Market Research in China - Industry Report.pdf

CONTENTS Error! No text of specified style in document. April 2012 www.ibisworld.com.cn | 1-800-330-3772 | chinahelpibisworld.com IBISWorld Industry Report 7432 Market Research in China April 2012 About This Industry . 2 Industry Definition 2 Main Activities . 2 Similar Industries . 2 Additional Resources . 2 Industry Performance 3 Executive Summary . 3 Key External Drivers 3 Current Performance . 4 Industry Outlook 6 Industry Life Cycle . 8 Products market segment and brand-orientation research; advertisement testing and medium-validity research; market promotion proposals and validity research; product distribution research; innovative data collection methods; and retail sales monitoring. ACMR-IBISWorld anticipates that customers from the automobile, pharmaceutical, IT, telecommunication, consumer electronic product, financial and government sectors will account for large market shares in the next five years, as these sectors are developing and changing rapidly. WWW.IBISWORLD.COM.CN Market Research in China April 2012 7 WWW.IBISWORLD.COM.CN Market Research in China April 2012 8 Industry Life Cycle This industry is in the growth stage of its life cycle. Life Cycle Stage Industry revenue and value added showed high growth rates in the past five years Enterprise numbers increased strongly in the past five years There is great development potential in cities other than Shanghai, Beijing and Guangzhou There are limited government regulations and requirements in this industry The Market Research industry is in the growth stage of its life cycle. In the 10 years through 2017, industry value added has been growing at an annualized rate of 14.7%v are estimated to be 14.4%, compared to annualized growth in China's GDP of about 9.0%. There are a large number of small enterprises operating in the industry. The number of enterprises increased rapidly in the five years through 2012, with an annualized growth rate of 6.7% to total 3,701. ACMR-IBISWorld anticipates that the number of enterprises will increase at a similar rate over the next five years. Enterprise distribution is geographically unbalanced and highly concentrated in Shanghai, Beijing and Guangzhou. Since the Market Research industry is underrepresented in many smaller cities, there is great development potential across other regions. WWW.IBISWORLD.COM.CN Market Research in China April 2012 9 Products financial and credit information on 300,000 companies; vehicle information on over 1.5 million companies; and IT status information on over 2.5 million companies. The consumer database of Sinotrust contains information on over 13 million business consumers, including occupation, job position, income, vehicle information and consumer behavior. The Chinese Affluent Lifestyle Database collects and analyzes consumer behavior data of over 20,000 high-end consumers in main cities across the country on a yearly basis, including vehicle purchase and usage, travel, personal finance, credit cards and shopping. CCID Consulting Co. Ltd. Estimated market share: Less than 1.0% CCID Consulting Co. Ltd. was founded in 1986 as the information section of the Administration of Computer Industry of the former Ministry of Electronics Industry. Headquartered in Beijing, CCID Consulting has branches in Shanghai, Guangzhou, Shenzhen, Chengdu, Nanjing, Hangzhou, Wuhan, Harbin, Dalian and Xi'an, with over 300 professional consultants and industry experts. Its service networks cover more than 200 medium- and large-sized cities across China. The company has also established business agencies in the United States, Europe, Japan, South Korea, Singapore, Hong Kong and Taiwan. CCID Consulting currently conducts research across a wide range of fields, including computer and peripheral equipment, software and services, communications and networks, telecommunications, WWW.IBISWORLD.COM.CN Market Research in China April 2012 28 semiconductors, mobile terminals, digital products, consumer electronics, government, automobiles and other industries and markets. In 2010, the company's revenue increased by 7.8% to $16.8 million. Revenue benefited from the recovering economy, the successful transformation of the business and a breakthrough in the large client segment. In 2009, the company reported revenue of $15.6 million, down 8.3% from 2008. The declining revenue was due to decreasing demand for the company's market consulting services, which was affected by the financial crisis. In December 2002, CCID Consulting was listed on the Hong Kong Growth Enterprises Market (HK8235) and became China's first professional consulting firm listed in Hong Kong. All China Marketing Research Co. Ltd Estimated market share: Less than 0.5% All China Marketing Research Co. Ltd. (ACMR) was founded in 1992 by the China Statistics Information Consulting Service Center of the National Bureau of Statistics of China. It is one of the earliest and largest enterprises in this