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How China’s digital ecosystem is moving ahead of the rest

Stefan Kingham

Welcome readers. Let me get something off my chest.

When I first decided to write on this topic and performed my usual internet research, I was amazed to see just how little Westerners knew about China’s digital prowess.

Now I’m not talking about unimportant websites with small budgets underestimating China’s digital knack, I’m talking about internationally-renown news websites claiming that China’s digital ecosystem is “steadily growing and catching up” with its Western counterparts.

Now forgive me for losing my cool, but are they for real? Look, I’m not Chinese but that condescending, ignorant brand of journalism really drives me up the wall.

Condescending journalism drives me crazy!

As a westerner myself, I know first-hand that we like to think of ourselves as trend-setters and anyone who attempts to steal our limelight is nothing but a copycat.

But unfortunately homies, it’s time to wake up and smell the coffee. The fact of the matter is that China is light years ahead of us when it comes to the creation and adoption of digital experiences.

The following article is an opinion piece in which I’ll explain why I believe China’s digital ecosystem is years ahead of its Western counterparts, based on 3 factors; Consumer behavior, accessibility and innovation.

Consumer Behavior

To start off with, let’s take a closer look at the manner in which Chinese netizens interact and engage with digital experiences, and compare that to Western trends.

Alright, let’s dive into some insights.

According to digital expert Vincent Digonnet, while most Western social media users are recent graduates with little income to spend, China’s social media fanatics are well-educated and well-paid post-1980ers with money to burn.

Burning money on e-commerce platforms

As well as being older and more able to consume, Digonnet believes Chinese netizens are more active than their Western counterparts.

He says that 30% of all China’s internet users are genuine content creators, 50% are curators who share and interact with content while only the remaining 20% are passive spectators.

To put that into context, he claims that in the West, 90% of all internet users are passive spectators, 9% curate content and only 1% actually create content.

Now these numbers wouldn’t be all that impressive if we were talking about a small sample of people but the crazy fact is that there are approximately 721 million internet users in China (just over 1/2 of the population), meaning that 216 million Chinese netizens are potentially active creators rather than passive spectators… Wow, right?!

721 million internet users in China

Ok so we get that they’re slightly older and more active, but what consequences does that have on things that matter such as the digital economy I hear you say.

Alright, so imagine a world in which social media and e-commerce have become intertwined and the same people who are extremely active on social media have the financial means to consume.

Now imagine that these people appreciate e-commerce in the same way that they enjoy social media, using it as a means to waste time rather than save time.

What do you get? A forever active digital ecosystem that promotes impulsive-buying habits, fan content creation and internet celebrities.

Say what you will, but this sort of behavior is great for the digital economy and Western economists can’t wait until we adopt the same habits.

Accessibility

The engaging behavior Chinese netizens adopt online certainly stimulates the rise of China’s digital ecosystem but that behavior would take them nowhere if they didn’t have access to digital technologies. So to what extent is China connected?

As stated above, more than half of China’s population is online. Now obviously, due to the fact that China is currently the most populated country on the planet, not to mention that large parts of the country remain undeveloped and poor, internet penetration in China is considerably lower than in most developed countries.

That said, there are roughly twice as many Chinese web users than there are people in the United States and the share of people in China that have access to the internet is practically the same as the likes of Turkey and Colombia and higher than in South Africa or even Mexico. Not too shabby.

Moving on from internet penetration, what really makes China unique is the sheer popularity and nationwide ownership of smartphones.

At the end of Q4 2015, smartphones accounted for 68% (913 million) of the estimated 1.3 billion mobile connections in China.

Smartphone use in China

As a comparison, the average level of smartphone adoption in Europe as a share of mobile connections is approximately 55%.

If that wasn’t crazy enough, market research performed by the Pew Research Center in 2015 revealed that 58% of China’s immense population own a smartphone compared to 49% in France, 45% in Russia and 39% in Japan.

So how come China has more smartphone users than the US, Brazil and Indonesia combined?

Smartphone users in China

More than anything else, it would seem that the increasing affordability of smartphones has helped boost adoption, with low-cost smartphones from local brands such as Xiaomi, Huawei, Oppo (and the list could go on and on) overtaking their more expensive international competitors.

