Staff Writer
Oct 16, 2019

Cindy Yan Chan: the evolution of outdoor advertising in China

The CSO and CIO of Focus Media on the challenges facing outdoor media in China.

Cindy Yan Chan: the evolution of outdoor advertising in China
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At the 2019 China Outdoor Advertising Forum on Aug 28, Cindy Yan Chan, chief strategy officer and chief information officer of Focus Media, was invited to give a keynote speech on China’s outdoor ad landscape. Organised by the China Advertising Association and the Qinhuangdao Municipal People's Government, the forum attracted nearly a thousand industry experts, scholars and urban planners. A formidable figure in the Chinese ad landscape, Chan is also the VP of China Advertising Association and deputy director of Academic Committee of China Advertising Association. Here are a few key takeaways from her speech:

1. From off- to online
The current outdoor media landscape is facing three key developments. First, the drop in demand caused by the downward pressure of macroeconomics; second, the decline in demand brought about by shifts in Internet venture capital; and third, a rise in demand due to an upgrade in domestic brands. Those in media and marketing need to go beyond old ways of thinking about how people consume content, says Chan. One way is to understand how new urban planning policies has brought about a shift in urban population flow, and how that has in turn created a favourable condition for the flourishing of outdoor media. From 2012 to 2018, nearly all marketing channels suffered a decline in ad revenue—that is, aside from Internet and outdoor media. As the share of the Internet ad industry reaches a saturation point, outdoor media revenue is on an upward trajectory. In the second half of 2019, there was an unexpected 1.93 million decline in mobile Internet revenue. As digital dividends dip, more and more Internet giants are embracing outdoor advertising—a trend that’s expected to continue in the near future.

One way is to understand how new urban planning policies has brought about a shift in urban population flow, and how that has in turn created a favourable condition for the development of outdoor media.

2. Outdoor media’s (relatively) short production chain
The production chain of outdoor media is a relatively short one, where publishers often negotiates directly with advertisers and agencies. This sets outdoor media apart from other channels such as Internet and TV. According to Chan, outdoor media companies have spared no expense in embracing the digital revolution, making them strong contenders when it comes to helping brands reach their target audience in the most effective way possible. The digital transformation of Focus Media Group is a case in point. With its recently-developed big data and real-time monitoring capacities, Focus Media is well equipped to accurately assess campaigns, both pre- and post-execution. During the last ‘Double 11’ (November 11), a major shopping festival day in China, Focus Media collaborated with Tmall, one of the largest online retail platforms in China, to achieve higher conversion rates.

3. Outdoor media’s three dividends
One future of outdoor media lies in lower-tier cities in China. These lower-tier cities have vast populations, yet have relatively low brand awareness. Outdoor media agencies should capitalise on this gap. Another area outdoor media agencies could capitalise on are Chinese companies that are exporting their services and products abroad. Outdoor media companies could leverage their international reach to promote a certain product or service, and develop long-term business strategies. Focus Media, for example, has branches in Korea, Indonesia and Singapore. A third area that outdoor media firms need to focus on is the rising demand for impactful outdoor advertising. It used to be the case that it was near-impossible to measure the effectiveness of offline advertising, but with increasingly sophisticated algorithms, that is no longer a dream. Algorithms are increasingly dominating marketing communication and business operations systems, and clients are increasingly demanding greater synergy between sales and marketing. 

At the end of her speech, Chan emphasises that the future of the industry lies in three developments: technological upgrade, the innovation of campaign models and holistic insight into consumer behaviour. In the future, the distinction will no longer be between online and offline marketing; rather, the line will be drawn between digital and non-digital species—and it is clear which group will win out.

Source:
Campaign Asia

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