The 10 Biggest Stories of the Decade

Ten Trends That Have Emerged in China and Changed Chinese Society Over the Past Ten Years

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HONG KONG (AdAgeChina.com) -- In the past ten years, China has undergone enormous changes.

China started this decade as a relatively poor nation where people traveled around cities by bus or bicycle. Most locally-made products were low quality but few could afford foreign-made products. Chinese looked to the West for manufacturing contracts to keep local factories humming.

People still get around by bicycle, but car sales have surged, the quality of local products has improved and those factories are now turning out goods to be consumed at home, too. There are dozens of things that have changed in China -- and changed Chinese society -- in the past decade. But we've narrowed it down to ten.

1. China showcases the 2008 Olympic Games
The 2008 Summer Games in Beijing were China's official coming out party. Demonstrating the control and precision for which China's Communist regime is known, the gleaming, massive venues were finished on time, Chinese athletes performed exceptionally well, and there were no major political disruptions during the tightly executed event. It even rained on schedule.

Beijing put on one of the most commercialized Olympic Games in recent times.

Alongside global sponsors, the Beijing Organizing Committee named dozens of national sponsors.

Foreign sponsors like Adidas invested in major marketing campaigns to grow their brands in China through a connection to the Olympic Games.

Local companies like PC-maker Lenovo Group (a global sponsor), Chinese dairy Yili Group and China Mobile used the Olympics to cement a dominant position at home and grow their brands overseas.

No doubt to the dismay of both China's leaders and commercial sponsors, the glory of the games was short-lived. During the months leading up to the games, the prestigious Olympic torch relay was disrupted by political activists in cities like London and Paris, creating a global debate about the future of Tibet.

Almost immediately after the games concluded, the U.S. was hit by a banking scandal that led to a meltdown of the global economy, and threatened to stall China's exports, the backbone of that country's economy.

About the same time, China was hit by an embarrassing scandal involving melamine, a chemical added to dairy products to make them appear more nutritious. Melamine killed or sickened thousands of Chinese infants and led to the recall of products like Lipton milk tea and Cadbury's chocolate bars. Dozens of dairy producers and distributors have been implicated.

2. China struggles with quality and safety in manufacturing
China's image problems didn't start with the melamine scandal.

Over the past decade, China's manufacturing industry has been implicated in numerous problems related to product quality and safety, leading to illness and death in people and animals around the world. In 2007, for instance, U.S. toy giant Mattel recalled Fisher-Price preschool toys that contained excessive levels of toxic paint.

Cheap Chinese tires missing a safety feature were blamed for a fatal traffic accident that same year in New Jersey. And U.K. retailers discovered children's jewelry imported from China contained dangerous levels of lead.

In May 2007, over 10,000 tubes of Chinese-made toothpaste sold under the Excel and Mr. Cool brands were recalled in the Dominican Republic after it was found they contained diethylene glycol, a lethal chemical used in antifreeze and brake fluid. In the wake of these discoveries, many consumers around the world have lost confidence in products made in China.

3. Chinese start creating, not just copying and manufacturing
China's manufacturing industry has taken a lot of hits over the past few years, for bad products, a blatant disregard for intellectual property rights and human rights abuses inside factories.

But don't write China off, because a new breed of entrepreneurs has appeared on the scene that is turning China into a hotbed of innovation and creativity, in terms of production, design and technology. Marketers should tap into these resources to develop products for China and for the world.

4. Digital media soars China
Despite heavy-handed government control and the need for self-censorship, the web has become enormously popular in China, now the world's largest internet market. In November 2009,the number of internet users in China reached 360 million, an increase of 20.8% from last year. By the end of October, the total number of broadband internet access users had topped 10 million, according to China's Ministry of Industry and Information Technology. China is also the world's largest mobile phone market, with over 729 million phone phone users.

Why is the internet so popular in China? TV shows are still dreadful, and most households still own just one TV set. With two and often three generations living under one roof, the remote is controlled by parents and grandparents, sending teens and young adults living at home to a home computer for cutting-edge entertainment.

Youth also gravitate to internet cafes, partly for the camaraderie it provides kids in the one-child families that are the norm in urban China. Those same cafes also provide a parent-free venue to indulge in online games, a passion for millions of Chinese kids.

5. The Super Girl phenomenon inspires imitators--and marketers
China elected four Super Girls between 2004 and 2006, when the "Mengniu Yoghurt Super Girl Contest" was produced by Hunan Satellite Television, one of China's leading provincial broadcasters. But one, the androgynous Li Yuchun, captivated China and changed the course of Chinese television.

