Dr. Erica Ng Dr. Irving Lim Dr. Candice Lau Dr. Mei Lim Kim E Perry Haley W. Ridza S. Kristine A. Eunice T.
ACADEMICS SPECIAL GUEST HONS.LY AD AGENCY
Good evening Dr Chung and fellow classmates. Today, we will be presenting on Advertising. Let us introduce our
academics who specialize in this area.
They are AP Irving Lim, Dr Mei Lim, Dr Candice Lau and Dr Erica Ng. (Each acadamic stands up and waves once he/she
is being introduced). They will be covering topics ranging from Characteristics of Transnational Advertising Agencies
(TNAAs), Online Privacy and Risk, Advertising in Emerging Markets as well as Social media trends - Current and Future.
On the other side of our room, we have a real life example of an up and coming TNAA, Hons.ly Ad Agency. A little more
about Hons.ly ad agency. It was set up in 2004 by the CFO of a TNAA Sootchi&Sootchi, who left the top advertising agency
to pursue greener pastures. Ever since, Hons.ly grew from a small company of 3 to 3000. Their headquarters lies in the
concrete jungle where dreams are made of, New York. Today, they have branch offices all around the world, especially in
emerging markets like China, Brazil, India and Russia. You are looking at a Hons.ly office located at 4202.
But before we begin, let’s hear from AP Irving Lim on TNAAs.
Leveraging on Global markets
Products and services of TNCs
Consolidation through mergers & acquisitions
Introduction to TNAAs (Irving):
According to Holwerda & Gershon (1997), it was mentioned that transnational corporations (TNCs) and transnational advertising agencies (TNAAs) have become business partners and are increasingly financially interlinked.
This unique relationship allows TNAAs to tap on products and services of TNCs that are going global. What this essentially means is that as TNCs go global, their advertising agencies go global with them too!
Another key characteristic that has been observed of TNAAs is the consolidation of agencies through mergers and acquisitions. Starting in the mid-1980s, the field of advertising has experienced increased consolidation similar to other
transnational media companies (TNMC). Some of America’s leading agencies are merging and purchasing smaller agencies.
This trend of TNAA expansion and consolidation will likely continue given worldwide privatization trends. Why, then, is there a need to consolidate? According to Gershon, there are 4 major factors.
Firstly, to obtain positive synergy. Advertising is no longer just about providing a single service such as conceptualizing and producing an ad but it now encompasses varied services. A full-service agency specializes in planning, production, and
placing of advertising for clients in all categories, from radio commercials, to posters and print, to interactive television commercials, to Internet and businesses. It also includes media planning and buying, market research and consulting, public
relations and specialty communications.
Secondly, there is a need to harness more creative talents. This is important as TNAAs has ventures in the global market, there is a need to tap on the creatives of host nations who better understand the context in which the ad will be placed.
Thirdly, to obtain a strategic niche to complement current strengths. For example, through mergers with media and digital agencies, a TNAA will be able to harness their expertise on media technologies.
Lastly, there is a need to adopt an aggressive approach to expand quickly before other competitors for creative talents and new customers. The extensive network of subsidiaries and offices in core, semi-peripheral, and a few peripheral nations
will help build up a portfolio of global clients.
Top 4 agency companies:-
(1) WPP, (2) Omnicom Group, (3) Publicis Groupe, (4) Interpublic Group
Primary holdings consolidated:-
Global networks (Young & Rubicam Brands)
Other agencies (Hill & Knowlton)
Media agencies (Mindshare Worldwide)
WPP Investments (Asatsu-DK)
The top four TNAAs globally in 2009 are WPP, Omnicom Group, Piblicis Groupe, Interpublic Group of Companies
An example of concentration can be seen in WPP. It can be seen that the major subsidiaries it holds is able to offer world-
class advertising, public relations, and marketing research to help expand globally.
Award winning ceremony (Background:Slide of trophy and star trek sound clip to play)
…And the winner of the Most Creative Advertisement of 2009 goes to…. HONS.LY enerGEN-Y taste the revolution
*Creative Director, Project Manager and Social Media strategist receives award and hugs each other* FREEZE
Introducing HONS.LY AD AGENCY
One Year Ago…
• The Client: new energy drink called enerGEN-Y
• The Goal: launch product in new emerging market called 4202
• The Target Audience: 4202
• A group of young, ambitious students whose motto is “Work hard, play
• The Competition: Red Bull, Naughty G, Gatorade
Turning back time:
Let’s look at what happened 1 year ago.
One day, HONS.LY ad agency received a brief from a major ad client
• Create an advertisement to help enerGEN-Y enter a large emerging
market called NM4202
• Description of NM4202
• Who are they? How old are they?
• What do they like? What do they hate?
• What do they do on the weekends?
