Recommendations for market research in China

To fully understand the Chinese market, it is necessary to consider the realities of the vast territory and regional differences. Breaking China down into a multitude of smaller markets and prioritising the research effort on the core market(s) would be a sensible strategy to begin with. In the planning stage of the research, it is important to understand the extremes of demography and geography. For consumer products, the key urban markets will be the natural place to start, while for industrial products, the layout of China's key industries will have to be taken into consideration. Market research should be able to find out, in addition to other critical information, where your core market is and what potential it can offer.

In choosing a research provider, it is important to test their understanding of the market and their understanding of how market research should be carried out to meet research objectives. Both within and outside of China, there are numerous research organisations and consulting firms that boast of their expertise on and special connections in China, but their understanding of market research in China varies greatly. Some understand market research as market intelligence. They build their advantage on their claimed special connections with China or access to insider information or statistics that are not publicly available. As a result, much of the research effort is devoted to 'ploughing' this information while neglecting changing dynamics. It is important to appreciate special connections or access to privately held information, but the capacity to be able to deploy an on-the-ground research force to explore first hand information is even more important.

In designing the research, it is highly recommended that a company planning to carry out research in China takes the following into account:

• Objectives should be clearly defined to exclude any possible ambiguity. The statement of research requirements or terms of reference should not only include the scope and problems to which answers are needed, but also precise specifications of the meaning of all words and terms;

• The disparity between what the company wants to find out and what the research provider can realistically do under the proposed budget and schedule should be recognized, while the limitations of carrying out research in China should be frankly discussed;

• Protection of the ownership of the research results should be made clear in the form of a confidentiality agreement. There have been instances where research providers infringed on the ownership of the research findings by publishing them in newspapers;

• Sources of information need to be detailed to justify the validity and reliability of the research findings;

• A face-to-face meeting with key researchers upon completion of the research is important to pick up opinions and observations that might not be included in the report.