Greg Paull
Jan 14, 2014

Defining trends in China: 2013 and 2014

Four trends that defined marketing in China in 2013, as well as four that will drive the industry in 2014.

Greg Paull
Greg Paull

It was a challenging year for brands in China. With Xi Jinping’s “Four dishes and one soup” setting the tone, a lot of luxury marketers had a tough time. The Global CEO of Remy Martin was fired at year end for missing China goals, and both Revlon and Garnier pulled out of the skincare market.  Meantime online, Singles Day on 11 November saw record e-commerce results, reflecting the energy of digital.  

1. 2013: No surprises, Ogilvy and Zenith lead new business

As we track over 2,000 wins and losses in China through the year, it was the same trusted past brands of Ogilvy and ZenithOptimedia heading the New Business tables. Following behind Ogilvy were McCann Erickson, Saatchi & Saatchi, JWT and Leo Burnett. Yet one agency to watch for the future, BBH, managed to win three of the 10 largest account changes for 2013. Amongst media agencies, R3 was fortunate to lead the two largest pitches—for AB Inbev and Mengniu—and both were won by Publicis Groupe agencies (Starcom and Optimedia).

Creative Agency Month Account Area
JWT May China Unicom China
Saatchi & Saatchi Mar Buick (Buick GL8, Excelle XT and GT) China
Leo Burnett July China Mobile (Telecom) China
Saatchi & Saatchi Jan Mazda (CX-7 and Mazda 6) China
BBH Jan Qoros Global
Lowe June SGM Buick Regal China
Saatchi & Saatchi Oct Union Pay China
Saatchi & Saatchi May Minute Maid Dairy (Yogurt based drink) China
BBH Sep Ikea China
BBH Oct Harbin Beer China
Media Agency Month Account Area
Starcom Sep AB InBev China
OMD June China Telecom China
ZenithOptimedia June GAC FIAT China
Carat July BMW China (Digital) China
MediaCom Sep Inoherb China
Carat June Bright Dairy & Food China
Havas Media June DYK China
MEC July General Electric China
MindShare Feb Qoros Project China
Mindshare Oct L’Oreal (Digital) China

2. 2013: One mega merger, plus 21 other ones

Of course, the biggest global news of the year was also big news in the Middle Kingdom—the merger or Publicis Groupe and Omnicom. China, though, remains one of the few markets in the world where the combined group will still be smaller than WPP. Meantime, there were 21 other acquisitions for China alone last year (two more than 2012), led not only by WPP, Publicis Groupe and Aegis, but also local players such as BlueFocus, GDAD, INLY and Spearhead. Gone are the days where a local agency only admires a foreign agency group. We love BlueFocus’ strategy of going global from China through Huntsworth and WeAreSocial. 

Month Holding group Agency brand Target (Chinese) Target (English) Specialisation Markets
March Aegis Aegis 创世奇迹 WonderAD Digital BJ/SHA/GZ/SZ
March M&C Saatchi M&C Saatchi aeiou aeiou Creative SHA
April WPP WPP Leading Smart Leading Smart Digital BJ
April CSM Sport & Entertainment CSM Sport & Entertainment 泛睿体育文化 People Marketing Marketing Service SHA
April WPP TNS 新华信 Sinotrust Market Research Market research BJ
April BlueFocus BlueFocus Huntsworth Huntsworth PR Global
April Spearhead Spearhead Group 美意互动 Meiyi Media Media BJ
April BlueFocus BlueFocus 博杰传媒 Bojie Media Media BJ
May Publicis Groupe Publicis Betterway 永阳营销 Yong Yang Marketing Marketing Service SHA/BJ/GZ
July Publicis Groupe Digitas LBi 墨尔广告 Net@lk Digital SHA
August WPP XM Designercity Designercity Digital HK
September Ruder Finn RuderFinn 宇修公关 S&W PR PR CD
September Aegis isobar 三子互动 Trio Digital SHA,BJ,Taipei
September Aegis isobar 维拉沃姆 Verawom Digital SHA
October Engine DeepFocus 泛世互动 Flipscript Digital SHA
October WPP VML 二点零 IM2.0 Digital SHA/BJ
October INLY INLY 一零二四 1024.00 Digital BJ/SHA/GZ
November GDAD GDAD 雅润文化 Yarun Culture Media SHA/TJ/WH
December BlueFocus BlueFocus We Are Social We Are Social Digital Global
December Spearhead Spearhead 盛狮睿信 Shengshi Ruixin Creative BJ/SHA
December Lianjian Guangdian Lianjian Guangdian 分众传媒 Sharetime Media Media BH/SHA/CD
December Arkr Group Arkr Digital 维他命社会化 Vitamine Digital SHA/GZ

3. 2013: Revolving doors at the top

It was a tough year to be a China agency CEO, with changes made at JWT, Dentsu, PHD, OMD, DraftFCB, Saatchi & Saatchi, Proximity, Sapient Nitro, Ogilvy, Aegis and GroupM. Many of these were organic, with Debby Cheung stepping into the president role for O&M after many years at the agency. But others were more brutal. It will continue to be a hot seat for the coming years—with the lack of growth in the business in Europe and other places, all global firms are looking to China for more revenue and growth.

4. 2013: China goes truly social

It was also the year of the Social Media Agency, with Digitas LBi Net@lk,  iWom, Social Touch, Womi, Teein, Social Lab, Verawom, Uncle, Kongming, iMag, Vgo, Reload, Vitamine, Yupu and a host of others emerging on the scene. R3 ran standalone social agency pitches for Visa, BMW, VISA, AB InBev, Lays and a few others, as this sector now shows the need for dedicated experts in Weixin, Weibo and more to come.

So what of 2014? How can marketers and their agencies be ready for the challenges ahead?  Here are our predictions.

5. More M&A

Despite the Dentsu-Aegis merger and the Publicis-Omnicom merger, we believe that M&A will actually increase this year—too many new client demands in social, e-commerce and mobile will force holding groups to look for local nimble players to expand. China still has 178,000 local agencies. The idea that “all the good ones are gone” is not correct, as new ones emerge every year and capture local and multinational business.

6. Every top marketer will want their own social agency, or do it themselves

No company in 2014 will rely on their ad, PR or even digital agency to deliver social marketing, as the need for real specialists with execution abilities becomes critical. We also see companies in China doing what Mondelez has done in the US and hiring social people internally.

7. Everyone will want better integration

With marketers now forced to manage a wide range of agencies, the challenges for all will be “Who’s in charge?” and “How can I get the best ideas?” More and more companies will look to Coca-Cola, which is leading the way with its IMC team in China, as a more organised way to better manage agency integration.

8. Measurement will move from KPI-related to business-related

With the huge growth in e-commerce, marketers and agencies will be forced to show how campaigns drive not only brand equity but also sales. Big data will help lead this work.

China’s in for a fantastic 2014 in marketing. Strap in for the ride.

Greg Paull is co-founder and Principal of R3 (www.r3ww.com), a consultancy focused on improving the effectiveness and efficiency of marketers and their agencies. R3 works in China with Coca-Cola, BMW, JNJ, Samsung, Visa, AB InBev, adidas, Mengniu and Huawei.

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