• What music do they listen to? What kind of movies and shows do they
• How much information do they have on Facebook, Twitter and other
*Creative Director goes to Intern instructs her to do data mining of 4202*
1. How does a market’s characteristics affect its spending habits?
2. What do their activities reveal about their preferences as consumers?
3. Is there anything from their respective lifestyles that indicates a need that Energen-Y can fill?
4. Can we create new needs for them to encourage them to buy Energen-Y?
*Slide of Intern tracking on 4202 facebook profiles*
Data and Findings
Singapore stars popular blogs tv series
chocolate reality TV animal welfare
music social media bubbletea chinese pop
tennis staying up
sports sales late
*Presentation on Findings*
Intern Eunice: I used Facebook to stalk them because everyone displays all their information there. I know it may be
unethical, but all advertisers do that right? Information of consumers are being traded and sold everyday amongst
companies, I’m sure we’re not the only ones who prowl personal profiles for information! Anyway, based on my research, I
found out that 4202 likes KPOP, SPORTS, give tuition and most of them are on the DEAN’S LIST. They are also heavy
users of social media. *FREEZE*
Level of government involvement in
corporate privacy management
Low Medium High
If you’re worried by what the intern’s done, it’s because you feel your privacy has been infringed upon. As market data becomes increasingly important to
companies making strategic decision, the tension between consumers who want as high a level of privacy as possible and corporations who want as much
information as possible grows ever higher. As a result, governments have stepped in to varying degrees to try and manage the amount of access and control
companies have over client data. This has led to five broad models arising for the level of involvement of governments in corporate privacy management.
Self-help: Consumers report infractions.
Voluntary control: Companies practice self-censorship
Registration: Remedial in that registration is only revoked when companies have been found to have committed infringements
Licensing: Anticipatory. Companies must first prove ability to comply with laws before being granted a license to manage a database.
Data Commissioner: Ombudsman model. Third party with no legislative powers receives complaints/ monitors corporations and reports infractions to
relevant government bodies/ the media.
International standard vary; can make compliance for TNMCs and TNAAs tricky. E.g. EU countries e.g. UK and France tend towards high government
involvement while the USA and Japan favor self-help or voluntary control models.
• Different opinions of acceptable privacy
• Similar “hot topics”- especially healthcare
• Unauthorized secondary access- the “third party”
• Data tracking- going beyond cookies
This difficulty for TNAAs is even ore greatly complicated by the fact that social standards of privacy vary from country to
However research has shown that some topics, such as healthcare records are universally held to be sensitive.
E.g. of CVS (American pharmacy store) selling client prescriptions to drug company Elensys. Elensys used precription data
they bought to market drugs to CVS customers. Resulting law suits and public opnion was so bad that they had to change
Universally people are most concerned about unauthorized third party access.
Perhaps this is related to the fact that the data collected is getting increasingly complex and detailed.- especially online.
Data tracking online used to mostly be cookies tracking how often you visit a site or what you buy but no longer.
E.g. LOTAME which provides audience data for advertisers by tracking demographics, interests, actions (e.g. what people
share on and comment on in social media), media, recency and frequency of visits and actions, exposure and sentiment
and interaction. Much of which requires real-time tracking of user information.
*UNFREEZE* Creative Director: We’re so honored to receive this award today! At Hons.ly, we sound like we’re honest, but
we’re not. We pretend to be creative, but we’re not. But we’re so glad that just because we are a TNAA, we can dominate
the industry and win these awards, even though there are small local firms who produces cutting edge creative campaigns.
Its just too bad they don’t have the money and access to many media channels, which we do. Its all about size, you know.
Anyway, this is such a touching moment, I think im going to cry soon. Let me pass the mic on to my Project Manager who
will walk us down memory lane to our road to success.
Project Manager (Kristine): Hi everyone! Aren’t we just so awesome? I know, I know, no need to marvel in our
awesomeness. But we really did face a challenge in advertising EnerGen-Y. When we first got the account, I wondered,
how are going to sell EnerGen-Y in a market dominated by drinks like Redbull, 100 Plus and Naughty G? It wasn’t enough
that we stalked our target consumers on Facebook and found out what they liked, we also needed to find out their values:
what do they care about the most and what’s the most important thing to them?
Eight Gen Y Norms
• Freedom: choice, jobs, expression
• Customization: UGC, media, services
• Scrutiny: products, company practices, employers
• Integrity: corporations, marketing campaigns
• Entertainment: video games, Facebook at work
• Collaboration: Rotten Tomatoes, Amazon
• Speed: instant feedback, rapid communication
• Innovation: iPhone 3G, 3Gs to 4 in 2 years
- Kristine talks about Gen Y Norms
Source: Grown Up Digital, Ch.1, p.15
enerGEN-Y: The ultimate Gen Y
• Familiar personas within target market’s environment, i.e. the campus
hottie, the sports star, the geek
• Product is ﬂexible enough to be used by anyone for any purpose
• High sense of ownership and what it means to individual, i.e. What will
you do with your EnerGen-Y?
• BUT: admission of “guilt” that product is no more than a drink; depends
on what you make it
- Kristine talks about product strategies
–Familiar personas within target market’s environment, i.e. the campus hottie, the sports star, the geek
–Product is flexible enough to be used by anyone for any purpose
–High sense of ownership and what it means to individual, i.e. What will you do with your EnerGen-Y?
