Mobile marketing leads to real outcomes in China: Tencent

Seng Yee (SY) Lau, President, Online Media Group, Tencent and Senior Executive VP, Tencent Holdings, says mobility has empowered the Chinese consumer. Lau’s keynote at the Mobile Marketing Association Forum 2014 in Singapore focused on how the Chinese consumer has moved on from mobile marketing as passive branding to marketing as active transacting.

“The fundamentals have changed overnight,” he said. “In China, mobile app developers have seen great success. Didi Taxi (Didi Dache) launched 16 months ago in China, and has 220 million users and 350,000 taxi drivers using the app. If you use WeChat, there is a discount. It is a robust industry going forward.”

Lau noted that the Shopin retail chain’s WeChat experience store in Hangzhou, opened in April 2014, is a testament to Chinese confidence about mobile e-commerce. There are no cashiers at the store; shoppers just get a Shopin WeChat account and pay for everything through the WeChat Payment feature. He also shared a mobile campaign with Mercedes Benz in which 388 cars were sold, without test drives, in just three minutes. 

The Chinese have responded to mobile-based calls for donating their voices too. Tencent’s CSR outreach began with blank books at bookstores and ads at massage businesses where blind masseurs worked. Readers used associated QR codes to access a short stretch of text, roughly a minute’s worth, that they could read aloud. Each recording, it was explained to the public, would eventually be compiled into an audio book to be offered to the blind. In two months, 200,000 donors read enough text for 200 audio books, Lau said.

What drives success, Lau emphasised, is what’s in it for the user. “The key drivers of any initiative have to start from who benefits first and who benefits most and that has to start from the focal point of the user,” he said, pointing out that mobile-first users see things differently.

“Today people don't go to the TV, they don't go to print, they don't go to radio. The mobile Internet has dominated the media needs of the Chinese. The Tencent mobile news platform..is integrated with WeChat and covers 630 million people on a day to day basis. That's changing lifestyles.”

Lau suggested that things would change again as smartphones become common in rural China, where 47% of the total Chinese population resides. “Such people will have a quantum leap in terms of their experience of the Internet. They will be very sophisticated smartphone users,” he said. “Emerging markets will be the digital frontline.”

Tencent is the most valuable brand in Asia today: BrandZ

China's Tencent is the most valuable Asian brand and the fastest-growing brand in the world, according to the 2014 BrandZ Top 100 Most Valuable Global Brand rankings. The brand almost doubled its value to US$54 billion to rise to No. 14 globally, overtaking China Mobile in the process.

Source: Millward Brown website.

"The big story here is that a market-driven Chinese brand is now at the top, rather than a state owned enterprise (SOE) that might have benefited from being a monopoly. Tencent continues to innovate and increasingly plays a bigger role in helping people to organise their lives, like other successful brands such as Google and Facebook," said Deepender Rana, Managing Director of Millward Brown Greater China.

"With 11 brands in the Top 100, China continues to have the largest representation from Asia. However, Chinese brands should not be complacent about the need to continuously invest their brand-building, as apart from the technology brands, other brands saw significant fluctuations. There is a need for the big SOE brands to become more market-oriented, and for Chinese brands to go abroad to become truly global," Rana further added.

Globally, Google has overtaken Apple to become the world's most valuable global brand in 2014. The brand is  worth US$159 billion, an increase of 40% year on year.

After three years at the top, Apple is now No. 2 on the back of a 20% decline in brand value, to US$148 billion. Whilst Apple remains a top performing brand, Millward Brown notes that there is a growing perception that it is no longer redefining technology for consumers, reflected by a lack of dramatic new product launches. The world's leading B2B brand is still IBM at No. 3, with a brand value of US$108 billion. 

Nick Cooper, Managing Director of Millward Brown Optimor, commented: "Google has been hugely innovative in the last year with Google Glass, investments in artificial intelligence and a multitude of partnerships that see its Android operating system becoming embedded in other goods such as cars. All of this activity sends a very strong signal to consumers about what Google is about and it has coincided with a slowdown at Apple."

"This year's index highlights the end of the recession, with a strong recovery in valuations and, for the first time, real growth across every category and the Top 100 as a whole," said David Roth, CEO of The Store, WPP. "What's remarkable is the way that strong brands have led the recovery. Seventy-one of the brands listed in our 2014 Top 100 were there in 2008. Despite the financial turmoil and the digital disruption that have decimated many businesses during the last few years, these brands have remained in the ranking, proving the durability of strong brands."

