Christina Leung
Feb 17, 2014

China's whirlwind media landscape

The rapid rise of ecommerce and the decline of traditional magazines will challenge luxury marketers and agencies in 2014.

Christina Leung
Christina Leung

In China, digital has penetrated all aspects of marketing and largely changed consumer mindsets as well as their daily lives. Traditional media—TV and magazines—have to develop a strong digital competence, otherwise they will face a “to be or not to be” challenge. And the changes don’t stop there.

Marketers have to become fully digitalized, from online advertising to search engine marketing to e-commerce. PR agencies need to understand how to influence the public or build buzz for a given topic by leveraging social media and search-engine optimization. Media agencies should review the effectiveness of media plans with thoughtful analysis of TV GRPs and online video GRPs.

Advertising agencies also have to think digitally and out of box as the available options are more diversified than ever: a 15- or 30-second TVC, a mini movie, a print ad, banner ad, a series of advertorials on social media or search on e-commerce sites.

Looking ahead in 2014, the following three areas are most likely to change the landscape for marketers and agencies at whirlwind speed.

1. Ecommerce

E-commerce accounted for 6.3 per cent of 2012’s total consumer-good sales in China, and that is likely to increase to 16.3 per cent by 2020. During the singles day e-commerce promotion this past November 11th, Tmall raked in record high revenue in one day, reaching RMB35 billion. With more than 244 million online shoppers, and people having the option to pay for goods not only via PC, but also with mobile and social media (both Wechat and Weibo), e-commerce is the New World. And it brings with it new hopes, uncertainties and challenges for all the marketers. It doesn’t matter if you want it or not, you have to be there some day.

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My point of view is to get there as soon as possible because there is no such thing as “ready then go”. Given that this is such new territory, with rapid evolution, there are no existing textbook rules to follow—all marketers, as well as agencies (actually there is almost no qualified e-commerce agency in the market), will have to prepare open minds, fast learning skills, flexible organization structures and quick decision-making processes. And great courage with a long-term plan will help too.

2. Media planning and tracking systems

How much shall we spend on TV and how much on online?  With the development of video vertical sites such as Youku, Tencent video, iQiyi, PPTV, and PPS, consumers spend more time watching dramas, movies, entertainment shows and sports programmes on “online TV”; therefore, marketers have to ask this “how much” question more and more frequently. As marketers, we hope digital media tracking will become more and more sophisticated in 2014, which will allow us and our media agencies partners to easily evaluate and allocate media investment in TV and online media by GRP/iGRP, and mixed reach and frequency.

3. Magazines and their future

A few magazine titles already announced business closures in 2013 in China. How many titles will survive in 2014? Do e-magazines bring sustainable revenue? More and more Chinese consumers read news, finance analysis, fashion information and gossip via their PCs, tablets and mobile phones. Expect to witness dramatic changes in the magazine scene for 2014. More magazine titles are likely to close down if they do not reform their mindset and recruit the right team—if they are unable to develop real revenue-generating business models for a digital world. This is sad news to marketers, in particular to luxury brands, as without this traditional channel, high-end names will struggle to find similar quality, in-depth content and such an effective medium for reaching the high-net-worth individuals they target.

Christina Leung is brand communication/PR director and marketing director for champagnes, wines and other spirits with Moët Hennessy Brands

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