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Secrets of Social Media revealed 50 years ago Create a stage for your consumers

Interview with Lego

Intro welcome

Social media is omnipotent. It dominates our relationships and dictates how we communicate with friends, family and brands. “Communications tools don’t get socially interesting until they get technologically boring,” writes Clay Shirky in his 2008 social networking tome, Here Comes Everybody: The Power of Organizing Without Organizations. “It’s when a technology becomes normal, then ubiquitous, and finally so pervasive as to be invisible, that the really profound changes happen.” For much of the world, social media outlets like Facebook – which recently topped 750 million global users – have quickly reached this level of pervasiveness, becoming an essential part of everyday life. Terms like “tweet,” “defriend” and “hashtag” have entered common vernacular, while others – “like,” “check in” and “tag” come to mind—have gained added meaning. More than that, though, it’s transformed the way humans interact with each other. Relationships are no longer bound by geography or time zones, and ideas of privacy and intimacy have been completely redefined. We are all online and we want to tell the rest of the world. Social media provides brands with a gateway to consumers. But what should they be doing? Social media strays from its more traditional brethren like television or print in a way that radically changes a brand’s communications model. One-way messaging is no longer sufficient. Consumers now demand that brands both listen and respond: a true conversation. Used correctly, social media can help brands cultivate fans, inspire loyalty, glean important marketing insights and drive sales. However, social media is also constantly evolving – think MySpace’s recent sale for $35 million, a far cry from the $580 million that News Corporation originally paid for the once-behemoth social networking hub. So what should brands be doing in the social space?

#3 August 2011 Circulation: 6.100 MediaCom Global 124 Theobalds Road London WC1X 8RX UK Tel.:

+44 (0)20 7158 5500

Email: Web: Editor-in-Chief: Signe Wandler, MediaCom Design & layout: Propellant, Art Director, Martin Dahlbeck Cover: Shan Lu Printed By: Vilhelm Jensen & Partnere ISSN: 1903-5373 The opinions expressed in the articles are those of the authors. Minor textual contents may be republished as long as the original author and publication are cited. Find BLINK in the “News & Insight” section at

In this edition of Blink, we consider the impact of social media around the globe and provide expert advice for marketers looking to connect with consumers online. We also take an in-depth look at the developing BRIC nations to see how advertisers are responding to these new opportunities – both online and offline. I hope you enjoy this latest edition of Blink

Stephen Allan MediaCom Worldwide Chairman and CEO



photography Jack W. Nip







The Building Blocks for Social Media

02 Welcome

interview with Lars Silberbauer How the company will evolve with the use of social media tools.

06 M:files 08 The Building Blocks for Social Media 12 Ancient Lessons to Win Over the Chinese Online Generation 16 Cases 18 Social Media Infographics 20 Russia: The Dreamland of Social Brands 24 Secrets of Social Media Revealed 50 Years Ago 26 The Call of Social Media: Interview with Deutsche Telekom 28 Twitter 30 A Global Social Media Snapshot 34 BRIC infographics 36 New Market, New Consumers 44 The House That Took Over Russian TV 46 M:files



Secrets of Social Media Revealed 50 years ago

By David Aaker Identification of four motivations for a person to communicate about brands.


new consumers, new markets By Andrew Curry

A global media snapshot By Tom Smith Social media is impacting the way we globally consume media and communication.





content M:files

Google goes wholehearted into social

Follow the leader

Google’s new social network, Google+, has finally made its debut. It’s the company’s most ambitious social project to date, and in their minds, Google+ is more than a social product, or even a social strategy, it’s an extension of Google itself. Hence, Google+. Google+ comes with a lot of features, Circles being the prominent one. It’s through Circles that users select and organize contacts into groups for optimal sharing in a quite simple process that is as pleasant as possible. You simply select people from a list of recommended contacts (populated from your Gmail and/or Google Contacts) and drag them into Circles you designate. The interface to do this with is intuitive and simpler than dividing your friends into groups on Facebook.

It was Barack Obama who started the rush to Facebook and Twitter. By successfully using social media to reach out to younger voters, he proved there was a whole new way of campaigning. His rivals learned quickly and during the 2010 US elections, a Pew Internet Study found that 22% of all online Americans used social media for politics. Social media is now a political tool around the world, with it’s role in the Arab Spring is well documented. It seems that no political leader can function without a Facbook fan base.

The Pope has sent his first tweet


Barack Obama: 2012: 22.0m Sarah Palin: 3.2m David Cameron: 134,529 Angela Merkel: 95,325 Nicolas Sarkozy: 443,693

Pope Bendict XVI has overseen the launch of the Vatican’s YouTube channel as well as apps for mobile and Facebook and is now tweeting. Apparently from an iPad. The first

U.S. President Barack Obama 2012: 22.0m

tweet was sent on June 29th 2011 and launched The Vatican Today information portal.

Dear Friends, I just launched Praised be our Lord Jesus Christ! With my prayers and blessings, Benedictus XVI

Power of Visibility On Facebook it is a very special algorithm that determines whether you will be seen or not in your friends newsfeed. Facebook has now published the Edgerank

ue Is the AFFINITY SCORE: creater vs. viewer history. That is: The more history you share the higher the affinity score.

we  Is the WEIGHT for type of edge: Each type of interaction is weighted differently. It is assumed that video/pictures has the highest weight, followed by links and status updates.

Facebook has now built in the Microsoft-owned Skype service into the platform. And you can now talk and see your friends while on Facebook. Facebook and Microsoft has already joined forces in search and more collaborations are on its way.



photography Meena Kadri

Facebook strengthens relationship with Microsoft

∑ uewede


de Is the TIME DECAY: no one cares about yesterday’s news, so older content has lower weight.


What does Edgerank mean for your Facebook site? The most important variable in the algorithm is the affinity score, so the more interaction you can create with your fans the higher the rank and virality. Think about the type of content you have on your Facebook site. Coca Cola has more than 13.000 pictures of Coca Cola bottles on their Facebook page. And make sure to update the content daily, keeping in mind not to wear out your fans.



interview The building blocks for social media

strategizing. Your strategizing should happen while

the entire dialogue going on about the LEGO brand. But

you are engaging with the consumers.

we do listen carefully of any signs of crisis and we have a comprehensive crisis management system set up.

Each country should be individually thought through. Technologies, platforms and consumers are very

IF: Why is social media important to LEGO? What is

different from market to market. As an example, in

social media adding to the brand in terms of under-

Italy we have 200,000 fans on Facebook and 80,000 of

standing behavior and attitudes?

them are located in Rome. This gives us tremendous

LEGO is very successful in social media which any search on Youtube or Flickr clearly shows. The company’s first Social Media Strategist, Lars Silberbauer, explains how the company will evolve its use of social media tools even further. The building blocks that we all grew up with have

and benefits of social media.

themselves grown up. LEGO has become noted as a

LS: There is no single answer to that. Social media

events. On the other hand, we are not very strong on

is a way to get to know what consumers are doing

social media in Spain for some reason.

with our products and our brand. LEGO is a very creative brand. You have a simple LEGO brick that

This creates a challenge in creating the optimal

you can build to fit your imagination and consumers

strategy. Should we use the Italian country-based

have a massive need to show the world what they

model? Or should we instead target Spanish-speaking

have created. Social media is the perfect platform to

people in general? It is important not to use the

display and interact with your peers. Social media

same strategy across all markets. Even very mature

is continuously broadening the LEGO brand and we

markets like Germany, the UK and the US vary. It is

learn a lot from listening to the conversations.

smart user of social media. Crowd-sourcing ideas,

Ivan Fernandes (IF): LEGO is a global company

allowing enthusiasts to design their own kits with

working across different markets. What do you

Design by Me are all in a day’s work for this iconic

think are the main challenges for a global brand

Danish brand.

in social media?