–BUT: admission of “guilt” that product is no more than a drink; depends on what you make it
Source: Grown Up Digital, Ch.1, p.15
enerGEN-Y: The ultimate Gen Y
• Gen Y Norms Featured
• Customization: it is what you want it to be
• Entertainment: oddball humor
• Speed: no more than a minute and a half ad
• Scrutiny/Integrity: we said no b*llsh*t, but is it true?
- Kristine talks about Gen Y Norms featured
Gen Y Norms Featured
–Customization: it is what you want it to be
–Entertainment: oddball humor
–Speed: no more than a minute and a half ad
–Scrutiny/Integrity: we said no b*llsh*t, but is it true?
Source: Grown Up Digital, Ch.1, p.15
A Critique of the
• Uniﬁed Marketing Strategy
– Homogeneity in consumption patterns
• Change in Design of Advertising Message
– Product information to persuasion-oriented
– Appealed to emotions and psychological needs
of the audience
Newly emerging international environment prompted advertisers to develop a unified marketing strategy for a global market.
Such globalized plans required homogeneity in consumption patterns.
This results in a change in the design of advertising messages from product information to persuation-oriented campaigns that
appealed to the emotions and psychological needs of the audience
• efﬁciencies in advertising
• established a common
The Old Formula! brand image! Formula !
• gave access to market
‘Standardization’ ! segments which were similar
from one country to another"
• Global Marketing Disaster !
Standardization and localization
What the creative director of Hons.ly has just mentioned about dominating the industry and edging out small local firms illustrates Anderson’s (1984) point that “Transnational advertising agencies have become profitable global communication enterprises that are
powerful when compared to indigenous agencies.”
This results in high barriers of entry into this sector and even if they do have a strategic niche such a cutting edge technologies, they might be acquired by TNAAs eventually.
In the world of advertising today, a key consideration for ad agencies is discerning in what situations, and to what extent advertising across national and regional borders should be “standardized”. Or alternatively, “localized”, that is, made specific to each market
(Duncan & Ramaprasad, 1995).
What Hons.ly has done, is exactly what I have just mentioned, identifying a target group and suggesting commonalities that characterizes them. As energy drinks are already a fairly homogenized product, what they are actually doing is to
Levitt (1983) suggests that there is now a “commonality of preference” which “leads inescapably to the standardization of products, manufacturing, and the institutions of trade and commerce.”
One advantage of adopting a standardization approach is the creation of a stronger global international identity through consistent positioning and image across markets over time.
Cost reduction through economies of scale in advertising production, sharing of experience and effective use of advertising budget
Globalization of markets concept is attractive for global marketers as it promises greater global returns through the adoption of standardized marketing communications efforts.
However what we are definitely missing out on the complexity of having the need to “glocalize” global campaigns, and adapt them to suit particular local markets.
Asia is a region that has complex socio-cultural, religious and geographical differences that characterize the many national markets within the region
There is a need for global marketers to respond to these complexities, although matching marketing communications efforts to local cultural and other differences is a difficult and potentially costly process
Given the higher returns promised by more standardized communications approaches, the pull towards greater standardization is often harder
There are also other issues that affect the success of standardized advertising such as regulation, product use patterns, socio-economic levels of development, education, language differences, and organizational structures
Case Study on P & G
Corporate Strategy of P & G
“Winnowed” extensive roster of over 200 global marketing
services shops and its interactive agencies
To facilitate the “faster ﬂow of information” between P&G, its agencies,
and its retailers
Streamlines its global marketing communications effort
The largest advertiser in the global market is Procter & Gamble. They have adopted a glocalization approach for the
promotion of their wide range of products and services.
The “global business units also known as brand management groups” develop and manage strong global brands by
developing largely standardized global products as well as “geographically based market organizations” to plan and
execute the company’s marketing strategies, to adapt these standardized advertising to local conditions.
P&G also went through a process of “winnowing” through its extensive roster of over two hundred global marketing
services shops and interactive agencies. In 2004, they approached 2 main agency holding companies, Publicis Groupe
and Grey Global Group, to pitch plans to consolidate or re-organize its global retail marketing effort.
All these efforts were aimed at facilitating a “faster flow of information” between P&G, its agencies and its re rilers, thereby
streamlining its global marketing communications efforts.
Project Manager (Kristine): We’re so, like cool and creative right??? Anyway, another secret strategy: GLOCALIZATION!!!
Motions to Posters: Check out the posters all around the room. We have endorsements from Singapore’s most popular
aesthetic doctor, Gorgeous Lee!!! Who by the way has generously given me a special botox shot for tonight’s event. We
also have local tennis superstar Roger Feng De Ler. And of course, who could forget the region’s most popular pop
superstar, Kim E Perry from Korea!!!
SHOW JACKIE CHAN SLIDE: oh, by the way, Jackie Chan actually volunteered to endorse our product too, but we said no
because he’s already endorsed waaaaay too many products. And personally, I think he’s too old for EnerGen-Y anyway.
