sight. I haven't yet seen scanners, even ones that are covered up, at any stations in Guangzhou. Scanners were earlier in use for the Asian Games but have since been removed. Is it due to the same radiation concerns that may have prompted their retirement in Shenzhen? I don't know. Maybe it is related to these concerns that were shared on China Daily almost 2 years ago:
In Guangzhou, several commuters said they believe the biggest danger to subway security is a stampede of panicked passengers.

"If there is a risk, it comes from overcrowding, not terrorism," said a middle-aged woman on the city's metro. A middle school student traveling on the same train agreed, adding: "It is too crowded and especially dangerous when you use the escalators."

Guangzhou Metro spokesman Ye said in response: "Guangzhou Metro is crowded but it is absolutely safe. At peak times, our staff helps direct the flow of passengers at the scanning points, on escalators, in elevators and on platforms."
The crowds in some Guangzhou subways stations can indeed be overwhelming, and I say that after having been a regular rider of the highly trafficked Shanghai subway. I really can't imagine what it would be like in those stations if scanners were in place and in full use.

However, not everyone in Guangzhou may agree that the absence of scanners is a good thing. After a case of arson in the subway last year some voiced the desire for stricter security checks to be reinstated. As reported on the website "Life of Guangzhou":
A passenger ignited a gas tank in a subway car along Guangzhou Metro Line 10 Monday, leaving four passengers slightly injured. The workers in the subway did not stop the suspect from taking the gas tank into train.

The suspect, whose surname is Wu, confessed to the police that he wanted to vent his anger through arson because he was unhappy with his life, Guangzhou-based Yangcheng Evening News reported...

Li Guangjin, a local resident, told the Global Times Wednesday that although security checks in the subway delay people during rush hour, he felt it is necessary to avoid danger.

"Both Beijing and Shanghai subway authorities have been following strict security measures in the subway for years, which ensure the security of passengers," Li said. "If the security measures in the Guangzhou subway could be as strict as that of the Asian Games period, it could have prevented the gas tank fire."
My only comment is that while this may indicate the need for better security, it's not clear that scanners are necessary for preventing gas tanks from being brought into stations. Anyways, that was a year ago and the scanners have still not returned. However, it is common to see subway personnel in stations. I would hope they are now alert for people with gas tanks.

So, how about balloons? Here's a sign I saw while entering a subway station:

sign in Guangzhou subway forbidding items such as balloons

That's right, no balloons allowed -- especially ones that resemble the head of Mickey Mouse. They don't appear to follow Hong Kong in distinguishing metallic and non-metallic balloons. Unlike the earlier post I have no balloon adventures to share since nobody in Guangzhou gave me a free balloon this year (though, last year in Guangzhou I received one -- maybe a story for another day).

While I had already shared my frustration over the balloon rule here, I thought that I needed to do something more. But what? Well, the answer came one day in Guangzhou when I saw something that I had never before seen in a subway station in China.

A suggestion box. With comment cards. And a pen.

In great excitement I took advantage of this special opportunity:

suggestion box at a Guangzhou subway station

The attached pen was connected to the box in such a way that it made writing left-handed very difficult, but that didn't stop me. If you can't read my writing the comment I left is:
I think it's wonderful that there are no needless security scanners in place. Great! Please reconsider the ban on non-metallic balloons. It could really ruin some kid's day.
I would like to explain the word "needless". I believe there are conditions where scanners can play an important role. I'm just not convinced they're worthwhile for subway systems -- especially if appropriate checks for radiation haven't been conducted and they're used in the manner as seen in Shanghai.

Since I left my email address on the comment card I'm looking forward to a response. I'll provide an update if I hear anything (note: for confirmation they really possess the card I will ask what symbol was drawn on the back of it).

Immediately after taking the photo of the comment card, I discovered that a tall man in a security uniform was standing next to me. With a concerned expression he asked me what I was doing. I've had similar questions from police lead to unexpectedly interesting experiences so my alertness jumped up a level or two. I explained that obviously I was leaving a comment and expressed my happiness about the lack of scanning machines in the station. I decided it was not worth sharing my thoughts about balloons. After I inserted the comment card into the box he told me that he would be sure to pass my comment on to his superiors. "Fantastic!" I replied and we shook hands.