Despite this success, the 9,000-strong company

Lars Silberbauer (LS): I think that all global

clearly feels it can do more. Earlier this year LEGO

brands find it challenging to align their global pre-

raided the Danish Broadcasting Corporation, DR – the

sence while creating local social media engagement.

the local culture that will determine the best way to

We also have a direct dialogue through social media.

country’s public service broadcaster – to recruit Lars

You need to be as close to the consumers as possible

use your resources. What platform you use depends

We answer questions and we let the fans know about

Silberbauer as its first Global Social Media Strategist.

to create engagement and build relations with the

on your target audience and the product you are

new products, but we make sure to do it as a service

In his new role, he sees himself driving the LEGO

users, but at the same time your engagement and

marketing. On top of that, the global nature of social

and not as an invasive message.

brand’s corporate social media strategy and ensuring

your brand must be consistent on a global level.

media makes it challenging to localize individual

that it is connected with the overall strategy of the world’s fourth largest manufacturer of toy materials. Silberbauer believes that brands need to consider

“On social media, you should think of brands as the creators of a stage”.

markets and consumers. IF: So where do you start in solving this dilemma?

IF: How does LEGO view social commerce? And how is LEGO using social commerce to interact with

Do you focus on global strategy first with local imple-

IF: An important feature of social media is listening

mentations or do you do it the other way around?

to conversations and sentiment. What are the key

themselves as social media enablers. “On social


opportunities to do highly targeted messages and

your consumers?

topics, the volume of mentions and so on? How do

LS: Like many companies we are trying to figure

you address listening?

that one out. We are testing various ways of using

media, you should think of brands as the creators

LS: I actually think we do it in a third way. To get

of a stage from where the consumer can shine and

social media right you need to be dynamic and

look good to their network and friends. It is far more

flexible and this is our strategy. We are dynamic and

LS: We certainly listen and we are very fortunate that

and our users. We don’t have a complete answer

important to create an environment than to simply

flexible with a global goal and we are continuously

thousands of engaged fans post pictures, comment and

yet. Social commerce is an important development

state the brand is fantastic,” he says.

listening and adapting to the local markets. The old

interact with us every single day. In my opinion, social

right now if you create the models and get the right

way of doing strategy simply does not work anymore.

media is very suitable for listening to the dialogue

products out in places such as Facebook. I believe the

In a conversation with Ivan Fernandes, MediaCom’s

You cannot sit in an office for six months and come up

that is going on naturally among consumers. LEGO’s

companies that get social commerce right first will

Global Director for Social Media Technology,

with a good social media strategy. In my opinion, you

overwhelming amount of consumer engagement,

be hugely successful.

Silberbauer gives his perspective on the challenges

should simply redefine your way of thinking about

however, also means that we of course cannot listen to


social commerce and finding the best way for us



interview The building blocks for social media Ivan Fernandes, Global

Lars Silberbauer,

Director for Social Media

global social media

Technology at mediacom.

strategist at lego.

have many different KPIs. It is about reaching out to

company. And the third tier is the engagement

the consumers and getting a closer relationship and

strategy. These three tiers make for a continuous

then driving sales. I think engagement will always

process that enables our social media handling.

somehow reflect on sale and ROI. What I think most brands need to understand is that IF: From a practical perspective, how do you manage

on social media you shouldn’t focus so much on your

social media content? Do you handle it yourself or is

brand and think that the brand should be the centre

it outsourced?

of attention. Instead you should focus on helping the user to build his or her own personal brand and let

LS: Our goal is to create a genuine and authentic

your brand be a part of that process. It’s all about the

relationship between the user and the LEGO brand

user and social media, I think, has answered a basic

IF: What other developments are you keeping an

If a company wants to enter social media, I think

and that is why we do not outsource our conversa-

human need: A need to be in the centre of your own

eye on?

crisis management is another important subject to

tions with our consumers to agencies.

life and a need to create a world of information and

be aware of – at least it has been a focus for us. LS: I see two important trends that are impacting

communication around yourself. You don’t want to have a stranger to call of one of

social media: The massive development of mobile

IF: Has the need to be always-on changed the way

your friends and that is why it is always a LEGO

On social media, you should think of brands as crea-

and social gaming. Social gaming is an interesting

LEGO deals with social media?

employee that is doing the conversation on social

tors of a stage from where the consumer can shine

media. You cannot outsource it to others to build

and show off to their network and friends. That is far

challenge because we have a clear and ethical policy at LEGO that states that we do not want to interact

LS: LEGO is a global brand, so there are always

a emotional relationship, that must be done by

more important than saying that telling the consumer

with kids less than 13 years of age old on social

consumers in a daytime zone and we are used to

employees inside the company.

that the brand is fantastic.

media. However, social gaming is only going one

accommodating to a 24/7 setup. But, of course, this

way and that way is growth.

is more extreme on social media and it requires

IF: How do you keep the strategy fresh and relevant

It is necessary for a brand to be humble and acknow-

the right organizational setup. We are still in the

to your target audience?

ledge that we are in a social media space where we

IF: Yes, social gaming is one of the biggest activities

process of enabling the company to do social media

on Facebook and I think more and more brands will

in the right way and develop the social media

LS: We always try to develop our strategy as we

have to redefine their way of thinking about brand

leverage this opportunity to engage consumers.

organization. Again for us, this is about trying a

engage the consumers and as we enable the company.

marketing when engaging on social media, as social

What is most important when you as a brand want

lot of different stuff out and feeding it back to the

We have a three tier model of developing the social

media should never be seen as yet another one-way

to enter the world of social media?

strategy. It is an on-going process and the challenge

media strategy. The social media architecture is

channel for pushing out marketing messages and

is to do it fast enough to keep of with the users.

the basic layer in our social media strategy. The

traditional campaigns. It’s not just a new platform;

next layer is our social media enabling within the

it’s a mind shift.

LS: For us, it is extremely important that we do not let our consumers down once we have engaged

IF: In every aspect of marketing, measure is grow-

with them on social media. If you decide to engage

ing in importance. How do you measure success on

with consumers on social media you cannot stop

social media?

have to earn our rights to be. In my opinion, brands

“To get social media right you need to be dynamic and flexible and this is our strategy”.


the conversation just because some marketing

LS: It depends on what social media is part of. If it

campaign has ended. You need to show commit-

is part of a crisis management strategy then you

ment. So for us, what is most important is that we

need to measure sentiment and the development

are committed every time we create something on

of dialogue. It is different if it is a product launch

social media. You should never commit to more on

on social media. The measurement also depends on

social media than you can actually live up to. Make

your goals and how you want to proceed. We do not

sure you don’t promise something you can’t deliver.

work with just one single KPI for social media We




Content AncientAncient china: Lessonslessons to win

Ancient lessons to win over the Chinese online generation Confucius lived long before social media and other emerging marketing platforms but his teachings can help Western brands to understand and connect with millions of Chinese netizens. Major global social media sites might be blocked in the country but their Chinese equivalents and their 265 million users are welcoming Western brands with open arms. There’s only one condition: understand the philosophy behind the Chinese way of life and tailor your communications accordingly. Text by Kinga Papp, Mediacom Beyond Advertising (MBA) UK

Social media “When you have faults, do not fear to abandon them.” Chinese social networking sites might

social media services in China. Sina

have started out as Facebook, Twitter and

Weibo, the Chinese equivalent of Twitter

YouTube copy-cats but they realised early

has 140 million users and more than 90%

on that Chinese Internet consumption

of them say that they trust brands more

differs from the Western one and they

if they are present on the microblogging

were not afraid to alter their approach. So

platform. While bulletin boards are not

what are Chinese netizens like?

popular anymore in the Western world, 98 million Chinese still consider them a

87% of social media users in China befriend

primary information source for product

or follow brands on social platforms, while

reviews and recommendations so these

only 12% of Americans are likely to do the

platforms shouldn’t be ignored.

same. In addition, 77% of Chinese netizens believe that social media presence makes

And what about Facebook?, you could

brands more attractive.

rightfully ask. There’s no such equivalent that aggregates all demographics

They watch longer, professionally

because the Chinese prefer to join social

produced video content rather than short,

networking sites that talk to ‘their kind of

user-generated content on Youku and

people’. QZone with 481 million registered

Tudou (the local versions of YouTube) and

accounts is the first and largest social

their favourite way to engage with brands

networking site and attracts teens from

is to watch commercials and branded

second- and third-tier cities. RenRen,

content on these platforms, indicating

the platform most similar to Facebook,

that strong video presence is essential.

attracts university students, while

Multinational brand that got it right - BMW BMW launched its brand page on Kaixin001 to raise awareness and engage with affluent young professionals. By integrating its cars into ‘Car Parking’, one of the most popular games on the platform, the brand managed to reach a significant portion of the 45 million players who had installed the game on their profile. In order to enhance the luxury feel of the brand, players had to make and pay lots of virtual money to own a BMW in the game. Still, more than half of those who played the game, felt proud and accomplished when they could finally afford to buy a virtual BMW. Exactly the emotion that the car manufacturer was aiming for.