As I was saying, because we’re in Asia, we want to make sure that our celebrity endorsers were still people that our target
audience can relate to, because this is exactly how glocalization works! Though EnerGen-Y is a globally popular energy
drink, we want to make sure that it reflects your unique taste and personality, no matter which corner of the globe you’re in!
Their economic growth provides great potential for TNAAs.
By breaking into emerging markets,
TNAAs can increase market shares and increase proﬁts Reasons for entering
5 Asian Countries with the highest advertising growth include Asian markets
Philippines, China, India, Indonesia and Vietnam
Well said well said, indeed Glocalization is an essential strategy that Advertising companies should engage in, efforts like
the use of pop superstar like Kim E Perry will definitely help create a connection between the audience and the product. I
will further elaborate on this point later, but before I proceed, let’s first take a look at why Advertising companies should
expand their efforts to the Asian market as well.
Reasons for advertising in Asian markets
- Their economic growth provides great potential for TNAAs
- To increase opportunities to gain more market shares and increase profits, TNAAs will enter into Asian markets to
engage directly with new consumers.
- As seen above it is projected that from 2008-2013, the 5 Asian countries with the highest advertising growth would
be Philippines, China, India, Indonesia and Vietnam.
- (lead on to next slide) For the purpose of this presentation, we will be looking at advertising in China as a case study
Advertising in China
Recent Developments in the
Advertising Industry in China
Since China joined the WTO in 2001, Chinese
advertising industry is increasingly under global
Foreign companies were initially required to
operate in China as joint ventures with a local
Since China joined the WTO in 2001, Chinese advertising industry is increasingly under global influences. Like what was
mentioned in the Gershon article: The protectionist sentiment led to the institution of artificial barriers to protect the culture
and autonomy of host nations. Hence foreign companies were first required to operate in China as joint ventures with
Recent Developments in the
Advertising Industry in China
• However in order to achieve world class standards
and cutting-edge advertising, the requirement for a
TNAA to joint venture with a local company was
abolished in 2005.
• Multinational agencies may now operate as foreign-
owned corporations and repatriate proﬁts directly.
• Two-tiered structure of the global advertising industry
- Large Global Advertising Agencies
- Hundreds of local agencies that serve smaller
cities of China.
However in order to achieve world class standards and cutting-edge advertising, the requirement for a TNAA to joint
venture with a local company was abolished in 2005. Multinational agencies may now operate as foreign-owned
corporations and repatriate profits easily.
Two-tiered structure of the global advertising industry
Large Global Advertising Agencies
Hundreds of local agencies that serve smaller cities of China
Recent Developments in the
Advertising Industry in China
• Foreign direct investment and high economic
growth both contributed to an increase in
advertising expenditure which exceeded US
• China overtook South Korea to become the
second-largest advertising market in Asia.
• With a total of 76,200 advertising agencies and
a 14.8% growth rate in 2004, China became
one of the largest and fastest-growing
advertisement markets in the world
Due to a combination of foreign direct investment and high economic growth, advertising expenditure has exceeded US
$7.2 billion, resulting in China overtaking South Korea to become the second-largest advertising market in Asia.
With an estimated 76,200 advertising agencies and a 14.8% growth rate (2003–04), China is one of the largest and fastest-
growing advertisement markets in the world (Harney 2004; China Advertising Yearbook 2005)…Now let’s take a look at
how China is faring in online advertising
Online Advertising in China
Apart from advertising via traditional platforms, China is also actively leveraging on advertising via the online platform
Although the growth rate of China’s online advertising has been fluctuating, a quick glance at the graph shows the market
size of China’s online market has been on the rise since 2001
• Advertising is causing
transformation into a
• A political economy that
promotes high salary and
With advertising being done on various platforms, the consumer is bombarded with endless advertisements everyday. This
gradually transforms China into a consumerist society. This growing phenomenon also steers China’s citizen towards a
political economy that promotes high salary and high consumption.
Marketing strategies being pursued by global
advertisers to overcome various challenges:
But conducting advertising on an international platform is not as easy as it seems. There are definitely challenges that lie in
the way of success. Indeed, today we will be presenting on two challenges, namely the cultural and political challenges.
Challenges Faced - Cultural
Despite modernisation, China is rooted in traditional Chinese
Posing dilemmas for advertising executives to develop
Advertisers soon saw a need to remove the ‘Americanness’
out of the product
Despite modernisation, China is rooted in traditional Chinese values
This pose dilemmas for advertising executives to develop creative campaigns simply because western advertising were
first created in accordance to the American dream and conflicted with China’s communist values
Advertisers soon saw a need to remove the ‘Americanness’ out of the product
Cultural Trespass -
Ads Disallowed in China
Homogenized, broad appeal messages that failed to
consider the impact on Chinese cultures
Promotes consumption of Western products
regardless of the culture’s needs or wants
Hence incongruent cultural views of consumers and
marketers and a lack of historical sensitivity on the
part of the advertisers, may result in failure.
Advertisers had to be care to remove homogenized, broad appeal messages that failed to consider the impact on Chinese
Advertisers also had to assess if it was befitting for them to promote consumption of Western products that were in conflict
with the culture’s needs or wants
Hence in order to ensure success in the China market, incongruent cultural views of consumers and marketers and a lack
of historical sensitivity on the part of the advertisers must be addressed lest it resulted in failure.