I then decided I really didn't need to take the subway and left the station. It was such a pleasant day for a walk.

Saturday, January 14, 2012

Time to Vote in Taiwan

This Saturday many Taiwanese will do something that can't be done in mainland China. An entry on Wikipedia [choose your own adverb] states: "The election for the 13th-term President and Vice-President of the Republic of China (traditional Chinese:第十三任中華民國總統副總統選舉) will be held in the Free Area of the Republic of China (ROC) on January 14, 2012."

It's an important election, but I'll refrain from writing about the election itself. Instead, I'll simply point you to the informative "Taiwan 2012" section of the blog Ballots & Bullets which is "produced in partnership with the School of Politics and International Relations, the Institute of Asia-Pacific Studies and the China Policy Institute at the University of Nottingham" and can be found here.

In the election spirit a Taiwanese friend of mine who is currently working in Beijing shared the image that currently exists on the homepage for Google in Taiwan:

Google logo modified to indicate people voting in Taiwan

And on Friday she returned to Taiwan to as she wrote "excercise my democratic rights". Apparently she isn't the only Taiwanese to be returning to Taiwan for this purpose. As she shared and CNN reports:
As many as 200,000 people -- most of them mainland China-based Taiwanese - are expected to return to Taiwan this weekend for an election viewed as critical to the future of an economy that has boomed thanks to warmer ties with Beijing.

Taiwan does not allow absentee voting and the growing political clout of Taiwan's expatriate businessmen -- known as Taishang in Chinese -- will be a determining factor in elections that will set the tenor of the relationship with Beijing.

"Because of the closeness of the race, this election has the highest ever number of returnees," says Professor Ray-Kuo Wu of Fu Jen University, adding that estimates could be as high as 250,000 returnees. "Corporate bosses have mobilized their employees to participate in these elections like never before."
It would be interesting to know whether the voting patterns of the returnees from mainland China significantly differ from other Taiwanese.

I won't express my thoughts on which candidates I hope will win. Instead, I'll simply express that I'm happy for the Taiwanese people on their election day.

Thursday, January 12, 2012

"Fake" Apple Stores in China

Apple Store in Shanghai
A "real" Apple Store in Shanghai

Last July, an American living in China wrote on her blog, BirdAbroad, about a store in Kunming, Yunnan province that in many ways looked liked a genuine Apple Store despite the fact that it was not. While some people found the story so incredible that they pondered if it was a hoax, for some in China it came as no great surprise. "Fake" can be rather common in China. In fact, just in Kunming alone police later found 22 stores "unlawfully using Apple's brand and logo". But as noted by Josh Chin on The Wall Street Journal's "China Real Time Report", the store highlighted on BirdAbroad was a jewel specimen showing the lengths some would go.

I've come across a number of "Apple stores" in a variety of other cities in China. None of the stores were on the scale of the one in Kunming, but they help paint a broader picture of the environment in China for a brand such as Apple. In that spirit, I'll share some of what I've seen in 3 of the cities I've most recently visited. For a number of the examples I'll share, I discovered them purely by chance as I walked around exploring the cities. Others where found when I deliberately visited certain shopping districts, though not because I knew I'd find stores selling Apple products there. Especially given that I wasn't deliberately seeking out such stores, I suspect that what I'm sharing is just the tip of the iceberg for these cities. To be clear, for some of the examples I can't be absolutely sure anything improper is occurring. But based on what I know and the example of the store in Kunming, there is certainly much that should at least raise some eyebrows.