Kaixin001 is designed for white-collar Forums, Bulletin Board Systems (BBS)

workers living in tier one and two cities.

and microblogging are the most popular





Content china: Ancient lessons to win

eCommerce and Group-buying “Men’s natures are alike, it is their habits that carry them far apart.” The Chinese love a good bargain due

platform is but Taobao has

to the fact that traditionally they are

been eager to challenge that by offering

value-oriented, savvy shoppers. But unlike

online storefronts for multinational brands

in the Western world, B2C eCommerce only

at its Amazon-like ‘Mall’ platform.

accounts for 20% of all online transactions, as the Chinese online generation feels

Group-buying is another Western phenom-

more comfortable with exchanging goods

enon that the Chinese social citizens are

between themselves and paying in cash for

embracing quickly. Although Groupon is

the products.

the market leader in the Western space, Taobao’s Juhuasuan has almost four times

Taobao, the eBay-like C2C platform is the

more visitors per month than the Chinese

ultimate online shopping destination at

version of Groupon. On the other hand,

the moment but it is likely to change.

the fact that the Groupon-Tescent venture

EMarketer estimates that purchases from

has integrated its deals with QQ, the most

official e-retailers will represent more

popular instant messaging service – with

than half of all online transactions by

636 million registered accounts - might

2015 due to changing shopping habits and

give the Western brand a much-needed

the availability of more secure payment

competitive edge.

Multinational brand that got it right – Mercedes-Benz Mercedes-Benz offered 200 ‘smart’ cars for sale on Taobao’s Juhuasuan platform. The mission was to sell the cars in three weeks in a group-buying scheme by offering a 23% discount. The results: the cars were sold out in three-and-a-half-hours and the campaign attracted over 300,000 visitors in less than 24 hours.

Experiential Marketing

options. Currently the most successful B2C

“I hear and I forget. I see and I remember. I do and I understand.”

Mobile Marketing “Wheresoever you go, go with all your heart”


Given that thousands of domestic and

Jack Morton Worldwide in 2010, Chinese

of the surveyed also said that they took

foreign companies compete for the

consumers don’t prefer experiential

action after participating in a live event.

attention of China’s 1.3 billion consumers,

marketing to other media channels but

And last but not least, 85% of them said

brands need to be innovative and unique in

they do think that it’s more influential

that they told others about interesting

order to stand out. And it’s not just about

and that it’s the “most engaging” form of

brand experiences, proving that high

There’s one thing that is very close to the

without their mobile devices”, interactive

the product they offer but the experience

brand interaction. 80% of the respondents

interactivity turns consumers into brand

Chinese heart: mobile phones. Since 70% of

and on-the-go marketing activities are

that comes with it.

said that such activities made them better

advocates. Even in China.

mobile phone users say they “couldn’t live

most suitable to reach this target audience.

According to a research carried out by

understand brand benefits, while half

Puma used an integrated mobile marketing campaign around the Formula 1 Race to position itself as China’s No.1 motorsport lifestyle brand, recruit new Puma fans and increase brand awareness.

submitted their scores via text message or invited friends to play, received extra points that could be exchanged for Ferrari gifts. In order to also drive foot traffic, as soon as someone downloaded the game, they also received a coupon to redeem mobile phone decorations at one of the Puma stores.

They launched a mobile car racing advert-game, Puma ‘F Wan’ which could be downloaded from a mobile website. To generate buzz and encourage social sharing, players who

As far as results are concerned, the campaign drove 150.000 game downloads, 185.000 qualified database contacts, 70.000 coupons and 85 million page impressions.

Multinational brand that got it right – Puma


Credits; Title: Big Stain Client: P&G Ariel Client Contact Name: Alan Zong Agency: Saatchi&Saatchi Great Wall Advertising Co.Ltd.Guangzhou Branch Creatives: Fan Ng, Wendy Chan, Jonathan Ip, Andy Greenaway, Edmund Choe, Henry Chu (Pill & Pillow HK) Director: Eddy Chan, Lee Wai Kai Music title & Artist: Drum

Multinational brand that got it right - Ariel In order to increase brand awareness and sales, Ariel created the “world’s biggest T-shirt” and put it up as an outdoor installation in key Chinese cities. Then the brand turned stain creation and removal into a social gaming

experience by dressing up Wii consoles to look like ketchup, mustard, soy sauce bottles and of course Ariel. Consumers with the ‘sauce consoles’ could have fun causing stains, while the ‘Ariel fighters’ could have the satisfaction of getting rid of them. So how did Chinese consumers react to this cool brand experience? They started

Winning the wallet of today’s Chinese

and modernity that shapes the Chinese

consumer is not easy but it’s a no-brainer

mind will certainly succeed. If not today,

that it’s worth it. And brands that dare

tomorrow. Because as Confucius said, “it

to ditch their global brand handbook

does not matter how slowly you go as long

to embrace the hectic mix of tradition

as you do not stop”.

buying the product. According to official campaign statistics, sales rose by 113% in the first month, brand awareness increased by 300% and the stunt generated over 8 million views online.

Sources: OgilvyOne Worldwide, 2010, TNS Research International, 2010, Fleishman-Hillard and Harris Interactive, 2010, Resonance China, 2010 Source: China Internet Watch, Source: U Talk Marketing, Source: Ads of The World



cases i am nikon + WINNERS

cases LOHAS


Lifestyles of Health and Sustainability

Nikon created a twin-track strategy designed to hit its two key target audiences: casual snappers and serious amateurs. Using Facebook for compact users and Flickr for the semi-pro DSLR users we created platforms designed to celebrate consumers’ photographs, taken with ANY camera. We encouraged consumers to share their images with the world, creating a democratic platform for a democratic art form.

thousands of new fans.

The competition was judged by “likes” on Facebook and by big name pros on Flickr, encouraging our targets to tell the world Who They Were With Nikon.

On Flickr our group is already in the top 2% in terms of group size, with more than 9,000 members.

The results Going social has connected Nikon with hundreds of

This campaign contributed to a doubling of Nikon’s compact share in its six biggest EU markets.

Background: Winners is a national Canadian retailer that offers branded products at discounted pricing. The objective of the campaign was to generate a database of fans on Facebook for on-going communications and engagement. The campaign was supported with Facebook ads as well as other sites. Facebook itself considered it to be one of the most successful campaigns in garnering fans within a short period of time. “The Winners Facebook Page was one of the most successful Canadian Brand Page launches and was one of the first to achieve 60.000 Fans within 4-weeks! Within 4 months, they grew to 120.000 Fans and continues to be one of the leaders in the Canadian retail category” - Facebook


To build awareness of a new organic, non-additive juice brand from carefully selected origins, MediaCom China decided to create a Lohas-owned easy-to-access platform, which would enable consumers to frequently get involved with nature and healthy elements while getting on with their busy city lives.

We attracted more than 560,000 unique visitors on Facebook and users have uploaded nearly 40,000 Photos and have “liked” entries 260.000 times. The Facebook fan page continues to grow and now has 81,000 fans.



Launch campaign for the healthy juice brand, LOHAS in China.


With the increasing usage of digital media at work and the growing popularity of social networking among the target audience, we realized that, rather than rely on regulars like TV or portal websites, our media focus should be on Kaixin001, the biggest social networking site targeting white-collars in China. We successfully negotiated a content cooperation with Kaixin001, allowing us to tap into, and add value to, one of their hottest plug-ins called ‘Garden’ (similar to Facebook’s Happy Farm). We also introduced a Planting Competition, designing rewards carefully to incentivise participants to share the results of their efforts with their friends. This would not only facilitate the communication between friends, responding to one of our target audience’s needs, but, crucially, it would help to disseminate the brand messages quickly. A competition element encouraged trial in the real world.

