The 10 Biggest News Stories of 2009

This Year Was Less Tumultuous Than 2008, But China Continues to Appear on the World Stage

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HONG KONG (AdAgeChina.com) -- It was always going to be hard for 2009 to top last year, when China hosted the Olympic Summer Games. And the world was rocked by the worst financial crisis in decades. And China suffered a tainted-milk scandal that killed or sickened hundreds of children, as well as a tumultuous Olympic torch relay and a horrific earthquake in Sichuan province.

So this year China appeared on the world's front pages a bit less often, but there were still plenty of significant events. Here's our list of the top ten stories of 2009.

1. Spending at the China Central Television (CCTV) auction reaches new record
For years media buyers fretted about what would happen to media spending the year after the 2008 Olympic Games -- and that was before anyone knew global ad spending was about to get punched by a global economic recession.

Advertisers wondered just how bad the hangover would be this year, but the aspirin stayed in the medicine cabinet in Beijing on Nov. 18, the day of CCTV's auction for prime-time slots on its network. The auction is an annual benchmark for the current and future health of China's ad industry, and this year, the future looks good. Advertisers spent $1.6 billion, an 18.5% increase over November 2008.

2. China overtakes the U.S. as the world's biggest car market
The discrepancy couldn't have been more glaring. America's car market was gutted this year, as some of the biggest car makers in the U.S. begged for a government bailout. But car companies found good news....no, great news, halfway around the world. China turned into the world's largest car market by number of vehicles sold. And growth shows no signs of slowing down. In fact, sales reached a record high in November 2008 of just over one million passenger cars, and dealerships around the country have a waiting list for new cars.

3. China launches 3G services
In the world's largest mobile phone market, the launch of third-generation (3G) mobile technology was destined to be a big deal, even though mobile operators and advertisers knew it would take time to reach the mass market. The number of 3G mobile phone subscribers hit 9.77 million in October 2008, according to China's Ministry of Industry and Information Technology. That's not a lot, considering China has over 729 million phone phone users. But the top telecom companies China Mobile, China Unicom and China Telecom have pumped over $15 billion into developing 3G networks in China.

4. Selling China to the world
Tired of playing the role of disliked totalitarian regime, China is flexing its soft-power muscles to the tune of $6.6 billion. The money will be used to expand the international presence of state-controlled media companies such as CCTV; the official state-run news agency Xinhua; People's Daily, the official newspaper of the Communist Party; and Shanghai Media Group.

Those companies are hiring reporters, planning to publish and broadcast content in more foreign languages, and opening news bureaus around the world. They are also acquiring overseas media assets and launching special projects -- all to improve China's global image.

China is also turning to Madison Avenue to help sell its image to the world. A coalition of state-owned groups is running a TV spot, "Made in China, Made with the World," on CNN International to help improve the image foreigners have of China.

The ad, created by Beijing-based DDB Guoan, shows a series of products manufactured in China, including household appliances, mp3 players and aircraft parts, with designs, engineering and technology from multinational partners. Individuals and families interact with the products, each of which bears a label that reinforces the collaboration.

5. Marketers test e-commerce on Taobao
Alibaba Group scored an early hit with Alibaba.com, its business-to-business site connecting foreign buyers with Chinese manufacturers. Taobao.com, the company's consumer retail site, took longer to grow, but is winning over some of the largest marketers in China.

This year, Procter & Gamble Co. even started experimenting with e-commerce in China, the world's largest internet market, on Taobao. Many of P&G's top brands in the mainland, including Olay, Pantene, Rejoice, Illume, Head & Shoulders, Gillette, Max Factor, Oral B, Braun, Pampers and Crest, are now sold on Taobao.com (shop57895461.taobao.com).

Other marketers like Uniqlo, Hewlett-Packard, Lenovo Group, Li Ning Co. and Walt Disney Co. have also set up stores on Taobao.com.

6. Coke loses Huiyan bid
Last year, Ad Age China ranked Coca-Cola Co.'s offer for China Huiyuan Juice Group, a Hong Kong-listed company that owns the Huiyuan juice business, as one of the top stories of 2008. The deal was seen as a barometer of just how far Beijing was willing to go in letting local firms fall under foreign control, as well as a test case for the country's new anti-monopoly law. Last spring, China's government answered both questions by rejecting the deal.

7. China's net nanny put her foot down
Despite, or because of, the popularity of the internet in China, many foreign-run web sites were shut down there this year. Chinese netizens can't legally access Twitter, Flickr, Facebook, Youtube, Hotmail and other sites.

The move wasn't entirely unexpected. This year was marked with symbolism, such as the 20th anniversary of the government crackdown on student protests in Tiananmen Square on June 4, 1989, and the 60th anniversary of the founding of the People's Republic of China on Oct. 1, 2009. Web fans hoped the sites would be unblocked by the end of the year, but the Great Firewall looks stronger than ever.

8. QQ turns into a marketer's dream
When Tencent Holdings launched QQ in 1999, it was an instant messaging service in a fledgling internet market. Over time, Tencent added features like chat rooms, games, personal avatars and internet storage. And it kept expanding. Chinese web users can now use QQ to raise virtual pets and engage in internet dating. They can also use virtual QQ coins to buy stuff on QQ.com and other online retail sites. The Shenzhen-based company has 892 million registered users, including 377 million active users, which has attracted advertisers like Mars, Procter & Gamble, PepsiCo and Ford Motor Co. who want to reach young Chinese consumers. QQ.com has become one of the most popular internet partners for web-based promotions and user-generated programs.

9. Hu Shuli resigns as editor at Caijing
Hu Shuli dazzled readers in 1998 when she launched Caijing, the first major publication in China that used investigative reporting to probe corrupt officials and businessmen. The twice-monthly business and finance title has a circulation of 225,000, and generated $6.9 million in revenue in the first half of 2009. After weeks of tense negotiations last fall between Ms. Hu and the magazine's owner, Hong Kong-listed Stock Exchange Executive Council (SEEC), she resigned. Her departure left the future of Caijing, China's most influential and profitable magazine, in doubt. But Ms. Hu is starting another magazine, Caixin, keeping alive the hope that at least one Chinese magazine will tell it like it is in China.

10. China becomes the world's fifth-largest consumer market
China is an emerging market, and a fast-growing market, but is it a profitable market for advertisers? Yes. This year China became the world's fifth-largest market for consumer spending, at $890 billion, following the U.S., Japan, the U.K. and Germany. By 2020, China is forecast to become the third-largest consumer market worldwide after the U.S. and Japan, and consumer spending is expected to exceed $2.5 trillion, according to global consultancy McKinsey.

China will reach another milestone much sooner, however, when it surpasses Japan as the world's second-largest economy by early 2010, as much as five years earlier than previously forecast. China's GDP will expand around 8% this year, while Japan's economy stagnates due to falling exports, the costs of an aging population and a growing national debt.


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