In actual fact, an industry study conducted in mid-2015 found that the average price of a domestic smartphone in China was 935 yuan (US$135). Yep, that’s about 6 times less expensive than the iPhone 7!

Innovation

Forgive my excitement but this is where things get sexy.

As a foreigner, I know very well that we like to think that all Chinese apps & social networks are copies of Western success stories and I guess that to a certain extent, there’s some truth in that.

After all, anyone who denies that Renren’s interface is a copy/paste of Facebook’s, that Youku sounds like Youtube or that Xiaomi’s branding resembles that of Apple is tricking no one!

Xiaomi copying Apple's branding

But, and this is a big but, these copycats are only part of the landscape.

Forget about the obvious doppelgangers, the copied slogans and logos and focus instead on 2 of China’s strongest recent digital inventions; Mobile payments and the master of all QR codes: WeChat.

Thanks to the digital innovations the country has witnessed in recent years, I can go to the nearest corner shop and pay for my groceries with my phone, hail a cab in a matter of seconds through WeChat, scan a code on the back of the driver’s seat to get a discount at a local bar, invite my friends with a vocal message (who has time to write messages nowadays) and get refunded the next morning on my phone.

Oh and before you say it, no. Paypal is not as good as Alipay or WeChat pay. It just isn’t.

WeChat Pay isn’t only available in massive retail shops or popular restaurants AND all it takes is a 6-digit code. No account numbers, no fuss, no hassle.

Apple is currently launching its own digital wallet service called Apple Pay though, so that’s something to keep an eye on. (Although it’s only limited to Apple phones… As is the Apple way.)

Then there’s the whole QR code debate.

QR Code use in China

Many of my Western friends chuckle when I tell them about QR codes. QR codes are so has-been they say, is China living in the past?

But how can something be has-been if it never worked in the first place?

For some reason, QR codes never caught on in the Western world.

No one seemed to have a QR code scanner on their smartphone and for a bunch of self-proclaimed creatives, we didn’t know what to do with them.

In China, QR codes enable marketers to be creative & consumers to benefit from O2O promotions and ultimately we all benefit from that.

To what extent is China’s digital ecosystem ahead of the rest?

Just look at it this way.

Sure, a higher percentage of Americans have access to the internet when compared to the Chinese. But there are 1.357 Billion people living in China! And roughly 55% of them live in rural areas!

Ultimately, there are more Chinese netizens than people living in the US and as the saying goes, it’s not the size that counts, it’s what you do with it.

China’s internet goers mainly use the web to create or interact with content and as opposed to most Western countries, passive spectators are hard to find.

This results in value creation which itself generates profit and there’s no doubt that in that respect, China’s digital ecosystem is more user-driven than what we’re used to back home.

Furthermore, the increasing affordability of digital software in China has resulted in smartphones accounting for approximately 70% of all mobile connections, as compared to 55% in Europe.

Chinese netizens are ultimately more web-savvy than their Western counterparts and there’s no doubt that local technology companies have contributed to this change, supplying locals with the means to get online at low prices.

In many ways, this is enough to state that China’s digital ecosystem is ahead of ours, but China’s recent digital innovations are the icing on the cake.

Technologies that are somewhat unknown (or at least unused) in Western countries such as QR codes and mobile payments have become a mainstay in China and few people would disagree that they’re useful and practical tools that make your life easier.

And after all, what’s the point of technology if not to make life easier?

Look at the end of the day, a country’s digital efforts, infrastructures and inventions are difficult to rate or rank and as underlined in previous sections of the article, China still has a long way to go in terms of improving overall internet penetration and getting rid of their copycat reputation.

But although certain other Westernized countries may look at China’s digital ecosystem and see nothing but censorship and forgery, there’s no denying the fact that China’s netizens are in actual fact the world’s biggest online spenders and constitute the world’s largest mobile market, m-commerce market AND most active social media landscape.

Now that’s not just impressive people, that’s what you call winning.

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Stefan Kingham
Stefan Kingham

Stefan is originally from the UK and holds a degree in international business. He's been working in digital marketing for almost 3 years and loves to motivate, create, innovate (and any other word ending in "ate"). Before joining Sekkei Studio, Stefan worked at a medical startup in Berlin, several record labels in London and Reykjavik and a social media agency in Beijing. When he's not reaching out for backlinks, Stefan likes to code, sing in the shower, and support his beloved AFC.

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