2008 - online advertising in china and considerations for us market entry
DESCRIPTION
The executive presentation to accompany the market entry analysis white paperTRANSCRIPT
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6 CHALLENGES US WEB FIRMS MUST MEET TO SUCCEED IN CHINA
Going .CN
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What This Is
A Report for US Senior Executives at Web Firms trying to leverage
The largest Internet audience in the World The largest commercial market BUT an immature online advertising environment
Whose Revenue Model is based on Online Advertising
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What We Found
Six Unique ChallengesUS Firms Are Unaware or Ignoring these
issuesBottom Line: No US Web Publisher Is
Leading In China Today They have no natural advantage in China
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Overcome Fear of Labor
China has a lot of people who need jobs Brute force labor in lieu of infrastructure
Government likes massive headcountsCultural expectations mean face to face is
important Automation is not a virtue
Contrary to typical US firm focus on labor cost saving
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The Government – Obey, Lobby but Move Ahead
Multiple government (national and provincial) authorities and influence
Multiple, often conflicting, rules and regulations
Close ties can be beneficialGet over the uncertainty and move ahead
Ask forgiveness if questioned But See the Great Firewall
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China Has the Largest Online Audience. So What?
China Internet Audience is 100+% of US Audience But China Ad Spend is 5% of US And 80% of that goes to 6 players
Ad Models are unsophisticatedAd Buyers are different
Focusing on brand awareness Users Aren’t Transacting
Set Your Expectations Accordingly
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Start at Zero – Build Up to What Makes Sense
No US Based, Cookie Cutter SolutionsRethink Everything for China
Offering Brand Model Systems
Local Leadership And Autonomy Is KEY
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Deals Are Person to Person, Bargained For, and You Buy What You Can See
Even Online, Guanxi Matters
Everything Must Be Negotiable
Advertisers Don’t See Value Unless They See the Ad
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The Chinese Internet Will Not Become the US Internet
Clutter Is ExpectedEntertainmentYouthCommunityProvincialMobileCafé
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Final Thoughts
IF Your Goal Is to Compete in China’s Online Ad Space, Don’t Wait…
Don’t Wait Because of These Challenges Chinese Internet Is Moving Even Faster than U.S.
Don’t Wait Because of Ethical Issues Ethical Issues Surrounding Media Especially
Difficult But Not Going to Fundamentally Change; Make
Go/No-Go DecisionCompete Now
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