Geo-Political Meets Commercial in China

Map of China

We have written for several years about how companies that want to reach the Chinese consumer should adapt to and respect the country’s cultural norms to have a receptive audience. At times we have made note of how a given company has adjusted.

The need to adapt is now greater than ever. That’s because China’s geo-political position in the world is stronger than it has been as its economy has become more of a world powerhouse.

The consequence of China’s new status is that companies that want to do business in China not only must respect the culture, but now they must respect the country’s sovereignty. Example: Referring to Tibet, Taiwan, Hong Kong, Macau and Singapore as countries on your website will offend the government of China, which considers them to be provinces or special administrative regions of China proper.

Companies such as Marriott International Inc., Qantas Airways Ltd., Delta Air Lines Inc. and apparel maker Inditex SA have made changes to their messaging or are being challenged to make them. The advice from here is to make the geo-political and cultural adjustments voluntarily.  Source: Bloomberg

So Much for Programmatic’ Decline

Programmatic projections

With all the talk about pulling back on programmatic ad spending because of ad fraud and such, a survey of senior marketers from 28 worldwide companies that spend in excess of $50 billion, projects an 11% increase in 2018 compared to 2017. And North America could see an increase above 30%. So there!

Part of this increase can be explained by a deep interest in emerging programmatic formats such as out-of-home and TV. Seventy-seven percent of these high-end marketers expect to appropriate more to these media segments.  Sources:  The Drum

See Yourself in These Data?

Visit Growth by Device

These data are probably confirmed by your own practices. Since 2015 visits to smartphones have gone up 89% while desktop and tablet visits have decreased. Two tangential facts supplement this changing practice. The first is that in spite of the shifting pattern, desktops still corner 61% of the all visits and the second is that while smartphones are getting more and more visits, those visits have shortened by about 10% in the period from 2015 to 2017.

The reality is that smartphones are ubiquitous in our lives, so we go to them more frequently, but the screen size limits the experience when compared to a desktop.  The shortening attention span everyone talks about may be as much a function of screen size as it is generational. For mobile advertisers recognition of shorter attention spans is central to development of creatives.   Source: Marketland

Chinese Consumers in the Driver’s Seat

GDP 6.9%

As we have documented, the Chinese economy is healthy. To further substantiate that fact, the country’s premier Li Keqiang has predicted the GDP for 2017 to come in at 6.9%, the first move upward in seven years. From a marketer’s point of view the internal fact that almost two-thirds of the activity results from consumers spending is reassuring. In particular, retail spending is up 10%.

When we look deeper we see a consumer population that is growing more proud of their Chinese heritage as the country prospers and less enamored by the pull of foreign products. While that is true, it doesn’t mean that the fascination is gone. Smart marketing by outside companies, marketing that respects the culture is still very welcome by Chinese consumers.

Foreign Brand Do’s & Don’ts in China

Do: Promote the heritage that makes your brand special

Don’t: Enter the market as though you are the big western poobah.

Do: Turn around “Chinese renaissance through thoughtful communications, promotions and product development.”

Source: China Skinny

Contrasting Attitudes


A recent study of UK consumers suggests they are of two minds regarding personal data privacy. The data suggests consumers are largely content with the amount of personal data they are sharing and they believe it is a requirement of a smooth running modern economy. Twenty-five percent are relatively unconcerned about their data privacy while most view their personal data as an asset to be traded for benefits of some sort.

The level of contentment and lack of concern is even more pronounced as demographics scale younger. And for what it’s worth, 88% in this survey believe that transparency is key to further data sharing.

Notably, the comfort level with data sharing reflected in this survey comes in a world where data hacking is a recurrent event, where stories of stolen personal data for sale on the dark web are real…a puzzle. Source:

Sixty-Six Percent Growth Seen For Digital Advertising by 2022

Digital Ad Projections - Statistica

This table has a load of numbers, but there are three essential facts to be drawn out: Statistica projects digital advertising to grow steady through 2022 and the relative position of the breakouts will remain the same. Less obvious is that banner ads will see the slowest growth at around 36%, which in any other circumstance would be strong. But next to search and social media in the seventieth percentile range and video, which is projected to grow more than 90% by 2022, banner looks weak.  Source: Statistica

Chinese Consumer Trends to Watch in 2018

Chinese Consumer Profile 2018

A Mintel Research survey of Chinese consumers ages 20-49 reveals the unique way their preferences are shaped by the social/political environment in which they have grown up as compared to that of their parents.

Opt-In: Consumers between the ages of 20-49 tend to be willing to opt-in to big data collection of behaviors via their many connected devises. Their belief is that machine learning of their preferences will yield better life experiences

Playful Preference:  Sixty-three percent of Chinese 20-24-year-olds say they play online games to relieve stress. These new consumers prefer a less rigid, more flexible approach to the world than their predecessors.

Individuality:  At the young end of the age range, there is more of a desire to express individuality in behaviors and in lifestyle. “Forty-one percent of teens…say they would like to live in an unconventional way.” These data imply a rebellion against the rigid ways of Chinese life and educational system that existed in the near past.

Environmental Concerns:  Mintel research reveals that 58% of Chinese adults ages 20-49 are willing to pay up for “ethical brands,” that is, products that are environmentally conscious and those that will benefit their health.

Mobile is Ubiquitous: As a measure of how thoroughly internalized and how quickly mobile technology is transforming Chinese culture, Mintel’s data shows “87% of Chinese consumers in tier 1-3 cities used mobile payments in 2017, up from 69% in 2016.”  The smartphone is the central devise of Chinese life for the core consuming demographic.

These trends all have marketing implementations as we approach the Chinese market.  Source: Branding in Asia

Programmatic Tech To Grow Through 2025

Prog Ad Growth Projection


Data from Persistence Market Research projects the adoption of programmatic technology moving into a more mature stage going forward. The compound average growth rate (CAGR) during the liftoff phase was 36% a year between 2012 and 2016. The projected average growth rate for the eight years ending in 2025 will be under 30% a year.  The slowdown in growth is to be expected as programmatic advertising becomes more universal. The study also notes that there is a shortfall in the number of skilled talent in the industry, those who fully grasp the nuances and implications of programmatic.   Source: Persistence Market Research

There May Be More To It

Benefits of AI

According to a survey of senior executives from more than 900 worldwide companies that already implement some level of artificial intelligence technology, there are three key benefits they expect to gain from their investment. They are (1) better data that (2) will yield better decisions and (3) more creativity.

We are sure these gains are probable, but we believe they miss the broad role AI can play in marketing. First, advanced slicing and dicing of audience data will find ever more demographic layers. Second, is the development of content for publishers. Content works for publishers in two ways. There is content for editorial reasons, which it equals money for publishers. And there is content for marketing purposes.  Marketing may ultimately be the most direct and practical benefit of the use of artificial intelligence for publishers.   Source: eMarketer; in-house analysis

Coming US – China Parody: Retail Sales

Domestic Retail Sales- US v China

If one asks why we spend so much time watching the emerging middle-class in China, this graph is the reason. According to projections made by Japan’s Mizusho Securities, 2018 is the year that retail sales in China will, for the first time, be equal to sales in the US. Both countries are approaching the six trillion dollar mark. Many US multinational companies get a significant share of their sales in China – not a surprise. Many smaller US companies should be considering how they too could grow their sales by approaching the Chinese consumer. Source: Washington Post