MR in China – a Market Summary

UK agency B2B International, which plans to open a Beijing office in January 2007, has produced a detailed analysis of the Chinese MR industry. The White Paper identifies the main characteristics of the Chinese market for market research and highlights the great potential for research buyers.

B2B says the Chinese MR industry has been in existence for around two decades largely in the consumer field, but until recently has developed slowly, with a current total value of around 5,000 million RMB (£350m) commissioned per annum. However, the market is growing at around 20% p.a. as of May 2006. The firm says b2b research is a newer concept but growing faster, 'with Chinese companies increasingly open to the idea of obtaining the views of business people and Western companies more and more hungry for Chinese business opinion.' In China b2b MR represents about 25-30% of the market, compared with a generally touted figure of 10% in more developed markets.

The agency estimates fewer than 50 full service research agencies in China with a national capability – most of these using networks rather than in-house capability – and only c.100 if regional players are included. Most major agencies have three offices – one in each of Shanghai, Beijing and Guangzhou – and companies with a strong business-to-business focus tend to be headquartered in Beijing.

The Paper points out that business in China is far more relationship-oriented than in the West and agencies 'do little in the way of the more conventional marketing activities to market themselves. To all but the very biggest agencies, the main method of winning business has been through simple relationship building.'

In contrast with the West's focus on customer and employee satisfaction studies, branding studies, concept tests and segmentations, much of the MR conducted in China is about entering new markets or indeed entering China itself - around 60% of research projects are market assessment studies, looking at structure, size and key players. In terms of business research and market sectors, the level of work commissioned can be ranked in the following order: automotive, petrochemical, IT, telecoms, pharmaceutical and medical, and financial.

Regional differences make it difficult to talk of 'the Chinese market' and difficult to conduct fieldwork, but b2b says on the whole there is no great reticence in terms of providing information, and in contrast with Western markets, getting people's views is perhaps becoming easier as they become more aware of market research.

In terms of data collection methodologies, telephone fieldwork is growing and in five years will constitute the main data collection method, says B2B – especially with growing demand for research outside the main cities. Face-to-face interviewing will however remain prominent as it is firmly entrenched in the culture of research in China and not enormously more expensive than telephone interviews (whereas in Western markets it can be at least 10 times more expensive). Substantial growth in web surveys is predicted to begin 'within two years' time'.

Desk research sources are often considered hard to come by, and this is not helped by the language barrier. However, the Paper says it is 'not the case that there is a lack of desk resources for the researcher. In fact, if it is industry statistics and details of regulations that are needed, then it is doubtful that any country makes more information available than China.'

B2B says potential research buyers 'should be reassured about the very high reliability of research produced by the national and international agencies', with agencies in the big cities placing 'an extraordinary emphasis on quality', utilising new technology – for example, it is not uncommon for Chinese agencies to listen to 50% or more of telephone interviews as they take place, with recordings of the remaining interviews also listened to. Face-to-face interviewers typically use MP3 players to record their interviews. According to Alaric Fairbanks, the firm's Head of Asian Research: '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. China might not be the easiest country in which to conduct research, but for the research buyer, the value of the information obtained is likely to be enormous.' Co-author and Director Matthew Harrison, adds: 'with the right agency, research in China is good quality, detailed, insightful, cost effective and above all, an excellent aid to decision-making.'

The full White Paper includes further detail, including B2B's five recommendations for those commissioning research in China. A free copy is available on request – see www.b2binternational.com for details.

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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