As international market research specialists, we have experienced first-hand the many differences – cultural, linguistic, economic, etc – of different countries and markets around the world.  Sometimes the extent of these unique ‘quirks’ can be greater that many people realise, influencing the way we conduct our market research in any given country, and sometimes impacting on the findings and conclusions we uncover.  While we have written widely on some of the differences we have encountered around the world, we are always very interested to hear about other people’s research and experiences.  In the following article –

Dragons of different hues – which featured in the July/August 2009 Association for Qualitative Research magazine, Irwin Hanks contrasts qualitative research in two very different countries: China and Japan.

Let’s start with a little history

Japan has a strong market research culture going back to the early 60s, led by the rise of post-war manufacturing and exporting. Formal research agencies grew from what was, initially, an internal activity among large Japanese companies. Many are now over 40 years’ old and national household names.

China, by contrast, despite its astonishing recent economic and MR growth, had few formal agencies in this field until around 17 years ago, before which few capitalist businesses were around to buy research.

Initial industry growth was fed by the ‘conversion’ of State economic and statistics gathering units into quasi MR units. More significant, however, was the advent of investment by foreign agencies, driven by awakening interest in China’s market potential from their own clients.

So what affects the two countries’ MR industries?

The Economy

The contrast between both markets is currently huge. China, even if it has taken a well publicised hit in the export-driven low-cost manufacturing sector, remains in growth mode. Major clients remain reasonably robust domestically, and there is little decline in foreign interest.

In Japan, unfortunately, it’s a different story. Companies are, for the first time, laying off workers, consumers cutting spending, and the Government has lurched from one crisis to another recently without any effective remedial action. Worse, because the Japanese MR industry depends far more on domestic clients than international, business is seriously down. Qual is doing better, but only because it is seen to be cheaper.

Professional skills

In China, the strongest skills set agency-side is found mainly among the first wave of a small group of (now senior) managers from the late 80s/early 90s. More recently, they’ve been joined by a wave of imported expats. The latter, though professionally skilled, usually rely very much on local staff for cultural input and language. Qual is growing in China and takes a far larger slice of the ‘pie’ than in Japan. This is fuelled by sophisticated clients who want to gain deeper insights, and those less sophisticated who like qual because it is fast, cheap and they can ‘see it with their own eyes’.

Japan now has a broad base of trained and skilled market researchers (although biased towards quant), and a research culture which has long since spread to service sectors and government related organisations. Generally, professional standards are high, and ethics are strong within the context of Japanese business society.  The typical Japanese client, however, places far more faith in numbers, including those from the ubiquitous group interviews than from true qualitative.

Awareness

This affects how one sells, how one recruits and in some ways, even how one interviews. In Japan there is generally a well absorbed understanding of the benefits and uses of MR among business people, despite a strong preference for numbers rather than ‘feelings’. Even the general public is familiar with the concept of taking part in MR studies and are also well informed about issues like privacy and rights.

In China, however, the picture is rather different. Aside from perhaps the top 12 Chinese companies and the many joint-venture and foreign-invested ones there is little understanding among business owners of the benefits of MR, let alone of qual. Among the general public the picture is very varied. The urban elite in major cities may now be familiar with surveys, but elsewhere we often spend as much time explaining what we are doing as actually doing it.

Lower professional standards in China, along with a tendency for many city dwellers to seek easy money by any means, have however had one unfortunate consequence. Professional respondents have become a nightmare, far worse than in the West. They even use different names and multiple ID cards, an activity with which less reputable agencies connive.

In Japan, while professional respondents exist, western clients can expect few issues if screening protocols are explicitly agreed. The stereotypical view of Japanese honesty is, generally, fairly valid. Many Japanese MR companies do, however, use people called ‘monitors’ who are recruited for surveys regularly. That’s why clients need to specify if they want ‘fresh’ respondents, or at least place restrictions on how recently they participated.

Lifestyle and Culture

Along with differences, there are also similarities. Focus groups can be difficult to conduct successfully in both countries. Other forms of qual, in particular individual depth interviews, are often much more effective.

