Under the sponsorship of the Organization Support Programme of the Dedicated Fund on Branding, Upgrading and Domestic Sales, the Hong Kong Brand Development Council (BDC), in collaboration with the Chinese Manufacturers’ Association of Hong Kong (CMA), implemented “Tianjin Hong Kong Brand Festival” Serial Activities, aiming to assist Hong Kong brands to explore the North China market.
As one of the major deliverables of the Project, the BDC commissioned the Brand Strategy and Innovation Center of Hong Kong Polytechnic University to carry out a series of market researches (the Study) during mid-2014. The Research Team held several consumer focus groups and distributor panel discussions in both Tianjin and the Baoding City of Hebei Province, supplemented by questionnaire surveys. The Study conducted a comprehensive analysis of the consumers’ behavior and their perception, expectation and acceptability towards Hong Kong brands, in an attempt to gain insights into local residents’ buying patterns, spending characteristics and preferences. And it also looked into the practices and experiences in market development and brand promotion from the perspective of channel operators, helping to gather first-hand and in-depth market intelligence that sheds light on the effective strategies for Hong Kong brands to tap into the regional market.
The main findings of the Study are as follows:
1. Among the participants of the consumer focus groups, about 70% have attained a college or higher degree, and over 60% have a monthly income of more than RMB 4,000. The post-70s and post-80s generations have become the most important consumer groups; and as the main source of household income, they tend to hold a pragmatic attitude but have higher requirements for product quality. Being freshmen in the workplace and free from family burdens financially, the post-90s are more willing to consume and to try new things; and they often spend a small amount of money each time but pretty frequently and spontaneously. As for the elderly, they prefer health-care products due to the paramount concerns over health. Overall speaking, residents in Tianjin and Hebei tend to attach much importance to family values, and therefore brands with a focus on family lives could be relatively well-received.
2. Hong Kong brands generally do not enjoy high awareness in the Tianjin and Hebei. Both local consumers and distributors are not quite familiar with Hong Kong brands, and their knowledge about Hong Kong brands are mainly confined to limited industries like gold & jewelry and apparels.
3. However, residents in Tianjin and Hebei tend to hold Hong Kong brands in high regard, associating them with favourable attributes such as good quality, positive image, high cost-effectiveness and credibility. Besides, Hong Kong brands are deemed superior and high-end in comparison to domestic brands. Yet, as some distributors pointed out, Hong Kong brands would be more attractive to the provident local consumers if their product prices could be lowered down to some degree and more added values provided.
4. Consumers in Tianjin and Hebei learn Hong Kong brands mainly via TV advertisements and Internet, followed by word of mouth, advertisement in shopping malls and paper media. In addition to mass media commonly used, on-site product demonstration in shopping malls is also an effective avenue for brand promotion. Internet is the most direct channel for young and middle-aged consumers to receive brand information, and mobile has become an essential brand touch point.
5. As for consumers’ buying channels, Internet, mobiles and physical stores are equally prevalent, while the population of mobile shoppers is expected to grow in the future. When seeking cooperation with distributors, the intermediary role of local business associations is pivotal, to the extent that they could increase both the chances and convenience for Hong Kong brands to expand into the regional market.
6. According to the Research Team, due to the significant differences in lifestyles, value sets and consumption habits between consumers in Tianjin and Hebei, Hong Kong enterprises should pay heed to market segmentation, introducing specific products for different consumer groups. And the promotional activities in different cities might be closely connected via the two major channels of information acquisition, namely transport network and media, so as to achieve better economy of scale for business operation.
Besides, traditional media remains popular in Tianjin and Hebei, especially among the elderly, while more and more consumers become used to searching brand information through social media. In view of these, Hong Kong enterprises are suggested to establishing multi-dimensional marketing channels and keeping an eye on the online comments about their brands. Since credibility and quality are highly valued by consumers in Tianjin and Hebei, Hong Kong brands need to emphasize their own strengths in such areas, so as to highlight and promote the advantages of Hong Kong brands by leveraging on the marketing mix that includes products, services and communications.
(For a full report, please refer to the Chinese version京津冀消費者購買行為及市場環境研究報告)