In spite of rising costs, Chinese tech companies see value in attending big industry gatherings

PUBLISHED : Monday, 06 March, 2017, 8:59pm
UPDATED : Monday, 06 March, 2017, 10:36pm

The Mobile World Congress remains a highly regarded networking event for mainland Chinese companies, with the industry showcase in Barcelona drawing a strong turnout during its four-day run to March 2, although some attendees highlighted concerns saying the costs of maintaining a presence had become prohibitively expensive.

Among the unique exhibiting companies at the event, 196 were registered in the mainland, up from 183 mainland companies which attended last year’s event.

The growth in attendence helped to boost mainland companies into the No 4 spot in terms of company origin by nationality.

Analysts said that MWC and the International Consumer Electronics Show (CES), held in Las Vegas, Nevada each January, remain popular networking events for mainland companies.

“Chinese brands are investing in CES and MWC because of their global visibility and the buzz it can create with media in the US and western Europe. Some Chinese brands lack brand personalities there and for those who want to grow abroad, this can generate indirect value,” said Thomas Husson, principal analyst with Forrester Research.

Companies attending this year’s Barcelona event noted spiralling prices for peripheral amenities and services such as hotel rooms, where a single night’s stay in a downtown four-star hotel cost more than US$1,000, significantly higher than the daily average rate throughout the year.

Participants said there was little choice but to pay the rates as many hotels were often booked out months in advance.

Costs related directly to attendence can also punch holes in a corporate expense account. Those wanting to exhibit at the conference need to submit their applications a year in advance and make full payment well ahead of the event’s start.

Apus Group, a Chinese Android-app provider, said total costs to attend Barcelona amounted to roughly 1.5 million yuan (US$218,000), with about two-thirds going towards rental of a 30 square metre booth and decoration. The remaining third of the budget went towards travel, accommodation and daily spending allowances for a dozen of the company’s Beijing’s staff who attended.

Apus’ founder Li Tao, said in an interview with the South China Morning Post, that the event was an effective way to raise the company’s profile while keeping in touch with clients.

Li said he had been able to make contact with representatives from Google as well as other prospective companies.

“Most of my clients attend the MWC event, so I can meet them all during just one event. If I meet them separately, in different countries, it costs much more time and money,” he said. Li added that the event had value in developing ties with other exhibitors and attendees.

For other major Chinese technology companies such as Huawei and ZTE, international conventions like MWC are more of a global platform to launch their latest products and showcase technologies.

“With Chinese companies now taking a leading position in every aspect of the mobile ecosystem, larger companies are looking to demonstrate industry leadership, while smaller companies are looking to grow,” said Bo Chen, head of Asia, GSMA.

Yeelim Lee, director and North Asia tech sector lead of Edelman, said the trend of Chinese companies flocking to global industry events is indicative of the growing stature and importance of Chinese brands in the global marketplace.

“Across various technology segments, Chinese brands are competing alongside established international brands and holding their own, so it is no surprise to see them feature prominently at these international trade shows, said Lee.

“Historic issues with trust in Chinese brands are being effectively addressed by most and the old perception that Chinese products are cheap is changing.”