Global Internet retailers get excited at the mere thought of promoting and advertising their products within China. Few have managed to take the neccesary steps however. Ebay is one that has and it is leading the charge in many respects, announcing a deal with Chinese online fashion retailer Xiu.com to create a localized online shopping experience called Ebay Style.
Ebay Style will include up to 5000 brands in apparel, handbags and shoes, accessories, health and beauty and other lifestyle categories. All products will be new and available from eBay’ trusted sellers. As well as providing the platform for Ebay Style, Xiu.com will be responsible for curating and translating the inventory from eBay with a product search and browsing experience suited to Chinese consumers. Xiu.com will also provide local returns and Chinese language customer service.
Melanie Tan, vice president for Ebay said: “Today, Chinese consumers are increasingly coming to eBay and we have seen a 40% year on year increase of goods bought by Chinese consumers navigating eBay.com in English. We believe that in the future Chinese consumers will use eBay as a passport to global Fashion styles, especially for leading women’s brands and accessories, and menswear, because our broad selection of new, branded, and designer merchandise will be unmatched in China.”
China’s increasingly important role in the future of the Internet and Web hosting just got a major seal of approval from Microsoft, who recently announced that it was going to bring its Windows Azure cloud-based operating system to the Asian nation.
This launch, which follows the release of Windows Server 2012, will bring multi-tenant public and private cloud services to millions of the businesses that operate in the world’s most populous country, giving owners a choice in how (and when) they will move to the cloud. Thanks to both Server 2012 and Azure, Windows customers can find the cloud that best matches the needs of their businesses, from on-premises datacenters to a public cloud.
According to a report from Forrester Research, the public cloud market in China is set to grow from $297 million in 2011 to an astonishing $3.8 billion in 2020.
Microsoft has signed a memorandum of understanding with the municipality of Shanghai and inked a deal to license its technologies with the company 21Vianet, which will provide Windows Azure services from its local Chinese datacenters to provide the best performance for its customers in the country.
Digital marketing agency Acquity Group has released its Global Usability Study that surveyed American and Chinese consumers on their website preferences to better understand online shopping behaviors of consumers in China.
The findings revealed that both groups of consumers favored the American-style Web design over the Chinese-style design, especially on the homepage. American consumers gave the American style a 78-percent approval rating while Chinese consumers gave it an approval rating of 72 percent.
Different Web Experiences
Three Web page layouts were shown in both American-style and Chinese-style designs. Separate versions of a hypothetical e-commerce apparel site were created based on a set of generally accepted design principles for each market. Participants were asked to evaluate the three pages from each style of site – a homepage, a category landing page and an individual product detail and order page.
The American-style design featured a clean homepage with a large, branded image, limited selection of promotions and information, with little or no scrolling capabilities, and similarly structured product category landing and detail pages.
The Chinese-style site was much more information-heavy, characteristic of that market's typical retail website. Product images, descriptions and promotions were all included upfront on the homepage, with long pages and opportunities for continuous scrolling. This was consistent with the category landing and product detail pages.
American audiences tended to rate both design styles an average of 5 to 10 percent higher than Chinese audiences (75-80 percent, versus 70-75 percent), indicating that the Chinese respondents had a slightly more critical perception of Web design styles. Chinese respondents pointed out the American-style design's use of “Big pictures can drive attention, but the information was not enough”, and that the Chinese-style had “Too many product pictures on the homepage.”
Chinese respondents also noted a lack of advertised promotions more readily than Americans did, and were more frequently affected by price points.
“Creating a positive and rewarding Web experience is a complex formula of design best practices coupled with cultural preferences,” says Dominic Lee, Acquity Group’s creative director. “Although we went into the study with general cultural assumptions, the insights we collected about consumer preferences in both countries were unexpected. The cultural styles were not as easily categorized as we initially believed. This tells us that it is time to cross-pollinate the international e-commerce space.”
Entry into Foreign Markets
The point of the study was to generate analytics for marketing and IT officers as they continue to evaluate their digital channels in foreign markets. It revealed that consumers in the Chinese and U.S. markets have distinct tastes when it comes to interacting with digital channels, suggesting that marketers will need to explore new ways to merchandise a site and display product information when moving their brands into foreign markets.
