Roland Berger study confirms China the world’s leader for bike-sharing

29 September 2018

A study from global consultancy Roland Berger has confirmed China as the world’s most prolific bike-sharing nation, with over 9 million bicycles now in circulation.

In an update on its 2016 global bike-sharing report, strategy and management consultancy Roland Berger has highlighted the dramatic increase in the number of bikes and bike-sharing schemes over the past two years, with the worldwide fleet expanding from around 1.2 million units in 2015 to over 10 million at the end of last year. The firm projects a further doubling in numbers to 20 million by just 2021.

Buoyed by ever more greatly congested cities and growing health and environmental concerns, along with consumer trends away from the accumulation of assets and a digitally-savvy modern milieu, the popularity of bike-sharing schemes continues to rise around the world, with 1,250 schemes of various model types now operating in 71 countries – up from around 1,000 in 2015 and including new global entrants Uber and Didi.Number of bike-sharing systems around the worldWhile growing globally, and tipped to reach to a worth of €8 billion over the next few years, much of the recent rapid growth – like many things in the global consumer economy, such as the luxury fashion and electric vehicle industries – has come courtesy of an phenomenal boom in Chinese market, which has since 2015 added over 8 million bikes to its national fleet – predominantly in Shanghai and Beijing.

These cities with Shenzhen combined now have an approximate 50 percent share of the world’s total number of shared-bicycles. With the country’s biggest schemes previously in Wuhan, Hangzhou, Taiyuan and then Shanghai (with 280,000 bikes less than a third of the number in Wuhan), Beijing was in 2015 barely on the map. Now the city – which is home to over 20 million residents – has a bike-sharing fleet in excess of 2.3 million units, with Shanghai contributing a further 1.7 million to the global tally.Development of global bike sharingAccording to Roland Berger, these numbers are only set to expand – projected at 20 percent growth annually through to 2021 – on the back of massive ongoing investments and continued public interest, with Asian market leaders ofo and Mobike already having some 200 million registered users apiece and an apparent $3 billion in venture capital having been amassed by Chinese private providers to further push Asian and global expansion.

For China, the consulting firm further points to a local bike manufacturing capacity upwards of 80 million units per year, a largely unregulated market, and unsaturated public demand as factors in the meteoric local rise in bike-sharing. However, as dramatic photos of mountainous bike dumps in the country attest, there are some concerns already for current over-saturation. Further, share-bike operators around the world have been feeling the squeeze from city authorities fed up with visual pollution and indiscriminate parking.

Such a clamp-down has occurred in Singapore, where unable to comply with a spate of new licensing regulations the locally-founded operator oBike has slipped into receivership and withdrawn a fleet of around 70,000 bicycles, with liquidators FTI Consulting fielding demands from thousands of disgruntled customers scrambling to retrieve some S$6.3 million in deposits. oBike is now being investigated by Singaporean authorities for misappropriation of funds.

The crash-and-burn stories of a sudden market proliferation are not an unfamiliar one, and Roland Berger predicts an upcoming period of consolidation in the bike-sharing domain; “Despite the promising opportunities offered by the burgeoning bike-sharing market, the rapid pace of growth is not without its pitfalls. Operators are faced with becoming the target of vandalism, or oversupply in certain cities. We predict the market will consolidate in the coming years, with a smaller number of high quality offerings surviving the initial boom to find longer term success,” the firm concludes.

OC&C survey of 15,000 consumers uncovers distinct Gen Z characteristic

30 January 2019

An emerging borderless tribe; that’s how OC&C Strategy Consultants has characterised Generation Z following a comprehensive study of the globe’s youngest generation.

As the older members of Generation Z reach maturity, born from the mid-to-late-nineties and on, the international strategy and management firm OC&C Strategy Consultants has undertaken an in-depth study of the world’s generational habits and perspectives, describing those of Gen Z as belonging to an emerging borderless tribe – hungry for uniqueness but with the most globally consistent attitudes and behaviours.  

In an effort to gain a clearer understanding and insight for business and retailers into the youngest generation, OC&C altogether surveyed more than 15,000 respondents across four generations (Baby Boomers, Gen X, the Millennials and Gen Z) residing in nine countries, including 2,000 citizens in China, with Gen Z’s accounting for approximately one fifth of the Chinese population and 30 percent of world’s overall total.Chinese Gen Z ratio of household spend compared to globe

The findings of the survey demonstrate that while Gen Z is similar to its Millennial predecessor in certain respects, such as featuring experience-led and socially conscious consumers, the younger cohort has developed some distinct traits which set them apart – fittingly, one example being the desire as individuals to stand-apart. The other defined markers however may strike as an immediate contradiction; Gen Z is the most likely to be influenced by peers, and as a group is the most closely aligned in behavior and perspective at a global level.

The ready explanation to this apparent contradiction is of course social media. As stated by the report, whereas Generation X, the Millennials and Gen Z – the latter soon to account for one third of all consumers worldwide – may all shop online and are all influenced by social media, Gen Z’s list of influence extends further on digital media channels; “Brands’, friends’ and celebrities’ social media and blogs have bigger influences for Gen Z than for older generations.”

“China’s Generation Z are the first Chinese generation to be born in a fully digital age,” said Adam Xu, who was recently made Partner with OC&C. “They are an extremely tech-savvy crowd, willing to share their feelings and experiences in forms of online reviews, blog posts and other means of self-expression. Chinese Gen Z are more likely to make their social media public compared to their Western counterparts who prefer to limit their social media audience to people they know in real life. This suggests that information sharing extends even further beyond their immediate circles for Chinese Generation Z, a trend that presents immense marketing potential if leveraged appropriately.”

One area where this is apparent is in terms of brand discovery channels, with Gen Z’s citing a friend’s influence in 21 percent of recent occasions where they’d been introduced and subsequently purchased an item from a fresh brand, compared to 14 percent of Baby Boomers and Gen X’s and 17 percent of Millennials. The influence of social media and the internet can also be evidently credited for Gen Z’s sharing the greatest cross-border similarities in behaviours and attitudes compared to other generations.Social responsibility priorities for Gen Z As to those shared behaviours and opinions, Gen Z is distinctly socially-minded, or its members at least state a variety of social concerns as having a greater level of priority than their generational peers – building on the Millennial mind-set. Issues such as human rights, diversity, and building local communities all attract concern at far higher levels than the generational average, while for the Gen Z’s of China, environmental-friendly consumption features prominently – at 25 percent compared to the 13 percent global Gen Z average.

While those of Gen Z expect brands to adhere to high ethical standards, and are for example more willing to take extra steps to research a brand’s supply-chain and employment practices before making a purchase, the stated environmental concerns of the newest generation don’t necessarily translate however to broader purchasing activity, with its shoppers favouring passing trends and showing the lowest tendency to preference products that can be used repeatedly. This would suggest opportunities for brands which can meet both the Gen Z need for individual style while leading on social and ethical issues.

And for those same brands, retailers and manufacturer looking to the Gen Z market, it may be worth noting than the Chinese segment of young consumers – most still just teenagers or even younger – account for a massive 13 percent of direct or influenced total household spending in the country – 10 percent of that from their very own pockets – against comparative overall figures of just 3 percent in the US and UK. “These statistics are enough to urge brands to rethink their business strategy if they want to capitalise on China’s booming market,” concludes OC&C Strategy associate partner Veronica Wang.