Understanding China: 10 Essential Takeaways
Kristopher Spencer is Senior Director and Head of Content for Weber Shandwick China‘s Automotive practice. With experience spanning America, South East Asia and China, he reflects on what newcomers need to understand in entering the increasingly-crucial Chinese PR space.
As an American working in PR in the PRC (People’s Republic of China) for more than a year now, I can tell you things work differently in the Middle Kingdom than they do in the West or even in Southeast Asia (where I worked prior to moving to Shanghai).
While the experience of living and working in a mega city such as Shanghai is surely not representative of life in China overall (any more than New York City is representative of the U.S.), it does offer an eye-opening look at the PR practices and media trends that proliferate in China and are likely catching on in other markets as Chinese companies go global.
Here are my 10 key takeaways:
1. It’s All About Mobile Internet
China has at least 731 million internet users and that number is growing fast. That figure represents 53.2 percent of China’s population, meaning that it is almost on par with the entire population of Europe, some 743 million people. While the PRC came late to the worldwide web, they effectively leapfrogged the West by mastering mobile Internet platforms and applications.
More impressively, 95 percent of China’s internet users are on mobile; that’s 695 million in total. That means that, for the first time, half of China’s 1.4 billion people use the internet on a mobile device. About 80 percent of users subscribe to public accounts, of which there are more than 10 million, 1 percent of which are news sites. More than 40 percent of users rely on WeChat to get news.
In other words: If you want to get the word out in China, think mobile first and foremost.
2. It’s All About WeChat & Weibo
As most people are aware, western social media platforms do not currently have a presence in the PRC. That vacuum has enabled the quick rise of the WeChat social media platform – used by 80 percent of all internet users in China for everything from instant messaging and sharing personal moments to mobile payment for almost anything using WeChat Pay.
In the most recently reported quarter, WeChat had 938 million monthly active users, closing in on 1 billion users, including more than 70 million outside of China. Also, there are now more people using Sina Weibo (or simply Weibo), the Chinese micro-blogging platform, than there are using the world’s second-most popular micro-blogging website. According to the Chinese company’s first quarter results, it has 340 million active monthly users, 30 percent up on the previous year. About 154 million people use the site daily, and 91 percent do it via mobile.
In other words: Any PR campaign in China must include strategies for WeChat and Weibo; starting with brand/company-owned platforms.
3. China’s Addiction To Social Media Shouldn’t Be Taken For Granted
While nothing is likely to stop WeChat from reaching 1 billion monthly active users soon, there is a notable weakness in its formula for success. According to a New Rank survey of 131 Official Account operators, there is a clear decrease in reading rates and growth rates on WeChat in 2017. About 39 percent of the accounts are experiencing a decrease in their article reading rate; while only 28 percent are seeing an increase.
This trend is even clearer when focusing on the number of followers of official accounts. Only 51 percent of accounts reported a growth in number of followers during 2017. According to WalktheChat, this is a surprisingly low number. It means that half of the official accounts are seeing a stagnant number of followers and 23 percent of accounts are even losing followers when publishing articles. It’s normal to lose followers as you post articles. The less relevant, lower quality follower will naturally unfollow your account, while you gain new followers who are actually attracted by your latest articles. But, a net decrease is a strong signal that your content quality may be too low.
(The situation might be even more extreme, as this is a survey from account managers active on New Rank, so who are actively managing their accounts. These accounts are therefore likely to perform better than average.)
For brands, this means that when you look for influencers for PR and marketing, don’t focus on the number of followers. It’s much more important to look at the reading amount, reading rate and user engagement when choosing Key Opinion Leaders.
4. KOL Engagement Grabs Attentions – But Doesn’t Come Cheaply
Key Opinion Leaders (KOLs) are essentially social media influencers. They have a lot of clout in China. For example, according to a report by an online retail giant, one Chinese superstar has generated $74 million USD in e-commerce revenue. KOLs range from legitimate celebrities and “web celebrities” to bloggers who write product reviews and “WeMedia” which are smaller media companies, often run by former or current journalists, writing on a niche topic. These include industry-specific KOLs focused on automotive, luxury goods or fashion.