Lohas Planting Competition’. Prizes are awarded, both virtually and in reality, to those who ‘earn’ most in the competition. Additionally, there is an option for users to grow their plant more quickly by downloading various ‘Lohas Themes’ for their virtual garden. Each of the Lohas Themes depicts one of the beautiful specially-selected origins of Lohas juices, such as Sao Paulo of Brazil and Wusu of Xinjiang in northwest China. This helps to deliver, and make memorable, the benefits of the specially-selected origins of Lohas. When virtual Lohas fruits become ripe, participants may exchange them for virtual money or use them to make their freshly squeezed Lohas juices. It is at this point that participants experience the ‘non-additive’ Lohas bottling process in the form of a lively flash. Participants could also win the chance to get real Lohas delivered to their real friends in the real world – thus driving trial. the Results The numbers say it all:

In the plug-in, participants are encouraged to purchase Lohas seeds to plant in their own virtual gardens. When the fruits become ripe, they may use them to make their freshly squeezed juices, which can be later redeemed for virtual money or given away as gifts to their friends. Purchasing Lohas seeds immediately enables participants to enter ‘the

Sales up by 30% after campaign No. of participants: 9.7M No. of Lohas theme downloads: 5.3M No. of people joining Lohas BBS: 541K No. of bottles of virtual Lohas Juice produced: 186.3M No. of bottles of virtual Lohas Juice sent: 127.6M



content Social Media Infographics

CANADA 11.72m 54%














44% 40% 28%




12.03m 48%





16% 8%


USA 114.55m








CHINA 155.29m 47% 53% 34%


FRANCE 15.92m





















63% 37%

54% 51% 34%


45% 36%













54% 63% 41%




10.10m 47%











48% 27%







Find out more: mail:



Content Russia: the dreamland of social brands

1. Forget Facebook Russians are the most engaged users of social media in the world, spending an average of 9.8 hours on social networks. This is almost double than the global standard (Comscore, 2010). However it’s not Facebook but its local equivalents –, and – that keep users excited. or ‘VK’ as Russians call it, is the number one social network in the country and currently has over 98 million members according to the official counter of the page.

3. Stay away from location-based marketing Westerners may be eager to become the mayor of their local coffee shop but not Russians. They take great pride of where they eat, shop and hang out, however there’s still a significant resistance about sharing their whereabouts with the world. 70 years of socialism certainly doesn’t disappear without a trace…

Case Study: Clearasil used Vkontakte to engage Russian teens and encourage them to use the facecleansing product on a regular basis.

Russia: the dreamland of social brands Socialism in Russia is booming again but this time around the country of vodka and Matryoshka is mastering a new form of the ideology: digital socialism. An opportunity that shouldn’t be missed by brands wanting to tap into the minds, hearts (and wallets) of 141.8 million people. So how do you (or your clients) make the most of the Russian digital craze? Text by Kinga Papp, Mediacom Beyond Advertising (MBA) UK



2. Focus on blogger outreach Blogging is big in Russia. There are 7.4 million Russian speaking blogs with a readership of approximately 23 million, according to the Russian Association of Electronic Communications. Livejournal, the most popular blogging service has almost five million registered accounts. Since 60% of bloggers are urban women, outreach programmes offer an invaluable opportunity for luxury brands targeting a female audience. Case study: Yves Rocher generated online buzz for its Serum Vegetal product line in Russia by inviting key beauty bloggers to a lavish launch party. The brand offered bloggers make up and product training and generous gift packs. Not surprisingly, they fuelled the Internet with raving product reviews afterwards.

4. Only use mobile if you market a luxury product Although the number of smartphone and tablet users is likely to reach 18 million by the end of 2011, it only offers access to 10% of the population. On the other hand, mobile might be ideal if you want to reach the rich and trendy. Case study: Volvo launched XC60 by directing Russian luxury car lovers to a mobile website, featuring a 3D game “City Rally.” It offered users the chance to test the Volvo XC60 and see it for themselves why it’s called “the safest in Volvo’s history”.

5. Offer exclusivity There’s only one thing Russians love more than luxury and that’s exclusivity. And it’s no different, when it comes to online communities. for example is a social network of elite Russians who enjoy traveling to exotic locations by themselves. Due to the social status and high net worth of the members, car manufacturers and banks are eager to offer exclusive value-add services to the privileged group.



Take a new look at Eurosport

All Sports. All Emotions.





Content Secrets of Social Media

Secrets of Social Media Revealed 50 years ago

Text by David Aaker

expert although that can help, people that have an

Almost 50 years ago Ernest Dichter, the father of

experience and access to relevant people and infor-

motivation research, did a large study of word of

mation will qualify as well. Another is that listeners

mouth persuasion that revealed secrets of how to

also are skeptical of the speaker’s motivation. They

use social media to build brands and businesses.

want the speaker to be interested in the listener and

The study was reported in a 1966 article in HBR

his or her well-being without a bias. Is the speaker’s

(Harvard Business Review).

intention to sell a product or help me? What is the

intense interest in a subject resulting in relevant

speaker’s relationship to me? An implication is that A major Dichter finding, very relevant today, was

a firm promoting its own brand needs to be aware

the identification of four motivations for a person

of its status and emphasize facts instead of opinion,

to communicate about brands. The first (about 33%

represent the right culture and values, and have a

of the cases) is because of product-involvement. The

balanced perspective.

experience is so novel and pleasurable that it must be

Four motivations for communicating about brands


a dialogue because a listener will be more likely to

attention, show connoisseurship, feel like a pioneer,

accept judgments from someone with whom there is

have inside information, seek confirmation of a

an interaction going on. With a dialogue, it is much

person’s own judgment, or assert superiority. The

easier to communicate expertise, interest in the

third (around 20%) is other-involvement. The speaker

subject matter, and the right motivation because

wants to reach out and help to express neighborliness,

there is a chance to build up a relationship and use

caring, and friendship. The fourth (around 20%) is

reassuring cues. In contrast, a one time, one way

message-involvement. The message is so humorous or

communication will have a harder time demonstrating

informative that it deserves sharing.

credibility and motivation.

Looking at the social media role in brand building,

A third finding was that recommenders had on aver-

I suspect that these same four motivations explain

age a huge impact on purchase running to 80% for

why some brands have been successful in using

some products. The classic and even earlier work of

social media. It suggests that, in the absence of

the sociologists Katz and Lazerfield reported in their

exceptionally entertaining communication, in order

book Personal Influence had already documented

to employ social media effectively a brand needs

the impact of social influence has a two-step flow

to deliver extraordinary functional, self-expressive,

but this study brought the ideas to the level of

or social benefits. That is more likely to be the case

purchase decisions.

when the brand is associated with an offering that is innovative and differentiated in a way that truly

It is amazing that the nearly forgotten theory and

resonates with customers. It is unlikely to happen

practice of word-of-mouth communication and


when the brand represents a me-too offering in

influence from five decades and more ago can be so

an established category or subcategory. So it

relevant today.



Another implication is that a firm should promote

Sharing knowledge or opinions is a way to gain

24% 20%


shared. The second (about 24%) is self-involvement.

comes back to creating and leveraging innovation and differentiation.

David Aaker is the Vice-Chairman of Prophet and the author of Brand Relevance: Making Competitors


A second finding was that listeners are primarily

Irrelevant and of the blog: Aaker on Brands (http://

concerned with two conditions. One is that the


speaker be credible with experience and background that is convincing. A person does not need to be an

This was first published on Printed with permission.



interview Deutsche Telekom

The call of social media

in a more direct way, but companies can

Q: What is the long-term impact of social

expect such models to be developed in the

also learn more about what customers think

media campaigns like Million Voices for

next 12 months. Until then, we are using

of their products. If a company learns to use

Deutsche Telekom?

media equivalence calculations to define

of great value.

