Ad Holding Companies Pitch to Take Chinese Telecom Giant Huawei Global
Faces Suspicion in Some Countries, But Has Huge Potential as International Brand
Ad Age has learned Chinese telecom giant Huawei is looking for an agency partner to help shape it into a truly international brand -- and is conducting a pitch process at the ad holding company level.
Huawei built its wide-ranging empire as a global B-to-B supplier of switches, boxes and towers. But the company has recently shifted its attention to the consumer marketplace, with products such as phones and tablets.
Agencies are salivating at the prospect of working with the Chinese giant, with one top agency executive based in Shanghai saltily calling it "the wet dream of every ad agency, being the first to take a Chinese brand global."
According to multiple industry sources, the suitors for Huawei's global corporate branding work include: WPP, Omnicom Group, Dentsu and Interpublic Group of Cos. Each company is drawing teams from a combination of different agencies.
All four holding companies are currently preparing final presentations expected to take place early next month in Shenzhen, the southern Chinese city where Huawei is headquartered.
Representatives for the holding companies either declined to comment or could not be reached by press time. A Huawei spokesman declined to comment.
Publicis Groupe 's agencies were contacted about the corporate brand pitch but declined to participate because of client conflicts, according to a senior executive at the French holding company. Existing clients include Samsung and LG.
However, Publicis Groupe -owned BBH is on the company's roster already and does work for Huawei's global devices business, creating advertising for consumer products such as mobile phones and smartphones. The client and BBH's lead account team are based in London -- an indication that Huawei is serious about creating globally relevant work.
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It's possible the agency that wins the global corporate branding work will also be based outside of China.
In the past, Huawei has worked with a range of shops, including Ogilvy, Fleishman-Hillard and MS&L. And it's unclear what the pitch means for the agency that recently created the Olympics work for Huawei, RiechesBaird.
Big challenges -- and potential
Pronounced "hwah-way," the company is treated with suspicion by some governments, including the U.S. Founder Ren Zhengfei is a former People's Liberation Army engineer, and though there are no official links between the company and the Chinese government or military, Huawei has been shut out of key overseas projects due to fears that Beijing would be able to disrupt or disable communications systems.
Still, Huawei's customers serve people in more than 140 countries, raking in revenues in 2011 of more than $32 billion, according to the cover story of The Economist earlier this month, titled "Who's afraid of Huawei?" And though one challenge is creating a positive image for a company with such a history, arguably an even bigger task is forging a global identity for a relatively unknown Chinese brand amid commonly held attitudes that the country's products are cheap knock-offs.
For agencies involved in the review, it's not known how much the ad account is worth. Chinese marketers are notorious for being penny-pinching and having short-term relationships with agency partners. However, the prestige and potential that comes along with an assignment of turning a Chinese brand into a global brand is proving irresistible.
"I'm pretty sure nobody is doing this for the money at this stage," said one executive that 's involved in the agency pitch. "Probably of all the Chinese brands, this is the one that is the most ready to do something on the global stage. That's why all the holding companies are interested because obviously if you have this under your belt, it's a big thing. But I'm pretty sure it's going to be a long and tough journey."
Huawei has already taken clear steps toward becoming a global company, including an Olympics TV campaign and hiring expats at its Shenzhen headquarters. The company exhibited its smartphones in Barcelona and Las Vegas this year at major global telecom and electronics conferences. And it's currently setting up design centers in Shanghai, London, San Francisco and Tokyo to innovate for its consumer product lines.
Other Chinese brands with global aspirations include appliance maker Haier, athletics brand Li-Ning and computer company Lenovo.