Challenges Faced -
In 2003, Toyota had trouble with its advertising. The company produced an ad for its Prado Land Cruiser in which a stone
lion (a symbol of China) salutes the Japanese vehicle. The ad fired up the long-standing animosities and competition that
exist between China and Japan. In addition, Prado was translated into Chinese in such way as to suggest rule by force,
tyranny, and domination. These cultural and linguistic innuendoes were not well received in China.
Challenges Faced- Political
Socialist system of one ruling party
Chinesegovernment has more power to intervene economic
development than any democratic government
Unlikethe U.S where there is a National Advertising Review
Board, the government reviews advertising in China
Advertising produced by multinational agencies for global
brands frequently encounters strong feelings and attitudes on
the part of the Chinese government.
China has a socialist system of one ruling party without a system of balance and check, the Chinese government has more
power to intervene the economic development than any democratic government.
Unlike the U.S where there is a National Advertising Review Board who vets the content of advertisements the government
reviews advertising in China.
Advertising produced by multinational agencies for global brands frequently encounters strong feelings and attitudes on the
part of the Chinese government.
Analysis of ad content :
List of Advertising Taboos
Tom Doctoroff, CEO of J. Walter Thompson for
Greater China advices advertisers to stay away from
Sex – No Cleavage, Sexual Scenes, Homosexuality
Unsafe behaviour – No jaywalking, spitting
Disrespecting the political hierarchy –
Poking fun at any political ﬁgures
In order to ensure that advertisements disseminated in China will be well received by the general audience and the government, we
went to research on the general taboos that the Chinese government would not hear of.
Tom Doctoroff, head of advertising in greater China for JWT, offers the following hands-on advice about succeeding with the censors.
Here is his list of what to avoid:
For Sex. Just to name a few, No eroticism. No cleavage. No mornings after. No premarital titillation. A BIG NO NO to married couples
in bed together. No homosexuality. No condoms. No AIDS. No massage parlors. No sensual skin stroking. Belly buttons are vulgar.
"Unsafe" or "uncivilized" behaviour are also not allowed to be displayed in ads. So, no driving without a seatbelt. No jaywalking. No
running on busy sidewalks. No blocking traffic. No playing on the roof. No rolling around on the grass of a public park. No spitting.
The Chinese place a lot of emphasis in respecting their political heads hence any Disrespectful acts against the political hierarchy
must also be avoided—i.e. Poking fun at any political figure—Mao, Deng, Jiang, Hu (Jin Tao), Wen (Jai Bao), the local Party secretary,
"good" emperors, and any Party member—is, of course, strictly forbidden.
Analysis of ad content :
List of Advertising Taboos
4. Disrespect to social hierarchy – Eg. Teacher
must always be wiser than the student
5. Affronts to China- National symbols are
6. Affronts to competitive products-No
7. Affronts to neighborhood pharmacists- No
showing of patients or symptoms
Another interesting taboo to note is not to showcase any content that Disrespects the social hierarchy. Father is always
smarter than son. Teacher is always smarter than student. Elder brother is always smarter than younger brother. Senior
citizens are always the wisest of all, save the emperor (or Party leader). Round-faced children are obedient disciples of all
Affronts to China are also not permitted. The Chinese are nationalistic. Any slight, perceived insult to their National
symbols—dragons, phoenixes, the Great Wall, the Temple of Heaven, Tiananmen, Ne Zha, Kung Fu masters (Nike got
burned here)will not be permitted. The failure to explicitly recognize China's greatness is risky.
Affronts to competitive products. Comparison advertising for example in "The Pepsi Challenge” the advertising company is
not allowed to have Sprite's colors (yellow and green) next to a 7-Up cart.
Affronts to neighborhood pharmacists. Over-the-counter drugs are highly regulated due to concerns for: (a) public welfare
as well as (b) the industry's fossilized state-owned enterprises and distribution arms. Advertizing companies are not
allowed to show doctors, patients, symptoms or cures.
Now let us have a look at two PEPSI advertisements, one done in the US and the other re-tailored to enter the Chinese market.
(to be presented after two videos has been shown)
Let us first have a look at the ad as shown in the US
Now for the ad as aired in China
Although the content is similar in both the US ad and the China ad some obvious changes include
1. Change in celebrity used in the ad: US- Michael J Fox, China- Aaron Kwok to ensure a familiar face for the audience
2. Heroic figure:
In the US advertisement: Michael J Fox was seen squeezing himself out of the window, climbing down the stairs in the back alley dangerously, jaywalking and running across the road and jumping over cars.
However as mentioned in the slides above:
Dangerous acts are seen as a taboo in China, and any scenes that advocate dangerous acts should not be present. Hence we see the great modification and simplification in the Chinese ad in which Aaron Kwok runs across a zebra crossing instead.
