How to Compete with the China’s Booming Digital Economy
China’s digital economy is the hottest thing in the entire global economy today. It is growing too fast that economic futurists predict that it might topple the traditionally established economies in the next few years. The economy stands at about $4 trillion today, which is about a third of the country’s entire GDP. Other global economies, of course, have been taken by surprise by the unexpected turn of events. But how can a foreign tech player compete with Chinese companies in this huge digital economy of China?
Hiring Chinese employees is one of the ways that you can leverage the knowledge and experience that IT experts from the Asian country ooze so effortlessly. I mean, these experts who are actually very youthful seem to know something that other people don’t know in regards to AI, advanced robotics, IoT and healthcare technology, just to mention but a few. Its huge population, on the other hand, is supporting the country’s digital economy more than any other population across the world. China boasts of the highest early tech adoption rates and the Chinese government is among the few governments in the world who invest heavily in empowering their bright, creative and youthful minds.
In this post, we look at four ways through which to compete effectively in the digital economy of China. We, however, acknowledge that penetrating the Chinese digital economy isn’t the easiest thing to do for an international player. Some renowned tech companies such as Google and Facebook have been through too much trouble with the Chinese government when trying to enter the market. These companies have since been blocked in Mainland China. Other giants such as Amazon have tried many times to enter the market all without success. It is not impossible, though, and that is what we seek to prove through this post.
Master the Local Languages
Only about 10 percent of Chinese natives speak any of the major western languages: French, English, German and Spanish. For no known reason, even those in this group will rarely speak a foreign language when doing business. This is one technique that the Chinese use to code their business transactions and to keep foreign encroachment at bay.
Hiring Chinese employees can help you to penetrate this market with relative ease. If you can manage to learn some Mandarin before establishing your digital business in China, then you will be at an early advantage. You can as well develop a translation app if your budget can allow such, which will eliminate the need for premium translation companies; they are very expensive in this side of the world.
Be Ready to Abide by the Tough Tech Regulations in the Country
The Chinese government- in collaboration with private tech firms- regulates every little aspect of the country’s digital economy. The government has a database for all its citizens in which it plans to store all data relating to the citizens by 2020, public or private. This system will be determining how creditworthy an individual is, how worthy he or she is to rent apartments, and many more government-related services.
Of course, this is a good way to maintain social order in their part, but it could be bad news for foreign companies targeting the Chinese digital economy. If your prospective customers are under constant surveillance by the government, you may have a thing or two to worry about your privacy too. But you must live with that unless you want to be blocked like Google was.
Mobile consumption is big in China. As a matter of fact, the value of the country’s mobile money transfer market was more than 800 billion dollars by the end of last year. That is equivalent to the mobile payments of entire Western Europe and the United States combined for the same year. E-commerce is big here and accounts for up to 40% of all Chinese players within the digital economy. With the right e-commerce strategies, you might have a good shot at success.
Leverage Artificial Intelligence
The government is keen on ensuring that businesses incorporate artificial intelligence in their day to day interactions with customers. As a matter of fact, the government injected more than 15 billion dollars into the digital economy in 2016 to facilitate players who had started incorporating AI. This could be a great opening for any international player to exploit.
About the Author:
Laura is a marketing specialist at SEOforX. She helps her company advertise its products and services and she has a thorough knowledge on developing marketing approaches for products and brands. Besides being a marketing specialist she has a special interest in financial technology. She finds Fintech fascinating and writes about how the new technology is being used to improve activities in the finance sector.