Conquerors of the East

    Observations from Shanghai: Mobile Congress and our first Chinese customers

    A visit to the Mobile Congress in Shanghai (Mobile World Congress) is my second trip to China: we decided to enter the Chinese market a few months ago, and I already shared my first impressions . After the first trip, we were not sure that things would go, but it would be strange not to try. Since then, we have gained several customers from China, and there is no doubt that the market has succumbed to us. Now we are thinking about accelerating on it, and for this we are studying the local mentality and experience of other companies in China - Chinese and Russian.

    What happened at the Mobile Congress

    Mobile Congress in Shanghai is a clone of the Mobile Congress in Barcelonawhere our employees also visited. It is smaller in size than the Barcelona congress, but also rather big - three huge pavilions and an extensive conference program that costs crazy money. Like in Barcelona, ​​telecom operators from all over the world should meet here, but in reality - from all over Asia. They meet not only among themselves, but also with suppliers of various products and services, one way or another connected with the telecom industry. Why are we here? Here are all the companies with which we could work in China, either among exhibitors or among visitors.

    To help Russian companies get acquainted with potential partners from Asia, RVC and Russoft organized the Russian Day congress, where they managed to collect 50-60 visitors from companies from different countries. There were several Russian companies that looked good against the general background - ABBYY, SPB TV, and several successful startups.

    In addition to networking, knowledge of market trends in online games and television, and the main industries where CDN services are used, was important for us. There was a section at the congress where people from gaming companies spoke, but there 80% of the speeches were in Chinese with fragmentary translation. There was more English in the section where the representatives of television spoke, and there I lingered. Especially interesting was the presentation of CIBN (an analogue of our VGTRK). They perceive television not just as a backdrop for an evening of family entertainment.

    The role of television in China of the future is much more important: it is the main channel of bilateral interaction with the family as a unit of consumption. Chinese TV people are convinced that to buy products for the whole family, to pay bills and so on, you will always need not a smartphone, but a TV. The role of television will be more significant, and this is only at hand for us.

    About the Asian Food Approach

    To understand what products the Chinese market needs, I studied those that are already there - both in the B2B sector and in the consumer sector. Some of the solutions that I saw in Shanghai are sold with might and main in Asian markets, but we do not have them as a class. I liked, for example, a small box - a router that is registered in all Asian networks, all electronic SIM cards of all operators are already flashed in it. That is, you travel around Asia, and you always have Internet at a local rate, and the router connects to all networks automatically. It turns out something like routers that our mobile operators sell, only from all operators at once.

    Another interesting thing is the service that a Korean company represented on the forum. She installs her icon on all phones that are sold in Korea, and sells it to other developers as a place for their applications. This month, one company will pay for the right to put its application under this icon, in another month another. This is very convenient: none of them need to run around all the phone manufacturers and negotiate with each separately. This is a very serious business model, which is also lacking in Russia. We regularly see press releases from the category “Yandex Nexus is now installed on Google Nexus phones.” And each time you shrug: well, cool, well done ...

    When you come to European exhibitions, you understand how much you lag behind in understanding even your own product from local competitors. I mean marketing: to be considered seriously, you need to invest millions in brand promotion and product packaging. And in Asia, marketing is about the same as in Russia - even the Japanese and Korean companies that were represented at the exhibition were not impressed with marketing and expressed themselves in technology. Well, we in Russia are accustomed to the same thing, which means that when entering Asian markets, at least marketing does not need to invest millions, as if we decided to enter Europe.

    How to sell to the Chinese

    In Asian IT markets, they pay more attention to the practical side of things, rather than to the image-building side. If a Chinese entrepreneur sees that the product is suitable for him in terms of technical specifications and price, then he will not begin to think about buying for a long time. As I was told, the "psychology of the wolf" is characteristic of the Chinese. If they see something profitable, they immediately grab it, almost like ours in the late USSR. The quick decision to buy me, as a seller, cannot but impress. While in European markets reflection in transactions is common. When you sell your product in Europe, you go through several stages of marketing communications. At each step you have to convince, and all the time you run the risk of running into the phrase: “Oh, I don’t know, we need to think!” After it, the negotiator disappears for six months,

    The stereotype of the slow and meditative approach of Asians was finally debunked by our experience. Our first client from China came to our website, wrote a message that he wanted to work with us, after which we connected, billed him, and he paid it on the same day. The same thing happened with the second client (both were representatives of gaming companies). They all figured out, they all understood what was happening, and they use the service. And after a trip to the forum, we immediately entered into active negotiations with three more: a large media group, a TV manufacturer and an online game developer. The Chinese do not hesitate, they bring everything to an end, and that’s good.

