Helping Chinese Consumers Essay

QuarkMan Technology was founded in 2012 by David Yuan. As the Chinese domestic consumption continues to grow at a rapid speed, consumers need a reliable source for independent and impartial review of products to find the quality and functionality. The mission of the company is one of â€Å"unveiling products’ essence in an independent, professional, and powerful way.† The two core principles are â€Å"Independence† and â€Å"Fairness†. QuarkMan has set up two business units, Information Advisory and Media. The reports and data obtained by the testing of products are handled by the Information Advisory unit and the Media unit takes this information and displays it in a user friendly way so that consumers can make educated decisions. QuarkMan Media is further divided into Jancr which is the consumer goods testing division and China Consumer Report which is the communication division responsible for settling disputes between the consumer and manufacturer. SWOT ANALYSIS for QuarkMan Strengths Manages their own lab and return team Strong relationship with third party labs and research institution labs State of the art testing lab with 400 pieces of equipment and 3000 square meters External expert network from numerous industries In-house lab is a stand-along profitable business unit which finances the media unit Weaknesses Hard for an independent and fair media company to be profitable in China In order to remain independent, advertisements on their website is not an option Majority of the testing resources are owned by the government affiliated consumer associations, industry associations and government research institutes A big chunk of the capacity has a very low utilization rate Takes 2-3 weeks for QuarkMan to deliver one product review and others longer QuarkMan struggling with capacity issues Opportunities No mature player conducting comparative tests and analysis across different industries The third party testing market was controlled by the government but has now become a huge and rapidly growing market QuarkMan currently handling six product categories but have the opportunity to handle more Exhibit 4 – Private only handles 10% of the current market share Threats Private sector is growing at a CAGR of 25% Speed is a key factor for the high growth rate New players in the market have gained decent traffic from more frequent content releases Exhibit 4 – Foreign markets only handle 25% of the current market share Problem/Decision Statement How can QuarkMan influence consumer perception of their brand and business values and thus gain their trust and business? Identification of Alternatives Consider advertisements as a revenue stream with the use of a 3rd party to manage the sale and pay a portion back to QuarkMan so independency and objectivity is upheld. Use these funds to mark the business philosophy of QuarkMan to gain additional market share. Obtain additional financing through other interested parties and use revenues to promote the business model and use additional financing funds to expand testing resources and improve turnaround time and reach more consumers Critical Issues Impact on current and potential consumers and their ability to trust QuarkMan if they attempt to raise revenue revenues through advertising The use of a 3rd party to manage advertisement while increasing revenue and the effects on their ability to stay independent and transparent to the consumer Significant lead time to bring products to market and the limit number of product reviews that can be completed times. The use of a 3rd party to manage advertising would directly go against the company’s core principles of Independence and fairness thus leading to more mistrust. Analysis Consider advertisements as a revenue stream with the use of a 3rd party to manage the sale and pay a portion back to QuarkMan so independency and objectivity is upheld. Use these funds to mark the business philosophy of QuarkMan to gain additional market share. The current market has a distrust of the industry because of the lack of transparency and the blurred lines between the agency reviewing the produce and the product manufactures. The current Chinese consumer agency is not transparent and the government plays such a significant role in the reviews because of this the consumers do not trust any consumer reports. QuarkMan’s guiding principles of independence and fairness will be viewed as conflicting with any advertisement from a manufacturing. This conflict will add to more doubt from their consumers. Obtain additional financing through other interested parties and use revenues to promote the business model and use additional financing funds to expand testing resources and improve turnaround time and reach more consumers This alternative would allow for additional revenues while not compromising their independence and fairness. QuarkMan can continue to market their product and services through current media channels and bring awareness to their strong brand name and transparency while setting them apart from the current competition. This will help to generate long term customer loyalty. Additional revenues can strengthen their 3rd party testing environment and help to reduce the lead times and number of products able to be reviewed at one time. They can further expand the types of products they review and be able to reach more potential customers. Recommendation The recommendation based on the entire analysis would be to obtain additional financing through other interested parties and use revenues to promote the business model and expand testing resources to improve turnaround time and reach more consumers. This alternative would allow for additional revenues while not compromising their independence and fairness. QuarkMan can continue to market their product and services through current media channels and bring awareness to their strong brand name and transparency while setting them apart from the current competition. This will help to generate long term customer loyalty. Additional revenues can strengthen their 3rd party testing environment and help to reduce the lead times and number of products able to be reviewed at one time. They can further expand the types of products they review and be able to reach more potential customers.