Everyone seems to be trying to come up with their own secret to success for doing business in the Chinese marketplace. In his book, KFC in China: Recipe for Success, Warren Liu aims to do just that. KFC is the market leader in China’s quick food services industry, and as Vice President of Yum! Brands Greater China, and a member of the Executive Committee from 1997-2000, Warren instilled many of the winning practices that helped KFC achieve such tremendous success.

In order to find out more about the impact of the Chinese government’s stimulus package on China’s consumers, I interviewed Shaun Rein, Managing Director of the China Market Research Group (CMR). CMR conducts ongoing research into Chinese consumer culture and Rein writes extensively on the subject in publications such as Seeking Alpha, BusinessWeek, the Harvard Business Review, The Wall Street Journal and many others (For more on Rein’s background, click on this link).

Despite slowing economic growth, China’s e-commerce market is still growing strong. According to a China Tech News report from last week that summarizes market research firm IDC’s recent report, trade volume of China’s e-commerce market increased approximately 20% in 2008. It is expected to reach CNY3.22 trillion in total trade by 2010, up from CNY1.951 trillion in 2008. China e-commerce giant Alibaba Group’s [SEHK: 1688] C2C auction website Taobao.com was one of the greatest beneficiaries of this growth in 2008, realizing CNY100 billion in trade volume, up from CNY43.3 billion in 2007.

Alibaba’s e-commerce dominance is quite impressive, but how long will it continue? Alibaba founder, Jack Ma, admits that because e-commerce is still at relatively low levels of penetration in China, the online shopping penetration rate is only 26% among China’s internet users versus 80% in the US, competition is necessary for further development of China’s e-commerce market. eBay’s failure in its first attempt to gain a foothold in China despite vast resources and international experience demonstrated that a true competitor is more likely to emerge from the domestic front instead of from overseas.

Like many others I couldn’t resist having high expectations for Focus Media Holding Limited (FMCN). For the first two and half years after its IPO I watched its stock price soar, but over the past year I also witnessed its value decline 81%. Is there hope for the ailing Chinese media giant? As of this week, Sina Corporation (SINA) assumed control over Focus Media’s cornerstone outdoor advertising services, which are comprised primarily of strategically placed posters and LCD screens. This leaves Focus Media with just its online advertising, movie theater and traditional billboard advertising services. However, I am still optimistic that there is hope for Focus Media. This is why…

Time To Refocus

Last month, Alibaba.com [SEHK: 1688] announced its Q3 figures reporting EPS up 57% and Net Profit up 49% year-on-year. David Wei, CEO of Alibaba.com, was quoted saying:

While the global economy is facing extraordinary challenges, our business continues to grow at a steady pace.