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Part One: Concept vs. Value: the Struggle of China’s Consumerism;
  Part Two: Double Bureaucracies - Corporate and Government in China;
  Part Three: No Reasons to Fail -Invest in the Fundamentals (1)
  Part Three: No Reasons to Fail -Invest in the Fundamentals (2) (to be continued)

  China’s economy is a myth even to well-respected and successful businessmen in China. It is a common scene – during the casual conversation, people would unintentionally say things like ‘the more do we stay in this market, the more can we not understand this market’ and they, the successful Chinese businessmen, are at awe of how deep, unexplainable, and fast growing this market is. They have trouble to read this market.
  For the most complicated matter, we can always find a simple explanation. In the 21 century China today, the whole nation and its people are willingly moving toward consumerism assimilation. As a matter of fact, consumerism has such a power to overcome barriers to integrate the world despite of the differences in culture, religion and system – this is an age of information and integration.
  The gap in term of the market maturity between the West and China is wide. Mature consumerism countries of the West expand the market beyond their own borders into the willingly acceptive and immature nations of the East. It is a Déjà vu, an immediate repeat of a modern history. As long as the fundamentals of a business are sound, there is no reason to fail.
  Flood of Consumerism
  Consumerism has the capacity to change and to twist people’s mind.
  In China, people in their 40’s can vigorously remember the harsh life 30 years ago. In a sudden, the door to the West was slightly open. Ever since, Chinese are hit hard by consumerism, which goes viral into people’s heart and mind with no control and hold-back. Consumption is no longer a sustaining of a life but a life itself. Religion, tradition and geographic position in many countries are the last line to slow the invasion of such a monstrous force. In China, the line has long been broken. China’s consumerism has a magnitude of revolution. However, for any economic changes as drastic as this magnitude, it not only means great prosperity and wealth, but could also mean great distortion and possible destruction.
  In terms of scale and depth, China’s shock-therapy like consumerism is far from being comparable with America’s evolutional one. The overwhelming inflow of extravagant but foreign information in such a short period congest people’s mind to a level of misinformation. People interpret the same piece of information in their own respective preference. Believing is seeing. Consumerism becomes Christmas story.
  China’s consumer market is in distortion when try hard to duplicate the West. For instance, milk is never a traditional dairy to Chinese, but has been promoted heavily by the government since 1980s despite of the fact that China has neither natural resource nor biological mechanism to rationally promote such a fast growth. Waves of scandals in milk industry have not abated since 2008. Traditional Chinese soymilk is a major beverage for hundreds of years in China and a fit substitution to milk. The western countries have enhanced soymilk flavor and texture, and its sales have been rising sharply in the recent decades. Now, soymilk industry in the West is a billion dollar industry. However, in its birth place China, soymilk industry is still very much on the street level, and the major players and investment are still obsolete. In another case, coffee as a social and functional drink has neither current market nor social environment to foster one in China when Nestle and Starbucks speared head into China’s market. Because of Chinese’ strong inclination toward western culture and financial power of the international corporate, coffee and coffee house gain a great deal of social awareness. The international corporate and the glow of western culture are capable to create a new industry in China not out of necessity or demand of the market, but simply creating one. The stories can go on and on, from the rise of real estate, boom of luxury products, to nearly every aspect of China’s economy.
  Swift adaption of consumerism is basically a shock therapy, and centralized government is at handy to deliver such an adaption. Too many human interventions cause too many distortions in a hypothetically natural market evolution. The overwhelming image of uneven wealth between nations distorts people’s mind and rattles people’s nerves. Greed and fear are driving the business instead of business itself. In spite of distortion, it is also a natural consequence when consumerism is taking a life in such a fashion and speed. As long as the market is still vast, void, and hungry for whatever it comes to it, the distortion can continue in spite of hefty price.
  Regardless how it takes a life here, consumerism has already set a deep foothold in China. The trend is irreversible. Consumption mentality is here, and average people are wealthy enough to spend. All in all, the market is ready enough to have its common sense back.
  Reading a Mind – Consciousness vs. Subconsciousness
  Consumerism is a big topic, covering a wide range of aspects. In here, we take an approach on the mind processing.
  When have a longer conversation, people become relaxed. They tend to speak what they really think and even things they themselves don’t realize. Their subconsciousness kicks in and speaks more objectively. Our conscious mind, on the other hand, is more subjective and reacts to more immediate matter. When there is a sudden influx of overwhelming information in accompany of strong desires, it can confuse the dialog between consciousness and subconsciousness.
  In an evolution process, the subconsciousness accumulates information and then makes judgment. In a revolution process, the consciousness dominates and has to make judgment based on superficial information and the demand of immediate action under constantly changing motion. Our subconscious mind is the super computer of our mind when our consciousness absorbs information through simple and superficial visual impacts. No matter how smart a person is, if he acts on something without much clue what that thing is, his chance to misinterpret the information is large. As Bob Marley said, if a person knows everything but don’t know himself, knows nothing. However, the chances that we don’t know ourselves are quite high in real life especially in a society with such a fast transaction. More than too often, we prefer our consciousness lies to us than listen to the reasons. When we cannot find a bottom line in our action, we can be a myth to ourselves.
  Subconsciousness is still the master. It is a super computer. For instance, for an old enough kid, if give him a price, he can make reference to a long list of price index in the back of his mind tracing back to a history as far as he can remember how to pay for a goods. As said, the distortion in China’s consumer market is a common phenomenon. Many policies and business practices in China seem to enjoy challenging Chinese consumers’ sense of reality. When it is prevalent in such a grand scale, we also temporarily lose our sense of reality. Nevertheless, we know that the market will make its correction eventually. There are also the companies who abide with the market fundamentals and successfully stride in China’s market such as IKEA and McDonalds.
  All in all, there is confusion in China’s consumer market. The confusion is on all levels, from individuals, small business, major investment to the general policy making. Despite of too much irregularity in China’s market, the fundamentals of market mechanism have never been changed, especially in a consumer market.
  1.3 Billion Of People – Visualize It
  Consumers as in a consumer market should always be the focus. China has 1.3 billons of people. It is such a surreally big number in term of a nation’s population that we can all be thrilled but few can mentally comprehend. China has 300 millions more people than the combined population of USA, European Union and Japan. Furthermore, it is a population of 1.3 billions of people with open arms to consumerism in which the major human hurdle now is the certain interest groups trying to preserve wealth and superiority through delaying a fair market mechanism.
  The scope of the market potentials is unprecedented. A lot of market research is based on the methodology of much more mature Western countries, such as, segmentation, age, demography, income, and so on so forth. There is nothing wrong in the methodology but its results can be quite off points on conclusions and even miss the obvious opportunities.
  Before we segment China’s market, we have to think first and foremost 1.3 billion of Chinese as a whole. We need to gaze at the number, 1.3 billion, long enough till we can mentally associate them with a business instead to separate them too early into income group, class, age or any particular category. After all, it is 1.3 billion consumers of which business is interested rather than a sophisticated human error-prone calculation of its 5% or 10%. If anyone either a local or a foreigner still has difficulties to comprehend the meaning of 1.3 billion, one can take a ride to a third or a fourth tier city, standing long enough at the center of its downtown or any of its district centers and watching people passing by to substantiate 1.3 billion from a number to a real market scope. The 1.3 billion of consumers is real.

  (to be continued) 

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王海

王海

189篇文章 195天前更新

20年中国咖啡产业和消费业的从业者

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