WAVEMAKER MAKING THE FUTURE THROUGH TRANSFORMATION
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1 WAVEMAKER MAKING THE FUTURE THROUGH TRANSFORMATION February 2018: SOCIALONE interviewed Wavemaker Greater China s CEO to discuss Wavemaker s transformation and how it will help brands grow their business. "Transformation" is one of the industry s hottest buzzwords. Behind the rise of this concept is the change in how brands react to marketplace disruption. For brands, there s an increased awareness of the short-term marketing effects of branding, and changes to both stakeholders and the media landscape--encouraging companies to build their in-house marketing and promotion teams, while media platforms enable teams to offer highly personalized and targeted services. But all this comes down to the one thing about marketing that never changes: how to influence consumer opinion about your brand. A report by market research firm TNS shows that only about one-third of Chinese marketing professionals are confident in their ability to manage consumer touchpoints with the media. The question for advertisers remains, "Where is the consumer?" "How can I reach them most effectively?" This is good news for Wavemaker, a company that has invested huge sums of money, resources, and time into researching the consumer purchase journey. In fact, Wavemaker is also one of the few media agencies in the industry that truly understands how consumers purchase brands with a huge research study spanning over 400,000 individual journeys, spanning 72 categories in over 35 countries. The first collaboration between SOCIALONE and Wavemaker was on the brand interpretation of the "Generation Z Report" "Generation Z is here - what does this mean for brands?", and this study has reached Research House" standards in its understanding of consumers. SOCIALONE interviewed Gordon Domlija, the CEO of Wavemaker Greater China, who talked about Wavemaker's transformation in the face of an ever-evolving media landscape and changing brand needs.
2 So you've been in China for ten years now. Please share your personal perceptions of the changing Chinese media environment. I came to China in China has been changing very rapidly, and this has been fully reflected in the fields of media and communications, and in marketing and technology. Unlike more mature markets, the Chinese market is still ripe with opportunities. There are not too many established business models, and therefore, disruption can occur very rapidly. A brand can quickly enter the market, and then gain a foothold for themselves by communicating and connecting with consumers and engaging in a direct dialogue. Chinese consumers are always interested in the latest trends, and always eager to try something new, and this creates opportunities for many different types of businesses. Of course, in practical terms, you just have to look at the changes to media budgets. When I first arrived in China, the digital marketing budget accounted for less than 10% of the total budget. Now, 70-75% of our business comes from digital media. Brands and products can gain market share in a flash and lose it just as quickly. As we move more and more into e-commerce, more and more brands are emphasizing shortterm marketing effectiveness. What do you think about this? That's right, in China, the focuses of marketing communications is always about performance, because in this fast-growing market, you have to sell product to be able to survive for tomorrow, much less talk about the long-term growth. However, focusing solely on short-term ROI inevitably means neglecting the building of your brand and that s a long-term investment. Many Chinese companies have great products, and they've brought their products to market where we ve helped to empower them. And these products have been very successful in the short term. But if you ask me, are they truly excellent brands? I don't think they are. For example, you look at a takeaway app platform, you have to realize you are not just a food distribution platform; food distribution apps might disappear tomorrow. What brands need to really think about is, how do we make ourselves indispensable to consumers? Can you become a lifestyle brand, that can meet the needs of your consumers in other scenarios? What makes you different from another takeaway app? We serve a number of well-known luxury brands, the original brandfirst enterprises. The first thing is to define the consumer s dream and then how you commercialize that comes more naturally. I have always believed that products come and go, but brands last forever. 2
3 So in this context, how does Wavemaker position itself? We place equal emphasis on performance and brand building, we understand how consumers purchase brands and services and we focus on integration and cooperation across all parts of the marketing spectrum. All brand service agencies aspire to do that, but what are Wavemaker's core advantages? The services provided by all marketing agencies are basically the same. What makes us different? For this, I think you have to go back to the consumer. Before a brand makes any marketing decisions, they must have a very deep understanding of the consumer purchase journey--the impact of different interactions along the customer journey towards making a purchase, not just contacts with paid media but inclusive of earned media, owned media, word of mouth, and so on. What makes them choose one brand over another? What results in the eventual decision to buy? So we can help brands sort out their preferences across the entire buying process, and help