    The most important thing on sale is to convey the essence of the product so that the Chinese partner can figure it out for himself. If you have to move on to explanations, there is a chance to stumble upon a language barrier. Most Chinese do not speak English (and even more so in Russian), and without a Russian-Chinese translator it is almost impossible to communicate with them. It is very rare to meet a Chinese manager with perfect English and a Western MBA education, but it would be better if you did not meet him: in everything that relates to IT, he understands better than you.

    About negotiations with the Chinese

    The Chinese themselves are very easy to climb, quickly understand everything, quickly make decisions. But if negotiations begin, then difficulties begin along with them, and this is not only a language barrier, but also a mental one. You will never understand the external reaction to your words, but you can only guess about the internal one. I had a case when I was telling a person about a technology. He said it once, he answered, and it seemed to me that he understood exactly. Said a second time. And the third time I mentioned the same thing in a conversation, but in other words, and the interlocutor made round eyes: “What, really? Its cool!". But it seems to you that he already knows this.

    It seemed to me that it’s completely impossible to understand what is in the Chinese mind, not being the Chinese himself. And all the successful Russian companies that operate in China seem to never forget this. They send a Russian director to the Chinese office, but, as a rule, he does not participate in negotiations with local ones. The director hires Chinese managers for this, and then his function is to stand over them with a stick, make sure that they do not steal and are not lazy. Periodically, he flies to headquarters in Russia to replenish stocks of knowledge and energy. In general, a director in China is an overseer. A well-known fact: in Chinese companies, even computers are arranged so that the boss sees what his subordinates are doing.

    However, despite the mental abyss and some cunning on the part of the Chinese, they are very nice to the Russians. The official rhetoric of the authorities in China is the same as in Russia, and is illustrated by the phrase "Russian and Chinese are brothers forever!". I flew to China on a transit visa and had to stay in a certain hotel, but there were no empty seats in it, and I stayed in another. So I was blacklisted for a transit visa next time. After China, I visited another country, but flew back with a transfer in China, where there was an unprecedented situation at the airport. By chance, my luggage was not handed over for transit to Moscow, but was sent to a common tape, that is, to the territory of China. To pick him up, I had to formally enter China, but there were problems with this, because I am on the black list. However, the Chinese border guards after much persuasion allowed me to enter the territory of China, take my suitcase and go back. It is simply impossible to imagine such a thing in Europe or the USA. Maybe the Chinese border guards have some kind of unofficial attitude not to offend the Russians?

    Is it possible to become successful in China?

    Following the results of a trip to Shanghai, we began negotiations with three more potential customers. These are three Chinese companies: a television channel, a television manufacturer (with its smart TV), and an online game developer. But, more importantly, we have an understanding that full-fledged work in the Chinese market is possible. Although our mentality is nevertheless closer to the European than to the Asian one, many features of the Chinese market are close to us and understandable, and it will be even easier to adapt to them than to the European ones.

    The most amazing thing is the speed with which the Chinese live. In Shanghai, I talked to a Chinese man who returned home from Toronto, where he studied for several years. He said that in Shanghai everything happens much faster, and he called Canadians lazy. It seems to us that time is fast flowing in Moscow, but in Shanghai I had the feeling that it was flowing even faster.

    Life in modern China is changing dramatically. Since contact with European culture, the current generation of Chinese has probably become the first to eat their fill. Because of this, there is even a cult of food in China: with a minimum flight delay at the airport, I received a bowl of rice with meat from the airline. However, the Chinese very quickly met their basic needs, moved away from the concept of "copy the west and sell cheaper."

    According to historians, in the Middle Ages, China accounted for about 40% of global GDP, and now it is possible that history will repeat itself. In 2014, China has already become the largest economy in the world , with a share of 16.3% in world GDP so far. The Chinese are once again able to get ahead of all other countries many times, both in technological development and in consumption, and we want to be nearby.

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