JW: The Million Voices campaign was designed to demonstrate the high quality

Q: How would you describe Telekom`s

Q: How do you utilise social media as a

of Deutsche Telekom’s mobile and fixed

engagement in social media? Is Telekom just

gateway to consumers?

line network whilst giving consumer a

a sender brand or is it even more than that?

chance to experience this quality in a

Deutsche Telekom has been using social media both to build ITS brand and improve customer service. Stephan Naumann and Daniel Bischoff talk to Germany’s biggest telecom company to find out why.

Andreas Bock: We chose a multi-

highly emotional way.

AB: We want to improve our customers’

channel strategy to address our different

In general, social media and participatory

experience. Therefore we are trying to

target groups in the most appropriate

campaigns perfectly express our brand

establish a dialogue with our customers

way. Our Million Voices campaign and

claim “Life is for sharing” and create a dia-

and prospects to develop sustainable

our customer service via “Telekom hilft”

logue, not only between Deutsche Telekom

and valuable relationships. We also want

are good examples for this. While the

and our customers, but also between

to empower our existing customers

customers can experience professional

customers. Successful campaigns therefore

to become loyal customers and

customer support via “Telekom hilft”

have the potential to turn customers into

brand advocates.

long-term brand ambassadors.

Social media has revolutionized media

One brand that does seem to be thriving

more traditional call centres. Consumers

channels, they can experience the brand,

consumption and consumer behaviour. In

on these complex platforms is Deutsche

can write their questions and opinions

as well as quality of our products and

Germany, 60% of people online already

Telekom, Germany’s leading telecom-

on Telekom_hilft-channels and get near

network via the Million Voices campaign.

use social media sites like studiVZ, Twitter

munications provider. It’s using social

real-time feedback from Deutsche Telekom’s

and Facebook.

media to build both brand equity and

social media team.

Q: How many people are responsible for Q: How do you assess the value of a

customer support via Twitter and Facebook?

social media campaign like Million Voices Q: How do you value social media benefits

for Telekom?

across different departments?

benefit customers. We sat down with the initiators of Million

This transformation has challenged

our Social Media ROI.

this information in the right way, it can be

AB: We have 13 full-time employees who translate into 34 “faces to the customer”,

VK: The assessment of social media

because the team members work across

conventional communication models.

Two new initiatives in particular highlight

Voices, Jürgen Wermuth, Head of Online

Volker Krön: We have established

campaigns takes into account two main

several teams to facilitate the exchange of

Marketers know they need to be where

the company’s attempts to get to grips

Marketing and Social Media Telekom

different information circles to align

factors. On the one hand, we have a lot of

knowledge and experience.

consumers are but many struggle to

with the real benefits of social media.

Deutschland, Volker Krön, Senior Manager

activities internally, share our experience

quantitative data such as fan numbers,

Online and Social Media Marketing

and co-ordinate our communication. The

video views or uploads, comments, likes,

Q: What are the crucial skills you need to be

A recent campaign entitled “Telekom

Telekom Deutschland, and the leader of the

idea is to ensure that all the company’s

tweets and blog entries that can be meas-

part of Telekom`s Twitter and Facebook team?

A recent survey – conducted by Social

Million Voices”, featuring German singer

Telekom_hilft strategy, Andreas Bock, Head

messages work together.

ured quite precisely. This data expresses

Media Examiner – found that 92% of

Thomas D, invited everyone to join the

of Social Media Management Sales and

marketers in Germany cited Facebook as

biggest online choir in history. Launched

Service Telekom Deutschland, to ask them

their number one social media tool with

using TV advertising as well as radio and

about their approach to social media.

84% saying Twitter was of high impor-

social media it encouraged consumers

tance for their company.

to film themselves, with selected perfor-

Q: How do you think communications has

mances used as part of the campaign.

changed with the rise of social media platforms?

that’s had to get to grips with a revolution.

Another example of Telekom’s ambitions

Jürgen Wermuth: With social media

The range of company functions that can

in this area is new customer service

communication has become more direct.

Q: How are you spreading social media

coverage and a degree of interactivity.

AB: The core competency is an excellent

profit from social media extends from

channel @Telekom_hilft. This enables the

Both parties – companies and custom-

expertise through your company?

On the other hand we also monitor the

knowledge of our products and services

marketing to sales to customer support

company to interact via Twitter, Facebook

ers – gain a lot of advantages. Not only can

tonality of comments as a qualitative

and the enthusiasm to explore this new

and beyond.

as well as via and

customers and companies talk to each other

JW: Deutsche Telekom has established

factor. In combination these two measures

kind of conversation with customers.

a company-wide Enterprise 2.0 project,

give us a very good picture how successful

Customer service colleagues must be able

controlled by an office called Center of

campaigns are.

to express themselves adequately in the

generate real benefits.

But it’s not just the marketing department

Jürgen Wermuth

Andreas Bock

Volker Krön

“Marketers know they need to be where consumers are but many struggle to generate real benefits”.

Excellence. Within this project we imple-

context of Twitter and Facebook.

ment the company’s social media strategy,

Q: What metric is used as a benchmark for

develop social media guidelines and share

social media campaigns? Do you put a value

best practice efforts. Included on the

on each fan?

working group are representatives from



all departments that are engaged in 2.0

JW: There is no comprehensive and widely

activities such as marketing, communica-

accepted model for benchmarking owned

tions, HR, customer service and IT.

and earned media in the social web. We



content twitter





Content A global social media snapshot

A global social media snapshot Social media is fundamentally impacting the way we globally consume media and communication. Over 50% of the population worldwide is active in social media. text By Tom Smith Illustrations by Esther aarts / shoparound

The internet is all social Sometimes the hype is right. Consumer internet adoption across the world is now increasingly defined by social media. Since launching in 2009, the GlobalWebIndex and the 4 waves of research that have been delivered to date, have demonstrated substantial growth in social media adoption. The fastest growing type of website between July 2009 and February 2011, is unsurprisingly Social Networks, with the percentage of consumers visiting on a monthly basis rising 29% to 49%. This is mirrored with video sharing sites (increase of 18), photo sharing (15%) and consumer review sites (7%) In contrast static sites such as news, portals and even search have declined in consumer visits globally. This shows a dramatic shift from the early model of the internet defined by siloed URLs, static content and automated algorithms, to a model today that is defined by social technologies and the internet users that use them. The result is a stunning level of consumer involvement in social media. When looking at a combination of active participation in, blogging, Forums / BBS, microblogging, uploading video and social networks via a PC device we can see that in all markets at least 50% of internet users take part in one activity on a monthly basis. In some markets such as Brazil, China and Russia this climbs to over 80%. Even more telling is that this percentage has grown slightly in all markets over the last 18 months, showing that social is cemented and here to stay.

Real-time taking over from There is a major shift taking place in terms of the social platforms that internet users actively contribute too. As of February 2011 the fastest growing form of social contribution was Microblogging (not just Twitter), growing 28.4% in 18 months, with 14% of global internet users now actively contributing on a monthly basis. This is followed by Social Networking, which grew 20.8% and video sharing 19.9%. In contrast, contributing to a website, only grew 6.4%, blogging 3.4% and posting in a forum or BBS actually declined 5.8%.





