iMedia: What are some of the recent marketing trends you are seeing in China?
Frederic Jouve: China, in many different fields, is leapfrogging other markets, and because of its size, it is driving practices for marketers that are exported to other locations. Where in the past China was following others and trying to learn what was done, it is now becoming a bellwether of what is happening. With clients having more integrated teams, we see trends appearing in China and then spreading to Asia Pacific.
Market segmentation in China is happening very quickly now, and the ability to drive much more targeted marketing is very important. It requires marketers to deploy more sophisticated approaches.
Some people say that 2010 is the year of ecommerce in China, and it is something we see across clients and industries. There is an absolute drive towards it, and this has been fuelled by two things:
First, C2C platforms -- the major one being taobao.com -- have opened the door and taught people to buy online.
The second is because the growth of China has now spread across the country; China is no more Beijing, Shanghai and Guangzhou. We are talking about the development of hundreds of cities across the country. And in these third and fourth-tier cities, you don't have the retail network or brand presence, so consumers there are using ecommerce to get the brands that they want. That is changing the way marketing is done -- how do you integrate ecommerce with your store; and how about social networks? It's a whole new ball game for marketers.
iMedia: Moving forward, how do you see user targeting developing in China?
Jouve: The ability for a brand to get information about their customers on what they want, who they are, and what they expect, is very important. The ability to turn that information, through analytics, into actions that drive results, is fundamental. The market is getting segmented very fast, and it requires marketers to have the ability to get and process this information efficiently so they can put that back into their plans.
iMedia: Do you also see these trends developing across Asia Pacific?
Jouve: Yes, for the regional clients that we serve, we see similar trends. It's very much a reflection of a global retail trend. The role of the retailer is changing and therefore brands are changing. Retailers sometimes have up to 60 percent private labels in their stores; they become a brand themselves. So this is changing the way they manage their information and the way they do their marketing. There is a struggle of power between retailers and brands on who owns the information, and who owns this data will win the battle. The conversation is changing.
iMedia: How are clients' attitudes towards customer data use changing in China?
Jouve: What used to be a back-end process is becoming more strategic and more front-end. You need to be able to project customer information into your campaigns. Brands are typically used to managing their marketing by product campaigns. But in today's interactive world, where consumers are taking a much bigger role in getting information about the products they want, you go towards consumer marketing and real-time interaction. You shift from product campaigns to consumer-triggered campaigns, where the consumer by his behaviour triggers a particular campaign.
iMedia: How do you see customer loyalty programs evolving in China in the next two years?
Jouve: Traditionally, there are many loyalty programmes in Asia because of the status-consciousness of consumers. Those programmes are often used passively as a discount mechanism, and not strategically.
The result of that is you end up getting consumers that are not really interested in your brand. They get the card just to get the discount. You don't necessarily get good customers. We now see a lot of brands trying to shift to a more strategic usage of loyalty programmes, driving them with the ability to provide the right offer to the right customer.
We often see brands that are giving discounts to people who would come and buy anyway. What's the point? You are just giving up your margins. You'd be better off using the money to attract people that are not coming. And for the people that are coming, maybe you want to give them other incentives than just discounts? Many retailers are realising that they need to shift to a more strategic usage of loyalty programmes, to be able to project them in the multi-channel world.
iMedia: How do you expect the digital marketing landscape in Asia to change over the next two years?
Jouve: In the near future, the term 'digital marketing' will be dead. What I mean by that is that digital marketing will be marketing, and the split between digital marketing and marketing is just a transitory phase until digital becomes mainstream.
The idea that there could be a world that is purely digital and disconnected from reality is not something that makes a lot of sense. The future is really integrated multi-channel marketing, where you leverage both offline and digital channels. It is this combination of the right offer, message and channel of communication. That's the real future of digital marketing, to become mainstream and be integrated as part of a multi-channel approach.
iMedia: What digital technologies do you think will come to the forefront in the next few years?
Jouve: The merger of mobile and the internet will happen. This will change a lot because it will bring the power of the internet into the store. Customers will be able to compare prices and offers, so this will change a lot of the dynamics.
iMedia: What advice do you have for marketers to move forward with customer data management?
Jouve: My recommendation is to kick-start change. You need to start putting it into practice. Getting this vision of your customer, being able to identify them, looking at the info and running some basic analysis, is something that is often the right first step. The foundation is getting an effective segmentation. It's something that can be used strategically.
iMedia: What are the challenges you face in getting your clients to understand data usage?
Jouve: There is a difference between markets. In more mature markets, legacy is a big challenge, their standard way of marketing. The other challenge is if you look at the implications of those changes, it puts marketing in a much higher perspective compared to other divisions. In a lot of companies, marketing is not the most important department, but here we are talking about driving the business through the consumers, so marketing is taking a much higher ground. The challenge is for marketers to really step up and take the lead in driving it.
Marcel Lee Pereira is editor of iMedia Connection Asia.
