OppOrtunities fOr fOreign enterprisesin China’s evOlving digital wOrld
YOur lOCal eXpertChina digitalizatiOn COmpetenCe Center
China‘s digitalizatiOn push– aCCelerate YOur pOtential
digital services and platforms to cut out middlemen are booming in China for both B2B and B2C sectors
end-to-end connectivity can amplify business performance by bridging the contact between manufacturers and end customers
end-tO-end COnneCtivitY
is YOur COmpanY utilizing
the Chinese eCOsYstems?
sharing of durable goods, daily supplies and even services is already deeply embedded in day-to-day life of Chinese consumerism
user reviews are proactively given and commonly shared by consumers in digital ecosystem which strongly impact user experience
sharing eCOnOmY
are YOur retail Channels and
CustOmer tOuChpOints up-tO-date?
visualization with assistance of digital ecosystems and vr to achieve real time tracking and experience affect both B2C and B2B industries (e.g. customer service via vr)
additive manufacturing to turn 3d data into physicals leapfrogging in China
dematerializatiOn
is YOur faCtOrY readY fOr
China‘s dYnamiC innOvatiOns?
2 3
digitalizatiOn as CatalYst fOr grOwth
KeY fOrCes fOr China‘s digitalizatiOn
QuestiOns tO fOreign COmpanies
1) unicorns: privately-held startups valued at > 1bln usd
30% of global robotics purchased in China
in 2017
China‘s government invested
>15 bln eur into ai
By 2025, China is expected to account for 40% of global 5g users
China accounts for almost one quarter of the global manufacturing capacity. however, rising labor and capital costs increasingly pressure companies in China to innovate beyond mere efficiency improvements.
with a young and highly tech-savvy population combined with a ready-to-take-risk business mindset, China is rapidly embracing digital technology in consumer sectors. in particular e-commerce and mobile payment platforms have transformed business models, disrupted traditional sectors and heavily increased the convenience for the Chinese consumer. platforms have emerged in China at an unprecedented scale – and provide a substantial basis for an accelerated digitalization push.
strongly driven by first-tier internet giants Baidu, alibaba and tencent‚ as well as later emerged players didi, meituan and toutiao, China is creating a multi-industry digital ecosystem with tremendous investments into digital technologies and is now home to almost one-third of the world’s unicorns1). policy makers actively support digital innovation and entrepreneurship by offering investment support, driving the development and consumption of new technologies and giving companies room for experiments.
Chinese companies are rapidly catching up to shape global industries through innovative digital technologies. in order to benefit from China’s digital transformation, foreign companies need to put China at the center of their digital strategy. furthermore, one can establish ‘watch lists’ on billions of dollars of investments in hidden and public digital outbound acquisitions in western markets. China is no longer just developing isolated digital appli-cations for the middle Kingdom – but is re-defining the global innovation ecosystem.
eaC has been active in China for more than 25 years. Our first-hand knowledge through local resources and exis-ting networks enable our strong digitalization competence in a dynamic business environment. Benefit from our extensive industry and asia insights and use us as a catalyst for your future success on digitalization in China and beyond.
dietmar KusCh madlien lOrenzeaC partner eaC managing COnsultant
amBitiOus targets and strOng investments transfOrm industries
China gOes digitalnumbers to impress: China‘s digitalization scale is leading the world
KeY digitalizatiOn pillars shaping China’s eCOnOmYsupported by government investments and regulations, various industries increasingly digitize their operations and business models. foreign players can benefit from the existing ecosystem and platforms in China but need to act now to participate in future growth.
36% of global unicorns are from China
>1 bln monthly active users are on weChat
>3 bln usd is the valuation of the world’s most valuable ai start-up – a Chinese company
4 5
eaC digitalizatiOn mOdel Of China‘s KeY industries
smart manufaCturing n digitalization and automation in manufacturing are one of the
key pillars of the “made in China 2025“ initiative
> China still lags behind industrialized nations in smart manufacturing and thus heavily relies on foreign technology – however, application openness (i.e. for robotics and additive manufacturing) far outsteps the west
> innovation frontrunners like home appliance manufacturer haier, hisense and midea as well as construction machine suppliers sany and zoomlion have built “internet/ digital factories“
mOBilitY disruptiOnn digitalization focus driven by Oems, policy makers but also
experimental consumers/ early-adapters
> integrated shared mobility concepts such as shared bikes and shared cars digitally connected to one another and integrated with public transportation
> Business model innovation: by-passing dealerships via apps or e-commerce platforms to enable direct touchpoints along the customer journey
> Car connectivity, focusing on in-vehicle infotainment, customer-driven co-creation, smart surfaces and connected after-sales offering targeted at tech-savvy Chinese
smart healthCaren empowered by a rising middle-class, digitalized smart
healthcare is transforming China’s inefficient medical system n China’s government pushes smart healthcare through “internet
plus health” policy and “healthy China 2030” initiative
> iot-driven remote treatments and online doctors enable direct connections with patients and remote digital health and wellness treatments
> ai-empowered diagnosis supports the accuracy and consistency of treatments
> wearables and platforms like alihealth combined with cloud-based healthcare Big data inform patients on their health conditions instantly