Content A global social media snapshot

BRIC and emerging markets lead the way

The impact of the Post PC era

platforms is increasingly in Real-Time environments, whether that be Twitter and Facebook in the US or

The adoption of all mainstream social technologies

will be revolutionised by the way that people get

Sina Microblog or RenRen in China. This has a major

is being led by fast growing internet markets. This

online. This is already happening with the massive

implication of the impact of social media. When social

is demonstrated clearly by monthly involvement in

technologies arrived, it was defined by consumers

social networking, where 76% of internet users in

fast growing markets, the internet and social media

from 32% of internet users to 45% of internet

creating and publishing their content. This was seen

Philippines and Indonesia use one. This is followed by

are thanks to a lack of competition from traditional

users on a monthly basis, in just 18 months. This is

very much as threat to the established media industry

Malaysia with 68%, Brazil and Russia with 64% and

media usually the number one form of entertainment

only the start in the shift to the post PC world. In

and professional content producers, however real-

India 63%. Compare this to the US, where 53% are

for the connected consumer. We also see that users

February 2011, we asked what the favourite internet

time platforms do not enable content creation and

active, UK 46%, France 41% and Japan just 16%.

in fast growing markets are using social media to

device was today and 86% stated their personal PC

achieve personal success, either through education,

/ Laptop and just 1% a tablet device and 5% their

In short consumer contribution via social media

As we look forward, we can see that social media

growth of mobile internet adoption that has grown

are focusing users on sharing opinions, other peoples content or responding to or interacting with live

The higher levels of adoption are demonstrated regard-

their own business or through work – something

mobile. However when asked what their favourite

events. As our research shows, the top three forms

less of which demographic, attitudinal outlook or job

that is not universal in developed markets. Social

device will be in one year, just 54% stated their PC

platforms have also been adopted as form of free

/ Laptop and a massive 15% stated Tablet and 15%

expression and a chance to express individuality,

mobile. Even 8% mentioned an internet connected

something that traditionally didn’t come easily in

television set. This demonstrates clearly the massive

hierarchal societies like China, South Korea or India.

demand to move to post PC devices, a shift that will

"social media in many ways is becoming less social".

again radically transform social media. Mobiles, tablets and TVs are dominated by applications

of microblogging behaviour after sharing photos or

type you compare. Users in fast growing markets are

The massive adoption of social media has funda-

and shift consumers from the open platform of

images, are linking another microblog, linking to

doing more with social media. The country you are

mentally changed the way that consumers want to

the browser based internet. This will focus social

videos and linking to news stories.

born in, is without doubt the key factor in how you will

interact with brands and there is now a real desire

involvement on content sharing not creation and

go on to adopt and use social media.

to interact, converse and be entertained by brands.

re-enforce the shifts that have been initiated by the

When asked about what “social brand activation”

real-time revolution.

Consequently real-time has created a renaissance At the GlobalWebIndex we have spent much time

techniques are most likely to improve their opinion

content, live events and access to journalists, celebri-

exploring the why we see this and there are a number

of the participating brand, the number one action

ties and people in the public eye. Thanks to this trend,

of clear reasons. Firstly in developed markets, people

regardless of age was to “listen to comments on

social media in many ways is becoming less social.

have been online longer and their online behaviour purchasing, information research and news content. We also see far greater competition from traditional media, where high cost fixed infrastructure of cable/satellite, multi room TV households, or games consoles erode our need to turn to the internet. In


photography Meena Kadri

in the traditional media business, as they have the

has been defined from a pre social age, focused on


The new opportunity for brands

forums/social networks”, this was followed by a “website/presence to interact with the brand directly” and then “creating applications / online services”. It is clear the role of a brand as simply an advertiser is over and concerns about a brands right to be active in social spaces is misplaced. Consumers crave and value brand interaction in all forms.







Average age

38.5 ▼



billionaires in China today






mobile phones

Source: 2010 Hurun Wealth Report






Climate range throughout the year and across russia

-50 nuclear power plants

Number of friends on social networks


worlds largest

highest tweet



Source: Discover BRIC, TNS

from mount everest


BRAZIL has the

NEW cars (SOLD IN APRIL 2011)

Half of China's population will live in cities and towns in 2015.


Discover BRIC, TNS

in russia






10.5 million

new delhi

21.5 million



6.5 million

Rio de Janeiro

Discover BRIC, TNS

19.5 million

Content new consumers, new markets

New consumers, new markets Picture the scene. The Futures Company’s chief executive, Will Galgey, on a trip to Shanghai, returns to his room after breakfast, to find that the staff have already started to clean it. The television has been re-tuned to CNN, and the maid is trying to tell him something. text by Andrew Curry, The Futures Company Illustrations by Mark Verhaagen

As he later blogged, “She was gesticulating with her fingers to make the number ‘two’ and pointing at the television. My Mandarin was no better than her English, and it was only after she left that I saw the news that China had just overtaken Japan to become the second largest economy in the world.” For Galgey, the story was about the pride the Chinese have in the country’s recent economic achievements – compressed into less than a lifetime. It is, say the IMF, only a few years before she will be able to celebrate China’s arrival as the largest economy in the world, at least by some measures of spending power. And where China goes, India and Brazil are following. The speed of this transition has been remarkable. By 2030, Asia’s economy could be larger than that of the US and the European Union combined, with the region’s share of world GDP swelling from a little under 30 per cent to more than 40 per cent. According to Anoop Singh, head of the IMF’s Asia and Pacific Department: “Twenty years from now, Asia’s economy as a whole will be larger than that of the G-7 and half the size of the G-20”. And Latin America—which, like Asia, had its financial crisis early—is growing at speed as well.





Content new consumers, new markets

When the economic trends are combined

billion people, spending a total of $6.9

—it still has the largest population of the

wind turbines. Huawei, similarly, was

trillion annually. Our research suggests

world’s poor within its boundaries, some

Shifts in corporate ownership

company, China Mobile, meanwhile, is

with population changes and urbanisation,

among the world’s ten biggest companies

listed as one of the world’s top innovators

it is not surprising that the world is now

that this figure will rise to $20 trillion

350 million.

Perhaps, so far, the biggest fundamental

by market capitalisation, with more than

by Thomson Reuters. Network provider

looking to the south and south-east. We are

during the next decade—about twice the

economic shift has been the global changes

508 million consumers. It has also pushed

China Mobile is now one of the top

likely to see another billion people on the

current consumption in the United States.”

And in Asia, in particular, there is poor

we are starting to see in ownership.

its way into the top ten of the brand

ten global brands in Millward Brown’s

planet in the next twenty years, who will

The goldrush, it seems, is on.

social protection, for dealing with unem-

There are now 61 Asian businesses in the

value survey BrandZ. This acquisition

annual BrandZ rankings – a list that

ployment and healthcare, which means that

FT’s Global 500, based in China, India,

trend seems certain to continue. Because

assesses consumer brand equity as well

mostly be found in the new mega-cities in Asia. And Asia and Latin America also have

There are some wrinkles, though. It is

families save instead of spending. From

Taiwan, Singapore and Indonesia, and

developing markets have weathered the

as financial performance. The notion

younger populations—certainly compared

unlikely that China, in particular, will

a global perspective, this has meant that

Asian multinationals are reshaping some

global downturn better, they are in a

that Western businesses do the design

of the world’s biggest industries. It is not

position to buy. A Grant Thornton survey

and leave the low-cost production to

coincidence, either, that Bill Gates has been

in March this year shows that 44% of

the Global South is rapidly becoming

displaced as Forbes’ richest man by the

privately held businesses in Brazil, Russia,


Mexican telecoms tycoon Carlos Slim.

India, and China are planning to grow by

We see markets which have strong and successful local players, with skilled workforces, different patterns of innovation, and which are moving rapidly up the value chain and into new markets.


acquisition in 2011, up from 27% last year.

And there are two big implications from

The result is a re-shaping of the world’s

In other words, the story here is not

all of this. The first is about innovation,

industrial landscape. In the car business,

the one that’s usually told. This is not a

the second about brands and branding.

for example, Volvo has been acquired by

tale about virgin consumer landscapes,

China’s Geely, after changing hands for

with people anxiously waiting for the

to Europe and Japan—which gives them, for

continue to grow at the same hectic rates

China has been able to carry on underwrit-

$1.5 billion. India’s Tata group now owns

delights of the world’s finest packaged

The implications for innovation

the time being, an economic and innova-

we have seen over the last couple of

ing America’s debts, but it is not a route to

Land Rover and Jaguar, as well as being

goods products. Instead, we see markets

We are increasingly seeing innovation

tive energy.

decades. Like India, it is rapidly moving

a balanced or stable global economy. Even

the world’s largest steelmaking group. In

which have strong and successful local

emerging from the new competitors

out of the stage of being a low cost

orthodox economists have started to point

telecommunications, China’s Huawei is

players, with skilled workforces, different

in Asia and Latin America which has

The consultancy McKinsey has put some

producer. Issues of inequality continue to

to the successes of Latin America in this

the world number two in mobile-infra-

patterns of innovation, and which are

originally been designed for local markets.

numbers on the scale of the coming

surface. Resource shortages, in particular

respect. Generally left-of-centre govern-

structure equipment, behind Ericsson. Its

moving rapidly up the value chain and

Such products tends to have squeezed

global shift. In typically breathless style,

food and water, are already causing

ments have started to address high levels of

rise has provoked a major restructuring

into new markets. Most of the world’s

out features and materials to reduce

it reports, “The rapidly growing ranks

problems. Pollution is problematic. In

inequality, and increased social protection,

of the global market, which saw Siemens

science and technology graduates now

cost. Historically, such products would be

of middle-class consumers span a dozen

India, corruption remains an acute issue,

with the result that people have started

and Nokia merge network infrastructure

come from China and India, and China is

unlikely to gain traction in more affluent

emerging nations, not just the fast-growing

and—for all the millions who have been

to buy more, creating more balanced, and

divisions and France’s Alcatel acquire

already—by some distance—the world’s

markets, but in a post-crisis climate, more

BRIC countries, and include almost two

lifted from poverty there

more prosperous economies.

