Taking Market Research to the Source

Hundreds of people visit Unilever’s Concept Centre in Shanghai every day. Visitors can get their hair done at a salon. There is a living room and a bed called the “chatting room” where they can relax, as well as a shop where they can try the company’s newest products. While they go about their business, these human guinea pigs are being discreetly observed from behind one way mirrors.

Concept Centre is just part of Unilever’s growing consumer research initiative in China, where it is trying to catch up to its nemesis, Proctor & Gamble. Just outside the city, in a huge office park, the company conducts all kinds of R&D, from market research to creating mock-ups and packaging prototypes.

Consumer preferences are still very much a mystery to multinationals operating in emerging markets. Cultural complexities, especially latent Asian ones, can be hard to break down and trends are fluid. Consumers who are not used to commercialized brands lack brand loyalty and buy based on price over packaging. Due to less disposable income in these markets, there is less room for brand equity built on price premiums. Consequently, companies selling basic consumer products are moving in to get a closer look at consumer behaviors in their natural habitat.

Because of the lack of brand loyalty, companies need to get even more creative with their marketing campaigns. Shanghai is literally covered in advertisements. Neon city lights shine larger than life corporate logos across the sides of skyscrapers. Taxis, buses and metros all have TVs so that you can keep up to date on the local news while being bombarded by ads. My mobile phone sends me several messages a day with the latest deals on massages and air flights. And Nike symbols are strategically placed throughout the city, like subliminal messages reminding us of the ever-present swoosh.

Some companies proliferate through high tech mediums while others prefer the human touch, hiring sales associates to dole out samples galore. Catering to Asian consumers also means changing your secret recipe to suit their tastes. Unilever makes its soaps and shampoos foamier than its Western products. PepsiCo adds spice to its potato chips. P&G makes herbal and green tea flavored toothpaste. Juicy fruit adds different extracts to its gum (flavors that ruin the entire purpose of chewing gum for this author’s taste). Companies need to keep up with local tastes and preferences, especially in a market that is growing and changing as quickly as China’s.

While the Chinese market remains a mystery to many international companies, those that are on the ground learning about consumer preferences are making headway and penetrating the market. With increased disposable income, the Chinese are looking to spend so it seems worth going the extra mile on consumer education and understanding to reach them.