industry, focusing on commercial information services and market research. ACMR was reformed into a joint stock company in 1995. Headquartered in Beijing, ACMR has offices in Shanghai and Guangzhou and has 40 local agents across China. There are about 150 full-time and over 110 part-time employees. ACMR has a nationwide data collection network that covers 29 provinces and is capable of conducting fieldwork in more than 60 cities simultaneously. At present, ACMR has the capacity to conduct over 150,000 interviews per year. ACMR established its industry research department in August 1995, providing industry research, industrial product market research and B2B research, focusing on the chemicals, energy, machinery, IT and automobile industries. ACMR also provides company credit risk surveys. ACMR founded a joint venture named All China Strategic Research (ACSR) with Market Facts of the United States in July 1997, mainly focusing on consumer research. In 2006, ACSR was acquired by Millward Brown, forming the independent joint venture: MB-ACSR. Since 2006, ACMR has increased investment in its B2B research network and expertise. In the same year, ACMR established a partnership with IBISWorld from Australia for the production of Chinese industry reports covering the entire Chinese economy, and is now one of the major players in the product-based market research segment. This report is the result of ACMR's partnership with IBISWorld. WWW.IBISWORLD.COM.CN Market Research in China April 2012 29 CCID Consulting Co., Ltd. - financial performance Year Revenue US Million Dollars Growth % change NPBT US Million Dollars Assets US Million Dollars Growth % change 2005 5.26 N/C -0.88 15.81 N/C 2006 5.41 2.9 -0.17 15.89 0.5 2007 10.39 92.1 2.17 21.07 32.6 2008 16.96 63.2 2.58 16.87 -19.9 2009 15.56 -8.3 2.55 18.75 11.1 2010 16.77 7.8 2.62 19.96 6.5 SOURCE: ANNUAL REPORT WWW.IBISWORLD.COM.CN Market Research in China April 2012 30 Operating Conditions Capital Intensity The level of capital intensity is low. There is limited investment in data collection equipment and networks There are some requirements for high volumes of qualified and trained staff Large enterprises in this industry must establish wide data-collection networks, improve data collection effectiveness, and maintain low costs, especially for large collection projects. New types of data collection equipment and systems, such as computer-assisted telephone interview systems (CATI), have become more popular and positively affected the capital-to-labor ratio of the Market Research industry. Highly qualified and trained staff are important for enterprises in this industry to conduct data collection and analysis activities. Salaries and wages are expected to account for 15.8% of industry revenue in 2012. The capital-to-labor ratio of this industry is expected to increase over time as more advanced equipment is employed. Technology & Systems The level of technology change is low. Data collection Data collection technology is the most basic market research technology, and started in China with face-to- face questionnaires and interviews. Telephone interviews became more popular in the 1990s due to their convenience and low costs. At the end of the 1990s, computer and internet technologies were brought in and combined with other traditional methods, which greatly promoted the effectiveness of data collecting process. Now, advanced technologies and equipment such as computer assisted telephone interview (CATI) systems and people meters, which measure audiences for radio, television, internet and retail in-store broadcasts for programming and advertising purposes, are widely used by large market research companies to ensure data collection speed and integrity. Many top companies in this industry also established wide data- collection systems in different cities to collect sufficient data within a short time. Data analysis Data processing and analysis technologies are mainly based on computer and software technologies. Professional statistics software and enterprise resource planning software, such as SPSS and SAS, are widely used by most enterprises within this industry to analyze the collected data. Data mining is also important. Most large enterprises within this industry also establish their own databases and develop research models based on their expertise and experience. Customized research accounts for about 85.0% of total industry revenue. Quantitative research is the main way to conduct customized research and makes up about 65.0% of customized research revenue in 2011. WWW.IBISWORLD.COM.CN Market Research in China April 2012 31 Revenue Volatility The level of volatility is medium. The rapid development of China's economy has resulted in major increases in demand for market research services. Industry revenue volatility increased in 2008 with a major slowdown in growth due to the global financial crisis. Growth stabilized in 2009 and is expected to increase moderately in 