These industry experts generally cost between 1,000 to 10,000 RMB per Weibo post. PR campaigns often include KOL engagement or “co-ops”, which are obviously “pay to play” – but it’s essential to choose a KOL based on the nature of the content, not just audience size or price.
(Speaking of co-ops, they can happen with traditional media outlets as well as WeMedia, and it’s usually more expensive to do so. As the term “co-op” suggests, this is content that normally co-developed with the media, tailored to its audience. Otherwise, It can be a hard sell to get WeMedia interested in doing a co-op, and they are likely to insist on editing the content to their liking.)
5. WeMedia Matters
Many of the most popular WeChat channels belong to traditional state-run media outlets and are designed to direct Internet traffic flow to their original platforms. On the other hand, there are many journalists who have left the traditional media to start their own outlets. This trend is frequently referred to as neirong chuangye, or “content business,” wherein former traditional media journalists (or WeMedia) have managed to make a career of distributing content across multiple platforms, including WeChat, Weibo, the video-sharing platform Youku, and the podcast site Ximalaya FM (aka Himalaya FM).
The word “WeMedia” is based on the Chinese zi meiti, or “self-media”. Like China’s traditional media, WeMedia are subject to censorship and are forbidden from reporting on politics or current affairs without credentials or express approval from the government.
Bottom line? Both traditional media and WeMedia are important to the success of any PR campaign.
6. Traditional Media Is Still Powerful – For Now
Even in the land of WeMedia, traditional earned media still has tremendous influence. In China, there are nearly 2,000 newspapers, nearly 10,000 magazines and periodicals, over 2,300 radio stations, 4,000 TV stations, two news agencies and over 3.2 million websites.
Unsurprisingly, there is heavy government involvement in the media, with many of the largest media organizations being agencies of the government. There are certain reporting guidelines set by the Communist Party of China – but within those restrictions, there is a vibrancy and diversity of the media and fairly open discussion of social issues.
At present, China’s overall media industry is in a mid- to long-term “prosperous phase”, with expanding consumption of new media and mobile technology upgrades being key drivers. According to the 2015 data, the market size of China’s media industry reached 1,275.4 billion yuan, and the y-o-y growth rate was 12.3 percent, which is higher than the GDP growth rate by 5.6 percent.
That being said, traditional media, including newspaper, magazine and broadcasting, continues to shrink sharply. In 2015, the total sales of newspapers fell by 41 percent.
(Source: China Daily)
7. Being Newsworthy Is Critical For Coverage
From a personal point of view, working on editorial content in China after doing it in Thailand required various adjustments.
In Thailand, you can get coverage with a soft feature story (a “consumer tips” story, for example), because the Thai media have a strong appetite for quality content whether it’s hard news or soft, for a variety of reasons. But in China, the media have little interest in content that isn’t “hard news,” because they don’t have time or space for it in their publications – in that way it is somewhat similar to the media in the West.
Brand/company content needs to really be news, because media are absolutely inundated with press releases every day that clamor for their attention and coverage. For example, if the story is a deep-dive into the various ways an automaker removed weight on its latest SUV to deliver better fuel economy, it will be better served by a media workshop, not just a press release, and even then it will be hard to attract the most desirable auto media outlets.
Bottom line: be newsworthy, or at least event-worthy if you want to get coverage.
8. Content Is Still King – But It Needs Eye-Catching Visuals To Rule
When it comes to brand storytelling on new media platforms, the emphasis is definitely on visuals – especially strategic integrated use of the HTML5 (H5) video format, budget allowing.
(That being said, three quarters of WeChat users will bounce off if an H5 video doesn’t load in 5 seconds. Alternatively, WeChat native video pages provide ten times faster loading speed as regular HTML5 landing pages do to achieve smooth interactions and experiences. It significantly reduces bounce rates.)
