China’s Intellectual Long Game

China Penetration of Intellect

Lest we get stuck in the old thinking that China may be catching the US economically, but it is still a relative slow learner intellectually, these data tell a different tale.  Measured by the output of scientific papers China now rivals the US.  They did it by growing their output four fold since 2000.  That defines the present.

Looking at the future, we see that China is now home to 11% of the world’s top 100 universities while they are sending loads of students to the best schools in the US.  Of foreign born students in the US, China is number one with 32.5% of the total followed by India, which sends 17.3%.  Source: Bloomberg

Busting Out of China

Marie Dalgar

Chinese women are makeup hounds.  Cosmetics are one of the top selling consumer products in the country and web enablers that help women create facial artistry are some of the most important apps.

Along comes Marie Dalgar, a cosmetics company founded by Cui Xiaohong whose mission is to “help Chinese ladies find their own unique beauty.”  Cui views makeup as art and that idea has found lots of fans.  The company’s mascara product sold within 15 seconds of its online launch.

Though the brand’s focus is enhancing Chinese beauty, it has no border limitations as evidenced by its international success at French cosmetics chain SEPHORA.  Marie Dalgar stands as another example of China’s next stage, one where it moves from being the piece workers of the world to one where locally developed businesses go global.  Source: Wersm.com

4 Keys to the Future of Mobile Video Ad Spending

Key to the future

According to Forrester Research analysis, video ad spending will continue to grow because four evolving factors:

  1. McLuhan’s “the medium is the message” continues to resonate in the modern world as the biggest players, Google and Facebook, begin to recognize that mobile is a different medium than desktop. Research says that attention span among mobile users is about eight seconds.  Result: Both companies are encouraging advertisers to limit the length of their mobile video ads to six seconds to better fit user preferences.
  2. Facebook and Instragram have initiatives dedicated to drive more revenue from video advertising by better integrating the ads into content.
  3. The medium itself is changing as bigger mobile screens are becoming more common making all video more appealing.  In addition to which providers are using hot spots and unlimited data plans to lower the cost of use.
  4. The promise of emerging technologies – 360-degree video, augmented reality, and virtual reality – will affect, in a positive way, the mobile user experience.

Sources: Destination CRM; Forrester

Forrester: Mobile’s Share of Ad Spend to Increase 21% by 2022

UntitledProjected Mobile Spending

New Forrester Research data projects mobile’s share of digital ad spending to increase by 21% by 2022. The data also sees the relative positions of mobile ad spending’s three components remaining almost the same with mobile social taking shares from mobile search, though all sub-categories will benefit from an increase in allocated spending.  Source: Destination CRM

Native Advertising in the Mobile World

McLuhan

Sixty years ago Marshall McLuhan famously said, “The medium is the message.” The professor’s point was that radio is different from TV, which in turn, is different from film.  And, he went on; people absorb information from each in different ways.  The best use of a given medium respects its nature. For mobile, it is where and when do people use their device and what apps do they use.  Add to those fundamental marketing data points the idea of native advertising, which mimics the style of the content in which it resides, and you have the ultimate understanding of the medium as the message.

That’s the core idea behind an article by Farshad Fardad, CEO of Causal IQ who expands his recommendations on native mobile advertising by suggesting that for the deepest connection an advertiser should hone the message to reflect the app in use.  His example is the person playing Words with Friends who is served an ad promoting brain food.

Once the campaign is active, measuring results becomes central.  Fardad lays it out, “For direct response campaigns, marketers typically optimize toward clicks or conversions. For branding, advertisers measure viewability and engagement rates.”  Native mobile ads are expected to be the majority of mobile display advertising in the near future.  For success in this world, these ideas are worth remembering. Source: MarTech

China Begins to Feel Trade Pressure

Food Fight

Early industrial numbers coming out of China indicate the tariff food fight between the US and China is having a more negative effect on China’s economy than on the US economy.  While the US is moving toward more protectionist trade policies, China, according to the latest words of its President Xi Jinping, appears to be holding steady with a gradual opening of its economy.  Last week President Xi said, “We are willing to use practical actions to drive all parties to jointly adhere to trade liberalization and facilitation and build an open world economy.”

It remains to be seen if the industrial numbers trickle down to consumer sentiment, which would mean the pressure is moving through China’s whole economy. Global News

Chinese Consumers: Buyers Now, Buyers in the Future

Projected eComm 2022

Forrester’s latest projections for the world’s e-commerce market in 2022 re-enforce our continuing interest in Chinese consumers.  At present China’s e-commerce market has nudged past the US for the first time, but by 2022 these data suggest China’s e-commerce activity will be more than twice the size of the US and other Southeast Asian countries will fall well behind both China & the US.  For Western countries, China is the place for growth in spite of trade difficulties.  Source: Marketing Week

Assorted Facts that favor In-App Advertising

In-App Advertising

  • From App Annie: Projected ad spending will increase by almost 180% in the five years between 2016 and 2021.
  • From IHS Research: Native ads command between an 18% and 200% higher CPM than a standard banner ad.
  • From Opera Mediaworks:  Click through rates for apps are double those for web and produce 13.5 times the revenue.
  • From Ipsos: 78% of games app users and 82% of news app users access them every day.
  • From Ipsos: 46-47% of users report remembering more detail from ads seen on mobile tablet apps and mobile web while only 36% report the same for ads seen on PCs.

Source: eConsultancy

Under the Surface of the Global Economy

JD plus Google plus Wallmart

A couple weeks ago we made note of Google’s $550 million investment in Alibaba’s chief rival JD.com.  This week we add a co-investment of $500 by JD.com and Walmart in Dada-JD Daojia, a Chinese online grocery delivery service that claims 20 million active monthly users.  Walmart, which already owns a 12% stake in JD, now is the number two investor behind Chinese giant Tencent.

The new investment brings Walmart closer to JD as Western companies continue to insinuate themselves into the Chinese market.  This is happening on both sides as Chinese companies slowly buy their way into Western companies.  While the governments make trade noises heard around the world, the slow, tectonic movement of commerce goes on just beneath the surface.  The economies of East and West inexorably knit together.  Source: Yahoo Finance

Video is King for both Engagement & Revenue

Engagement by the Numbers

A revealing study by Adcolony showed that in-app video ads that promise some kind of reward for viewing delivered the most effective user experience and monetary payback.

Re-enforcing a theme we have emphasized before, the study found that beyond video, ads that are well-integrated with an app’s overall user experience, are of short duration and are highly engaging produce the most success.  By contrast, auto-play ads were least favorable.

By applying demographic, behavioral and geo data to messages marketers can up the engagement for any of these breakouts.

One further insight: Mobile video accounted for 31% of revenue, display 20% and native 5%.  Our question: where does the other 44% of revenue come from?  Source: eConstultancy