China is a country of impressive numbers, but when it comes to technology adoption, it is still behind most of its Asian neighbors. As we all know, global advertising is increasingly dependent on digital platforms and technological innovation to convey engaging and targeted messages to consumers. This is the challenge advertisers in China will have to face over time should they want to make an impact in the local market.
Unlike other developed countries, China has had a late digital start but the past decade has proven that the Chinese are hungry to catch-up and position themselves as technological innovators. The recent announcement of Miao Wei, head of China’s Ministry of Industry and Information Technology (MIIT) mentioning that delivery of 4G licenses will be brought forward to 2013, illustrates this desire to strengthen its position in the connectivity race (1). Furthermore, companies such as Tencent (QQ) or Sina (Weibo) have already established themselves as global players and leaders of the digital evolution that is taking place in China.
China’s high internet and Smartphone adoption rate, and 401% market growth in 2012(2), has pushed most first tier city inhabitants to the forefront of a fully interconnected mobile internet world. With this in mind, let’s picture Shanghai 10 years from now and what a typical day in the life of a high-middle class Chinese might be.
Meet Da Ge – he is 32 and married with a young daughter.
7:00 AM: Da Ge’s phone alarm linked to his stereo goes off, turning on his favorite morning playlist, with all sound directed to his side of the bed as his wife doesn’t wake up till later (3). His phone also turns on the water heater at a preset temperature for his shower (4).
7:15 AM: China becoming increasingly environmentally conscious of its limited natural resources, he scores Eco points based on the amount of water used while showering. The less water used, the more points he accumulates that entitle him to discount prices for an apparel brand that is sponsoring the app that measures these Eco points (5). Entering the kitchen, the room light automatically comes on. Using voice control, he is able to activate a wall projection screen and chooses the divided screen display option with one half showing his favorite Youku channels (6) and the other, his schedule for the day (7).
8:02 AM: Leaving the house, he puts on a pair of recently acquired audio AR glasses which link to his mobile and listens to his favorite Weibo feeds (8). While waiting at a traffic light, he witnesses a car crash, which he films with his glasses. China has improved its mobile Internet connection considerably over the past decade, enabling him to instantly feed snippets of the video to his Weibo account. This year, Weibo is one of the primary digital platforms used by brands in China because it has consistently enhanced its offering for advertisers (9) by adding relevant ads at the end of user-fed videos. Da Ge’s recently posted video of the accident concludes with a German car ad. Looks like he’ll be taking the subway today!
8:14 AM: Getting in the subway, he sees an ad for the latest badminton racket on a 3D screen – he gets excited (10)! Thanks to his phone’s social integration and improved GPS signal, some of the ads he comes across are based on his interests. Waiting for the subway, he chances upon an ad for chocolate. He interacts with it, using a network ad app on his glasses (11). He now sees AR chocolates flying in his direction and needs to grab as many as possible in 10 seconds to get a discount coupon link… It’s a win, free chocolates for the family tonight!
8:56 AM: Opening his office door, he receives a personalized greeting; the company server records his time of arrival and sends a signal to his coffee machine (4). A hot sugar-free cappuccino is already waiting for him when he sits at his desk. He gets a low coffee supply notification on his phone. Re-order? Yes please!
12:00 PM: After a busy morning, the first hunger pang strikes. Not sure of where to eat, he types “lunch today” in Baidu, and gets localized results ranked by recent reviews made by his friends (12). Putting the full potential of the Semantic Web to use, China’s leading search engine has become much more relevant and transparent over the years. However, still uninspired, Da Ge sends a voice message to one of his contacts working in the neighborhood. Amy’s free and suggests a good restaurant he’s never been to! He gets directions and the approximate duration it takes walking there displayed on his glasses (8).
3:30 PM: Back at work, Da Ge attends a real-time telepresence (12) conference with Europe that is controlled by a virtual keyboard projected on their meeting room table.
6:55 PM: After work, he heads to his favorite hot pot restaurant and meets with 4 friends there. They choose their dishes directly from an interactive table they are sitting around. Once ready to settle the bill, brief multiple-choice questions on their overall satisfaction are asked via the table screen. They can skip these queries of course, but can get 10% off the total bill if they respond. Da Ge kindly treats everyone and pays directly through a mobile payment app that links with the table (14). The app also offers suggestions of places and products he might be interested in based on his previous mobile purchase.
9:30 PM: Da Ge hails a cab ride back home. At the back of the driver’s seat he watches a small Touchmedia screen displaying interactive ads. This screen has a micro camera that not only keeps the driver informed of what is happening in the back of his cab for security, but it also determines the approximate age and sex of the passenger and feeds ads in accordance to the retrieved data (15).
9:45 PM: At home, his wife and daughter are watching the Lancôme branded web channel on Youku. Being a leader in branded text web content (16), Lancôme quickly understood the power of dedicated web channels. Viewers comments are displayed live on the side of the screen. He joins them and altogether they engage with the compeer and audience of the show, by using their mobile to send live feeds (17).
11 PM: After a productive day, Da Ge heads to bed, ready for another digital tomorrow.
Take the most recent 1号店 campaign (18) for example, this digital tomorrow is spreading like wildfire in China. If it remains behind on some aspects of the digital realm, very few will be left in the dark because of the growing interconnectivity of technology there. All examples mentioned above represent the undeniable evolution of existing technological innovations, which advertisers will need to understand in order to grasp the full potential of digital advertising in the next decade. Furthermore, the recent news of earlier 4G licenses.
Agencies have already begun the shift towards digitally driven marketing strategies. Yet, if they hope to position themselves as leaders within the industry, they will have to think ahead and create more dedicated digital research departments. They will have to grow from being digitally savvy to tech-savvy in order to provide unique interactive content and work hand-in-hand with platforms developers and hardware providers, to reach out to Chinese customers in more innovative ways.