Chris Reitermann
Jun 11, 2015

China's ‘new normal’ in marketing

Digital is undoubtedly a priority for marketing in China, but that insight alone isn’t enough to drive strategy. Brands and agencies need broader and deeper awareness of the market’s unique and varied drivers.

China's ‘new normal’ in marketing

Digital is undoubtedly a priority for marketing in China, but that insight alone isn’t enough to drive strategy. Brands and agencies need broader and deeper awareness of the market’s unique and varied drivers. 

The ‘new normal’ has become the ubiquitous phrase media commentators, economic analysts and politicians used to describe a slowdown in China’s high-speed economic growth. In much the same way Chinese marketing has become littered with buzzwords like WeChat, BAT (Baidu, Alibaba, Tencent), online video and big data. 

Ask any marketer in China about ‘digital’ in 2015, and they’d all tell you about it being the only game in town when it comes to brands engaging Chinese consumers. And they’d be right; but only to a point. As brands and agencies all fight to climb aboard the digital bandwagon, what is becoming increasingly apparent is that ‘digital’ has very different applications for different consumers and categories.

Digital has massively impacted how brands are built, but in a low-growth environment deep consumer understanding and strategic differentiation are essential weapons for guaranteeing success in the marketplace. 

As an industry, we need to move away from the current mindset and practices that treat Chinese consumers as a homogenous group, and adopt a more segmented approach based on a more nuanced understanding of the Chinese consumer landscape and fresh insights. We wouldn’t apply a one-size-fits-all approach in other developed markets, so why would we do it in the soon-to-be biggest consumer market in the world with its many hundreds of cities?

We have reached a decisive juncture. Businesses and agencies now need to broaden and deepen their awareness of the different drivers influencing consumer behaviours, preferences and values across the country’s various cities and regions. By having a more sophisticated understanding of the various consumer archetypes in China, brands can engage their audiences in more targeted, relevant and effective ways. Crucially, a better understanding of these consumer dynamics will enable brands to find a clear differentiating positioning in an increasingly crowded and vociferous market place.

At the moment, luxury, automotive and technology brands in China lead the way for digital innovation and creativity. Some of the most progressive brands are increasingly challenging conventional wisdom when devising campaigns by identifying the latest digital platform and developing a specific idea and content that will be the best fit.

More commonly, a campaign concept is meticulously devised before being altered or manipulated to make it function on a desired platform, often diluting the original idea. This inverted thinking is frequently allowing the more daring and adventurous brands to steal a march on the competition.

Skimming through the list of China’s Top 1000 Brands (and it’s clear that big, international brands continue to dominate the rankings), it’s important not to overlook the many Chinese brands that are on the rise and, in some instances, starting to set the pace.

There has been much discussion about whether domestic marketers are simply paying lip service to the importance of long-term, brand building. In terms of strategic know-how, some domestic brands may lag behind their large, international competitors who benefit from having more mature and extensive global infrastructures and deeper talent resources. However, local players often outdo MNCs when it comes to reach, penetration and their ability to be nimble and flexible. Many domestic brands are effectively leveraging their size and business models to lead the way in the digital space with short-term, high-impact campaigns that resonate with consumers.

In the new digital era in China, the talent needs of in-house marketing teams and agencies are evolving. Digital creativity and social-media expertise, as well as specific knowledge of the Chinese market, are now essential. Agencies are moving quickly to adapt their structures and workforce to embed digital capabilities across their operations, with a view to making digital the lens through which all client problems are viewed and solutions are conceived. But a word of caution, this is a potential double-edged sword. In the clamour by organisations to make themselves digitally literate and relevant, the role of the digital specialist remains vital and should not be forgotten. Failure to maintain a core of specialists leads to a risk of expertise becoming spread too thinly.

All too often most marketers are just making noise. We regularly see social and digital campaigns generate ‘impressive’ results, but ultimately fail to make an impact on vital brand measures or the bottom line. The realities of the ‘new normal’ and slower growth places greater emphasis on more sophisticated, high-level, marketing skills. Strong digital and creative capabilities need to be allied with high quality, marketing strategy and integrated thinking, as market competition becomes more intense, budgetary pressures grow and clients demand greater efficiency. 

Digital is undoubtedly the ‘new normal’ in China marketing. There has been plenty of talk and much noise. Now is the time for informed, intelligent and innovative action.

Chris Reitermann is CEO of Ogilvy & Mather China

 

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