Whenever using video in a post, it is best to embed short gifs from the video to give a preview of the content, which may prompt a click on the actual video or at least give a taste of the content if the user doesn’t have time for it.
Given the importance of posting quality content, it is worth noting that WeChat Official Accounts published 7 articles less per month on average in 2017, due in part to the fact that content creators are spending more time to produce higher quality articles rather than just focusing on the volume.
9. Belt & Road PR Opportunities Abound
China’s One Belt, One Road initiative (OBOR) is seemingly many things.
It is the PRC’s visionary blueprint for global economic development; an ambitious, high-risk economic expansion plan; and a 21st century version of the historic Silk Road trade route. OBOR routes cover more than 60 countries and regions from Asia to Europe via Southeast Asia, South Asia, Central Asia, West Asia and the Middle East – currently accounting for some 30 percent of global GDP and more than 35 percent of the world’s merchandise trade.
Although OBOR primarily benefits infrastructure-development companies and natural resource concerns, Chinese automakers are also benefiting from the initiative. More than 190,000 cars were exported from China to OBOR markets in Q1 2017, 30.7 percent growth year-on-year. Of these, 110,000 were sold to countries along the OBOR route.
Gross sales of car exports in Q1 totaled $617 million. Car exports to Iran alone account for 29 percent of car exports, thanks mostly to one Chinese automaker’s unique arrangement with that country. Car exports to Southeast Asian countries also are growing rapidly. If the car export increase remains 31 percent every quarter, the total number of car exports is expected to be 1 million, which is a great milestone for Chinese car export.
The OBOR initiative presents a rich vein of PR opportunities for companies doing business throughout the region – and gaining media coverage could be instrumental to driving future investment. However, the PR teams at both Chinese firms and multi-nationals will need to be selective about how and to whom they communicate about their OBOR projects – so as to avoid being perceived as a cog in the government’s machine.
It seems the best strategy for OBOR-related communications is in China itself, as involvement in the initiative is generally considered favorable in Chinese media.
[Editor’s Note: For more insight on what Belt and Road may mean for communications, see Jack Leslie & Lydia Lee’s recent conversation on the initiative.]
10. Chinese Automakers Have An ‘American Dream’
It was recently reported that a major global automotive brand could be bought out by a Chinese automaker.
There was a time, not that long ago, when such a notion would’ve been greeted with snorts of disbelief. Not anymore. And, going forward, PR strategy will be key – because there’s currently talk of a trade war between the countries.
Many Chinese automakers are flush with cash from success at home and are avidly interested in entering the American market. Case in point: One Chinese automaker is investing $500 million to build a European auto brand plant that will employ 2,000 people in Ridgeville S.C. – while a Chinese auto-glass producer has spent $1 billion on U.S. manufacturing facilities (including reopening a former American automaker plant in Moraine, Ohio, that will employ 2,500). So, buying a company that already makes cars or car parts in the U.S. seems like logical way to break into the market by leveraging legacy manufacturing plants, supply chain and dealership networks.
Furthermore, many Chinese automakers are ready to take the leap, having benefitted greatly from joint venture partnerships with more advanced American and European automakers. Moreover, PRC government initiatives to promote new energy vehicles have put many Chinese automakers in a favorable position to capitalise on the electrification trend.
In other words, Chinese carmakers are making vehicles that are increasingly comparable in quality to models made and sold in more mature markets. It isn’t a stretch to think they will continue to rapidly develop in terms of design and engineering quality. As the Japanese and Koreans did before them, there is no reason to doubt the Chinese are capable of cracking the American market and achieving some degree of success there.
That being said, they will need to adapt their PR practices and brand storytelling to appeal to Western media and audiences. Having the right communications team in place to guide Chinese companies coming to America will undoubtedly aid them in achieving their “American Dream”.
Kristopher Spencer is Senior Director and Head of Content – Automotive at Weber Shandwick China.