It is still possible to find advertisements in China that seem to belong to a different era.
You might see them in provincial railway stations or other modest locations hundreds of kilometres from China's "first-tier" cities.
Instead of showing a shiny new product and a top celebrity, these billboard throwbacks to a more innocent age might try to lure customers with a photo of a factory. Or perhaps they will list in excruciating detail which international accreditations a manufacturer has secured.
But while some ads in China seem out of step with the modern world, others reflect perfectly the country's rush into the digital revolution.
Whether it is competitions on social-networking sites or virtual communities that mirror a brand's activities, China has a cutting-edge advertising scene aimed at its 400 million internet users.
"You still see a lot of low-quality advertising put out [even] on a national level," says Ben Cavender, an associate principal with China Market Research Group. "But the leading Chinese companies, their advertising is pretty sophisticated."
As with so much in China, advertising has come a long way in a short time. In three decades it has developed from a sector condemned as "capitalist" and "bourgeois" to a US$74 billion (Dh271.8bn) industry served by about 100,000 agencies, according to CTR Market Research.
Television attracts a vast slice of the revenues - about 114.7bn yuan (Dh63.4bn) - with the state network China Central Television (CCTV) still able to generate a bidding frenzy among companies keen to screen their ads in prime time. Late last year, the auctions for this year's key viewing periods generated 10.97bn yuan.
That was up 18.5 per cent on the previous year, impressive given many multinationals were cutting advertising budgets by between 10 and 15 per cent in the global slowdown.
"There is this logic that if a product advertises on CCTV it has to be good, otherwise the government would not allow you to advertise," says Dr Junsong Chen, a lecturer in marketing at Shanghai's China Europe International Business School.
Although they continue to generate vast revenues, ads on CCTV are no longer the guarantee of a brand's success, Dr Chen says. Part of the reason for this may be the new platforms for advertising.
That is not to say traditional advertising outlets are finished. Newspapers and magazines attracted 91bn yuan in advertising revenue last year, while radio revenues grew nearly 5 per cent to 7.6bn yuan.
But the new media frontiers are generating most of a stir.
"Outdoor advertising - you see a lot of LCD screens with different advertising - is becoming particularly important," says Dr Chen.
Online advertising is also attracting much of the attention. Last year, online revenues were estimated at 20.9bn yuan, and some studies have indicated it has grown this year by as much as 53 per cent.
Mr Cavender says spending on online advertising is only between 4 and 5 per cent of the total advertising amount but it is starting to approach that in some of the world's most developed markets.
"The people aged between 18 and 35 are driving retail spending in China and they get the vast majority of their information from the internet," he says.
Such consumers watch little TV, instead getting their news and watching videos online.
"There's been a big shift, and companies are catching up and providing digital content for their advertising," Mr Cavender says.
People such as Dr Matt McDougall, the chief executive and founder of the online advertising company SinoTech in Beijing, are capitalising on this trend.
Several years ago online advertising was mainly about buying banner ads on popular sites, Dr McDougall says. Today it is much more about engaging consumers to build brand loyalty.
The sector is becoming more "performance driven", with the amount paid often closely related to the number of clicks an ad receives, Dr McDougall says.
One celebrated example of the new frontier of digital advertising in China was when Pepsi ask consumers to submit screenplays for a TV ad to be made by the pop singer Jay Chou. There were 28,000 scripts submitted, 690,000 internet postings made and 5 million votes from netizens to choose the best script.
But for all the recent developments, some believe China's advertising industry has yet to reach its potential.
Tom Doctoroff, the north Asia director of the world's fourth-largest advertising agency JWT, has expressed concerns in a previously published report that there are too many agencies that are undercutting one another, harming quality.
And many of the large state-owned enterprises, while becoming more commercially savvy, still did not understand how to develop brands, although he said they were gradually adapting to the modern age.
But Mr Doctoroff said an increasingly liberal regulatory framework was allowing more foreign agencies to set up independently in China without joint-venture constraints.
Whatever hurdles remain, many are optimistic about, in particular, digital online advertising.
