For LEO Digital Network (LDN), China’s A-share listed digital agency network, being nimble and quick to adapt to the dynamic and fast-changing Chinese marketing environment is key to its overall success. "We’re always evolving according to the needs of China’s ad and marketing landscape," says the CEO of LDN, Dalton Zheng.
Set up in 2014, LDN’s ambition is to become the world’s leading digital agency network. Its ‘Reshape Communications’ strategy is a digital-driven, "customer-centric, data-enabled and content-targeted" business-transformation model integrating digital strategy and data, digital creative, digital media, internet traffic, smart TV, social and entertainment content, and ecommerce to achieve a "1+1>2" effect and provide holistic solutions. The group comprises six wholly owned agencies and multiple acquisitions. It has built its reputation on the smooth execution of integrated campaigns for clients such as Tencent, Alibaba, Adidas, Abbott, Baidu, Danone, Coca-Cola, Siemens, Juneyao Airlines, By-Health, Sony, Vivo, Huawei, NIO, Diesel, Roewe and Maotai.
Going beyond 'creative'
LDN is focused on two key strategies: to integrate and lengthen upstream (anything from consulting and product R&D to business-model innovation) and downstream marketing (any type of effort to promote the product), and to strengthen its creative capabilities. It is also ditching the classic definition of ‘creative’ in favour of ‘big creative’, which encompasses ads, packaging design, business design and content marketing. Zheng believes they are essential for cutting through in this rapidly developing market. "At a lot of companies, sales and marketing operate in silos, but the entire process needs to be integrated," he says.
The benefits, according to Zheng’s team, are to be harnessed from improved data. The most important thing is to build solid data that enables you to easily target your desired audience on whatever platform. To achieve this, an integrated marketing plan is essential. "In the past, [agencies] might only talk to a client’s sales department, but now you have to talk to the social and ecommerce departments, [and those handling] IT and data. If we want more precise targeting, we need a lot of data," says Zheng.
A holistic approach
The rise of influential social platforms has huge implications on sales volume. "I might [have been] able to sell, say, 20 units a day in a bricks-and-mortar store, but now, with social, I might be able to sell 10,000 units all over China," says Zheng. "Similarly, in the past, a single ad might draw 20 people to buy the product; now, I can easily create four different ads, targeting different audiences, which could draw tens of thousands of people to buy the product." In this environment, he says, social ecommerce seems inevitable.
At a time when a new social platform appears to come out of China every few months, adaptability is also key. "Things change very quickly in social ecommerce," says Zheng. "Yesterday, you might be pushing out content on Weibo, today WeChat and Little Red Book, tomorrow, another kind of platform." Brands therefore need to focus on building a good product, and building good data.
Helping clients leverage creative content to improve sales is another core strategy. A recent report by McCann found that creativity is the key to success in China. "It’s not just functionality that people want; they also want entertainment and social interaction," says Zheng. "The value of a product lies not only in the product itself or its functionality, but also its entertainment value and whether it has potential to spread on social media."
A holistic approach is at the heart of what keeps LDN’s creative capabilities strong. Its creative unit, Amber China, isn’t focused solely on pushing out a creative ad, but on overall ‘big creative’ output. "In China, creativity isn’t confined to an ad or a single piece of content," says Zheng. "Marketers are keen to integrate creative marketing with a creative way of doing business."
The China short video market has also undergone an explosion in the last few years. The number of short video subscribers in China has now reached 648 million, with a 78.2% engagement rate – nearly 80% of the country’s netizen. It is expected that the short video market will hit RMB 20 billion in 2019. Yet, the short video industry isn’t only experiencing an upshot in volume, but also further integration among short video suppliers, data crunchers, publishers and providers of other types of content.
This is something that LDN is at the forefront of, thanks in part to its understanding that content and media are always intertwined. The company enjoys close collaborative relationships with the likes of Tiktok (from Toutiao), Taobao’s live-streaming platform and Kuaishou, a short video mobile platform, and are able to help clients effectively push content out on these platforms. In the first half of 2019, LDN clocked over RMB 2000 million collaboration volume to become Toutiao’s top agency. Its business revenue also increased by more than 200% on Kuaishou.
Naturally, content isn't only about the content itself, but how that content is being consumed. To that end, LDN is always thinking of ways to improve the customer journey, and supporting companies who share the same vision. In 2017, the NINJA brand of LDN's innovation incubation platform NIL was invited to debut its own modular product life design platform, PARTZ, at the Taobao Maker Festival.
In 2018, ARKR Group, LDN's own subsidary, released a series of products melding traditional Chinese 'wu xia' style with anime aesthetics, including water bottles, bento boxes and robes, at the Taobao Maker Festival. The idea was to make day-to-day life easier without compromising on style.
It’s little wonder LDN continues to scoop top industry honours, including, most recently, at the Digital Media Awards, Agency of the Year, London International Awards, D&AD and Cannes. "These honours signify the priority we place on quality," say Zheng. "We’re focused on quality content because we believe that it benefits consumers and advertisers more in the long run."