America’s Lucent. The Chinese telecoms

largest producer of both solar panels and

affluent consumers are increasingly also




Content new consumers, new markets savvy shoppers who understand that

refrigerated storage. The lessons learned

designed for Ghana. But this might canni-

choice comes with a cost.

from Bangladesh helped Danone launch a

balise existing products and hurt margins.

luxury brand launched last year target-

discovered the hard way in India that its

low-cost yogurt sub-brand called Ecopack

But this is a classic business conundrum: if

ing the Chinese market. Historically,

American approach to water management

in France.

you don’t launch these products yourself,

Hermès expanded by buying existing

created more enemies than friends, and has

a competitor will—and quite likely a new

brands. But as with dENiZEN, Shang

spent the best part of a decade developing

competitor from Asia or Latin America.

Xia is being launched from the ground

different approaches which ensure that

up, using local know-how and materials

local communities are not disadvantaged by

So Huawei’s $100 smartphone has been developed for the Asian and African

• Shang Xia. Shang Xia is a new Hermès

There are always risks here; Coca Cola

markets, but there are already signs of

In the specialist health sector, Medtronic

a ‘grey market’ which imports handsets

developed for the Indian market a low-cost

into the US. The Tata Nano is a lightweight

pill-sized pacemaker which could be

The implications for brands

to build a global presence at a lower

the presence of a Coke plant, rebuilding its

car that has been designed against Indian

inserted in the heart using a stent. This

Increasingly, in this world, we expect to

price point. A Hermès representative

reputation slowly as it goes.

pricepoints, but which is likely to be modi-

was both a simpler procedure—so more

see brands operating in more complex

has insisted that it is “a Chinese brand,

fied, to comply with market regulations, as

surgeons were capable of carrying it

ways than in the past to manage the

developed in China with the Chinese

But the bigger challenges are in the deep

a low cost model for Europe and elsewhere.

out—and the design also included a sensor

complexities of different markets, new

team, based on Chinese craftsmanship

restructuring of the world economy. When

for remote monitoring. The company now

competitors, and more complex consumer

and broadly made in China. We don’t

China does become the largest economy in

And global brands have also been learning

plans to launch this in the United States

behaviour. As we argue in our recent

want any confusion.” The challenge

the world, it will be the first time that the

how to adapt innovation from the South

and Europe, and sees opportunities to

report on The Future of Global Brands,

for Hermès, as one scholar of the

largest economy has not also contained

for their traditional markets. From our

adapt it for other health conditions, such

increasingly, global brands will start to

Chinese luxury market has noted, is

the richest consumers. However large

Streetscaping network, we see increasing

as Parkinson’s.

build local brands, sometimes in partner-

that products specifically targeting

the growth of the ‘emerging middle class’

ship with local businesses, using local

the Chinese market are often “less

over the next decade, they will still be

numbers of examples. France’s Groupe Danone, for example, learned about reverse

Sometimes, such innovation is just a

expertise to “co-create” new products for

welcomed than products that are

far poorer than the middle classes in the

innovation in Bangladesh, where they

matter of repositioning a product for a

this emerging middle class, rather than

totally foreign”. It will be interesting

affluent world—even as those more affluent

set up local microplants that produced a

new market. •Nestlé’s Maggi brand—low-

merely copying existing lines.

to see if Hermès’ co-creation model

consumers are still squeezed by debt and

tiny fraction of the yogurt of a standard

cost, low-fat dried noodles developed for

resolves this challenge.

rising costs. The big opportunity is for

facility, partly because of the lack of

rural India and Pakistan—found a market

Some examples:

in Australia and New Zealand as a healthy and budget-friendly alternative. P&G,

innovation for a crowded planet which uses • BonVi. Launched in Ghana in 2009 by

• dENiZEN by Levis. dENiZEN was

less resources, costs less to produce, and

Amway, BonVi—a range of personal,

still rewards its innovators. It will take a very different mindset.

similarly, found that the market for its

launched last year in Shanghai, the

nutritional, and household products—was

Mexican Vicks Honey Cough cold-remedy

first time Levis has launched a brand

developed through a live prototype

syrup could extend to Western Europe

from the outside of the US, and the

run in rural Ghana involving in-home

and the US

first Levi’s brand to have its headquar-

interviewing and village charrettes with

ters outside the US. The five-pocket

feedback on everything from product

Of course, there are risks in this. Philips

jean is aimed at 18 -29 year-olds in

samples to the proposed colour of the

has considered launching in the affluent

China, Singapore, South Korea, and, in

brand identity. BonVi aims at a mass

world the low-cost solar-powered lighting it

the future, India. Levi’s calls this target

market using local engagement to

group “Asia Rising.” In style and price,

convert existing Amway products to fit

these jeans are all about this new

local needs, and co-creation to identify

global consumer. As importantly, these

additional needs learned from local

jeans represent a ground-up approach

collaborators that can be met by new

to building a global presence.

products within the global capabilities of

Additional research by Anand Rao

Amway such as water purification tabs.





SS: You’ve always been bullish about globalisation – are you still?

SS: But they thought it was slightly naughty of the United States to indulge in quantitative easing and, as far as the Brazilians saw it, deliberately undervalue the dollar?

JO: Yes. Although I don’t recall myself always being bullish; but I have been for the past decade or so.

JO: The US’s job is to follow a monetary policy that satisfies the US. The quicker they can follow policies that help the US get out of troubles they’ve been in, the more likely it is that the dollar will eventually recover. The Brazilians know that, as well as I do.

SS: So as emerging markets continue to grow it benefits the old industrialised world? JO: Broadly speaking I think that’s right. I think globalisation and the cross-border trade linked to it is one of the few win-wins that are out there. Of course there are losers, but in aggregate I think everybody is better off. What’s interesting at this moment in time is that we see a few more signs that there are winners from the supposed ‘declining’ west, which is a key in order for the social aspects of this to be accepted and tolerated.

SS: You don’t like to use the term ‘emerging’ economies, is that right? JO: I think it’s an insult. We’re living through an era where the world economy, for close to a decade, has been driven by these guys, increasingly so. To treat them in the same way verbally, or any other way, as commentators have done in the west is almost disrespectful.

SS: Not being disrespectful but realistic, do you believe that China, for example, can continue to grow on the rate it has? Is that sustainable?

Jim O’Neill HARDtalk is the flagship programme on BBC World News that asks the difficult questions. In this special series of interviews for Blink, Stephen Sackur, one of the BBC’s most respected journalists, adopts the same uncompromising style with moguls and figureheads shaping the worlds of advertising, sales and media. This issue, Stephen goes head to head with Jim O’Neill, Chairman of Goldman Sachs Asset Management.

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JO: I don’t think they will grow by that rate this decade. I think they will drop to the ‘intolerable’ [laughs] level of around 7% to 8%, which by our standards is quite remarkable. But China’s starting to have dilemmas whether to keep growing at that pace. Having spent a lot of time there, I think we’re entering a phase where China is all about quality of growth, as opposed to just quantity, which is a very important subtle shift.

SS: Your company, Goldman Sachs, said last year that China will overtake the United States, at best guess, by 2027. Do you think that was too cautious? JO: Well, I was a part of that. The momentum at any moment in time seems to be so powerful right now, that it may seem it was a bit premature, but China will go through ups and downs just like everybody else, so I’m highly reluctant to formally suggest that it could happen sooner. And of course there are various things that could happen in the meantime, that would have never actually happened so...