3. Difference in cultural elements:
In the US advertisement: the biker trend was depicted, but the Americanness in the ads which has no relevance in China had to be taken out
Lone hero up against an angry crowd, in this case the bikers, to show drama and emphasizes his desperate attempts to get the PEPSI.
In China, society refuses to admit that rebellion exists within society and the ad shown in US if shown in China would make a conformist audience uncomfortable.
5. Distribution in Global Markets
Project Manager: So enough of me talking. I now want to pass the floor to our genius social media strategist, whom we stole from a smaller, less important ad agency. Isn’t it so great being a huuuuge TNAA with lots of money??? Oh, I love it! Anyway, here
he is everyone, our social media strategist!!!
Don’t underestimate the value of social currency! Social media is like the next big thing. I mean, all thanks to social media,
the Hollywood industry and news industry is affected! Of course, we had to be reactive and think of something! So we
created a facebook and twitter page to have online presence, and then we had to go viral. *FREEZE*
Existing Media Trends
That is very wise! It seems Hons.ly knows exactly which forms of media would best reach its target audiences today. Viral
marketing is indeed one of the most effective means of advertising simply because of the power of networking.
Existing media trends
These days, everyone is trying to figure out how to connect with other people. It used to be simple, you just placed some
advertisements in whatever newspapers or magazines that was most suited to your product, but now that world is
becoming ever more irrelevant. So how do you connect with other people today? And more importantly, how would you do
it tomorrow? Let’s take a little tour through the history of how media evolved over the past 10 years.
In the early 19th century, the only way to get news was face-to-face communication but that started to change with the
advent of printed newspapers and magazines in the 1900s. Then came radio, followed by Television which still dominates
the medium but people are quickly moving away from traditional media as Internet websites and social networks are fast
becoming primary sources of news and information.
Rise of social media as a local business resource
Rise of social media as a
local business resource h"p://searchenginewatch.com/3635350
In 2007, social media and mobile topped the "primary sources" of local business information. Consider that consumers use
them every day or a couple times a week and you’d realize that makes up a good mass of audience known or unknown to
your company – that means you could even tap on and reach audiences you never targeted for or knew existed. This chart
here shows the growing activity on social networking sites and wireless devices. In this case, it's a reason to keep
emerging advertising opportunities in social and mobile channels on your radar, but of course, this doesn’t mean the end of
offline media, as research shows newspapers still remain a daily source of news for 16 percent of more than 2 million
people surveyed last year.
I’d say this is a very clear timeline of how mass communication has radically evolved. Once upon a time, it took millions of
dollars to reach a few, but today, it takes very little to reach millions of people with the viral nature of social networks. Year
over year, more digital channels become available to more consumers. So it's no surprise that the feedback loop between
advertising companies and their audiences are stronger than before the virtual network existed – the ease and speed of
carrying out market research for example, is certainly one of the greatest cost-effective advantages a company with social
media presence have over others relying solely on traditional mainstream media.
Social Media Marketing
Social Network Sites Categories
General (Facebook, MySpace)
Portal afﬁliation (MSN, Yahoo)
Vertical (Livejournal, interest-based sites)
targeted ads 108% click-through rate
compared to contextual ads
Social media most commonly take the form of social networking sites online. Broadly they can be classfied in to three main
General (Facebook and MySpace), Portal affiliation and Vertical (livejournal, specialist blogs, forums.)
Being online, social networking sties make tracking consumer behavior much easier and this is important because
Behavioral targeted ads. 108% click-through rate.
Social Media Marketing
Promote WOM discussion of products - increase currency
70% recommended favorite brands to friends and family.
Relies on momentum effect
Increased exposure as friends will introduce as well as the
And additional benefit of social media is its ability to Promote WOM.
70% survey by Edelman.
The very nature and structure of social media allows for the discussion and sharing of messages- including advertisements
and hence the product they revolve around.
It is important to realize however that real success of an ad on social media relies on momentum effect to spread the ad
and its message to as wide a range of people as possible as well as to do so in a persuasive fashion.
What tips a trend?
Law of the few
Power of context
This bring us to our next concern which is what tips a trend in social media?
The first thing is the law of the few.
Mavens: the information holders. They know a lot about all kinds of stuff. These are the guys you run to for an opinion when your dies and you need
to get it fixed ASAP or have to try and figure out what to get as a replacement.
Salesmen: the persuaders. They may not be the most knowledgeable or know the most people but they can really sell an idea.
Connectors: they know EVERYBODY. Lots of network connections. Only one of the “Few” who is easily recognizable off an SNS (hint: they’re the
ones with the most friends.)
Identifying the few as a possible area of future research. You could short circuit it with celebrity endorsements but as your market fragments you
might end up having to get a LOT of them. Also too top-down. Would kill the next two requirements.
One of which is stickiness. This refers to the ability of the message to inspire action on the part of the viewer. This action can be to spread the
message further or to actually try the product. Either way, the action will generate more awareness for the product the ad is pitching.
Finally there is context. In a nutshell, context refers to the need to have the right combination of factors and settings to allow the few to feel
enthusiasm for, have knowledge about and control over the message to encourage them to build communities. Really gets viral now.