“U.S. companies can save on costs by re-using designs and functionality from domestic-style home pages and landing pages, but winning over the Chinese consumer will require a product-page redesign to enhance both the quality and quantity of product information, which will likely prove beneficial to their home market as well,” says Lee. “Most Chinese companies launching in the U.S. should start from scratch with a new U.S.-style home page, but also keep in mind that U.S. consumers value the enhanced information featured in Chinese-style designs.”
The entire Global Usability Study can be downloaded here.
The number of Web users in China soared past 500 million last year, a tech-industry group said Monday, capping a period of explosive growth that has elevated Chinese Internet companies and challenged social and political discourse in the communist-controlled state.
The government-run China Internet Network Information Center said Monday that the number of Web users in China grew 12% in December, to 513 million, compared with the same period in 2010.
Chinese Internet giants such as search engine Baidu Inc., news portal Sina Corp. and gaming and messaging service provider Tencent Holdings added millions of users, raising the profile of the increasingly lucrative sector.
But 2011 was also a year that saw the increasing social might of Chinese micro-blogs, which became engines of public opinion that often challenged the authority of state-sanctioned news.
The number of micro-blog users quadrupled last year to just under 250 million, the China Internet Network Information Center said in its recent report.
Known in China as weibo, micro-blogs act much like Twitter, allowing users to post short messages with links that can then be read by subscribers.
The speed and scope in which the services operate create difficulties for government censors, who have more success blocking access to foreign websites such as Facebook, YouTube and Twitter using filters, better known as the Great Firewall of China.
Micro-blogs were instrumental last year in exposing government mishandling of a deadly high-speed rail collision in the eastern city of Wenzhou, protests concerning a chemical plant in the northern city of Dalian and corruption in the southern village of Wukan.
A recent decision by Beijing authorities to report the extent of the city's air pollution with greater accuracy is largely credited to an online campaign started from the micro-blog account of well-known property developer Pan Shiyi,
"Today we can say without hesitation that an independent and richly participatory civil society is emerging on China's Internet," wrote Hu Yong, a journalist and commentator in a recent article translated by the China Media Project at the University of Hong Kong.
"The Internet cannot usher in dramatic change to political life in China, but it can promote the creation of social capital on the basis of citizen rights and duties, giving rise to and strengthening social forces independent of the Chinese state," Hu continued.
The rising popularity and influence of micro-blogs has worried the central government, a fear exacerbated by the role of social media in the so-called Arab Spring uprisings. Chinese authorities have intensified efforts to quash domestic opposition in the last year, jailing and detaining a number of activists.
Damien Ma, an analyst at the Eurasia Group, wrote in a post on Atlantic magazine's website earlier this month that China's leaders regard social media as "western-invented weapons of mass dissemination as potentially powerful as nuclear bombs."
Since the Wenzhou train crash in July, authorities have increased pressure on micro-blog providers (namely Sina and Tencent) to crack down on "rumors," a euphemism for government criticism.
In October, the Communist Party's Central Committee vowed to strengthen control of the Internet, threatening to punish those responsible for spreading "harmful information."
Last month, cities announced new rules requiring micro-blog users to register their accounts with their real names, making it more risky for individuals to challenge authorities.
How much China's leaders are willing to rein in the Web remains to be seen -– a question investors will have to grapple with in a market otherwise filled with potential.
The Internet sector is the only major industry in China still dominated by private companies. But given the attention to reestablishing government order, 2012 may be defined by how much the state ultimately encroaches online.
One sign is regulators' approval last week for an online unit of the Communist Party's mouthpiece, the People’s Daily, to offer shares in Shanghai. The newspaper plans to raise $83 million to challenge established Web portals such as Sina and Sohu.
– David Pierson
Photo: Chinese youths at an Internet cafe in Beijing. Credit: Elizabeth Dalziel / Associated Press
The report, which is issued annually, detailed Apple's efforts to monitor its suppliers to make sure they're operating within legal codes and its own policies regarding environmental standards, occupational health and safety, and human rights.
Apple did not, however, say why this year it decided to name each of its suppliers, though the company has come under scrutiny in the past over workplace problems with its suppliers, such as nearly a dozen employees committing suicide at the Shenzhen, China, plant of Foxconn in 2010.
After that shocking and public string of tragedies, Apple sent then-Chief Operating Officer Tim Cook to Foxconn, which also manufactures products for a number of Apple's competitors, with two suicide experts and other high-level company executives to evaluate the working conditions there. Cook is now Apple's chief executive, officially taking over for Steve Jobs just before his death in October.
