China Marketing Blog

Chinese Consumers Still Warming Up to Idea of Buying Services

Echo — Thu, 07/28/2011 - 04:09

In my job helping non-Chinese businesses promote their products and services in Mainland China I’ve come to realize some key differences between Western and Chinese Internet consumers. One of the more important differences is that Western consumers seem to be much more likely to consider purchasing services. For example, I recently worked on a website for a client that provides Western Internet users with editing services. While performing keyword research in both English and Chinese to gain insight into the search intentions of our target market, the one point that struck me most was that paper editing services were not very common in China, yet ghostwritten papers were actually quite common. The search volume for paper editing services and related Chinese keywords wasn’t as high as I would’ve liked.

When researching the issue to find out why, I found that a common opinion amongst Chinese Internet users is “Why should I pay for editing services?” Without being offered a tangible or even intangible product, they had a hard time seeing the value.

Generally speaking, Chinese consumers are looking to spend their money on ‘things’ rather than services. For example, it wouldn’t be hard for them to see the value in buying a finished paper – the paper is a ‘product’, it is ‘real’ and so it has value. However, if they were to spend money to have somebody edit a paper, the paper would still basically be the same paper as it was before. Although the paper will be of higher quality than it originally was, I feel that many Chinese consumers will have a hard time seeing how the expense can be justified.

In the context of China’s current economic conditions, it’s still hard for many Chinese people to seriously consider tertiary industry purchases. But the number of consumers that are willing to purchase services is increasing and there are businesses ready to serve them. Tipping is a good example of the idea of paying for a service as a cultural trait. In Western countries, tipping is customary. In other words, paying for service is normal to them. However, Chinese diners tend to think that they go to restaurants to purchase food rather than to purchase a service. If they purchase 8 dishes, they will pay for the 8 dishes - not for the waitress’ service. But along with the gradually changing opinions of Chinese consumers, restaurant owners are changing their habits as well. Although it’s still very rare to allow waitresses to accept tips, some restaurant owners will add a 15% ‘service fee’ on to the bill.

Photo by Mister Jones

Illustration by Mister Jones

I’ll use VIP membership programs as a final example. Many stores provide members with a VIP card. From what I’ve seen, the vast majority of VIP cards provide members with a discount. For example, ‘Silver Card’ members of a restaurant may receive 20% off the price of their meals, ‘Gold Card’ members of an airline may get 10% off select flights or VIP members may be entitled to a free slice of cake at their favourite café on their birthday. All of these benefits are ‘things’. But if we broaden our perspective, we can see that there may be room for ‘non-thing’ benefits as well. For example an international hotel chain could provide VIP members with a VIP check-in counter so that they do not need to wait in line, no matter where in the world they check in. Services such as these would be very attractive to travellers.

In my opinion, it seems that the idea of buying services may still only be a seedling in the minds of Chinese consumers now, but it will grow greatly over time. Have you had success selling services in China? If not, do you have services you believe would be applicable to the Chinese market?

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Comments

Hello Echo

Thanks for this helpful article! I am in the process of setting up a proofreading business aimed at Chinese students studying in UK universities, so I'm very interested by what you say. Do you think that Chinese students studying abroad tend to have a different (more service-orientated) mentality, or do you think that I will find it difficult to sell a proofreading service?

Thank you

Tom

Proofreading services are popular with Chinese people, although I don't have any non-Chinese projects to compare it to.

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