Before sharing any examples of questionable sales of Apple's products or uses of its trademarks, I want to clarify one issue that I've seen cause some confusion. In addition to its official Apple Stores in China, Apple also allows select businesses to be official Apple resellers. Some of these stores only sell Apple (and Apple-related) products. Even in Shanghai where three large Apple Stores currently operate there are also numerous authorized Apple resellers where one can purchase Apple products. Here is a photo of an authorized Apple Reseller at a large shopping mall in Guangzhou, Guangdong province that is similar to many others I have seen:

Sunion Premium Reseller Apple store in Guangzhou

Sunion is a common Apple reseller in China. I'm sure this store is legitimate not only because of the "Premium Reseller" sign prominently displayed (which of course could be faked) but also because this specific store appears on Apple's list of authorized resellers in China. While official resellers often have some of the look and feel of an Apple Store, as referenced by Loretta Chao and Sue Feng (also on The Wall Street Journal's "China Real Time Report") there are guidelines they must follow. I'm not absolutely sure if this is part of the rules, but it's worth pointing out that the above store's name does not include "Apple" in it. Also, the employees wore shirts with "Sunion" written on them - not "Apple" or an Apple logo as was found in the now famous store in Kunming.

So, as far as I could tell all looked good there, as in many other authorized stores in China.

However, in the very same mall as the store above I saw a number of other stores also selling Apple products. None of them currently appear on Apple's list of authorized resellers. For example, there was this store with "iPhone 4" displayed where a store name is typically located:

store with prominent sign above entrance with words iPhone 4
An "iPhone 4" store

To provide some context, this section of the mall had numerous stores with their apparent "real" name posted in the same relative location above their main entrance. This store's business card did not indicate "iPhone 4" and instead provided a nondescript Chinese name for the business. The store sold a variety of Apple products such as iPhones and iPads. In addition to the Apple-like feel of the store, I also noticed PC monitors which did not appear to be Apple products with stickers of Apple's logo on them. You can see a hint of one in the photo.

Also of relevance is the logo in the red sign on the left side of the picture. It's China Unicom's logo for its WCDMA 3G Network. China Unicom has an agreement with Apple that allows it to sell iPhones. China Unicom also has an online list of dealers and currently this store is not listed there either. Even if the store should be on the list, its sales of non-iPhone products, the choice of the displayed store name, etc. remain issues.

There were other stores selling Apple products, many also with Apple-labeled PC monitors. And some stores weren't content with naming themselves "iPhone 4", but instead chose "iPhone 4S":

store with prominent sign above entrance with words iPhone 4S
An "iPhone 4S" store

stors with prominent signs with words iPhone 4,iPhone4S, and Android
iPhone, iPhone 4S, and Android too

The use of "iPhone 4s" was particularly fascinating since the iPhone 4S hadn't been authorized for sale in China when I visited any of these stores. In fact, its launch date is this Friday, January 13. So, what's the source for these phones which shouldn't be available in Guangzhou?

I spoke to assistants at several stores and they all told me the same story: the phones are purchased from nearby Hong Kong and brought to Guangzhou. They were very open about the source of the phones and one shop even had a sign stating the Hong Kong origin of the iPhone 4S phones:

store with a sign explaining iPhone 4S purchases

When I asked an assistant at the authorized Sunion store whether I could purchase an iPhone 4S she told me it would not be possible since they weren't available for sale in China. When I asked her why the other stores in the same mall already had them available she looked disgusted but refused to comment.

So, these examples are from just one mall and more exist there than what I've shared here. If you think that's a lot of iPhone stores to peruse in a single mall I can recommend you also visit the Starbucks a few levels below them (which I assume is genuine). Anyways, this is just a small taste of what you could likely find in Guangzhou. In other parts of the city I also noticed several stores with signs indicating they were authorized Apple resellers despite these stores not appearing on Apple's online list.

chang store with sign saying it is an authorized reseller
Is this store really authorized by Apple?

Maybe Apple's online list is not up to date. I did not contact Apple to check.

The examples from Guangzhou are striking, but it is one of China's more developed cities and may not be representative. What can be found in less prominent cities? Hengyang, Hunan province was another city I recently visited, and it provided a number of intriguing examples as well. Here's one store with an Apple logo prominently displayed:

Apple logo on store sign

It actually sold a broad variety of phones, but there was also a store nearby that focused on Apple products:

store in Hengyang with prominent Apple logo on its sign

This store sold iPhone and HTC products:

store in Hengyang with prominent Apple logo and word iPhone on its sign

Inside of the store

And this store claimed to be an authorized reseller:

store in Hengyang with prominent Apple logo on its sign and words Authorised Reseller

Now here's the kicker. Apple doesn't list one single authorized retailer in all of Hengyang. China Unicom does list one authorized reseller in the area I visited, though the address doesn't appear to be for the store above.