Support for Ms. Li and her rivals, namely Zhang Liangying, was so intense, that the final episode of the 2005 season was one of the most popular shows in Chinese broadcast history. The show attracted over 400 million viewers, making it even more successful than China Central Television New Year's Gala earlier that year.

The singing contest, a copy of "American Idol" in the U.S. and the U.K. show "Pop Idol," spawned dozens of copy-cat programs in China and helped turn the Chinese dairy Mengniu into a household name. The format also inspired marketers to create more marketing programs that let consumers cast votes via SMS, just like the Super Girl contest, mostly for web-based campaigns.

The show's wild success ultimately led to its downfall. The Chinese government introduced rules limiting TV contests, partly out of concern that the concept of voting would catch on in that one-party country. Media watchers say Beijing also wanted to clip the wings of Hunan Satellite TV, whose innovation was beginning to scare stodgy, state-run CCTV.

6. The success of athlete and cultural icon Liu Xiang
Liu Xiang is one of the most famous and beloved faces in China. The hurdler's 2004 Olympic gold medal was the first in a men's track-and-field event for China -- or any Asian country -- and he is the first Chinese athlete to achieve the "triple crown" of athletics, as a World Record Holder, a World Champion and an Olympic Champion.

His domination of the 110-meter hurdles turned him into a cultural icon, but he is also the most commercially successful athlete based in China today. Marketers like Coca-Cola Co., Visa, General Motors Corp, Amway and Nike tapped in Mr. Liu's popularity to build their Olympic-themed marketing campaigns.

7. Chinese start packing their bags
Ten years ago, few Chinese ventured overseas. Visas and foreign currency were difficult to get, as was the income to afford foreign travel. Few Chinese possessed credit cards, often needed to book hotel rooms and international flights.

Today, China is the fastest-growing outbound travel market in the world. Close to 45 million Chinese traveled abroad last year, generating over $35 billion in tourism revenue, according to the market research firm Bharat Book Bureau.The influx from the mainland has prompted hotels and luxury retailers to hire Mandarin-speakers to accommodate Chinese visitors.

Interest in travel within China is also growing. That country has one of the world's largest domestic tourism markets, generating revenue of over $100 billion in 2008.

8. Some Chinese get rich -- and are loving it
According to the Hurun 2009 Wealth Report, China now has 825,000 mainland Chinese, or one in 1,700, with personal wealth of at least $1 million. Of those wealthy Chinese, 82% have not made any lifestyle changes since the financial crisis hit.

Affluent Chinese are also younger than their western counterparts. The average age of China's millionaires is 39. The average Chinese worth more than $10 million is 43 years old, and for those with assets of more than $100 million, the average age is 49.

Rich Chinese are spending their new wealth on high-end goods ranging from designer fashions to pricey spirits to luxury cars. In 2009, Chinese spent $9.9 billion on luxury goods, up 12% from last year. Sales reached $8.9 billion in 2008, a 30% increase from $6.8 billion the previous year.

Once limited to a handful of ultra-elite Chinese who frequented luxury malls like Plaza 66 in Shanghai and the China World Hotel lobby in Beijing, China's luxury segment is maturing into a vibrant market that represents strong sales today -- not just potential for growth down the road.

9. China Inc. wants to buy the world
Encouraged by government officials and aided by easy financing from local state-owned banks, Chinese companies have embarked on an M&A craze. Still lacking the experience and expertise to build their business overseas through branding, they are acquiring growth instead.

Chinese companies such as as car makers Beijing Automotive and Geely Automobile, white goods and electronics manufacturer Haier Group, China Mobile and oil refiner Sinopec have invested or shown interest in overseas businesses. Chinese companies doubled their foreign investments last year, to $52 billion, and double-digit growth is expected this year.

10. The values of Chinese youth change
Western media often paint Chinese as single-minded in the pursuit of building careers and acquiring wealth. But younger Chinese have shown a different side of China's culture, a growing consciousness about social and environmental concerns.

This trend came to the forefront in May 2008, when a major earthquake rocked Sichuan province.

Chinese students flooded into the area to help sift through the rubble for survivors, while others donated blood, money and supplies.

China's young generation grew up in sheltered, protective households, so a seismic shift away from narcissism will take time, but a number of marketers are already taking advantage of the growing interest in environmental causes. Coca-Cola, for example, has stepped up its sponsorship of the 2010 Shanghai World Expo with a college environmental protection contest in one of the world's most polluted countries.


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