Pitfalls in Social Media
• Privacy- the “Creepy factor”
• Facebook- everything you could possibly do wrong.
Increasingly internet advertising makes it possible to tailor ads to increase the click-thru rate of users. This can be achieved through tracking user behaviour in a variety
But with this kind of targeted advertising comes the dark side of social media advertising: the “creepy factor”.
But when people share large amounts of personal information online, it’s often with the expectation that nobody will be interested in them or watching what they do. At
the very least they expect the information they share to held only by the company they’re sharing it with. (No third parties!)
Facebook provided user information to third parties through apps. Farmville (Zynga) affected.
Not unusual for data tracking to cover real-time activities on a site but information tends not be connectable to user’s real name. No unique personal identifier.
Facebook however made such tracking information available and provided advertisers/ marketers access to the unique profile ID of users they were tracking- which at
the very least gave these third parties access to the user’s name and photo.
Part of a long, bad track-record. Started with making privacy settings naturally lax and opt-out rather than opt-in so that default setting was to share a lot of information.
Then there was the Beacon fiasco where Facebook linked with other sites and shared user purchases on their Facebook profiles. Advertising potential but tremendous
Online social media advertising ecosystem needs to be fostered so everyone in the value chain benefits relative to their contribution. While the potential is immense,
there are also significant risks and potential challenges that need to be tackled before the industry evolves into a vibrant advertising medium. Once you start mining
user data, significant profile information can be developed. Then how that information is used and by whom becomes an issue, and a significant legal minefield. In
addition, if the industry doesn’t want regulators to get involved, the security policies and procedures need to be in place to protect the data from theft or misuse.
Tracing the Evolvement of Advertisement
Distributing Channels for McDonald’s
Very quickly, let’s look at the many advertisement distributing channels McDonald’s engaged in over the years.
During its early days, television was a great distribution channel because it reaches many households and TV commercials
were effective in retaining people’s attention. Beyond and out of the household, McDonald’s is known for their outstanding
creativity in their outdoor advertisements.
This is a picture of a zebra crossing in a crowded street in Switzerland where the lines were painted to look like French
fries. And the picture on the right, is a standup at a busstop in Munich to portray the freshness of McDonald’s.
And as the printing industry advanced, outdoor billboards were put up, all over the world on highways and train stations –
places where they can get the most number of eyes to watch the ads.
Ambient Media Thailand
This is one on a busy street in Thailand, where the shutters of a coffeeshop come down at night to reveal a 24-hour
McDonald’s poster, telling people that there’s a Macs somewhere very nearby whenever they are hungry.
Ambient Media Sydney
With the amount of resources McDonald’s has, it is capable of greater things. This is a picture of a large makeshift
playground at a central business district in Sydney. Adults heading to work were free to go on these slides. At that time,
McDonald’s was spreading a message that went along the lines of “you are never too old to play, or to go to McDonald’s.”
McDonald’s continue to advertise via print in well-circulated magazines and newspapers. While at that, they were still very
capable of being creative with their advertisements.
These newspapers were distributed wrapped up like a burrito McDonald’s was launching for the first time.
This one in Canada, which makes use of a subliminal aesthetic cue, was most well-received, not only because it wasn’t
obtrusive for the reader, the image of a packet of fries (or the burger here) was also clear to whoever could see it from far.
In 2003, McDonald’s introduced wi-fi, making it a pioneer among its competitors. It has the largest Wi-Fi network in the US,
beating #2 Starbucks, by several thousand locations. Today, McDonald's is still the only big fast food chain offering
company-wide wireless Internet.
on Social Media
For instance, McDonald’s launched an anti-littering campaign in May ahead of the FIFA World Cup 2010 in Germany, to
encourage young residents of urban areas not to throw litter around. Via facebook, youngsters could map their own face
into a video and kick the trash in the bin to win tickets for the Fifa World Cup in South Africa. We can see that this form of
an outreach transcends advertising to advocate social values amongst their target audiences – in this case, the youth.
Many times, companies also look at a bigger frame to get involved in some corporate social responsibility initiatives to
enhance and create goodwill for its brand name.
Twitter of late, is also a great avenue for McDonald’s to reach to people who are always on the go, yet who stay connected
all the time. You’d be surprised that in some countries, even its McCafe has its own twitter account to announce promotions
or free giveaways to all potential consumers.
If you are an Advertising Manager...
• Are you still trying to get journalists to write about
• Are you still making websites?
• Is your social networking strategy to 'get a
• Are you making yourself a natural part of people's
stream of information?
So, if you are an advertising manager today, will you still try to get journalists to write about your products? Are you still
making websites? Is your social networking strategy to 'get a Facebook Page'? Or, are you making yourself a natural part
of people's stream of information?
Are you a Smart Phone
*Wave your phone...
