All the trends Nielsen’s managing director for China, Oliver Rust (who also spoke at the China Top 1000 Breakfast Briefing), pointed out this morning hinge on one theme: Bigger numbers.
More people, a larger middle class, broader buying power, greater diversity, further media fragmentation and a multiplying of screens means brands have both huge opportunity and challenge ahead in Asia. And the bottom line for marketing is the data too will be bigger. Getting a firm hold on that will be key to marketing’s future in Asia.
According to Nielsen’s own Consumer Confidence Index, which surveys more than 30,000 respondents across Africa, Asia-Pacific, Europe, Latin America, the Middle East and North America, seven out of the 10 most confident markets are in APAC. They include India, Philippines, Indonesia Thailand, China, Hong Kong and Vietnam. The confidence reflects a measure of consumer willingness to spend (and Rust referenced declining savings ratios in China to demonstrate that consumption is actually on the rise). But despite the theme of more big numbers in Rust’s talk, he maintained that reaching this massive market will not be a matter of mass marketing. He went so far as to say mass marketing is dead.
These seven confident APAC markets are not only confident in their spend but they are also confident in their own cultural and personal identities. Many of these same nations are undergoing a shift of “we” culture, Rust explained, to one of “me” culture. Social media and media fragmentation, where consumers pick the narrow-cast channels that best suits their individual tastes, play into that same storyline to the point that you simply cannot expect to approach all consumers in one market, never mind across several markets, with one campaign.
So while Asia may be growing to 2 billion middle-class consumers (who are willing to spend), representing the world’s greatest market (Rust’s slide’s showed the US as only about 120 million middle-class consumers by comparison), it will take exceptional focus to reach them. The two strategies he emphasised for the future were content and precision marketing. That precision presumably comes down to data—collecting it, analysing it and acting on it in a big way. As a company that has always made data its business, that might not be a surprising conclusion coming from Nielsen.
But the trends Rust laid out, we have seen come up again and again in Campaign coverage. Is Asia’s population growing? Clearly. Is there more spending power and more media options? Absolutely. In our Marketers Outlook study from earlier this year we did finally see a shift away from TV and its mass appeal to find more spending on digital channels. Marketers go to where the people are. And today that’s in Asia and online.
You will still need to be creative to engage these consumers. But before they see even one of your ingenious messages, you will have to get in front of them. And that is the big job only data can help with.
The primary job of marketers: Insight, not attention
In the era of digital, it’s not data for data’s sake, but data with a purpose. This is the holy grail of marketing according to Philip Kotler, whose teachings were invoked this morning by Henry Lee, division managing director of Sony Hong Kong. Lee tried to give a simplified explanation of how Sony managed to score so high (number two) with local consumers despite all the negative publicity surrounding the cyber attack that held Sony hostage last year.
Good products of course helped to build the brand, but that was not good enough to touch the hearts of Hong Kong consumers. Wanting to know about these customers directly was the reason Sony opened two customer-service centres some years ago in the city. Having direct touchpoints ensured repeat customers, he said. "Get customer insight, and as deep as possible too," he advised. "It's not segmentation marketing anymore."
There are a lot more peripheral options that a consumer can engage with a brand, said Tania Lau, head of marketing at Yahoo Hong Kong. Digital marketing, in particular, gives marketers automation, budget visibility, media channel consolidation, data collection for precise reach, and efficiency.
Joseph Liu, vice president of marketing for APAC at Calvin Klein, talked about how the brand addressed a lack of awareness for its Calvin Klein Jeans casual line. The sub-brand was not well-known among young people, simply because the brand had not done much to understand its target audience, which it calls the "no-shock generation".
After finding that this audience spends most of its time on mobile phones trying to make new friends on Tinder or Tinder-equivalents, Calvin Klein set out to engage them as their peers on these sites. The brand designed its media plan first, turning the traditional campaign process upside down, to be on these sites and worked backwards to develop creative content for those sites.
Even non-marketers could not escape the mandate of being a consumer guru these days. When Richard Leong (pictured below, at right), CEO of Pizza Hut Hong Kong, hired for the brand's information technology department, it was a case in point. "My IT person wears two hats, and the other hat is to understand marketing and the cycle of a lifetime customer," he said.
"I tell my IT and marketing people that they must 'sleep together'." Hong Kong is a demanding market that wants to see new things every two months, he described, and this makes it an all-in-or-nothing game for everyone involved in the business.
Agencies think they understand all of their clients’ businesses. Clients don’t think they do. But they may not need to.
Beyond the client's business, "it’s about the whole value chain, including your brand’s partners/agencies that add value to every step of the customer’s journey," said Debby Chan, director of marketing at Fuji Xerox Hong Kong. "Branding is something intrinsic."
Suresh Balaji, regional head of marketing at HSBC, subscribes to a "horses for courses" viewpoint when it comes to the client-agency relationship; it is more important to choose suitable and best-of-breed agencies for specific tasks, he said.
"I understand my business the best; I want agencies to understand their businesses the best," he said. "I don’t agree with the practice of restructuring and building in-house capabilities that the agencies understand better. If they are a social agency, they bring social understanding. We want to trust our agencies to do the right things."
Ultimately, it is about unifying the capabilties of both clients and agencies, who can shuffle the cards better than HSBC can in areas outside the client's business because of "governance and other things we need to worry about", said Balaji.
Before that, the whole deck of cards should be laid out on the table for both parties, said Calvin Klein's Liu. "You have to have a very clear vision and share that with your agency. We're all in this together so mutual respect is really important."
The key takeaway for agencies here is asking the right questions as clients are "not going to sit there and volunteer all the information about their businesses", advised Seraphina Wong who holds two titles at UBS: executive director for global advertising and head of Asia Pacific communications and branding.
Today's event is the second of three delving into the results of Campaign Asia-Pacific's exclusive Asia's Top 1000 Brands research, produced in partnership with Nielsen and unveiled in June. The first forum was held last week in Shanghai and the last is slated for 22 September in Singapore.