From digital long-tail effects to 'corrupted' talent in China: DigitalMediaWorks highlights

DigitalMediaWorks, which includes a half-day seminar and a half-day workshop, is organised by Haymarket Media, publisher of Campaign Asia-Pacific, and sponsored this year by Tencent with support from FTChinese, HDT Mobile, and WSJ Chinese.

The seminar this morning focused on the following key questions.

What is the state of the digital market in China and how are consumers engaging with digital channels?

There are five main digital trends, according to Tony Chen, president of GroupM Interaction China. The most prominent is how social media has not only changed advertising formats, but the core way people communicate.

Chen pointed out that primetime has been redefined, with multi-screen viewership on both traditional television as well as online video. Secondly, TV is getting socialised as viewers react on social media to live events such as the Olympics.

Thirdly, social is also enabling an "evolution" in purchase behaviour, fuelling the advent of 'tao-commerce' (e-commerce on Taobao) and mobile commerce. Case in point, China's m-commerce market grew more than 400 per cent in 2011, with T-Mall clocking an average of 500,000 mobile transactions daily, according to iResearch data.

Fourth, mobile activates all other media because it is location-aware, personal, transactional, and relevant.

Fifth, social media provides rich consumer insights in real-time, as focus groups are "so yesterday".

James Zhu, national director of social media and invention at Mindshare China, added that the ball is already in the court of the consumers. "The power of social media is such that consumers trust even strangers on social media more than what an advertisement states. The same principle of attraction to win friends and influence people can be used to humanise a brand," he said.

Notably, the industry must realise that the concept of a 'target audience' is old and is being replaced by a ‘relevant group’—referring to a consumer’s closest circle of friends and family, Zhu said.

What is the extent of marketing dollars shifting online with decreasing adspend on traditional media?

Meg Chen, executive vice president of Aegis Media China's digital investment management unit, said that on the surface, recent SARFT rules have shifted adspend to online video, but the reality is that consumer viewership habits are changing anyway, with young consumers watching more online video than television in China on platforms such as PPTV, LeTV, PPS, iQiyi, Sohu Video, Youku and Tudou.

These platforms are now fighting for advertising dollars, with ad fees ranging from 3000 to 20000 RMB for each webisode for popular dramas. Chen is also seeing an increase of 10 per cent to 30 per cent of digital budgets to online VOD, thanks to its long-tail effect. The same commercial, when broadcast on online video, achieves better brand recall rates than on television.

However, K2 Chung-Tai Kung, general manager of Agenda Guangzhou, revealed that not all is smooth-sailing despite increased digital budgets, because calculative clients still expect the same production quality for a viral video or online ad as a TVC, even though the budget allocated is about a quarter for a TVC.

Why do digital adspend figures in China still lag behind the US and UK?

Leon Lu, CEO of Media Contacts China, explained that TV is the culprit, dominating the majority of adspend in China as people still think it is the most powerful medium for mass reach and awareness. Undoubtedly so for now, but within one to two years, Lu said that the industry may see negative growth in TV adspend as marketers become more open to the effects of digital marketing.

What are the new areas of investment for digital in China?

Jim Liu, president of Kinetic China, said the most significant advertising trend is digital OOH media, namely the ubiquitous LCDs in taxis and office buildings everywhere in China. "However, we cannot treat OOH screens as just another channel to broadcast existing TVCs, but a medium to trigger a continuous chain of communication," he said.

Take H&M’s summer campaign in China for example, when consumers took photos of a moving bus ad and uploaded them to their Weibo account, then key opinion leaders were identified and invited to an exclusive H&M party and offered limited edition H&M merchandise. "It doesn't just stop at a bus ad," he said. NFC technology is also to be closely-watched, even though smartphone penetration currently is low, but needs the investment commitment of outdoor media suppliers and vendors.

How difficult is it to get good digital talent in China?

A lot of candid exchanges were shared about how each agency is poaching talent from one another. John Dao, vice general manager of sales at Tencent, lamented that passionate and creative talent are few and far between.

"It's already difficult enough to find them, and what's even worse is these talent (after we found and hired them) are poached within a year by other agencies with perks like doubled salaries and overseas trips," he said.

The talent exchange game is a double-edged one, said Dao. "It is the industry’s problem, as well as the problem of a company which does not provide adequate grooming and training.

Ali Zein Kazmi, head of social at Omnicom Media Group China, shared how he recently made a mass hire of eight young people from a small local group-buying company instead of employees with direct advertising experience.

"These kids work closely according to the consumers’ mindsets, which is totally apt and better than people with agency backgrounds who think mainly from the advertisers’ point of views," he said. "Hiring an 'agency person' is not necessarily a guarantee that they will be the best talent. People with previous agency backgrounds are 'corrupted' — and by this I mean they got into the agency business mainly for the glamour and glitz, based on the ‘I want to make myself famous’ mindset."

"I also like to hire kids fresh out of university because they start on a clean slate and you are able to train them into the type of talent you like them to be," Kazmi said.