*UNFREEZE* So, time for reflection paper. I’m kidding. Okay, need your help. We are doing a survey. How many of you
use smartphones? iPhone, blackberry, android etc. Do you have your mobile phones with you? Can you raise it in the air. If
you have a blackberry, wave.. If you have an android, wave. If you have an iPhone, wave.. Hey, I have a msg, it says that
it’s for Dr Chung. to read out aloud to class, and she will win a drink... *FREEZE* (Someone please pass the phone to Dr
Chung to show that its an advertisement blast going through the classroom)
Wow! it seems Hons.ly has emerged as a winner in making itself a natural part of people’s stream of information! Let’s
revisit the McDonald’s case study to see how they did it.
Location based advertising
On April 16, 2010, McDonald's used 100 randomly awarded $5 and $10 giftcards as a check-in bait to lure in potential
diners - via Foursquare. You can see the result in this graph. Some people critiqued that this entire campaign wasn't a part
of a long term social media strategy. But through the sheer number of walk-ins, McDonald’s proved that they can influence
people's behavior, using Foursquare, and that this might be a way to increase both sale and traffic in the future. Connecting
people is key. And I think the real power of location based services is to focus on creating long term commitment and
Current - Future trends
Global mobile subscriptions surpassed 4bn at year-end 2008 and are
expected to approach 6bn by 2013, making mobile services an extremely
relevant platform for advertising for mass audiences.
Revenue potential in Emerging Markets, with a particular emphasis on
BRIC, Indonesia, Mexico, Romania, South Africa and Turkey.
Current & Future trends
Lie in location-based/mobile advertising. Global mobile subscriptions are expected to approach 6bn by 2013, making
mobile services an extremely relevant platform for advertising for mass audiences. There is also revenue potential in
emerging markets, with a particular emphasis on BRIC, Indonesia, Mexico, Romania, South Africa and Turkey as wireless
technologies advance rapidly.
Huge growth reported in Emerging Market
- creates a new revenue
stream for telecom
operators as well as for
technology enablers and
- mobile advertising will
play a key role in driving
usage of paid mobile data
Huge growth reported in emerging market mobile advertising
Especially in India, where a 98% growth in mobile internet network is seen in a short span of time between Q1 and Q2 of
2010. In some smaller and emerging markets like Ghana, growth is an astounding 654%. It shows, that this form of a
location based advertising creates a new revenue stream for telecom operators as well as for technology enablers and
content developers usually outsourced by the advertising company to cater to specific markets.
Today mobile advertising spending worldwide is almost 5 times as much as compared to just 3 years ago. It is predicted
that these figures will rise even more in 2012. In Japan and Korea especially, higher processing power handsets and 3G
pipes also play a significant role in the adoption of rich advertising content.
Contradictory Campaigns: The case of Unilever
Dove’s Campaign for Real Beauty?
Dove vs. Axe
appeal messages fail to
consider the impact on
of Western products
regardless of the
culture’s needs or wants
The Transnational Advertising Agency:
Global Messages and Free Market
Media Imperialism: “one way ﬂow of media products and
services from a few highly industrialized nations to Third
World developing countries” (117)
Inﬂuence on national economic priorities
Dissemination of inappropriate products
Cultural Trespass: Skin
Unilever: the same corporate structure campaigning for “real
beauty”, is at the same time marketing and promoting skin
Fair and Lovely, Olay, Vaseline, Neutrogena, L’Oreal
GlobalIndustry Analysts reports the market for skin-whitening
creams will grow to $10 billion by 2015
Lighter Skin = Privilege
Multinational corporations are proﬁting from and
further exacerbating ingrained attitudes which favor
reﬂecting the historical caste-system stereotyping
While Eastern nations, like
India, are trying to transcend
this stereotype, advertising
agencies are reinforcing it
….and by purchasing from
subsidiary brands, North
Americans are supporting it!
Theory of Rising Frustrations
Advertising promotes consumption of luxury goods for people who
can afford them, and induces frustration in those who cannot
National Economic Priorities
Directing attention away from development goals
Advertising of luxury goods in the Neglects needs
Developing World targets the higher social-strata,
yet these ads are visible to everyone of majority
Many citizens in Third World countries lack
the ability to choose the best products Inappropriate
Limited education and illiteracy inhibits the degree to
which underdeveloped countries will use these products properly Products
Plied mothers with free samples of infant formula until their
own milk ran dry, after which they became forced to purchase
Were not taught how to make the formula properly
Concerns about labelling
Issue:how to reconcile responsible government without
foregoing international trade?
(We are currently looking for research assistants
& interns. Talk to us during the break)
So I think that’s all the time we have for today, but thank you everyone for witnessing the glory that is Hons.ly ad agency,
the best and largest transnational advertising agency ever! Don’t forget to watch out for our next product, EnerGen-Z
because we promise, it’ll be bigger and better than ever! Goodnight everyone!
Possible Q & A questions
Itis worth advertising to small markets? (Take into
consideration the increasingly fragmented audiences of
today and the ability of social media to narrowcast.)
Isit practical for TNAAs to be so big given advertisements
need to have a local ﬂavor?
What are the beneﬁts of TNAAs over large local companies?
Hons.ly, will it succeed?
Mid-sized ad ﬁrm
Will probably be subsumed under a global agency
Surviving the competitive environment
In-house creatives insufﬁcient
Strategies for online platforms