Chinese brands' status are growing to eclipse global names.
A different kind of fast food Image: Jonathan Kos Read |
Across the country, international giants like Apple, McDonalds, KFC and Coca Cola are finding their market share being eaten away at by domestic rivals.
After a series of consumer watchdog exposes revealed poor hygiene and negligence, KFC's parent Yum! Food Brands saw profits slide across China. McDonalds has also scaled back expansion plans as consumers flock to regional rivals offering local delicacies in the fast-food format.
Coca Cola, the single most popular soft drink globally, is outsold double by Wang Lao Ji (Jia Duo Bao a cold herbal tea brand, despite the latter being twice the price.
Affluent, savvy consumers frequently complain that Apple products are not specifically tailored to Chinese tastes. For example, character input on the Apple keypad is cumbersome and the products themselves allow little room for personalisation - a sticking point for many consumers. Many are buying China's popular Xiaomi smartphone for a fraction of the price.
While data gathered by Credit Suisse and the Financial Times claimed that "91% of Chinese consumers intend to buy a foreign handset in 2013", in real sales terms five in six of China's top-selling phones were domestic models. Foreign brands need to do more to localise their offerings if they are to win over young consumers.
It would appear, however, that the trend has not yet reached the auto industry where, despite safety standards improving dramatically, domestic carmakers' market share decreased to 27% in 2013, from 31% in 2010, according to J.D. Power, an analyst.
According to James Qin, founder of Autohome.com.cn, the world's largest automotive site, the rise of female car buyers is also an important trend to take into consideration. Females now make up 31% of auto sales in China.
For international lubes producers, more foreign autos should also mean more foreign lubes recommendations. However, as safety standards improve and local firms produce ever-better lubricants, international firms will have to do more to convince consumers of their worth.