r3’s annual china agency scope provides new insights of

11www.internationalistmagazine.com 11

F R O N T L I N E S

R3’s Annual China Agency Scope Provides New Insights of Global Interest

Marketing consultancy R3’s China Agency Scope is always a treasure trove of extraordinary statistics that paint a comprehensive picture of shifting trends among marketers and agencies in one of the world’s most significant individual markets. Interestingly, this year, the survey also sheds light on a number of global trends as the comparative data becomes more robust with additional input from partner consultancy Grupo Consultores.

This edition of The China Agency Scope represents the fifth wave. The R3 study has been conducted every two years since 2006. This 2014 edition interviewed 425 senior marketers.

What follows are just a few interesting highlights. Those looking for more depth—in English or Chinese—can check out a slide version of the full report: http://www.slideshare.net/r3_asia_pacific/agency-scope-china-2014-advertising-agencies-general-report.

THE DURATION OF AGENCY RELATIONSHIPS IN CHINA IS AMONG THE SHORTEST IN THE WORLD.

The duration of creative agency relationships is short, averaging 3.2 years. While this has slowly increased since 2006, this was the first reported decrease (-6.4%) in the average agency tenure over the past 8 years and still places the client-agency relationship in China among the shortest in the world. The average duration of agency relationships in Brazil is 6.6 years, 6.1 years in the UK, 4.9 years in Mexico and 3.6 years in India.

There is a skew to shorter agency relationships among locally owned companies. For these businesses, the average duration is 2.44 years. Multinational businesses are more likely to value longer term partnerships, with an average duration of 3.4 years. State-owned companies are consistent with the overall average.

WHEREVER NEWS HAPPENSAROUND THE WORLD...REUTERS IS THERE

Reuters provides a wealth of award-winning news, photos, and data backed by the world’s largest international news agency. Reuters unmatched coverage is built on the principles of independence, integrity, and freedom from bias.

Intelligent information is an essential enabler of our 27 million unique users’ professional and personal lives. They trust Reuters for its balance between informed reporting on the ground and editing with an international perspective.

SCOTT AUDETTE / REUTERS

Learn more about Reuters innovative solutionsfor online, mobile, and app.Contact us at: [email protected]: Webtrends, Monthly Averages, Q2 2014

reuters.com

inter-2014-70indd.indd 11 10/3/14 2:36 PM

T H E I N T E R N A T I O N A L I S T12 T H E I N T E R N A T I O N A L I S T12

F R O N T L I N E S

AGENCY TRENDS IN CHINA: THE ROLE OF THE IN-HOUSE SPECIALIST IS GAINING MOMENTUM.

Although more commonly found within businesses of larger size and scale, in-house specialists are playing an important and growing role in supporting brand teams across many areas of marketing. They do this by providing entire services and/or overseeing the agency responsible on a day-to-day basis. The top 3 services provided by in-house specialists are strategic/communications planning, consumer insights, and competitive analysis.

INTEGRATED AGENCIES HAVE GREAT APPEAL AND POTENTIAL, BUT THEY HAVE NOT GAINED MAJOR MOMENTUM WITHIN THE MARKET.

The concept of the one-stop shop has enormous potential, and if implemented, it would allow advertisers to reduce the number of relationships it manages on a day-to-day basis. However, there is still a level of skepticism as to whether one single agency can effectively fulfill all the communication needs of a company, as is evidenced by the amount of work which is being channeled out of traditional agencies to specialist digital and marketing services agencies.


13www.internationalistmagazine.com

F R O N T L I N E S

AGENCY COMPENSATION IS EVOLVING INTO A JOINT RESPONSIBILITY BETWEEN MARKETING AND PROCUREMENT.

In the past, the agency compensation process was traditionally the sole responsibility of the marketing team. Over the years, we have witnessed an increased involvement of procurement teams in these processes. According to marketers, both marketing and procurement teams were jointly involved in 46% of agency compensation processes, up from 2% in 2012.

FEE-BASED REMUNERATION IS NOW THE MOST WIDELY USED COMPENSATION MODEL.

The use of fee-based compensation has increased from 46% to 56%, while project-based compensation has decreased from 51% to 37%, indicating a shift towards long term strategic partnerships.


15www.internationalistmagazine.com

F R O N T L I N E S

COMPANIES RESPECTED FOR THEIR MARKETING

The company most admired by marketers was Coca-Cola, followed by JDB and Nike, mentioned by 73, 54, and 39 of the professionals interviewed.


r3’s annual china agency scope provides new insights of

Documents