THOUGHT LEADERSHIP

 

Overlooked Innovation

Apr 30, 2012

Historically speaking, innovation and China haven’t often appeared in the same thought. However, over the past decade, and especially during the past five years, this trend is starting to change. Due to factors including lower start-up costs, companies at the forefront of this change typically fall into tech-related categories such as online platforms (Tencent, Taobao, Baidu) and wireless and telecom vendors (Huawei and ZTE). Nonetheless, it is also important to understand that innovation is happening across a number of industries, despite less popular coverage. And although there are many factors that continue to work against creativity in China, there are signs that the country is heading in the right direction.

Websites and platforms that are based on social connectedness are increasingly receiving attention. A popular example is WeChat, an app that offers users a wide variety of ways to connect with others – from “Shake Shake”, which matches strangers who use the feature simultaneously, to “Drift Bottle”, which allows users to send messages on an open server in the hopes of receiving a reply. Meilishuo.com also showcases an innovative business model in that it allows users to “follow” those that post pictures of themselves modeling different ensembles, and then couples that with links that lead to online purchasing channels such as TMall and Taobao.

However, innovation in China is not limited to technology services. One non-tech specific innovation can be seen through higher quality service offerings. Haidilao is one of the better-known examples of a local company that offers an innovative business model. Customers at the national hot pot chain can enjoy a manicure or a game of chess while waiting for their food, a “kungfu noodle” performance while eating, and an extremely high standard of service throughout. This idea of providing higher quality service is also being echoed by smaller scale business, for example, last month a local Chinese language school began offering a complimentary dumpling delivery service on students’ birthdays.

Other forms of innovation are seen through product customization. Longxin and Zongshen, two private motorcycle manufacturers based in Chongqing, have opted to use a “localized modularization” approach to compete with manufacturers that have foreign partners like Honda or Suzuki with deep pockets and proven designs. In the new business model, rather than laying out every detail of the parts they want from their suppliers, the motorcycle-makers specify only features like size and weight, and let outside designers improvise.

The key insight here is that although China’s innovation is currently most widely exhibited in the technology sector, new approaches are increasingly spreading to other industries. This trend should be of special importance to foreign businesses that are either looking to enter China or are already here. For them, the message should be clear - keep an ear to the ground, be prepared to take the long-term view and invest in ways to train and retain talent.


About the Author

Connect with SmithStreet
In the News

Technology|Jun 14, 2017

Programmatic Advertising in China

Consumer Goods|May 22, 2017

China Will Allow U.S. Beef Imports

Luxury|May 11, 2017

China's Return to Great Retail Service

Reuters|Nov 18, 2016

New Look Seeks Fashion Edge in China with Local Designs

Bloomberg|Jul 18, 2016

Nestle Seeks China Turnaround Online as Competitors Abound

LoginNot a registered user? Register now.
E-mail
Password
Remember me

Login using your social network

RegisterAlready registered? Login now.

SmithStreet provides you source for today’s leading business ideas. Our content explores the topics critical to China market today.

Create your SmithStreet account:

E-mail address & password

*E-mail
Make sure you typed it correctly.
*Password
Make it 6-10 characters, no spaces
*Confirm Password

Personal Information

*First Name
*Last Name
Company
Job Title
Job Function
Country
Screen Name

Subscribe

Subscribe to our China Spotlight weekly news feed - a complimentary email newsletter that matters to your China strategy.

Healthcare

Consumers and Retail

I agree with the Legal Terms.
RegisterAlready registered?

Create your SmithStreet account:

*E-mail
Make sure you typed it correctly.
*Password
Make it 6-10 characters, no spaces
*Confirm Password

Personal Information

*First Name
*Last Name
Company
Job Title
Job Function
Country
Screen Name
Legal Terms
This is the official privacy policy for www.smithstreetchina.com, which is administered, owned and operated by SmithStreet. This policy is intended to provide you with important information regarding your use of the Site.

This Site is owned, operated and targeted for use in China and may not comply with other nation’s laws or regulations. Your continued use of this Site implies your acceptance of our policies and practices as described below.

We do not collect any personally identifiable information from visitors to the site unless they voluntarily submit information.

You may choose to subscribe to our email edition, which requires you to submit a valid email address. This service is operated for free on an opt-in basis, and you may unsubscribe at any time by emailing info@smithstreetsolutions.com.

The information we collect is used for internal review and is then discarded, used to improve the content of our website page.

We do not set any cookies.

If you do not want to receive e-mail from us in the future, please let us know by sending us e-mail at the above address.

All of the content posted on our Site is created in-house. We do summarize news from other resources by following fair convention. If, for any reason, you would like us to remove any content, graphics, or other information that you consider a breach of copyright law, please email us, or feel free to call us by below number.

We reserve the right to revise this policy at any time. Revisions will be posted in this location. Any and all posted revisions are effective immediately. Please check back often to stay informed about your use of the Site.

Please contact us directly if you have any questions about this Policy or anything else.

Email: info@smithstreetsolutions.com
Tel: (8621) 6565 6533

This Policy was last modified on November 1st, 2013 and is effective immediately.