As it does each year, Apple documented good and bad news in its report.
The tech giant said that its Supplier Responsibility team conducted a total of 229 audits in 2011, which was an 80% increase from 2010.
"More than 100 of these were at factories that we had not audited before," Apple said in the report. "Facilities where we conduct repeat audits consistently show fewer violations, and the vast majority improve their audit scores year-over-year."
Apple also said that in 2011 it trained its 1 millionth supplier employee as a part of its "worker empowerment program," which trains workers on Apple's supplier standards as well as "their rights as workers, occupational health and safety standards, and more."
The Cupertino-based company also found that just 38% of suppliers it audited were in compliance with its policy of no-more-than a 60-hour work week.
"93 facilities had records that indicated more than 50 percent of their workers exceeded weekly working hour limits of 60 in at least 1 week out of the 12 sample period." Apple said in the report. "At 90 facilities, more than half of the records we reviewed indicated that workers had worked more than 6 consecutive days at least once per month, and 37 facilities lacked an adequate working day control system to ensure that workers took at least 1 day off in every 7 days."
108 audited facilities "did not pay proper overtime wages as required by laws and regulations," Apple said. "For example, they did not provide sufficient overtime pay for holidays." In response to that finding, Apple says it required suppliers to repay workers the wages they were due and to "change their current payment system to prevent recurrence."
The iPhone-maker also said it increased the amount of money its suppliers paid out to workers to compensate for migrant laborers paying outrageously high fees to recruiters, middle-men and other companies just to get a job making parts found in Apple goods.
"We increased audits in Malaysia and Singapore, countries known to be destinations for foreign contract workers," Apple said. "As a result, suppliers reimbursed $3.3 million in excess foreign contract worker fees, bringing the total that has been repaid to workers since 2008 to $6.7 million."
Apple also said in the report that it found no incidents of underage workers at its suppliers last year and that it stopped doing business with one supplier over a repeated "core violation" though the company didn't say who the supplier was or what the violation was.
– Nathan Olivarez-Giles
Photo: Workers assemble and perform quality control checks on MacBook Pro display enclosures at an Apple supplier facility in Shanghai. Credit: Apple
Siri, how do you say profit in Chinese?
One answer Apple's digital assistant might consider giving is: start selling the iPhone 4S in China. And starting on Jan. 13th, Apple will do just that.
The company said Wednesday that China will be among 22 countries that soon will get the newest iPhone, one of Apple's hottest-selling yet. The iPhone now accounts for nearly half of Apple's annual revenue, and some analysts believe it earns the company more than 60% of its profits.
China is one of the world's largest mobile device markets, with close to a billion cellphone users by some estimates. Apple currently partners with China Unicom, one of the larger carriers with close to 200 million cellular subscribers.
Apple said Wednesday it had no current plans to announce a partnership with China Mobile, the country's largest carrier with more than 630 million subscribers (a user base that, somewhat amazingly, is more than twice the size of the U.S. population). But for months now Apple has been rumored to be nailing down a deal with China Mobile, and millions of the carriers' customers are already using the iPhone by modifying the device to work on their network.
Will Siri actually be able to speak and understand Mandarin? Eventually, yes. An Apple spokesman said the company plans to add official language support in 2012 — and that will include Chinese. But Siri won't yet be multilingual when the phone hits Chinese stores this month.
— David Sarno
Photo: A couple look at an iPhone in Beijing in November. Credit: Diego Azubel / EPA
A factory explosion at an Apple supplier in China has left dozens injured and sparked concerns about whether iPad supply would be affected.
The blast took place over the weekend at a Riteng Computer Accessory Co. factory, owned by Apple supplier Pegatron, in Shanghai's Songjiang district, according to a report from the Associated Press.
The Chinese government is investigating the cause of the explosion and has ordered safety checks at the plant, the AP said.
Chinese media reported that 61 people were hurt in the explosion and that more than 20 had to be hospitalized, though none of the injuries were considered life-threatening, the AP said.
Apple officials were unavailable for comment on the explosion Tuesday, but company spokeswoman Carolyn Wu told the AP that "our hearts go out to the people who were hurt in Songjiang. We are working closely with Pegatron to understand the cause of this accident."
Pegatron told the AP in a statement that the blast was the result of "dust collection equipment."
