China agency scope 2010 : R3:GC

 

Here follows a summary of key client-agency trends.

China marketers are investing heavily in marketing; at 11 per cent of sales.

This year we see a rise in the level of investment that China marketers are spending on marketing; as the world's best brands as well as local Chinese brands compete in an ever more complex and demanding market. This level of marketing investment is up to double other emerging markets such as Brazil and India and shows the heightened maturity of the marketing sector in China.

 

China marketers are managing more agencies than ever before.

In the ever increasing complexity of engaging consumers in different ways and through fragmented means, it seems marketers are no longer necessarily convinced that a ‘full service' agency is the best way to address quite specific areas of specialization. More clients are building marketing strategies which require direct ‘1-1' consumer engagement techniques that require very different methods of communication and are now increasing the number of agencies being used, as well as outsourcing to specialized agencies.

 

Digital marketing needs more education and specialists.

The best approach to digital marketing has been revealed in a number of measures as still unclear for most marketers, and agencies are having mixed success in offering these services to meet client needs. Further, an admission on the part of 92 per cent of marketers that more training would be welcomed in this area, along with lower understanding than of traditional media, has compounded issues of low satisfaction with various agency types and unclear evaluation expectations and methods.

 

Pitching now used by 85 per cent of clients for agency selection.

Pitching (including both strategic and creative work submissions) has risen in popularity as a creative agency selection method, at the expense of other more collaborative methods. Pitching for media (strategy and rates) is also the most popular method ahead of trial assignment/project basis, with 72 per cent of marketers using this method and also on the rise.

 

Involvement of procurement increases a huge 40 per cent.

With the financial crisis putting never-before seen pressure on clients' top lines, this was the year for agency remuneration pressure. As a result we saw the appearance of more and more procurement departments, the involvement of which jumped up to 57 per cent of client companies engaging this discipline.

 

Overall there is a decreased level of satisfaction with media and creative agencies.

China marketers have consistently shown lower satisfaction measures with their agencies than in nearly every other market. This year however we see even further trends towards indifference with their marketing communication suppliers; and something that is supported by continued predisposition to change agencies as well as the shortest agency tenures in the world, at just 2.7 years for creative agencies and 3.2 for media agencies.

 

Local Chinese brands continue to earn respec.

Since 2006 we have seen an increase in the profile of local brands' in high profile campaigns, as well as the most respected marketers. Now 4 of the top 10 most respected marketing companies in China are local Chinese companies - gaining respect from other local companies and multinationals alike.

 

Please note this is a brief summary of Part One of the Agency Scope Study only. All individual agency preception and performance results are confidential to subscriber agencies. For more information please contact Sally Warren at [email protected].