Dr McDougall says many companies in China are putting 15 per cent of advertising budgets into digital, and he believes this will increase.
"It wouldn't surprise me if by 2015 we see 30 per cent of spend on digital," he says. "In five or six years, it's gone from a very small percentage to a significant proportion."
business@thenational.ae
The Farewell
Director: Lulu Wang
Stars: Awkwafina, Zhao Shuzhen, Diana Lin, Tzi Ma
Four stars
The full list of 2020 Brit Award nominees (winners in bold):
British group
Coldplay
Foals
Bring me the Horizon
D-Block Europe
Bastille
British Female
Mabel
Freya Ridings
FKA Twigs
Charli xcx
Mahalia
British male
Harry Styles
Lewis Capaldi
Dave
Michael Kiwanuka
Stormzy
Best new artist
Aitch
Lewis Capaldi
Dave
Mabel
Sam Fender
Best song
Ed Sheeran and Justin Bieber - I Don’t Care
Mabel - Don’t Call Me Up
Calvin Harrison and Rag’n’Bone Man - Giant
Dave - Location
Mark Ronson feat. Miley Cyrus - Nothing Breaks Like A Heart
AJ Tracey - Ladbroke Grove
Lewis Capaldi - Someone you Loved
Tom Walker - Just You and I
Sam Smith and Normani - Dancing with a Stranger
Stormzy - Vossi Bop
International female
Ariana Grande
Billie Eilish
Camila Cabello
Lana Del Rey
Lizzo
International male
Bruce Springsteen
Burna Boy
Tyler, The Creator
Dermot Kennedy
Post Malone
Best album
Stormzy - Heavy is the Head
Michael Kiwanuka - Kiwanuka
Lewis Capaldi - Divinely Uninspired to a Hellish Extent
Dave - Psychodrama
Harry Styles - Fine Line
Rising star
Celeste
Joy Crookes
beabadoobee
Third Test
Day 3, stumps
India 443-7 (d) & 54-5 (27 ov)
Australia 151
India lead by 346 runs with 5 wickets remaining
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
Simran
Director Hansal Mehta
Stars: Kangana Ranaut, Soham Shah, Esha Tiwari Pandey
Three stars
COMPANY PROFILE
Name: Xpanceo
Started: 2018
Founders: Roman Axelrod, Valentyn Volkov
Based: Dubai, UAE
Industry: Smart contact lenses, augmented/virtual reality
Funding: $40 million
Investor: Opportunity Venture (Asia)
CREW
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The biog
Hobby: Playing piano and drawing patterns
Best book: Awaken the Giant Within by Tony Robbins
Food of choice: Sushi
Favourite colour: Orange
The White Lotus: Season three
Creator: Mike White
Starring: Walton Goggins, Jason Isaacs, Natasha Rothwell
Rating: 4.5/5
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The%20specs
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Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
From Zero
Artist: Linkin Park
Label: Warner Records
Number of tracks: 11
Rating: 4/5
The rules on fostering in the UAE
A foster couple or family must:
- be Muslim, Emirati and be residing in the UAE
- not be younger than 25 years old
- not have been convicted of offences or crimes involving moral turpitude
- be free of infectious diseases or psychological and mental disorders
- have the ability to support its members and the foster child financially
- undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
- A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially
Afcon 2019
SEMI-FINALS
Senegal v Tunisia, 8pm
Algeria v Nigeria, 11pm
Matches are live on BeIN Sports
UAE currency: the story behind the money in your pockets
Formula Middle East Calendar (Formula Regional and Formula 4)
Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
Round 3: February 7-9, Dubai Autodrome – Dubai
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
A MINECRAFT MOVIE
Director: Jared Hess
Starring: Jack Black, Jennifer Coolidge, Jason Momoa
Rating: 3/5
The specs
Engine: 4.0-litre flat-six
Torque: 450Nm at 6,100rpm
Transmission: 7-speed PDK auto or 6-speed manual
Fuel economy, combined: 13.8L/100km
On sale: Available to order now