influence buying behavior. This is why Wavemaker has invested so much money, resources, and time into field research. * WM Momentum: a comprehensive study into how people make purchase decisions and have conducted over 400,000 surveys in 35 markets and across more than 72 categories. These are connected to various earned, owned, and paid media channels through WM Touchpoints. On understanding consumers, there is much advantage to having such consumer data and creating these big and small ecosystem platforms. In fact, they are already starting to serve advertisers directly. How are you dealing with this trend? This is also occurring outside of China. Google, Facebook, and other technology giants have a lot of data and are increasing their prominence. The definition of media is also changing--you look at Toutiao, Douyin, Meituan, Ximalaya...all these mobile apps that are capable of aggregating specific users can be referred to as "media." However, because of this, research on the consumer's purchase journey is becoming more and more important, and the brand must know which among the many touchpoints have 3
4 an impact on brand preference and buying decisions, and how these factors can be affected and influenced. It is also important to note that media fragmentation has also caused user attention to become extremely fragmented. The era of running ads across a single medium, in order to reach everyone, no longer exists. Most of these highly-fragmented media are quite independent. And as a company, we are focused on integration and cooperation; that doesn't just mean cooperation with our customers, but also with different media platforms. What the market lacks most at this point is integration. There are more and more service agencies, and the audience is getting more and more fragmented. What brands need is someone who can get all the available data on the market along with any possible solutions, and interpret them for the brand in a more holistic way. What we can offer brands is to help them understand consumer preferences across the entire purchasing process, rather than just on a single platform. Many of the changes that the marketing industry has undergone in the past few years were introduced by new players from outside the industry, and more new players will be coming in the future. Brands have very diverse needs for their integrated service providers, including entertainment marketing resources, technical data, grassroots and social media operations, e-commerce operations, and more. Everyone is talking about transformation, and Wavemaker is no exception. So what is the direction and goal of your transformation? We have been undergoing constant "transformation." Our recent mergers and our new name are testament to that. In reality, our products have constantly been undergoing sustained change. One move is towards greater integration. Our fundamental business is about understanding consumers and figuring out what motivates them to buy products and services. As technologies, markets, and ecosystems change, our understanding also needs to change accordingly, our people's skills need to be developed, and our solution sets need to be broader than before. Once upon a time, to be a "full service agency," all you needed to do was to create a print ad and find a place to display it. Now, we have content experts, IP experts, e-commerce experts, SEO experts, strategy and research insight experts, and so on, and this expansion and transformation will never stop. This expansion is the only way we can offer reasonable and effective solutions. Another direction for our transformation is that our business will become more analytic. When I joined the industry, things were pretty simple. Our main media comprised of newspapers, television, and radio, and the distinction between different target audiences was clear and straightforward. But now, we have tens of thousands of channels to choose from, and we can't enter these channels by using just one mode of 4
5 thinking or just one creative execution. This makes the ability to understand data incredibly crucial; without understanding the data, you will not survive in today's marketing industry. ABOUT SOCIALONE SOCIALONE helps marketers to triumph in digital marketing in China. SOCIALONE is the leading source of knowledge and information on digital marketing. We offer in-depth case studies, innovative ideas, and data evidence to help marketers to make better decisions. Our offline workshop/events will make you more connected and well-informed in the industry. For more information, go to ABOUT WAVEMAKER Wavemaker is a billion dollar-revenue next generation agency that sits at the intersection of media, content and technology. We are obsessed with the customer's purchase journey and is what connects our mission directly to our client's business challenges. We invented WM Momentum, a comprehensive study into how people make purchase decisions and have conducted over 400,000 surveys in 35 markets and across more than 72 categories. We are a business that is powered by the creativity and curiosity of our 8,500 people in 90 countries, united by our PACED values. We are a part of GroupM, WPP's global media investment management company. For more information, go to Wavemaker China has a team of 800 people across four offices in Beijing, Shanghai, Guangzhou and Nanjing. Clients in the agency's portfolio include CHANEL, Danone, Daimler, Meituan, Huawei and Pfizer. Press Contact Lucy Hong Business Development and Marketing Director Phone: lucy.hong@wmglobal.com 5
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