China Internet Usage Growth and Corporate Social Media

Ever since visiting China for the first time late last year and being hit with the statistics of growth in Internet usage as well as other aspects such as the much greater proportion of time spent online compared with the West, I have been endeavouring to make sense of what all of this might mean for my particular area of interest, the introduction and use of social media in and by the enterprise.

Certainly the growth numbers, in terms of Internet use in the general population, are amazing. The writing was on the wall by the beginning of this year when the latest update appeared from the China Internet Network Information Center (CNNIC).

With the release of a more recent report by consulting and research firm BDA the new reality is now upon us: China has more Internet users than the United States.

Perhaps even more significant than the raw numerical superiority is that while the major growth is over in the US it is still to come in China.

Internet penetration worldwide

Among consultants in the social media space, on blogs and in mainstream media articles in the West there is a recurring theme that goes something like “with the pervasive uptake of social media in the community and especially by younger generations, businesses need to become more active players in the social media space, or they will become increasingly unprofitable, even irrelevant”. It’s not about technology for its own sake. It’s about a new conversation which companies can choose to be part of, or not. There are consequences either way.

Writing in reference to a contemporary Western context, commentator Mark Pesce put the challenge for business to engage in (networked) conversation in forceful terms:

Something’s got to give. And it’s not going to be the public. They can’t be whipped or cowed or forced back into antique behaviors which no longer make sense to them.

The social media enabled conversation in China might not be as pervasive yet as in the USA. After all, Internet takeup is only 16% of the population in China compared to around 70% in the West, right?

Well yes, but that is an overall figure.

In Beijing and Shanghai, as at the end of January 2007, the Internet penetration rate was 46.6% and 45.8% respectively.

For companies wanting to access more affluent Beijingers or Shanghainese, would it make sense to look intently to ensure that opportunities for conversation were not being lost?

For companies employing young people in Beijing or Shanghai, would it make sense to look just as seriously in China at the deployment of social media within the enterprise as leading corporations are considering or doing in the West?

As an aside, although part of the bigger picture, there is also the aspect of companies in the West, with technologies that could be welcomed in China, perhaps not seizing the day. Some companies I talk to are concerned about the risks of copyright piracy, which is an understandable concern. No doubt there are also concerns about cultural difference and language barriers – the usual litany of “too hards”. But are there in fact opportunities emerging but being overlooked? One blogger thinks so. Tarun at TechBanyan says American startups are surprisingly ignorant of what is happening:

However what is extremely surprising on the part of American startups is, their sheer ignorance of the Chinese market. After the home market, the next usual target is Canada and/or Europe. In the meantime, some Chinese spark sees the potential, builds a copy cat application, and before the nerd in Silicon Valley realizes it, the startup has lost the first mover advantage in world’s biggest web market in terms of eyeballs and advertising revenue.

There’s lots of food for thought – and for corporate strategizing – in the available statistics. There is no shortage of reading material: the CCNIC’s Statistical Survey Report on the Internet Development in China: January 2008 is 87 pages long. It has lots of interesting statistical breakdowns – city/country, gender, age, education levels – with illustrative graphs. Even better, it’s also free to download.

What I’ve so far not found a lot of are analyses of what the statistics might mean for the use of social media, beyond basic e-commerce so to speak, at an enterprise level. Suggestions welcome!

Des Walsh

Business coach and digital entrepreneur. With coach training from Coachville.com and its Graduate School of Coaching, and a founding member of the International Association of Coaching, Des has been coaching business owners and entrepreneurs for the past 20 years. Over the same period he has also been actively engaged in promoting the business opportunities of the digital economy. He is a certified Neurolinguistic Programming (NLP) coach, and a certified specialist in social media strategy and affiliate marketing.

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