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China’s “high-speed” Consumers – Craving for a
Dr Andrew Zhu
Director - Trace Research Ltd (NZ)
Research Associate – New Zealand Asia Institute
Honorary Research Fellow – Department of Marketing UABSCopyright © 2016 Trace Research All rights reserved.Tracing the origin of consumer’s mind
Content
Who are China’s “high-speed” Consumers?
Perception of NZ Food and Health Product
What Do They Want From NZ?
The “Sunshine” Channel of Distribution – “Health Element”
The “Social/Grey” Channel of Distribution – Social Media “Wechat”
Country of Origin Effect – Yashili Baby Formula
Challenges NZ Food Exporters are Facing
Who are China’s “high-speed” Consumers?
“These high-speed consumers are optimistic, middle- to upper-
middle-class, active online shoppers, and will power
consumer spending in the years ahead… High-speed (affluent)
households are expected to generate 90% of digital
consumption between 2015 and 2020… High-speed households
are expected to contribute $3.8 trillion of the $5.6trillion in total urban consumption… Companies that want
to reach high-speed households will need to broaden their
distribution channels, and they need a multichannelapproach
Source: Boston Consulting Group Survey, 2015
Annual online spending: NZ$199,905
Perception of NZ Food and Health Product
Source: Trace Research 2016
What Do They Want From NZ?
217,700 NZ Product Items Listed
64.7% of Chinese E-commerce platforms carry NZ made products
58.8% of E-commerce operators only prefer to stock well-known NZ brands
41.2% of them don’t have specific brand preference, but they are looking forward to have more exclusive distribution rights for new NZ products
Source: Trace Research 2016
What Do They Want From NZ?
Tier One
Tier Two
Tier Three
Diary products
Honey products
Dietary supplement
Meat
Fresh food
Snack food
Skincare products
Source: Trace Research & Bank of China (NZ) 2015
NZ Product ConsumptionTrend in China
1 2 3 4 5 6 7 8 9 10 11 12
Source: Trace Research & Bank of China (NZ) 2015
The “Sunshine” Channel of Distribution – “Health Element”
Source: New Zealand Herald 2016
The “Social/Grey” Channel of Distribution – Social Media “Wechat”Buying On behalf
The “Social/Grey” Channel of Distribution – Social Media “Wechat”
Country of Origin Effect – Yashili Baby Formula
This was the sales revenue generated in
24 hoursthrough
E-commerce platforms
on 11.11 2015
Country of Origin Effect
There is only one brand that is fully owned by New Zealand…Fresco
“An Overview of Baby Formula Brands Sold in Supermarket in New Zealand“
Country of Origin Effect
Will this marketing strategy work in China?
?
Evidence?
How China's economic slowdown could weigh on New Zealand?
The infographic suggests that if China’s imports continue to decline at thepresent rate (an average of 14.6% over the first seven months of the year)
during 2015, New Zealand’s lost income will be$US3.54 billion, or 1.9% of GDP.
ANZ chief economist Cameron Bagrie says: “going forward, Chinesedemand is expected to be increasingly driven byconsumption (e.g., people buying food and otherconsumer goods) and less by investment (e.g., building houses,
factories, bridges, transport systems etc.)
NZ Institute of Economic Research senior economist Christina Leungsays: “the Guardian infographic is interesting but simplistic…for example,
the estimated decline in New Zealand looks like it isbased on the current amount of dairy products weexport to China, but that has been declining and will likely continue
to decline over the coming years…in contrast, other export sectorswill pick up and partly offset this decline in dairy”
Source: Guardian interactive infographic, 2015
Challenges NZ Food Exporters are Facing
保税区（Bonded Area ;the low-tax; tariff-free zone ;tax-protected zone)
9 RMB (NZ$2) for a kilogram of baby formula – counterfeit issue
Thank You For Your Attention
Q & A
Dr Andrew Zhu is the director of Trace Research Ltd (NZ) and a member of the Research Association New Zealand since 2006. Andrew specialisesin marketing research, marketing strategy, political polling, and social media marketing among Chinese consumers in both New Zealand andChina. Andrew has 10 years of marketing research experience in both academic and business environments. With his knowledge about Chineseeconomic development, consumer behaviours, and advanced analytical skills, he has been offering consultancy service to New Zealand brands ontheir market entry strategies to China.
Expertise
Andrew's areas of expertise include (but are not confined to) quantitative and qualitative research methods, survey design, multivariate data analysis (Big data analysis),statistical modelling, brand positioning and tracking, market segmentation and targeting, political polling, marketing via social media and strategic marketing.
Education
Andrew’s academic qualifications, all from The University of Auckland, include a PhD, MCom (1st Class Honours), and BCom (1st Class Honours) in Marketing andInternational Business. Currently, He holds an honorary research fellow position in the University of Auckland Business School, meanwhile he lectures a marketing courseat the New Start programme offered by the University. He is also a research associate (China Study) at New Zealand Asia Institute.
Experience
Andrew used to work at TNS Global when he first entered the research industry. When he returned to the University, he has been contracting his service to many domesticresearch companies. He has extensive commercial research experience in fuel & lubricants, dairy products (e.g. baby formula), FMCG, energy, food & beverage, banking &insurance, telecommunications, political polling, social media, tourism and tertiary education sectors etc. He has six years’ brand tracking and communications researchfor Chevron in 56 global markets.
Andrew has six years’ academic research and teaching experience in the Department of Marketing at The University of Auckland Business School, he was the leadresearcher in New Zealand Retail Banking Customer Satisfaction Survey 2007/2008 and the upcoming 2016 Retail Banking Customer Engagement Survey. Andrew wasalso the statistical analyst for SMASH (Strategy for Marketing Shaping) project, a consortium-based research run by the University of Auckland Business School for topcompanies in NZ. He has been a statistical advisor for TV3 Reid Political Polling since 2011.
Contact detail: [email protected]
Dr Andrew Zhu’s Bio