After Hengyang I visited Chenzhou, also in Hunan province. I should note that like Hengyang when I visited Chenzhou I hadn't expected to be taking photographs of stores selling Apple products. However, one day I was walking down a street and saw these stores all in close proximity to each other:

several stores in Chenzhou with Apple logos on their signs

store in Chenzhou with prominent Apple logo on its sign

store in Chenzhou with prominent Apple logo on its sign

store in Chenzhou with prominent Apple logo and word iPhone on its sign

store in Chenzhou with prominent Apple logo on its sign

inside of store

Get the point? And like Hengyang, Apple lists no authorized stores in Chenzhou and none of these locations are currently listed on China Unicom's site. Again, some of the stores might simply be missing from the lists.

All of the stores above from Guangzhou, Hengyang, and Chenzhou were very much out in the open and in highly-trafficked areas. Never did anyone ask me to not take photographs. In fact, in several of the "iPhone" stores employees were happy when I asked if I could take their photos. While they might not have thought they were really working for Apple as in the case in Kunming, I didn't get the sense that they had a feeling there was anything they might not want to be fully public.

So, it doesn't appear that Kunming is the only city with "creative" uses of the Apple brand, and I feel pretty safe in saying that Guangzhou, Hengyang, and Chenzhou are not unique in joining Kunming in this respect. Again, I'm not saying I'm sure that everything I've shared here is "bad", but there is certainly much that seems amiss. Perhaps most clear is that the sales of the iPhone 4S should not have been occurring.

All of this presents a mixed case of good and bad news for Apple. At least if the stores are selling genuine Apple products (which is another issue to explore) then presumably Apple is at least profiting from the sales, even if not in the manner they would like. It's a very different problem than what Microsoft faces with many people in China using pirated versions of Windows.

So while there are numerous locations in China where one can legitimately purchase Apple's products, it appears there may be many more locations where sales are less than proper. Whatever benefits there may be for Apple in reducing the number of "fake" Apple stores in China, there would mostly likely exist direct benefits for the properly authorized (and presumably Chinese-owned) reseller stores.

And by the way, I've noticed some other retailers who are indeed very careful not to improperly use Apple's logo or its products' names:

sale of MP3 players that look like the iPod Nano
On a sidewalk in Chenzhou

They just sell products that look remarkably like Apple's -- but for much cheaper of course.

Tuesday, January 10, 2012

"Find Me": Oppo's Bold Media Campaign for a Smartphone

As I've mentioned before, while China's mobile phone industry continues to include explicit copying of global brands, a number of Chinese brands, such as K-Touch and BBK, are trying to grow their own identities. One of the brands that I think is particularly worth following closely is Oppo. It can often be found next to popular global brands such as Nokia, Samsung, Sony Ericsson, etc. at mobile phone stores across China.

Oppo section at Mobile World (通信天地) in Shanghai

Oppo store in Guangzhou, Guangdong province

Oppo offers a variety of phones, some of which can be seen here:

Oppo mobile phones

Oppo mobile phones

Oppo mobile phones

Maybe even more than its broad availability and wide variety of phones, something that highlights Oppo's ambitions has been its recent marketing campaign for its Android-based Find X903 mobile phone. It's not hard to notice the advertisements which can be found in many places in China, whether in the larger cities:

Oppo Find advertisement in a Shanghai subway station

or those much smaller:

Oppo Find advertisement in a shopping district in Heyuan, Guangdong

And yes, that is Leonardo DiCaprio appearing in most of the photos above. He was reportedly paid 5 million dollars (US) for his role in the Oppo campaign. A brief (in English) describing the media campaign can be found here. The brief provides a useful (although presumably biased) overview and is worth checking out. One note though: while there are repeated mentions of "Twitter", Twitter was of course not part of the campaign as it is currently blocked in China. Replace "Twitter" with "Sina's and Tencent's micro-blogging services" (roughly similar in concept to a hybrid of Twitter and Facebook) to clarify that issue.

