Mobile commerce grows explosively every day. My recent trip to Mobile World Congress (MWC) Shanghai provides a glimpse into the mobile commerce landscape in the China market and how some global brands execute their mobile strategies.
Smartphone adoption is faster than any expectations in the China market. And MWC strategically anchors itself in Shanghai as a window for China and Asia to collaborate with the rest of the world in the mobile era.
According to IDC, as of Q1 2015, in China, 880 million consumers use smartphones with a penetration of 90%; 3G/4G access exceeds 70% even in many rural cities. Absent from the US market, mobile verification is prevalent, which fastens mobile adoption and usage. A service called Mobile Connect created by GSMA, a global mobile operator consortium, fastens that pace by enabling a new and higher standard of digital authentication. Along with many other innovations in this market, mobile convenience proves to be far greater in app registration and activation.
Against this backdrop, some great American brands have deployed different strategies that resulted in diverging customer experiences.
Uber entered China’s key markets about a year ago and has faced strong headwinds from government regulations, to the dominance of local taxi-hailing apps. Nonetheless, Uber manages to grow rapidly and now has close to 500 rides in each key city compared to New York after the same period of operation. With the same app I downloaded in New York, I am able to call for car services and have almost an identical experience in Shanghai. With location access, the Uber app in China automatically adjusts its interface with local offerings. The rest is same, including call-back, messaging alerts, payments and customer services.
On the contrary, Starbucks—known for its innovative mobile experiences—chooses to have a separate app called Starbucks China. To register, you need to first find a local store to buy a loyalty card and key in the card number. Without this step, you cannot move forward. At the checkout, you can pay with cash or a credit card. Alternatively (or inconveniently), you need to turn on Starbucks’ Wi-Fi to download a barcode to pay. It is confusing for US travelers as well as for locals. Along with other dysfunctional features, the Chinese Starbucks experience is out of touch and disappointing. Unfortunately, it carries the same Starbucks logo, look and feel. When it comes to a global brand like Starbucks, consumers demand a consistent experience everywhere around the world; shouldn't its mobile strategy be the same?
LinkedIn entered the China market in early 2014, exceeding growth in all its key metrics. Currently, LinkedIn has amassed 9 million Chinese users. As a new brand in China, it certainly can be satisfied with its progress. However, LinkedIn’s Chinese local leadership thinks it’s far from reaching the market potential with 150 million professionals. To achieve it, LinkedIn must address local needs, including Chinese users’ mobile lifestyle. The LinkedIn platform, created 12 years ago, is designed heavily based on the PC and email environment. Critical steps such as mobile verification simply cannot be installed due to various reasons. In June this year, LinkedIn’s local team launched a career mobile app 赤兔 (Red Hare, a powerful horse in ancient Chinese literature). Local culture and language aside, 赤兔 starts as an app and is exclusively designed to be a mobile experience for Chinese professionals. In the end, LinkedIn’s local team can finally circumvent system and corporate hurdles to accelerate its growth ambition.
As brands expand globally, mobile strategy is undoubtedly a critical aspect. To be consistent or to be locally adaptable, each brand must consider how they serve their core customers. While Uber is exceedingly appealing to me as an outside visitor, many locals also find the service straightforward, prompt and courteous. More excitingly, the Chinese find it a great comfort to be able to use Uber when they travel abroad. This truly makes Uber a global brand. If Starbucks fully understands how reliant Chinese consumers are on their mobiles, it could rather wait to launch the app until it can deliver a natural mobile experience from enabling registration on the go to loading money with ease. For LinkedIn, it is a strategic foresight that the current platform cannot keep up the rapid pace to court millions of Chinese professionals living on mobiles. To succeed, LinkedIn China needs to unlink from the mothership and create anew.