100 Most: When parody leads to IPO (probably)

The publisher of 100 Most Magazine (100毛) and the operator of TVMost (毛記電視) website and mobile application, Most Kwai Chung Limited, applied for an initial public offering on the Hong Kong Stock Exchange last week.

But this isn't like any other IPO-wannabe. 100 Most, a weekly Chinese-language magazine issued every Thursday, was first launched in March 2013 in Hong Kong and Macau. In the span of only three years, its Facebook page has amassed a base of more than 1.1 million followers—half of what longtime Apple Daily, with a similar satirical style, commands. Its writing is chock full of Cantonese colloquialisms, and it sees itself as "non-conformist" and "strident".

For the year ended 31 March, revenue generated from the provision of integrated advertising services (design of slogans, planning of marketing strategies and directions, conceptualising of ideas, production of artwork, placement of media) digitally as well as in print, amounted to HK$78 million (about US$10 million) on total revenue of HK$95 million ($12.1 million), ​according to a copy of the IPO application seen by Campaign Asia-Pacific. That translates to 82 percent of revenue from advertising.

Apart from essentially being a creative, media and production agency all rolled into one, in the past three years the company has also derived one-off income from granting broadcast rights to ViuTV for its 2016 anniversary ceremony, selling sponsorship to Pricerite, and charging management fees for its own contracted artistes. Its 'artistes', notably, are all fictional characters spoofing real-life news anchors from established over-the-air broadcaster TVB.

The company intends to organise more events to extend its current marketing channels to the physical arena. Its ad types include videos, online banners, in-newsfeed ads, and advertorials.

The online advertorials are by far its most significant success. The example above has Standard Chartered's Priority Banking logo on it, juxtaposing 100 Most's humour with the bank's conservatism. A character played by local celebrity Sammi Cheng gatecrashes a birthday banquet with the bank's Asia Miles promotions as a birthday 'gift', while crooning a witty remake of one of her own songs.

When the bank first partnered with 100 Most last year via its media agency PHD (see below video), many thought it was doing the unthinkable in terms of advertising. It is now one of the company's "representative" customers.

In the hands of 100 Most, most ad productions become remodeled playrooms. Its typical style of lyric modification, exaggerated dialogue, and brand ambassadors acting silly turns on its head the traditional hard-selling formula that irks consumers. 

Also in 2016, Nescafe featured one of Cantopop's four 'heavenly kings', Leon Lai, selling its premium white instant coffee by crooning one of his classic ballads (with modified lyrics of course) to his 'boss'. The self-deprecating ad (see below video) topped the 2016 Q2 YouTube Ads Leaderboard. "A 30-second ad, I may not view to the end; a 3-minute song I may not listen to the end, but a full 4-minute-6-second ad, I actually watched it all," remarked one YouTube user (in Chinese).

Roy Tsui (徐家豪), Most Kwai Chung's executive director and controlling shareholder, has in the past revealed that he and his two co-founders, Lu Kar Ho (姚家豪) and Luk Ka Chun (陸家俊), each put forward HK$2000 in January 2010 to bootstrap the business. The online advertising industry has low barriers to entry.

The business has grown during a time when Hong Kong viewers have been feeling increasingly gloomy about the state of local media, which in its former glory was abundant with creative comedy and fierce independence. In fact, the business itself is predicated on ridicule of the establishment. 100 Most's Chinese name, 毛記, is pronounced as 'Mou Gei', a homophone of the city's widely-criticised mainstream station TVB's Chinese name, 'Mou Sin' (無綫).

What is the value of parody? HK$78 million. Just ask these brands: DBS, Amoy, SCB, Veet, Braologie, Expedia, Olay, Watson's Wine, Laurier, Deliveroo, Royal Medic, Ipsa, SK-II, Clarins, Osim, Gatsby, Head & Shoulder's, Oasis, 3HK, Jetstar, Braun, Whisper, Breath Care, Tim Tam, Ogawa, M&M's, Levi's, Samsung, Rexona, HKTV Mall, Reenex, Hong Kong Museum Of Art, Nestea, Shell, Audi, Vidal Sassoon, McDonald's, Carlsberg, Häagen Dazs, Mr Juicy, Clorox, Kotex, Boxful, Laneige, Wrigley's and Wyeth. And note that none of the above are 30-second ad spots. 

100 Most versus the 4As

100 Most's growth is in line with the Hong Kong market, in which online advertising revenue has shown rapid increase, from HK$1.5 billion (about US$192 million) in 2011 to HK$5.9 billion ($755 million) in 2016, with a CAGR of 31.5 percent, according to Ipsos research. By 2021, the projection reaches HK$8.9 billion ($1.14 billion).

100 Most will share this pot with the likes of Mindshare, PHD, ZenithOptimedia, Mcgarrybowen, OMD and its local competitors such as Secret Tour and Bread Digital in Hong Kong. What's not emphasised in financial reports is how its comprehensive string of planning, design, production and distribution services overlaps with those of the major 4A agency players here.

In particular, it was the 'ghostproducer' of two campaigns that won accolades recently, though most of the credit went to its 4A partners.

In November 2016 at the Kam Fan Awards, the Nescafe campaign (see Leon Lai video above) won a bronze in the 'social and interactive video' category, thanks to ZenithOptimedia. Most Kwai Chung's IPO application points out that the agency was "involved in the project" but the conceptualisation and shooting of the actual video was executed by its own 63-person team.

Again, two months ago at the 2017 Hong Kong Effie Awards, the DBS Black Card iGO Rewards Sustaining campaign won another bronze, with the main entrant listed as IPG Mediabrands. The Most Kwai Chung document highlights the same situation.