DMA: A practical guide to China's data and analytics scene

How to overcome ad fraud?

Ad fraud is a long-standing issue in China, where it's estimated that up to 20 percent of daily impressions are generated by bots. And according to Ker Loon Ang, country manager at Sizmek China, 60 to 70 percent of ads are valueless.

That percentage should be enough inspiration to tackle this effectively, he said. "We shouldn’t see this as an elephant in the room, but something to solve so as to be accountable." In China, big media owners have so much sway and autonomy—too much in fact. "We need all of you to raise this issue," said Ang, addressing the brand representatives in the room. "If there’s a critical mass of advertisers standing up, we can have change.”

Change is sorely needed from the unrealistic targets that media owners "always tell you they can make just to get your business", he said. This sets up the problem for ad fraud.

Negotiate with media platforms, he advised, and say "I will not pay for any fraudulent traffic". The media will then start to improve ad pricing and base it on viewability, hopefully.

Will a one-stop shop cause black-box operations?

“It’s not a black box if it’s transparent,” said Wilson Yao, CEO of Allyes Group, when posed the question of whether a one-stop programmatic offering, popular in China, represents a conflict of interest.

The main concern is in real-time-bidding, which is less transparent than other programmatic forms, added Wei-Chong Khor, head of digital futures at Carat China.

Brands were advised to ask agencies and vendors these questions:

Cost: "Tell me what the fees are, whether for the technology or for the service. Tell me where the money goes?"

Operations: "Show me what it is that you’re optimising. Make sure we get a bidding log so it’s all transparent."

Inventory: “Show me my ads. Where are my ads delivered?”

For Khor, he said Carat is approaching DSPs and asking them to "open up" and "unbox the black box". "How can I bring clients to you if you’re a black box?" he asked. Some DSPs in China have decided on this business model "because it works for their margins", he added.

Reachmax's COO, Charlie Wang, said the trading desk charges a fee 100 percent based on its services. In terms of margins, "we’re doing just fine". It’s a matter of deciding what direction you want to take your company, he said. "We want to be as clean as possible."

What's the primary function of a DMP?

From the perspective of Jane Zhao, chief marketing officer at Miaozhen Systems, a DMP matches data from devices to the profile of the person targeted. “You want to know the humans behind the screens;   not just what the screens are 'doing',” Zhao said.

“Data creates trust," she said. Unfortunately, problems continue when it comes to accessing trustworthy data from within BAT’s walled gardens, so McDonald’s China VP of digital Ruth Feng is contextualising data in her own way.

"Our breakfast business is what we call a habitual business, because once a consumer builds up this habit of eating McDonald's for breakfast every day, it's hard to give it up."

From data analysis, she found that Shanghainese will take extra effort to visit a McDonald's  outlet even if it is not on their way to the office. "But in Beijing they won't do so. Why? The roads are too wide, and finding a underpass to the other side of the road is too difficult. Only an independent DMP can tell us such small differences in consumer behavior, she pointed out.

How will digitalised teams change workplace dynamics?

“It's interesting as we build up our digital team, which is a combination of people from digital marketing, internet, product design, UI/UX and data science backgrounds,” said McDonald's Feng, who sees a trend in other companies also trying to build such teams.

“If we call marketers ‘red people’ because they are very passionate; and IT people are ‘blue people’ as they are very calm and rational, such teams will be made up of ‘purple people’ with both red and blue blood inside them,” described Feng.

And ‘purple’ talent are in very short supply now in the market, pointed out Jun Yuan, head of programmatic at Omnicom Media Group Greater China, perhaps making a compliment to himself. People who possess these data skills can “easily” find jobs in China, he said.

Indeed, digital technology can help marketers in very competitive sectors like FMCG transform. P&G China’s vice president of marketing Freda Xu shared how as a marketer, her life was transformed “from a slow and traditional approach to a big-database, high-technology approach”. This “provided so much room to use imagination on how to do marketing”, she said.

In tandem, changes in media agencies are taking place in the media planning and activation processes. “Previously, we logged into a planning tool which gives us the top-ranking media sites and then we placed them into a media plan,” said OMG’s Yuan.

“But a better, data-driven approach is to start planning from the audience: identify the target group first, see how they spend time on various media, and then derive creative to reach them.” Choosing which media site is the last priority, he pointed out.

What is one way to expand on second-party data sources?

Second-party data is data shared only between parties in private agreement--in nature the first-party data of another brand available for use, said Derek Kwok, head of data solutions and insights for Greater China and Korea at Google. When used wisely, it can strengthen current loyalty programs while attracting new customers to increase retention rate and transaction value, he advised.

“An airline may not want to partner with another airline, but may want to partner with a hotel or a travel website,” he said. To activate second-party data, Kwok gave examples of Macau Sands, Lancome and Loreal having their logos on the frequent flyer programme materials of China Eastern Airlines in a co-marketing set-up.

This gives these brands the ability to tailor their creatives as they can target flyers who travel, say, four times a month to cross-sell perhaps a skin hydration product.

These opportunities also allow access to “non-endemic audiences”, meaning audiences which are not so obvious to a brand. “Like beer and diapers, these products are in an non-endemic relationship. New fathers drink more beer because of the stress of a new baby, but these are unexpected insights requiring data to connect the dots, Kwok summarised.