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Economy
How Chinese Consumers View “Made in China”
Economy

How Chinese Consumers View “Made in China”

by William J. McEwen

IRVINE, Calif. -- Product safety has been a well-publicized topic of consumer unease in the United States and elsewhere, with some recent high-profile recalls involving toys made in China. But product quality and freedom-from-defects aren't considerations for China just in regard to its exports. Quality is also a vital issue for Chinese companies seeking to market to increasingly savvy domestic consumers.

Today's Chinese consumers typically have a variety of brands from which they can choose, whether they're looking for a microwave oven or a mobile phone. And, when it comes to manufactured goods, there are competing brands -- both foreign and domestic. As a result, product availability isn't the overriding factor that determines what Chinese consumers will buy.

Product quality, both real and perceived, is a crucial consideration for any consumer, regardless of whether they're living in Beijing or Boston. Confidence in a company's commitment to keep its promises is, as 鶹ýAV's research has shown, the bedrock foundation for an enduring, profitable, "engaged" customer relationship. Buyers won't keep buying if a company breaks its promises.

鶹ýAV Polls in China include questions that speak directly to these issues, and serve to underscore both the challenge and the opportunity that confronts Chinese companies seeking to sell their goods at home.

Two 鶹ýAV questions address potential buyers' desires and preferences, asking consumers what they would ideally like to do. And here the answer is quite clear: Chinese consumers would prefer to buy Chinese-made products. And this preference became even more pronounced between 2004 and 2006. (As an important caveat, these data were collected before the high-profile food and product recalls in 2007.)

Chinese consumers would love to support Chinese brands … all other things being equal. But that's not always the case. A desire to support local brands and local industries is only one part of the consumer's buying equation and, as any number of Detroit automakers might attest, this desire doesn't always translate into a buyer's actual behavior. Chinese companies must also consider the Chinese consumer's perception of product quality and performance reliability.

Addressing the Quality Imperative

鶹ýAV's China survey includes a question that taps into prospective buyers' quality perceptions, images that are critically relevant in a competitive world that offers attractive and available alternatives. Importantly, and certainly good news for Chinese companies, there was a noteworthy decline between 2004 and 2006 in the degree to which the Chinese rate the quality of their country's manufactured products as "poor" or "only fair."

However, China's domestically produced goods are not yet acclaimed as "excellent," and about one in four Chinese consumers remains at least somewhat skeptical about the quality of what their country's manufacturers produce. The percentage who feel China's product quality is high (excellent (7%) or very good (21%)) is about equal to the percentage who feel it is low (poor (3%) or only fair (24%)). Of concern, looking at the vital and attractive urban consumer market, a third (34%) of these prospective buyers rate Chinese-made products as low in quality and only 1 in 20 (5%) deems them to be "excellent."

The quality of products made in some other countries, while far less familiar to Chinese consumers, is about as likely to be seen as "excellent/very good" and, worthy of note, much less likely to be rated as "fair/poor." Thus, they represent competitive options with relatively little negative product-quality-image baggage to overcome.

Of course, it's important to remember that domestic Chinese manufacturers typically enjoy a key economic, cost-of-production advantage over foreign companies. This pricing advantage has real relevance to Chinese buyers who may be increasingly hard-pressed to match their dreams with their incomes. In addition, far fewer consumers now have major doubts as to the quality of made-in-China durables. But it's also clear that Chinese companies cannot simply rely on the Chinese consumer's desire to support local industries. In the increasingly competitive marketing environment that now exists in China, Chinese manufacturers must continue to elevate their game. This has implications for manufacturing quality control, as well as for customer service, consumer communications, and brand marketing.

Survey Methods

Results are based on face-to-face interviews with more than 3,500 adults per year in China, aged 18 and older, conducted in 2004 and 2006. For results based on the total sample of national adults, one can say with 95% confidence that the maximum margin of sampling error is ±2 percentage points. In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.

Author(s)

William J. McEwen, Ph.D., is the author of .


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