The BrandZTop 100 Most Valuable Global Brands study, commissioned by WPP and conducted by Millward Brown Optimor, is now in its ninth year. It is the only ranking that uses the views of potential and current buyers of a brand, alongside financial data, to calculate brand value.

The combined value of the Top 100 has nearly doubled since the first ranking was produced in 2006. The Top 100 today are worth US$2.9 trillion, an increase of 49% compared with the 2008 valuation, which marked the start of the banking and currency crisis.

The BrandZ Top 10 Most Valuable Global Brands 2014

Rank 2014	Rank  2013	Brand	Category	Brand Value 2014 ($M)	Brand Value Change
1	2	Google	Technology	158,843	+40%
2	1	Apple	Technology	147,880	-20%
3	3	IBM	Technology	107,541	-4%
4	7	Microsoft	Technology	90,185	+29%
5	4	McDonald's	Fast Food	85,706	-5%
6	5	Coca-Cola	Soft Drinks	80, 4683	+3%
7	9	Visa	Credit Cards	79,197	+41%
8	8	AT&T	Telecoms	77,883	+3%
9	6	Marlboro	Tobacco	67,341	-3%
10	14	Amazon	Retail	64,255	+41%

Key findings highlighted in this year's research report include:  

Share of Life: Successful brands such as Google (No. 1), Tencent, Facebook, Twitter, and LinkedIn are more than just tools; they have become part of our lives. They offer new forms of communication that absorb people's attention and imagination, while also helping them organise the rest of their lives at the same time. To gain more of our mind-space, brands such as Tencent and Google are even crossing categories. This trend also pushed No. 1 Apparel brand Nike, a prime example of a brand seeking to become a share of life brand, to offer services such as Nike+ that extend well beyond its functional raison d'etre. 

Technology brands performed strongly and had the highest total value: Although technology companies are less than a fifth of the Top 100, they make up nearly a third of the value of the BrandZ Top 100 ranking. Service-based brands are thriving while product-based companies are struggling. Product-based companies like Samsung, HP and Sony under-performed relative to Tencent, Facebook and Baidu.  

Apparel fastest growing category: The top 10 apparel brands grew in value by 29% to nearly US$100 billion this year, outpacing cars (up 17%) and retail (up 16%). Uniqlo, Nike and Adidas all recorded double-digit increases in their valuation.
 
Strong brands provide faster growth: An analysis of the BrandZ rankings as a 'stock portfolio' over the last nine years shows a highly favourable performance compared to a wider stock market index, the S&P500. While the value of the companies in the S&P500 index grew by 44.7%, the BrandZ portfolio grew by 81.1%, proving that companies with strong brands are able to deliver better value to their shareholders.

Brands from the Western World bounced back with a greater proportion of both the number and value of brands within the top 100. This reflected the resilience of established brands and the breakthrough of new brands, as well as improved economic conditions. As a result, the number of brands from fast growing economies slipped in 2014. China, with 11 brands, continues to have the largest representation. 

Chinese brands grew slower and are in urgent need of internationalisation: The 11 Chinese brands listed in the ranking had a combined value of US$280 billion this year. China's overall brand value was on the rise, but at a slower pace than the global level. Except for technology brands that out-performed, other industries saw significant fluctuations. In a world where brands and technology are becoming increasingly international, going global has emerged as a very urgent task for Chinese brands. Overseas consumers have now begun to associate Chinese brands with being innovative and global, which establishes the foundation for Chinese brands to compete on the international stage. Chinese brands can differentiate themselves through innovation, and gain access to international markets faster at a lower cost by making use of the Internet.

Listed Chinese brands

Rank  2014	Brand	Category	Brand Value ($M)	Brand Value Change
14	Tencent	Technology	53,615	+97%
15	China Mobile	Telecom Providers	49,899	-10%
17	ICBC	Bank	42,101	+2%
25	Baidu	Technology	29,768	+46%
33	China Construction Bank	Bank	25,008	-7%
54	Agricultural Bank of China	Bank	18,235	-9%
67	Sinopec	Oil & Gas	14,269	+9%
68	Bank of China	Bank	14,177	0%
76	PetroChina	Oil & Gas	12,413	-7%
77	Ping An	Insurance	12,409	+18%
81	China Life	Insurance	12,026	-21%

The BrandZ Top 100 Most Valuable Global Brands report, rankings and a great deal more brand insight for key regions of the world and 13 market sectors are available online here. A new suite of interactive smartphone and tablet applications will also be available for free download via Apple IOS and all Android devices from www.brandz.com/mobile, or search for BrandZ in the respective iTunes or Google Play app stores.