The video included in the brief poses the problem of how Oppo can stand out in a market that is dominated by global brands. It says research indicated:
...male consumers enjoy exploring the unknown, they don't like to be simply told the facts but instead they like to find out the truth by themselves. Therefore, we should challenge their knowledge to search for our product rather than just present our product in front of them.
The rest of the video and other information on the page explains how this intriguing claim guided the design of an interactive media campaign. Oppo's targeting of male consumers for this campaign is notable since in the past it has often targeted female consumers.

Oppo's "Find Me" website is here (Chinese) and as described in the brief includes many interactive experiences and also several trailers & TV commercials which were directed by Jeremy Haccoun. The movie-like style of the videos is obvious and many have commented on their similarity in style with a film in which DiCaprio starred -- Inception. There is a video on several Internet sites that combines the videos but some sections aren't exactly the same as what's found on Oppo's websites. Since it's simpler to present, here's a version on YouTube:


On the "Find Me" website you can find videos of the 3 trailers here and the 2 TV commercials here (note: in addition to the audio for the videos there is music playing in the background of the webpage which can be turned off by clicking on the gramophone icon). Oppo's website for the Find X903 phone (here) seems to only have 2 of the trailers and neither of the commercials.

The campaign, which was created by NIM Advertising, has won several awards such as the Digital Media Awards Asia's award for Technology and Telecoms and earlier received some buzz on advertising news websites such as chinaSmack, Adweek, and brandchannel. Peter Fuhrman, Chairman of China First Capital, Ltd., commented on Oppo and this media campaign last August:
It’s a bold move by a little-known Chinese mobile phone company to storm into the big time, and grab market share from Nokia, Samsung, LG and Apple. None of these global brands uses a big name to front its ads in China. Oppo is determined to compete as equals with these larger companies. It’s still learning the rules of building a successful brand. Its tactics and ad strategy are a little off-beat. But, Oppo has the resources and distribution in China to challenge the large global mobile phone brands, and so cause them headaches in the world’s largest mobile phone market...

Oppo is trying to pull off a challenging feat: to catapult above the hundreds of no-name mobile phone manufacturers and brands, and establish itself as a premium brand in China. The other Chinese mobile phone brands do little to no advertising, and instead compete mainly on price.
There are a number of curious or problematic issues I could address regarding the campaign, ranging from strategy to website usability, but I'll put them aside for now. What is most significant is that Oppo attempted a campaign of this scope and nature. Its competitors, both Chinese and those abroad, would be wise to pay close attention to Oppo as it attempts to grow.

There are reports that Oppo will soon release the next version of the Find phone (so far being given the name Find 2). It appears that not all of the videos for "Find Me" have yet been released so it will be interesting to see if they're used for the advertising campaign of the next Find phone. For now, we'll just have to wait to see if the "Find Me" theme continues. However, if Oppo decides it wants to make the phone more easily discovered, an advertisement for a large upscale mall in Guangzhou may have already beaten Oppo to a potentially appropriate follow-up theme:

advertisement with words Here I Am
Inspired by Oppo?

Wednesday, January 4, 2012

McDonald's in China - Localized, Growing, and Influencing

When I compared a KFC and McDonald's in Yueyang, China, I mentioned that KFC has had much success in China and that one of the possible reasons is its localized menu. While McDonald's success hasn't been as great, that doesn't mean McDonald's hasn't localized its menu or that it is doing poorly in China.

Some examples of its localized menu include a taro pie and some different dipping sauces for its Chicken McNuggets -- such as chili garlic. See here for more examples of McDonald's food offerings in China (in Chinese and may not load in some browsers). I haven't bothered to try quantifying it, but my impression is that KFC's menu has been more modified from its US version than McDonald's. Whether that could be a key reason KFC has seen more success in China is another question.

