Entering the Chinese online market – Case study: Facebook

Entering the Chinese online market has showned itself to be troublesome for many foreign companies. Chinese websites are often blaimed to copy foreign website and to not be innovative. This is of course not true and there are several examples of innovative Chinese webservices tailored for the Chinese market, but what is more interesting is how and why some "copy". To start with, China is of course not alone in copying websites but get most publicity doing it, and I have to say that they though often are a little too good in the copying including the same colours and graphics so it becomes a rip-off. But what really fascinates my is how difficult it is for foreign companies to create a successful webservice in China. A good example is Facebook and Xiaonei. Facebook has become very popular all over the world except in China. Xiaonei is a local copy of Facebook that looks very much the same (rip-off); colours, icons and the whole concept is the same. Discussing – with a Chinese student – why Xiaonei has become so much more popular then Facebook in China I realised it is a very simple reason. The girl I talked to speaks english and she is a member of Facebook, but most of her friends do not speak english so they are at Xiaonei that has a Chinese interface. So the result is that becuase the majority of her friends is at Xioanei she spends most of her time there as well.

Of course Chinese users can also be said to suffer from the NIH syndrome (not-invented-here syndrome) and prefer local versions but just such a simple things as the language can apparently be a barrier. So it looks like this is a costly misstake Facebook did in China compared to how much it would have cost them to just translate it and ride on the publicity they have all over the world.

Entering a new "online" market of course often needs some customization and the battle between Google and Baidu in China as well as Google’s problems to get a foothold in south korea are good examples of this. But such thing as a social network doesn’t have the same requirements and looking at how Xiaonei managed to succeed just compying Facebook’s functionality shows that here it is not a need of special functionality suitable to China, instead just that they simply cannot use it because it is in the wrong language. 

~ by Andreas Sigurdsson on December 15, 2007.

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