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Will advertisers embrace the media-buying evolution?

Will advertisers embrace the media-buying evolution? Bharadwaj Ramesh

What has changed in the way the medium is sold to advertisers in one of the world's largest and fastest growing internet and advertising markets?


Nothing.


China's internet users continue to expand rapidly, most of them continue to be under age 25, advertisers continue to invest into the medium, five sites continue to account for 80 percent of all advertising spends, and third-party data still does not meet industry standards.


What evolution are we talking about?


There needs to be an evolution -- yes, but from sellers of online media rather than their buyers and advertisers -- some of whom have worked in developed markets before coming to China and are expecting big things from online in China.

Online is sold like outdoor. Buyers have to buy days. Campaigns can't be optimised on the fly based on feedback, targeting is imprecise and data disclosure not validated. The key advantage of online, targeting and accountability is not being fully leveraged in selling the medium. The expanding user base and increasing attractiveness of the Chinese market means that it's a sellers market, and that the medium sells itself.


To compound the problems from the buyers' side, online and digital are seen as incremental mediums for a majority of advertisers, and traditional thinking dominates. There's an increasing need for digital strategy that cuts across all client marketing and communications activity, rather than spot plans with banner ads, MSN, and pop-ups.


The need for an all-encompassing digital strategy becomes even more important when we consider the speed at which the internet itself is morphing -- into mobile devices and TV screens (as IPTV). Internet users are becoming active content generators and sharers via blogs, BBS, and online videos. Search is also coming into its own and media agencies now have search specialists as part of their existing digital teams.


China is exhibiting a massive divergence between hardware and software in digital thinking and implementation. While the media themselves are advanced -- with IPTV and Mobile TV trials rapidly gaining ground and peer-to-peer technologies bringing on-demand video a new meaning ("Prison Break" episodes are available one day after their telecast in the U.S. on Chinese P2P streaming networks) -- the measurement, metrics and ability to use these media for communication do not come up to the standards of some Southeast Asian countries, let alone the West.


And where are the opportunities?


There's growing realisation, even among marketers of soaps and toothpastes, that the internet can no longer be ignored. But what to do with it remains the larger question. The current model in China, with the emphasis on 'booking space' before somebody else does, doesn't leave much for experimentation or creativity.


It remains to be seen as to how long the big portals will continue to keep the Chinese internet users within their fold. Sometime after Beijing 2008 and before London 2012, the way the medium is becoming marketed to advertisers will evolve.


As consumers grow with the medium, their tastes will fragment, and that will lead to more sites for advertisers to invest in. The selling practices will also get more sophisticated and portals will start maximising yield from the same inventory through behavioural targeting and optimisation. Driving all of this would be the new breed of media agency staff and digital strategists, who will move advertisers beyond banners. More importantly, they will get remunerated in their own right as specialists, and not get lumped together with TV buyers. Underlying it all will be a strong focus on measurement and accountability, without which, the medium will not be able to secure a high share of media spend.


After all, where the money goes, the procurement and auditing folks follow.


Bharadwaj Ramesh is regional director of MindShare. Read full bio.

Bharad is regional director at MindShare Asia Pacific, based out of Singapore. He was previously national tactical planning director, managing clients' TV investments for MindShare China, where he spent four eventful years. Prior to China, Bharad...

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Comments

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Commenter: Jan Van den Bergh

2007, November 19

I'm not sure it's the sellers' side that's to blame. Just because they still sell days? Or because the figures are not correct? Are there any correct media-figures? It's mainly the whole industry at the buyers side that lags behind. The 172,000,000 webusers are waiting. Their PC's are waiting. Their mobile is waiting. We did some research recently that proved it. There are many more opportunities in interactive than just buy banners on the 5 portals. Explore them. Experiment with them. And convince your clients to join.