SS: But you don’t believe it will happen sooner do you? JO: No, I don’t. The thing that impresses me so much about the Chinese situation is that the policy makers themselves worry about what the sceptics say, which I see as a good sign. It stops them from getting into the trap other countries did. Japan being a perfect example, having been either in denial of any challenges or just ignoring them.

SS: But that threatens your rather rosy view of how all of this is going to play out, benignly? HARDtalk presenter, Stephen Sackur SS: But it isn’t all about China. By 2030 PwC says that China, Brazil, Russia, India, Mexico, Turkey and Indonesia, the so called E7, will be more economically powerful than the G7. JO: That’s very consistent with the reason why the BRIC term became so popular. Five years back we said that the 4 BRIC countries would become bigger than the G7 by 2037. Add in the others and that’s almost definitely right. Also, by the end of this decade the 4 BRIC countries will be bigger than the US. We are talking about profound changes in the world economy and society. From an investment perspective, it feels like what the California Gold Rush must have felt like. The degree of change is just incredible.

SS: Let’s start unpicking it... There are signs of serious problems in China. Inflation is high, the government is raising interest rates and it’s still not clear that it can prevent a bubble economy developing.

JO: One of the fascinating aspects of this, particularly on the back of the global crisis, is that we are in an environment where political leaders around the world play the blame game. Everybody wants to blame somebody else, that’s a mini-dilemma of the globalised world we live in. And due to the power of the information process, where everybody has access to everything imminently, people cannot separate emotion from objectivity. The fact of the matter is Brazil is living through an era where tens of millions of people are being brought into the middle classes. On a global basis, we’re probably living through the best era; income differentiators being narrowed, hundreds of millions of people being taken out of poverty. So to use phrases like ‘currency wars’ in an environment where that’s happening is just ridiculous.

SS: And international institutions and systems like the IMF and the WTO look increasingly toothless.

JO: I hear these things week in and week out. Eighteen months ago it was highly fashionable to say China was on the verge of a housing bubble. And they could have been but, very interestingly, the Chinese worried about it enough to stop a housing bubble. On the inflation, you are right, the Chinese are worried about it and that’s what you want to see. I worry when I see the local policy makers dismissing the problems that face them.

JO: We need a faster move of international organisations to cope with the complexities and subtleties of how the world is evolving. We still have very western dominated international organisations, which many of these (growth) countries feel do not represent their shared interest. In order to keep the benefits going, we need to move more rapidly to reform the IMF, the World Bank... The G20 is a good development in that regard but it needs to be made more successful. Probably, also the UN and maybe even the whole international monetary system as it currently stands.

SS: Talking about Brazil and other growth economies, are we seeing a real possibility of currency wars?

SS: Does the situation in Europe, particularly in the Eurozone penetrate your optimistic armour?

JO: The Brazilians themselves dreamt up this phrase and I’ve written to them and spoken publicly about it; I think it was slightly naughty of them to use this phrase.

JO: The EU example is more complicated. The crisis is worse since January. People need to differentiate between the EU economy and the EU monetary... The Eurozone crisis is about the structure of the monetary union.

“By the end of this decade the 4 BRIC countries will be bigger than the US. We are talking about profound changes in the world economy and society.”

Based on the interview that aired on 10 January 2011. Updated with Jim O’Neill on 6 June 2011. For further information on advertising and sponsorship on BBC World News and please call +44 208 433 0000 or e-mail

Advertising feature sponsored by BBC World News.

Content The House that took over Russian TV

The House that took over Russian TV Reality dominates primetime TV everywhere in the world. In Russia, The House has swept all before it. Dobrinya Gutiev and Vera Kagan explore the success of Dom-2. For the last eight years, Russian TV

record-breaking 8m Roubles.

schedules have been dominated by Dom,

People have remained loyal to the show

to get involved. International brands, in

early as 2005. The TNT channel earned

they should invest in the show or not.

because it’s interesting. For young people

particular, stayed away at the start.

$7m from indirect advertising and

Many – who naturally are not in the

sponsorship in a single season.

show’s target market – reject integration

Russian for The House. It’s a spectacularly

The House was so successful that in May

who live with their parents, Dom-2 shows

successful reality TV format that has

2004, the TNT-owned channel tweaked it

the basics of a self-reliant life, letting them

Local companies, however, were less

defied religious condemnation and

to create Dom-2 (The House-2). This time

see real human behaviour and study other

reticent. Russian mobile operator Megafon

For the first three to four years, integra-

feelings towards the show.

commercial caution to strike it big.

round 20 young boys and girls signed up

people’s mistakes.

used Dom-2 to raise the brand loyalty and

tions paid-off handsomely. After 2009,

They may have to change their views,

brand recognition – after seven months

however, the commercial performance

however, as the economic climate has

brand loyalty increased by 20%.

started to decline.

changed. After 10 years of impressive

with no end in sight. More than 400

Step-by-step international brands have

Taking part

to find love and build a home for the winIt wasn’t the first reality show on Russian

ner. To win they had to form a relationship

Gaining popularity

TV, that honour falls to Behind the Glass –

with another participant.

Dom-2 has been on air for seven years

similar to Big Brother – which ran in 2001

growth when there was little need to take risks, Russia is now different.

and offered viewers constant access to the

Over the years the focus of the show has

people have taken part and more than 10

become involved, to the point where

TNT has now changed its sales policy and

lives of participants.

changed. Instead of simply rewarding

couples have got married.

commercial clutter has become excessive.

only allows 5-10 products to get involved at

Growth rates have now shrunk to around

More than 90 brands – including Huggies,

any one time to decrease clutter. The show

4% – from around 6-8% – and brands need

participants for their mastery of building The success of Behind the Glass was a me-

skills, the programme now spies on them.

However, while the show continues to

M&M’s, Panasonic, Pepsi Max, KitKat,

has also become a multimedia operation:

to find new media solutions. At the same

too moment for TV, with every channel

The audience knows practically every single

be one of the highest-rating shows in

Nokia and Twix – have now participated.

there is a magazine, which sells more

time, dramatic media inflation have also

starting its own reality projects. TV-6 in

step they take – “candid” TV cameras, extra

Russian TV history, it hasn’t always

than 100 000 copies a week, participants

pushed traditional strategies out of reach

particular invested heavily in the genre,

episodes and online translations keep the

been popular with brands, regulators or

After Remington’s integration into the

tour all over Russia and appear across the

for some brands. Sponsorship on shows

putting reality shows front and centre of

audience informed almost 24/7.

religious leaders.

show, young ladies headed to the shops

media landscape, on popular Russian TV

such as Dom-2 can generate a big impact at

saying: “I want the same curling irons as

talkshows and in TV commercials.

a relatively low cost.

its schedule.


opportunities as a result of their personal

The show is also no longer about introduc-

Due to the nature of some of the content,

the girl from Dom2”. Remington’s brand

It hit gold in June 2003 with the launch of

ing a completely new set of participants

it has had to retreat from the daytime

recognition increased from 20% to 70% and

Online Dom-2 attracts more than 40,000

Those that do take the plunge need to

The House. Based on a format developed

every year but about getting to know a

schedules and now airs only after 23.00.

sales went up sevenfold.

unique visitors per day and has about a

make sure they take full advantage of the

by British company Zeal, it challenged

rolling group of competitors. Some of

million registered users. It’s become a

opportunities Dom-2 provides. Once you

couples to spend four months building

them have been in the house for more

The Russian Church protested against

According to the company Gallup Media

media juggernaut.

enter The House there can be no

a house, without any professional

than three years and viewers will always

the show and its participants and,

Russia, Dom-2 became a leader in product

help. The prize for the winners was a

recognise a familiar face.

initially at least, brands were reluctant

placement in the Russian TV market as


half measures. For marketers the key question is whether



content twitter





MediaCom Blink #3 - The Social Media Issue  

MediaCom Blink #3 - The Social Media Issue

MediaCom Blink #3 - The Social Media Issue  

MediaCom Blink #3 - The Social Media Issue