Advertisers to adapt approach to TV in China

12 April 2010

BEIJING: Product placement and programme sponsorship will both attract greater interest from advertisers in China this year, according to China Media Monitor-Intelligence, the consultancy.

Some 395 million households in China own at least one television set, giving this medium a more substantial reach than any other form of media in the world's most populous nation.

As previously reported, the State Administration of Radio Film and Television outlined new rules restricting the length of commercials and the amount of advertising that can be shown per hour on TV late last year.

China Media Monitor-Intelligence argued in a report that these provisions, which came into force at the beginning of 2010, essentially "play directly into the hands of sponsors and product placers."

The company partnered with CTR, the research firm, in an effort to gauge the value of television sponsorship revenues in China at present.

Overall, it was estimated that this channel accounts for between 5% and 10% of all television TV advertising expenditure, with spending likely to climb to 2 billion yuan ($293m; €218m; £191m) in 2010.

"There has never been a better time to start closing the gap between reaching consumers and making quality programming," Kristian Kender, research director at CMM-I, said.

"Most of the regulations focus on advertising not on sponsorship. If brands want to get into China, they would do well to do due diligence on TV production companies and get involved in creating branded content from the start."

Sony and Samsung, the electronics manufacturers, both currently sponsor Sufei's Diary, a popular teen drama series that is shown on Dragon TV.

Nike, the sportswear giant, has also forged a tie-up linked to the broadcast of matches from the NBA on CCTV-5, a strategy that has cemented its positioning as an aspirational brand among consumers.

Hewlett Packard, the IT company, adopted a similar approach with relation to the most recent China MTV Style Awards Gala, another programme targeted specifically at young people in China.

One obstacle that has prevented sponsorship from gaining further ground thus far is the lack of robust measurement tools, Kender said.

As such, she suggested that advertisers which get involved at the conception of a project typically stand to derive the most meaningful insights as to the potential payback on their investment.

More broadly, widespread corruption in the media industry has often acted as a disincentive to engage in this kind of activity to date.

However, as the Chinese authorities are attempting to stamp out these practices, CMM-I's study predicted that sponsorship may be increasingly seen as an effective way to cut through the clutter.

Talk shows, reality series, variety performances and sporting events aired on CCTV and Hunan Satellite have held the largest appeal for brands in this area to date, it added.

Unilever, in the FMCG sector, was one firm that was said to have successfully exploited product placement in China, integrating a number of its goods into the plot for Ugly Wudi, a localised version of Ugly Betty.

Data sourced from Hollywood Reporter; additional content by Warc staff