What makes Chinese consumers tick? That’s the question Chris Reitermann, CEO of Ogilvy China, has been puzzling over for the last two decades. Reitermann began his career at advertising giant Ogilvy & Mather in the 1990s, moving to Beijing in 2000 to set up the digital agency OgilvyInteractive. Since then, he has risen to head up the company’s entire operations in China. In this interview, he discusses the dramatic changes that have taken place in Chinese advertising during his time here, why China has much to learn from India on running a great campaign, and what the industry may look like by 2027.
Companies are dying fast these days. In the 1950s, the average age of a company on the Standard & Poor’s 500 index was 60 years, now it is less than 20. But International Business Machines (IBM), known as “Big Blue”, seems to be an exception. Over the past few decades, it has managed to keep up as others were dying and has successfully transformed itself. Now it has become a provider of cognitive solutions and cloud services. How has such a giant company managed to transform? Gill Zhou, chief marketing officer of IBM China, offers an answer in this interview with CKGSB Knowledge.
If you think ‘Made in China’ is always associated with cheap and low quality goods, think again. DJI—the first choice for any drone fan—is headquartered in Shenzhen and dominates 70% of the consumer drone market globally; Huawei, the telecommunication company that developed its first branded smartphone only five years ago, has already become the third largest player in the sector with a 9.4% market share worldwide, behind Samsung and Apple. In this interview, Doreen Wang, author of the BrandZ Top 30 Chinese Global Brand Builders report, makes sense of China’s “glocalized” brands and the bumpy roads they may face in the future.
The rise of e-books and reading on digital devices has changed every part on the publishing production chain, affecting everyone from the editors, to the designers, to the marketing and sales people. Editors are spending more time on acquiring books and less time working on manuscripts. Designers become more flexible and strategic: they need to make sure a book won’t be ignored by skimmers who only glance at thumbnails on websites, and must ensure that texts are well-laid-out for reading on many kinds of mobile devices. But they’re not who need to change most. It’s the marketing and sales people who face an ever-more-challenging job.
China strives to be a consumer-based economy, so it isn’t surprising that advertising spending has risen by leaps and bounds over the past few years, especially as people become more affluent and are expecting tailored ads. However, the ad spend is also changing to reflect the times. Mobile spending has risen ten-folds in the past three years, while print spending is slowly dropping off. Outdoor ads see consistent growth, while online advertising in 2015 was not as popular as it was in 2014. More changes are sure to come along as the digital disruption continues.
Telling and retelling stories is one of humanity’s most durable characteristics: Harvard linguist Michael Witzel has argued that most of the world’s mythologies grew out of a single set of stories first told in Africa 130,000 years ago. Yet what is the future of corporate storytelling? Although our penchant for storytelling may not change any time soon, the storytelling used inside the corporation does seem to be shifting in two ways. First, storytelling is becoming recognized as a trainable skill. Second, and possibly more importantly, the Internet is making it increasingly difficult for companies to control a single version of their own story.
Storytelling is a reliable way to reach audiences. According to storytelling experts, organizing stories in a form that connects to people’s feeling is an effective way to make information more memorable. But for sales people, telling their sales stories well is more challenging than for CEOs telling a company story—a sales person’s time is limited as the audience is under no obligation to listen to them for a long time; and they need to learn to tell the story throughout the entire sales process, from introducing themselves to managing customer relationships, and the focus of these stories will also vary by culture.
Theme parks are normally a place to enjoy a nice day out with your friends or family. However, in mainland China, theme parks may soon turn into a battleground. Wanda Group, a conglomerate that has opened several amusement parks across China over the last few years, has warned Disney about its theme park operations in China. It’s certainly not easy, if possible at all, for Wanda to make Disney unprofitable. Will lowering price at the cost of lowering its own profit help, or improve the quality and service is more practical? Maybe the best solution is to get along with the competitor.
It is a good time to reflect on Singles Day, a shopping carnival initiated by Alibaba that has just yielded a record-breaking sales of $17.8 billion, exceeding that on “Black Friday” in the US. It looks like everyone benefits: vendors sell, buyers get cheap goods and Alibaba profits through advertising fees and transaction commissions. But consider: to sell more, vendors lower product prices and sacrifice per-unit margins, yet they might not be able to make up on volume, as most of the items purchased are durable goods and therefore most of the increased sales on Singles Day are probably shifting sales from earlier or later periods.
In the past two decades, coffee has been making significant in-roads in China. Although it might not be a staple for workday breakfast yet, for young people in urban areas, it has become a status symbol and something that says about their style and taste. Coffee, says Esteban Liang, Managing Director of Costa, Asia, is an “affordable luxury.” In the interview with Liang, he discusses how coffee became so popular and what Costa Coffee has experienced in the Middle Kingdom so far. Attempting to ride the middle-class wave, Costa aims at becoming a “strong number two” in China with better environment, product and service.