Tuesday, 7 September 2010

The C-Factor: China's Influence on the Technology Industry

China recently overtook the US to be the biggest automotive consumers. You might think, so what? China may be on the other side of the world but consumer habits there are beginning to effect designs from other areas of the world.

This is an emerging source of globalization. Commentators have coined the term 'C-Factor' for this new found influence.

Businesses from Japan and South Korea have been revered for their technological expertise and approach to business. The digital and technology market has been dominated by these companies creating everything from watches to computers. But in recent years, particularly in the personal computer industry, Western technology companies have achieved a large share of the market. Even more recently there has been the growth of two new East Asian countries in the tech market - Taiwan and China.

China manufactures the world's most popular, high-end technology devices. China is now also home to the 4th largest PC manufacturer in the world.

Although not quite as famous in global economies as China, Taiwanese technology companies continue to rapidly grow. Acer is now the second biggest computer manufacturer - jumping over Dell to reach the coveted spot. It is clear that the technology industry continually changes. It is interesting to imagine the effect of the C-Factor (and T-Factor) on industries such as food, health and so on.

In comparison, the Asian markets are often seen as difficult to break into by Western businesses. What is popular in East Asia may often be unheard of in the West. Western companies must offer different products and brands in order to appeal to an Asian demographic. This can simply be explained by cultural differences - aesthetics do not always translate. Asian countries are also definitely a game changer for online companies.

It is easy to think that the world is converging into a single homogenized, global culture. The globalization of brands, as well as the spread of English, further fuels this idea. However, with the Internet and technology there are still many key differences between cultures.

For example, SMS phone messaging is one of the most popular methods of communication amongst young people in Europe. In certain Asian countries, this technology is mostly unused and emails are used instead. Furthermore, whilst many people in the West view the desktop computer as being the main method to access the Internet, mobile phones and other devices may be more popular in Asian countries. This creates genuine problems for online companies - if the technology that is favored is different then you cannot merely translate a website and expect it to gain traction.

Online social networks are a good example of such differences. Facebook is arguably the most popular website in the Western world. The number of Facebook users would rank it the third biggest population behind China and India if it was a country. However, its usage is not as pervasive in some East Asian countries.. Facebook is only ranked 27th in the top 100 visited websites in Japan and it is not even inside the top 100 for China. Twitter, another popular online social networking website has a much lower user number in East Asian countries.

Furthermore, online bookmarking (allowing you to save your favorites online) is also not used as much. The majority of users are from English speaking countries whilst the number of users from East Asian countries is a lot lower. This may be down to language differences but there are other factors as well. Layout, design and content should all be tailored for specific cultures. This is largely the reason why there are few truly global brands.

You might be wondering what is popular in Asian countries. Blogs are very popular in Asian countries and are used much more prolifically compared to the West. Of course, blogging is popular all over the world but Asian cultures have taken it up a lot more vehemently. Many celebrities blog and groups of friends work together on shared blogs. Blogging platforms are specifically created for certain markets and have individual features and unique quirks. Personalized homepages are also popular and many people set up home pages which feature images, links, music and so on.

Looking at how the social network marketplace is fragmented according to geography speaks volumes on the cultural differences and struggles faced by marketers and international businesses. Combine the C-Factor and Asia's new immergence in the technology market, we may soon be analyzing the East's influence on the West. Ultimately, it will be interesting to see if these businesses can continue at the pace they are currently at and if they can stay ahead of the competition once they reach the top.

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