And although the McDonald's in Yueyang wasn't busy at the time I visited, I've seen plenty of others that were. For example, recently I passed by a McDonald's in Hengyang, Hunan province:

inside a busy McDonald's in Hengyang, China

and another in Chenzhou, Hunan province:


Both were full of customers eating and drinking. There are also broader signs of McDonald's success in China. As reported on Bloomberg News this past summer:
McDonald’s Corp. (MCD), the world’s largest restaurant chain, should open an outlet a day in China as it challenges Yum! Brands [owner of the KFC and Pizza Hut brands] for dominance in Asia’s largest economy as rising salaries boost spending on fast food.

“We should be opening a restaurant every day in the next three to four years” in China, Peter Rodwell, company president for Asia excluding Japan, Australia and New Zealand, said in an interview in Singapore today. “We’re now opening a restaurant every other day.”
Even with that growth rate, though, McDonald's has its work cut out if it wants to surpass KFC. Not only is KFC currently far ahead of McDonald's in terms of number of stores in China, but it's likely to expand further. In fact, I've seen signs of potential new locations for KFC that I'll share in a later post.

McDonald's growth isn't good just for the company, but it has benefits for China as well. Again, from Bloomberg News:
The Oak Brook, Illinois-based company has said it plans to recruit 50,000 employees in China this year, including 1,000 university graduates as management trainees. McDonald’s, which trails Yum in number of Chinese locations, moved its China training center from Hong Kong to Shanghai last year.
Furthermore, the benefits aren't limited to McDonald's and China. For example, last April I had the opportunity to speak with these two employees of a McDonald's in Nanning, Guangxi:

Happy McDonald's employees

The young lady on the left was a college student and working part-time. The extra income was useful for her, and she preferred the job to what she did the previous year when I first met her -- promoting a brand of tea at a large park in Nanning:

Green tea promotion

What was most notable, though, was how she absolutely gushed about how much she enjoyed working at McDonald's -- the friendly atmosphere, the supportive management, etc. She didn't think she could have such a positive work experience in most similar Chinese companies, and her experience clearly influenced her view of the US in a positive manner. I can't provide any numbers, but based on other conversations I've had I know she isn't alone in her feelings. This is yet another example of America's "soft-power" that I have mentioned before in a very different context.

So, if McDonald's is localizing its menu for China and is playing a role in shaping Chinese people's opinions of the US it raises an important question.

Should McDonald's ever offer the McRib in China?

Tuesday, January 3, 2012

Scenes of China: Chenzhou, Hunan Province

In the previous post I shared where I spent the last days of 2011 -- Hengyang, Hunan province. Typically I don't do two "scenes" posts in a row, but in the spirit of symmetry I'll now share where I spent the first days of 2012 -- Chenzhou, Hunan (map).

Like in Hengyang, the weather was overcast and caused me again to forgo a nature trip. This time I had hoped to see Suxian Hill -- a place of natural scenery and Taoist relics. Again, maybe in another year or life I'll see it.

Despite some rainy drizzle at times, I took the opportunity to explore the city. Some of my walks were directed to places of potential interest I saw on a map and others were more random. One thing I noticed that is consistent with what I've more recently read about Chenzhou was that the food didn't have the characteristic spiciness found in the food of other regions of Hunan. I suspect Chenzhou's close proximity to Guangdong province, where cooking styles aren't known for their spiciness, is at least partially responsible.

If you've kept track of the last 4 cities (including Chenzhou) I've posted about, you may see a connection between them. That connection will provide a clue both for where I headed after Chenzhou and for what I plan to write about in a future post.

But for now, here's some of what I saw in Chenzhou:

busy street and department store in Chenzhou
The department store on the right was very busy on New Years Day

Nearby Xinglong Pedestrian Street

Popular place for Cantonese style snacks
People thrust money at the very busy server to get her attention to take their orders - not my hands.

employees at Bo Lan Yoga Beauty Club
The lady in the red coat saw me passing by outside and was eager to speak some English. So, I went inside and said hello.

Seemingly new apartment complexes. Similar ones nearby appeared to be mostly empty - a not uncommon sight in China.

Some farming in the city

Bridge under construction

Walking in the rain

Chen River

Baby Bar -- No, I didn't try it.

Snoopy by Peanuts car

Fruit and vegetables for sale at a street market

Street vendor selling a sort of peanut crisp

Remnants of fireworks