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Innovating Beyond Silicon Valley: Lessons from China

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The world’s manufacturing hub is also a new focus for marketing innovation, Shwetal Shah, Technology Partnerships Manager at MediaCom, explains why learning from China will be critical in the future.

Innovation hubs are places with a concentration of talent, money and ideas. They are the cities and regions that are changing our world and our business.

For the last five years MediaCom’s BLINK Consulting has been advising clients around the world on how and where to find new technology partners. One key message that we often give is to look beyond Silicon Valley to find specialist companies in other locations, gaining first mover advantage on other corporates.

Speaking at the 11.11 Global Shopping Festival, broadcasting live from the WPP BAV Alibaba Command Centre Studios, Liam Brennan, Global Head of Innovation and Lead BLINK consultant at MediaCom, argued that the best way to find alternative innovation hubs is to look for three key components:

  1. Top tier universities - From Boston to Cambridge, these are centres of excellence for cutting-edge scientific research and associated spin-off companies;
  2. Government support - Singapore with its tax structures, the ability to attract talent from across APAC and an easy lifestyle makes it a pro-innovation city; and
  3. Network effects – Silicon Valley’s network effect is often credited with its success but other locations have the same pull. Tel Aviv, for example, is a thriving hub for Cyber Security innovation because of the presence of these existing companies and talent in the city.

When people compile lists of the potential innovation hubs based on these criteria, however, the one place they often fail to mention is China. That’s partly historical, a decade or so ago most China innovation was based on taking a blueprint of innovation from the West and copying it.

Brennan explains that more recently the Chinese government has been silently designing their cities to turn into innovation hubs. Beijing and Shenzhen were the early pioneers of innovation but these days media and AdTech and all sorts of other innovation are popping up across various cities in China.

China is a great testing ground for marketing innovation because it is an advanced market for mobile payments, eCommerce and live streaming.

Uniquely developed consumer behaviours and outcomes include: using the phone as payment device and in-app / platform payments have enabled brands to reach consumers at a touch of a button; eCommerce platforms backed up by physical stores/pickup and last-mile delivery has led to consumers expecting brands to come to them; and live streaming via live user broadcasting and live shopping have created shopper-tainment opportunities, turning mundane shopping tasks into content-driven activations.

All of this makes China a key innovation destination for both BLINK Consulting and its clients. Brennan argues there are four key lessons to be learned from China to maximise results around the market’s key sales festivals such as 11.11.

Form strategic alliances with leading platforms: Partners such Alibaba and JD are key for 11:11 – agencies should help brands identify the partners in their local markets whose infrastructure they can leverage to reach a new generation of customers. They should not commit to one single partner – agencies should help brands know the strategic role each partner has in their local marketing.

Create fit-for-platform content to maximise value: Work to integrate content/messaging with platforms – don’t just ‘advertise’ on them. Since audiences use platforms differently – understanding audience behaviour on each platform is key.

Connect content to commerce – and address points on the purchase journey: Don’t just add a ‘buy now button’ – understand consumer intent to purchase at each stage of the purchase journey. Remember that digital journeys often end in physical spaces – offer pick-up as well as delivery.

Begin to build for a real-time future: The world is becoming ‘biddable’ and winners are teams that are connecting planning, buying and data. Use AI/ML to increase productivity and effectiveness in campaigns – automate optimisation and look to predication.

China speed genuinely is 30 times faster than anywhere else and that makes the country’s innovation pipeline particularly vital for brands that want to keep up with all the behaviours that consumers are adopting second by second, hour by hour and day by day, says Brennan.

Smart brands will go one step further than simply using the China advantage to localise for one market. They can take a step forward and, at least in part, lead from China. Right now, few companies empower their China teams to help create global strategy.

That’s a missed opportunity. What you learn about local strategy in China may well help transform your global strategy. If the rest of us can recognize and learn from that, we can make China’s innovation advantage our own.

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