Booming China captivates marketers

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[Beijing] Global interest in China's fast-growing economy brought 1,300 delegates from 42 nations to the International Advertising Association's 39th World Congress in Beijing last week.

The decision to host the event in the Chinese capital illustrates "the demand for first-hand information on a red-hot Chinese market driven by a 1.3 billion population," said IAA CEO Frank Cutitta. China is the sixth-largest ad market in the world, according to Publicis Groupe's ZenithOptimedia, and its gross domestic product is expected to overtake Japan by 2020.

The conference examined broad global advertising trends such as the future of media, return on investment and changes in the advertising agency model. But the spotlight was firmly placed on issues pertaining to the Chinese market, including entry strategies, consumer trends, creative, and the difficulty of finding and training enough marketing professionals.

Wang Zhongfu, China's minister of industry and commerce, opened the Congress by reinforcing his country's intention to further open its ad industry to foreign competition in 2005, as part of its entry into the World Trade Organization.


Tom Doctoroff, CEO, China and area director, North Asia at J. Walter Thompson Co., spoke passionately about the challenges to building brands in China, including "vicious commoditized price wars, acute short-termism and paper-thin margins."

Austin Lally, Guangzhou-based general manager of beauty care at Procter & Gamble Co. in Greater China, related concerns about media fragmentation brought about by a dramatic increase in the number of magazines and TV and radio stations in recent years. "We're all feeling the impact of these increasing numbers. It seems as though everywhere we turn there are new and more media channels."

Some more general topics included:

* Linda Wolf, chairman-CEO of Publicis' Leo Burnett Worldwide, shared examples of effective communication aimed at women- particularly in liberated Western countries-by being sexy-but not sexist.

* Karen Elliott House, senior VP of Dow Jones & Co. and publisher of the Wall Street Journal, questioned the validity of return-on-investment methodology because "all eyeballs aren't the same."

Methodology, she warned, has the danger of turning advertising into a commodity, "but the value of advertising depends on its credibility. We view the space around the advertising as much more than filler."

* Rod Pullen, CEO of WPP Group's Batey Red Cell network in Asia, spoke about extraordinary focus points that can become "brand rockets," such as Borders bookstore encouraging shoppers to browse longer in stores by adding a cafe and Body Shop's cosmetics with a conscience. He also warned of "brand termites" that erode brands over time.

The IAA used the Beijing Congress to elect officers for the 2004-2006 term. Michael Lee, president of Lee & Steel, Darien, Conn., was elected president, succeeding Jean-Claude Boulos, founder and owner of Inter-Regies, one of the first five agencies in Lebanon. Joseph Ghossoub, CEO of The Holding Group, parent company of Team/ Young & Rubicam in Dubai, was elected senior VP to succeed Mr. Lee in 2006.

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