2012. Regulation & Policy The level of regulation is light and the trend is steady. The China Marketing Research Association (CMRA), founded in February 2001 by over 100 market research organizations with the approval by the Ministry of Civil Affairs of the People's Republic of China (MCA), is the major supervision institute of this industry. It is responsible for formulating industry regulation, promoting market research standardization and database construction, and helping formulate the industry's development. In March 2005, the CMRA issued the “Industry Regulation of China Marketing Research“, which regulates the industry's basic definition, fair competition, basic professional ethics and operation principles. The National Bureau of Statistics of China (NBS) is a department of the State Council that is responsible for national statistics and national economy calculations. In the market research field, NBS is responsible for issuing Foreign-Related Investigation Permits, which are compulsory for enterprises within this industry to conduct foreign-related investigations. All foreign-related investigations conducted by enterprises within this industry must be declared or put on record with the NBS. WWW.IBISWORLD.COM.CN Market Research in China April 2012 32 Industry Assistance The level of industry assistance is low and the trend of industry assistance is steady. There are no specific tariffs for this industry. There are limited government regulations applicable to this industry. Industry assistance from the government is also very limited, and is expected to remain stable in future years. WWW.IBISWORLD.COM.CN Market Research in China April 2012 33 Key Statistics Industry Data Revenue ($m) IVA ($m) Establish- ments Enterprises Employ- ment Exports ($m) Imports ($m) Wages ($m) Total Assets (Million Dollars) 2003 608.5 233.0 5,046 1,890 28,259 - - 90.0 551 2004 764.7 292.9 5,796 2,070 31,028 - - 117.1 704 2005 951.5 344.4 6,612 2,280 33,572 - - 144.7 879 2006 1,177.6 420.5 7,250 2,500 36,292 - - 184.8 1,083 2007 1,557.4 559.2 7,808 2,680 40,066 - - 249.2 1,427 2008 1,781.2 622.9 8,180 2,914 42,470 - - 284.9 1,703 2009 1,959.2 679.0 8,256 3,070 43,107 - - 302.1 1,907 2010 2,240.4 773.1 8,514 3,270 44,831 - - 345.4 2,162 2011 2,621.2 912.3 8,911 3,498 47,073 - - 402.4 2,486 2012 3,095.6 1,071.1 9,214 3,701 49,191 - - 489.1 2,797 2013 3,482.6 1,201.5 9,389 3,871 50,323 - - 518.9 3,135 2014 4,025.9 1,417.1 9,736 4,146 52,386 - - 624.0 3,558 2015 4,613.7 1,628.6 10,106 4,449 54,900 - - 719.7 4,063 2016 5,361.1 1,860.3 10,490 4,751 57,810 - - 863.1 4,701 2017 6,159.9 2,149.8 10,658 5,093 60,296 - - 967.1 5,430 WWW.IBISWORLD.COM.CN Market Research in China April 2012 34 Annual Change Revenue (%) IVA (%) Establish- ments (%) Enterprises (%) Employ- ment (%) Exports (%) Imports (%) Wages (%) Assets (%) 2004 25.7 25.7 14.9 9.5 9.8 N/C N/C 30.1 27.6 2005 24.4 17.6 14.1 10.1 8.2 N/C N/C 23.6 24.9 2006 23.8 22.1 9.6 9.6 8.1 N/C N/C 27.7 23.2 2007 32.3 33.0 7.7 7.2 10.4 N/C N/C 34.8 31.7 2008 14.4 11.4 4.8 8.7 6.0 N/C N/C 14.3 19.3 2009 10.0 9.0 0.9 5.4 1.5 N/C N/C 6.0 12.0 2010 14.4 13.9 3.1 6.5 4.0 N/C N/C 14.3 13.3 2011 17.0 18.0 4.7 7.0 5.0 N/C N/C 16.5 15.0 2012 18.1 17.4 3.4 5.8 4.5 N/C N/C 21.5 12.5 2013 12.5 12.2 1.9 4.6 2.3 N/C N/C 6.1 12.1 2014 15.6 17.9 3.7 7.1 4.1 N/C N/C 20.3 13.5 2015 14.6 14.9 3.8 7.3 4.8 N/C N/C 15.3 14.2 2016 16.2 14.2 3.8 6.8 5.3 N/C N/C 19.9 15.7 2017 14.9 15.6 1.6 7.2 4.3 N/C N/C 12.0 15.5 WWW.IBISWORLD.COM.CN Market Research in China April 2012 35 Key Ratios IVA/revenue (%) Imports/ demand (%) Exports/ revenue (%) Revenue per employee ($'000) Wages/ revenue (%) Employees per est. Average wage ($) 2003 38.3 0.0 N/C 21.5 14.8 6 3,184.8 2004 38.3 0.0 N/C 24.7 15.3 5 3,774.0 2005 36.2 0.0 N/C 28.3 15.2 5 4,310.1 2006 35.7 0.0 N/C 32.5 15.7 5 5,092.0 2007 35.9 0.0 N/C 38.9 16.0 5 6,219.7 2008 35.0 0.0 N/C 41.9 16.0 5 6,708.3 2009 34.7 0.0 N/C 45.5 15.4 5 7,008.1 2010 34.5 0.0 N/C 50.0 15.4 5 7,704.5 2011 34.8 0.0 N/C 55.7 15.4 5 8,548.4 2012 34.6 0.0 N/C 62.9 15.8 5 9,942.9 2013 34.5 0.0 N/C 69.2 14.9 5 10,311.4 2014 35.2 0.0 N/C 76.9 15.5 5 11,911.6 2015 35.3 0.0 N/C 84.0 15.6 5 13,109.3 2016 34.7 0.0 N/C 92.7 16.1 6 14,929.9 2017 34.9 0.0 N/C 102.2 15.7 6 16,039.2 Figures are inflation-adjusted 2012 dollars NOTE: UNLESS SPECIFIED, AN ASTERISK (*) ASSOCIATED WITH A NUMBER IN A TABLE INDICATES AN IBISWORLD ESTIMATE AND REFERENCES TO DOLLARS ARE TO US DOLLARS. Jargon BUSINESS TO BUSINESS (B2B) Refers to transactions that take place between businesses. BUSINESS TO CONSUMER (B2C)Refers to transactions that take place between a business and an end user. COMPUTER-ASSISTED TELEPHONE INTERVIEW SYSTEM (CATI Allows for the electronic management of phone interviews, including automatic dialing, the enforcing of quotas, scheduling, and analysis. FAST-MOVING CONSUMER GOODS (FCMG) Refers to food and non-food consumer products used daily, such as soft drinks, toiletries, and grocery items. Also known as consumer