Leveraging mobile’s personal and complex potential requires deep understanding
Mobile truly arrived in 2013, as part of the marketing mainstream for brands looking to grow across China. This development was driven by the explosion in numbers of smartphones, coupled with the rapid development of 3G, 4G and Wi-Fi networks that allow consumers to fully utilize the capabilities of their devices. In China, mobile has become the primary route into the online world.
Coincident with the expansion of mobile usage has been the rapid uptake of tablets. By the first quarter of 2013, the overall usage rate of tablets across tier 1-to-5 cities was already 30 percent, according to Millward Brown’s tablet video research. This means that there are now at least 94 million tablet users in China – predominantly in higher socioeconomic groups.
Much of the excitement around mobile marketing has been about influencing purchasing behaviors. The juxtaposition of rapid growth in Internet access in China with the undeveloped physical retail environment across much of the country has driven rapid growth in e-commerce. It is estimated that e-commerce, as a share of retail sales, is roughly equivalent to the US, at 6-to-7 percent. But e-commerce in China is growing at an annual rate of 85 percent compared with 10-to-15 percent in the US.
This confidence in shopping online is translating into a willingness to use mobile devices for purchasing, too. In 2012, 13.2 percent of the 420 million Chinese using their mobiles to go online had shopped online using their devices— an astounding 136 percent increase over 2011, according to the China Internet Network Information Center (CNNIC), a government source. Marketers need to leverage this opportunity.
A personal media consumption tool
But beyond this transactional space, mobile devices are uniquely personal and portable media consumption tools. In China, increasing amounts of what used to be online leisure activity that people conducted on PCs is now happening on their mobile devices—often while the users are “immobile,” at work or at home. Usually it isn’t new behavior, but rather a switch to a new, “handier,” more personal device.
Above all, instant messaging is the smash hit on Chinese mobile devices, with 397 million people using their mobiles for this activity by mid 2013, according to CNNIC. People are also using mobile devices to play games, read their favorite magazines, watch their favorite TV programs and browse the web. Almost as much while sitting at home or work as when out and about.
Watching online video content on mobile devices is a growing phenomenon. According to CNNIC, 32 percent of mobile online users watched video on a mobile device in 2012, up 68 percent over 2011. You will see plenty of evidence of this happening on any trip on the Shanghai Metro. The peak moment for using mobile devices for viewing online TV content is actually in late evening at home.
Anyone with a tablet at home can observe the family’s behaviors and witness this type viewing across a range of content. These are more personal occasions than normal TV viewing, however. The key point is that mobile is not simply one medium, fulfilling consumers’ needs in just one particular mindset or media consumption context.
Media consumption leads to ad opportunities
Chinese consumers do like a special deal. The Millward Brown/ Mindshare China Mobile Search Habit study shows they do use mobile devices to help them find relevant offers. So brands that do not play in this space risk losing out to competitors who do.
However, brands may win even more by enhancing product and service experience through mobile technologies. QR codes can be just as useful as a quick way of getting more detailed product information or access to reviews as they can be for delivering specific offers. And especially in already prosperous higher tier markets, being able to easily book and pre-order by phone to avoid queues will often win as many consumers as a simple discount offer will. As 69 percent of mobile searches happened at home or work, they’re clearly not all about in-the-moment purchase decisions anyway.
Here the attraction of bypassing the older models for everything from buying tickets to other even more laborious tasks has led to many very innovative niche solutions. One example is a taxi app that allows you to send a message to all participating drivers. The drivers bid for the job in an auction process that potentially enables them to earn above metered rates. The payoff for the passenger is getting a cab promptly, even in the rain.
Consequently, media consumption via mobile provides potentially very powerful and personal advertising and communications opportunities to brands. The Millward Brown AdIndex mobile effectiveness studies show roughly twice the brand impact from mobile advertising in China as that observed in North America. But Millward Brown’s China Mobile AdReaction Study revealed that mobile users feel less favorably about receiving advertising messages on mobile than in most other media contexts. So marketers must tread carefully.
Mobile now a key brandbuilding tool
It would be foolhardy to think that we already have all the answers on optimizing mobile as part of the marketing mix in China. The space is still rapidly evolving as both consumers and brands discover how to get the most out of the mobile ecosystem.
To employ mobile effectively, marketers must recognize that phones and tablets are incredibly personal devices that consumers use in very diverse ways. Mobile has no one role in peoples’ lives or in consumers’ paths to purchase. So there is no one right way to communicate or engage with people through mobile. Mobile provides brands with multi-faceted ways to strengthen bonds with their key audiences. Brand marketers will have to navigate that complexity astutely if they are to achieve success.
But we are sure, based on the evidence we already have, that mobile in all its guises will be a key marketing tool for successfully building brands in China.