The Opportunities of Urbanized China Cannot be Ignored.

Thursday, July 19, 2012 11:46
Comments Off on The Opportunities of Urbanized China Cannot be Ignored.

In the recent HBR report Where the Next Wave of Urban Growth Will Come  by Richard Dobbs and Jaana Remes ,reviews the recent McKinsey Study Urban world: Cities and the rise of the consuming class and has picked out a number of what they believe will be the fastest growing markets (by city) for a number of categories.

Interestingly enough, while Chinese city have a strong showing in all categories EXCEPT Young Entry Consumers, it is two issues of sustainability that China sees the most representation.  With more than half of the largest markets for elderly products begin in China.

Going back to the post Managing China’s Elderly. As Easy as 90-7-3, the key take away should be that while Shanghai offers a huge opportunity for firms and entrepreneurs, China offers scale for those products and services across a large number of cities.  Cities where 2-3 million elderly exist.

A population that is too big to ignore, according to the authors:

The growth of some urban markets can exceed that of entire nations, which is why cities really matter when it comes to strategy [..] When you are looking for the most promising urban market for your products, you need to take account of the growth of cities, as well as their demographic and income trends. It is where these work together that you will find the market hot spots for your product or service

To which, particularly in the case of China, I would wholeheartedly agree.

Particularly for firms who are able to accurately segment the market, develop a product that caters to that local market, and show the value of said product or service to a wider set of stakeholders that includes government agencies and families.  Stakeholders who will be shouldering the burden of caring for the age, but more importantly will provide ample sources of revenue for a wide range of products catering to elderly health and lifestyle.  Active or not.

to which I recommend you revisit my post Managing China’s Elderly. As Easy as 90-7-3, to see the size of the problems in Shanghai, where a few of the policy gaps I see making this market interesting exist, and a few of the areas that I see as being viable markets for China’s elderly.

Some of which I will spend more time on in coming posts.

 

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