JWT scoops TCL deal as WTO tensions rise

SHANGHAI: In a move to elevate itself above the heavy discount practices of China's over-supplied television market, TCL has signed on J. Walter Thompson Shanghai to a one-year advertising contract. JWT China chief executive, Tom Doctoroff, said the price war that erupted last year had reinforced the urgent need for manufacturers of television sets to decommoditise this category. "That said, TCL was least hurt by the discounting. The company has a healthy reputation for innovation, which puts it in the upper tier colour television market," Doctoroff said. Advertising for TCL's television products was previously handled by the company's inhouse agency. However, as competitive pressure from China's imminent membership in the WTO builds up, companies like TCL have begun looking outside for brand building expertise. JWT won the TCL assignment without a pitch, but on the basis of a credentials as well as strategic and creative presentation. The agency will handle domestic advertising to position TCL above rivals such as Konka and Chang Hong. The advertising will need to take into account the two television markets that co-exist in China - the rural market, where penetration is still an issue, and the urban market, where the emphasis is on upgrading to a better product. Significantly, TCL has chosen to sign a one-year contract instead of handling its advertising on a project basis, which is favoured by state-owned enterprises (SOEs). But even as Chinese corporations accept the need to build up brands for domestic and overseas consumption, their relationship with multinational 4As agencies have rarely been smooth in the past. "Of course our cultures are different and there will be challenges ahead as we establish a smooth working style," said Doctoroff. Aware of pitfalls that have dogged agency-client ties in the recent past, the JWT chief said the two sides have agreed to structural set-ups which have been put in place to reinforce the building of a long-term partnership. It has been agreed that the key point of contact for the agency will be with the marketing department and the general manager of the television division. "We have streamlined the process. Typically, SOEs are hierarchical, where the ultimate control is divorced from the group and executives in sales have a lot of power in terms of what gets sold and produced as they control profitability," Doctoroff said. JWT, he added, had looked at several key points, including compensation, before taking on TCL as a client. He said JWT had secured fair compensation consistent with international standards." The agency also asked for exclusivity as TCL's advertising agency for its television brand - something that is "rarely guaranteed" in client-agency arrangements in China. Apart from televisions, TCL also manufactures computers, air-conditioners and other electronic appliances.

Sign In

Trouble signing in?

Reset Password: Click here

Contact Customer Support at

Customerservice@campaignasia.com