Forbes magazine reported Tuesday that the explosion could produce shortages of Apple's big-selling iPad 2 tablet, noting that the Japanese earthquake and tsunami earlier this year and an explosion at Apple supplier Foxconn last year also resulted in difficulties for iPad production.
Apple has faced criticism in the past for troubles at its suppliers' factories. Foxconn, which also supplies products for many other top consumer electronics companies, has also recently dealt with employee suicides, prompting Apple's then-COO (and current CEO) Tim Cook to visit Chinese factories in person over workplace concerns.
The iPad, like many other Apple products, makes use of aluminum and, as the AP noted it its report, aluminum dust is "highly combustible."
Photo: The Apple iPad 2. Credit: Nathan Olivarez-Giles / Los Angeles Times
Apple has been denied the rights to the trademark for the term "iPad" in China in a legal battle with Hong Kong-based Proview Technology that registered a trademark back in 2000, according to reports.
At the core of the dispute is whether or not a 2006 agreement between Proview's Taiwan-based subsidiary, Proview Electronics, to sell Apple the "global trademark" for the "IPAD" name for £35,000, or about $54,000, applies to China, according to a report from the Financial Times.
Apple says the agreement should include trademark rights in China, and Proview disagrees, Reuters reported.
Proview is arguing that the Chinese trademark owned by its Shenzhen-based company, Proview Technology, is different than the trademark formerly owned by Proview Electronics, the reports said.
Apple has sued Proview Technology for trademark infringement in the Shenzhen Intermediate People's Court, the Financial Times said, adding that while the court has rejected Apple's ownership claim, the U.S. tech giant can appeal the decision.
Meanwhile, Proview Technology has sued Apple resellers in China in an attempt to block the sale of Apple's iPad tablets, the reports said. In October, Proview Technology also filed a suit against Apple seeking 10 billion yuan, or about $1.5 billion, from Apple over alleged infringement of its Chinese "iPad" trademark.
But despite the legal back-and-forth, Proview spokesperson Li Su said told the Financial Times that a the company is open to a settlement.
"We hope that this decision will make our negotiations with Apple a bit easier," Su said in the report.
– Nathan Olivarez-Giles
Photo: An Apple iPad 2, running the Tabletop app. Credit: Armand Emamdjomeh/Los Angeles Times
If you're familiar with ZTE in the U.S., then you're familiar with low-cost or free phones from prepaid or contract carriers such as Boost Mobile, Cricket Wireless and MetroPCS, and from major carriers such as AT&T.
And you'd also know that ZTE's phones are nowhere near challenging top-tier handsets such as the Apple iPhone, or Androids such as the Samsung Galaxy S II and the Motorola Droid Razr. Like HTC used to do, ZTE often makes products devoid of their own brand for carriers looking for entry-level devices.
But next year, the Chinese company is looking to change things up and launch a high-end smartphone in the U.S., according to a report from the Wall Street Journal.
A high-end ZTE handset, running on speedy 4G LTE networks, could arrive toward the middle of next year and "by 2015, we expect the U.S. to be the largest market for handsets for ZTE," said Lixin Cheng, ZTE's North American president, in a Hong Kong interview with the Journal.
Such a smartphone would offer iPhone-like features at a price still somewhat lower than Apple's handset, Cheng told the Journal, declining to go into specifics about price.
The newest version of the iPhone, the iPhone 4S, starts at $199 for a unit with 16 gigabytes of built-in storage, increasing to $299 for 32 gigabytes and $399 for 64 gigabytes.
The idea may seem a bit far-fetched if you've never heard of ZTE before, but the company's growth is very real. As noted by the Journal, ZTE grew to a 5% share of global cellphone shipments in the third quarter of the year.
That recent push propelled ZTE to pass Apple as the No. 4 shipper of cellphones (not just smartphones) in the world, according to the research firm Strategy Analytics. Aside from phones, ZTE also makes mobile hotspot and USB-wireless dongles for carriers such as T-Mobile, Sprint and Verizon.
ZTE is "in talks" with U.S. carriers about selling its high-end phones, which may run either Google's Android operating system or Microsoft's Windows Phone 7 software, Cheng said in the report.
– Nathan Olivarez-Giles
Image: A screen shot of ZTEusa.com, ZTE's website for the U.S. market, which displays the AT&T Avail, an Android smartphone ZTE builds for AT&T. Credit: ZTE