China, as we all know, is shifting from the "factory of the world" to a major "market of the world." As a result, almost every consumer-oriented company has a China strategy -- and should also have a China design strategy. The increase in purchasing power will cause a major change in the way design is done in, and for, China. This will hold true not only for Chinese companies but also for any business wanting to sell to consumers in the Middle Kingdom.
Today, companies designing products for the China market typically create either cheaper versions of Western designs or slightly modified versions of local products. Design is generally not used at the front end of the development process to help discover what its citizens need -- instead it is used at the end of the process to make minor changes in appearance.
Of course, some exceptions do exist: Motorola (MOT) opened its first office in Beijing in 1987 and often designs products for China initially, later modifying them for the U.S. market. And rather than tweaking vernacular PCs, Lenovo does primary-user observation research on how Chinese consumers use computers at home in order to create fundamentally new forms of human-computer interaction.
Other companies operating in China are starting to think about sustainability and how to design unique products that could be patent-protected. But the norm remains: Mobilize design only when it's time to style a product for the streets of Shanghai.
That norm has to change for one phenomenal reason: The warehouses are packed. China's warehouses are filled with consumer goods that no one is buying. Companies are making things that do not accommodate their patterns of daily life. One of the reasons the country's citizens have such a high saving rate is that they don't like what they are seeing in the stores.
So how will smart companies respond? First, they will adjust their design process to reflect the fact that there is no "China market." Rather, the country has 30 markets, each one influenced by its own climate, economy, language, history, geography, and culture. China's consumer needs are as complex as Europe's. To attain success, both design firms and product manufacturers must employ sophisticated processes to understand people's desires and needs.
Second, they'll realize surveys, focus groups, and other standard tools of market research don't cut it. Not only is China as diverse as Europe, it is made up of novice consumers unaccustomed to such a variety of offerings. Their decisions are difficult to predict in a climate of rapid change. How can a company base product development decisions on such rocky data?
While U.S. companies can glean high-level consumer insight from the data generated by credit cards and check-out scanners, such tech-powered consumer research isn't possible yet in China. And even U.S. companies are turning to user observation techniques to get more detailed insights about customers' unexpressed needs.
The good news: Leading design schools at such great universities as Tsinghua and Shanghai Jiatong are beginning to teach ethnographic user research methods that, ultimately, will produce the design talent companies need -- both to understand the granularity of the Chinese markets and to develop products that won't languish in the warehouse.
Just as China -- and other parts of the "developing" world -- raced through or leapfrogged certain 19th- and 20th-century technologies, companies developing products for China must rapidly jump from using "design as late-stage styling" to the user-focused, business-based methods required by the complexity of the various markets in China.