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.

Facebook Hits 500 Million Users

Facebook recently announced that they have passed the 500 millionth registration. To put that into some context, that's 7% of the global population and 25% of Internet users. That's crazy! The BBC has a lot of interesting data too.

Facebook continues to see the largest growth of all social network sites, however it's also good news for Twitter, Orkut and LinkedIn. Sadly MySpace, Flickr, Bebo and Friends Reunited are not adapting quickly enough to Facebook's dominance. Do you remember Friends Reunited? A few years ago, when I was just a wee young whipper snapper it was all the rage! I was still at school at the time and a bit young to use it so the Friends Reunited fad went right over my head but I can remember my mum and her friends always going on about it. Friends Reunited can obviously be seen a pre-cursor to Facebook. Facebook was original only for university students. I think when it first opened you could only speak to someone in the same university as you. Imagine if it went down a more academic road? We'd all be swapping class notes on Facebook - maybe even having study sessions and revision workshops on there!

What else is really interesting is the comparison between Facebook and other social networks in specific countries. The BBC only gives data for US, UK, Brazil, Australia, Germany, Spain and Italy and it would be interesting to see Facebook fairs in Russia, China, India etc. (i.e. less Western-centric). Amazingly, Facebook has 127 million users in the United States, that's 41% of the population, 54% of the internet population. That means, for every 2 users of the internet in the US, 1 has a Facebook account. Isn't that crazy? In the UK, 24.2 million people have a Facebook account. That translates to 51.8% of UK internet users. That similarly equates to 40% of the population (based on recent population estimates).

Furthermore, the amount of time spent on Facebook per month has also gone up. In the US it has gone up by approximately 1 hour 20 minutes to 6 hours~. Whilst in the UK it has only gone up 20 minutes to 6 hours 10 minutes~. Interestingly Australia has seen Facebook usage nearly double to 7 hours 10 minutes~. This suggests we are increasingly becoming dependent on Facebook as a source of communication and/or entertainment. With the games industry on Facebook going from micro-transaction strength to strength and Facebook's rollout of being able to just about "Like" anything you see on the web, I wonder when the tail-off point will be reached?

What I find most interesting about the data is Brazil (arguably the least Western country examined) does not have Facebook as the number 1 social network. That honor goes to Orkut, Google's answer to Facebook. Orkut is somewhat popular but it has very niche markets - South America, Asia etc. Has Google made a smart move going after these new markets? I think quite possibly yes. The populations of many South American and Asian countries dwarf North American and European countries.

If a social network site can get a similar 40% of China's population registered, that would equate to 535,445,187 users. Leap frogging over Facebook as the world's most popular social network and with just 1 country! That's not to say that such an achievement would be easy to attain, I'm sure there are many cultural and technical difficulties to overcome when entering very different markets.

China's Influence on Global Technology?

I came across a really interesting article on CNET about China's influence on global tastes in the motor industry. China has recently overtaken the US as being the biggest automotive consumer industry. You might think, so what? China is on the other side of the world but consumer demands in China reflects what the consumer gets in the US.

I found this to be really interest. CNET mentions that car manufacturers have coined the term - 'C-Factor' in relation to this new found influence. I think this speaks volumes of the new position Asian countries find themselves in - specifically China and Taiwan.

Traditionally, Japanese and South Korean businesses are reverred for their technological expertise and approach to economy and business. Everyone is well aware of the technological power houses that dominate the tech landscape: Samsung, Sony, Toshiba and LG to name just a few. But in recent years we have seen the rise of HP, Apple and Dell, Western technology companies that continue to thrive. However, even more recently we have seen the growth of two new East Asian countries within the technology market - China and Taiwan.

China's technology industry has recently been making a lot of headlines internationally due to the controversial tragedies at Foxconn, manufacturers of Apple products amongst many other products for leading technology companies. China's Lenovo PC manufacturer is now in the top 4 selling companies and will continue to grow.

Taiwan doesn't normally get the same amount of headlines as China but its technology industry is making business headlines as it continues to rapidly grow. Acer has become the second biggest computer manufacturer - leap frogging Dell to reach the coveted spot. Although this is somewhat dismissed by Dell (who wrongly or rightly claim it is profit not sale numbers that count), it is still a huge achievement. I guess what it shows is that the technology industry is a continually changing landscape. It will be interesting to see how/if the C-Factor and T-Factor affects other industries such as food, health and so on. Ultimately though, it will be interesting to see if these new companies can continue at the pace they are currently at and if they can stay ahead of the competition once they reach the top.

(Image credited to here)