The Japanese find it extremely hard to express feelings or opinions, particularly to strangers. ‘Warm ups’ take much longer here and very good (cross-cultural) moderators are needed as so much of the ‘truth’ from groups here is the unspoken.

Furthermore, the Japanese are taught from a young age that for every situation or occurrence there is essentially a right or a wrong response, with nothing in between. So when asked ‘why’, many are left groping for a response. Different techniques to those used in the West or even other Asian markets are often needed.

In China, qual receives a much higher proportion of spend, but some of the same problems surface. While the Chinese don’t have quite the same communications problems in public as the Japanese, their character is still reserved and introverted. In addition, 50 years of post-revolutionary rule means that for older respondents, formulating independent opinions is problematic. Under this circumstance, the ability of moderators is crucial. Unfortunately, the industry’s meteoric growth means that many moderators don’t have such capabilities. The good ones are world class, but there are too few.

So, very different markets and challenges. Which is why, in China and Japan, choosing an agency with true cross-cultural abilities is so very critical.

Irwin Hanks
Copyright © Association for Qualitative Research, 2009

B2B International, through its Asian headquarters in Beijing, conducts b2b market research projects across many industry sectors, markets and geographical locations throughout the Asia-Pacific region.  Its qualitative and quantitative research specialists are fluent in many Asian languages, including Mandarin, Cantonese, Japanese, Malay and Korean, as well as English.  In conjunction with its European and North American offices, the group is able to conduct multi-country studies across the world.  For more information on any of our offerings, please call +86 (0)10 6515 6642 or email beijing@b2binternational.com 

To read some of our international market research white papers, please click here: http://www.b2binternational.com/library/whitepapers/

In the final installment of Alaric Fairbanks’ Asia Research interview, the General Manager of B2B International in China discusses the company’s short-term goals and offers some sound advice to anyone wanting to set up a business in China:  

What are your goals?

At a high level these include doubling our Beijing operation and opening a second office in Shanghai within the next two years.  Perhaps equally high on our list of priorities is that it is important that the whole team, including myself, finds work and life interesting, stimulating and enjoyable.

What advice would you give to someone wanting to set up a market research company in China today?

Be different, and be good at it.  Despite being a relatively emergent market, there is plenty of competition, much of it competing on price.  Anyone considering setting up must be aware of this and be able to offer something different.  Linked to this, do not be afraid of challenging orthodoxies or perceptions, particularly regarding methodologies, and be prepared to try new approaches.

In the second of our three-part blog series, Alaric Fairbanks tells Asia Research about the successes and challenges B2B International has encountered over the past couple of years in China:

How have you managed to create your business?

I think our success so far comes from close attention to our two major stake-holder groups: clients and staff. To some extent we had an advantage in that we had already been conducting projects in China for about 5 years, and some of our clients from our home markets were interested in further research in China. Like many emerging markets, a lot of the companies driving research early on were foreign, and although market research in China has a history of over 20 years, b2b research is relatively new.  We were able to leverage our position, client base and reputation outside China to assist in building the business here. This was a help, but a priority was still to generate business ourselves from both outside and within China; indeed we have seen a movement in less than two years from foreign companies commissioning work from outside China, to local offices of foreign companies, and increasingly to domestic enterprises.  The team that we have built in China has also been crucial in developing the business and we have been fortunate in attracting and retaining a highly motivated team.

What are your main challenges today?

Right now my immediate concern is finding new premises, as we have outgrown our current office in Beijing.  This practical issue aside, the challenges focus on maintaining our momentum in potentially challenging times.  Also, China continues to develop and change rapidly and differently, and this potentially has huge opportunities for the way we work – for example we are currently looking to develop our use of web 2.0 methodologies in b2b research.  Here, we have already tried IM and SN applications for both recruitment and interviewing, and we are keen to explore and develop these applications, particularly for in-depth qualitative data collection.

The final installment of the interview will be our next blog post, so check back in to read it soon.