digital COmmerCen early adaption of digital technologies has transformed a highly
inefficient and fragmented retail industry into one of the most digitalized ones
> Omnichannel retail, strongly invested by China’s Bat (Baidu, alibaba, tencent) promotes completely new retail concept: seemless integration of online into offline channels
> digital grocery stores with online payment and vr/ ar solutions – completely unmanned stores are a reality already
> e-commerce driven logistic innovations like Jd’s drone delivery increases efficiency through last mile optimization and user base by reaching rural areas
> Content-focused e-commerce, driven by social media and KOls, is amplifying customer centricity
> analytics-driven offerings generated by China’s massive consumer base on China’s ‘super-apps’ enable mass customization
industrials
mOBilitY
healthCare
COnsumergOOds
6 7
Big game: China‘s eCOsYstem fOr digitalizatiOn – partnering and investment OppOrtunities fOr fOreign COmpanies
made in China 2025initiative to comprehensively upgrade Chinese
industry by implementing various guidelines that link digital information technology tools with
production processes
internet plus+government initiative to introduce internet, cloud computing and iot into industrial production – goal is to sti-mulate economic growth and to take advantage of the trend towards digital businesses
smart CitiesChinese government pushes into funding official smart-city initiati-ves interlinking public services and
bringing real-time information for citizens online
teChnOlOgY fundingChinese technology companies have easy
access to various funding sources, i.e. government subsidy, angel/vC/pe investors,
crowd funding, Chinese new third board market and China new era technology fund
innOvatiOneCOsYstem
China
eaC prOJeCt fOCus and enaBlers
digitalizatiOn in China – eaC suppOrtahead of innovation trends through strong regional expertise and networks along all major industries
impliCatiOns fOr fOreign COmpanies tO gO digital in China
eaC eXpertise at a glanCe
YOur lOCal eXpert in emerging marKets sinCe 1993
funCtiOnal COmpetenCiesstrategYm&aOperatiOnal eXCellenCe
> 100 eXperts
OffiCes inmuniChshanghai mumBaimOsCOw
emerging marKetsChina indiasOuth east asia nOrth asiarussiaCee
industrY COmpetenCiesmOBilitYindustrialsinfrastruCtureenvirOnmentChemiCalshealthCareCOnsumer gOOdsadvanCed teChnOlOgies
strategY implementatiOn aChievement
CustOmer-CentriC digital strategies
full utilizatiOn Of digital eCOsYstem
maXimized Big data and analYtiCs
Identify (unmet) customer needs and digitalization opportunities
Outline partnering and invest opportunities in China‘s ecosystem
Influential role of digital platforms in China due to cross-sector services and super-apps
Re-design the online/ offline customer journey
Massive amounts of data generated every day (>700 mio users) with open data sharing and strong opportunities to monetize
agile OrganizatiOns
digitalize OperatiOns
utilize newestBusiness mOdels
Outside-in assessmentn major digitalization trends and future
scenarios in China n implications on current business
model and product offering
Competitor Benchmarkingn Key digitalization success factors of
domestic and foreign best-in-class competitors in China
Organizational Change requirementsn Comprehensive assessment of
organizational and talent requirements necessary to meet digital transformation
digitalization Cooperation Optionsn identification and assessment of
potential partnering/ cooperation optionsn innovation through platform and start-up
collaboration
digital strategy developmentn prioritization of digital initiatives and levers
shaping customers’ digital journey n Clear digital strategy roadmap
facilitated by digitalization workshops
digitalization ecosystemn Best-practice benchmarking n digitalization white spotsn improvement levers: Business models,
processes and structures, product features
guide & facilitate Qualification initiativesn identification of organizational and
qualification gaps n Concrete initiatives to close them:
coaching, workshops, restructuring
eaC local networkn strong understanding of local market trends and key players as well as access to corporates and start-up’s in China / for China
understanddigital market &
ideation attractiveness
learnBest-in-Class digitalization
use Cases
implementdigital Organizations
and Competences
aCCeleratespeed up your
digitalization strategy
eaC muniChheadQuarters
eaC shanghai eaC mumBai eaC mOsCOw
www.eac-consulting.de
latest eaC digitalizatiOn prOJeCts
YOur eaC eXpertsfOr digitalizatiOn
eaC – euro asia Consulting partgwidenmayerstr. 2980538 munich germanY
phone +49 89 [email protected]
eaC – euro asia Consulting sunyoung Centre rm. 801 - 398 Jiangsu road 200050 shanghai China
phone +86 21 3250 [email protected]
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phone +91 22 [email protected]
eaC – euro asia Consulting OOOmelnitskiy per. 1 105120 moscow russia
phone +7 495 [email protected]
dietmar KusCh eaC partnerphone +49 89 [email protected]
madlien lOrenzeaC managing COnsultantphone +49 89 [email protected]
n Business model ideation for EV’s and related charging
services
n Dynamic real estate footprint assessment and appraisal tool
n Digital sourcing platform with early warning system
for machinery components
n E-service platform including after sales support, spare parts orde-ring and remote maintenance
n Digital sales platform
for commodity chemicals
n Business model piloting for supply chain integration
n Start-up and ecosystem screening
for eHealth offerings
n Market and infrastructure potential for remote
diagnostics
n Ideation & innovation on ‚integrated
smart home‘ from focus groups to design and engineering studies
n Platform utilization for integrated Marketing and
Sales concept
n E-commerce go-to-market strategy
n Touch point optimization along digital customer journey
n Social Media branding push