A Beijing-based entrepreneur talks about how his digital marketing agency links Western companies to Chinese consumers.
By Aaron Posehn
In this article, I sit down with Dr. Mathew McDougall, the founder and CEO of Digital Jungle, a Beijing-based digital marketing agency that helps to establish Western brands looking for a place in the Chinese market. Focusing largely on industries such as higher education, real estate, imported foods, and consumer brands, their services offer Chinese-focused solutions across a wide range of digital channels.
LCB: What makes Digital Jungle different in terms of how it helps Western companies brand themselves in China?
Mathew McDougall: Originally from Western Australia, I established Digital Jungle after coming to China, having been here now for over a decade. Given my background, Digital Jungle has a unique approach that pervades all aspects of the company, from how it is run and managed to how we acquire clients. Our approach is to adopt the best marketing practices from overseas markets, localize and contextualize them in terms of audience, platform, consumer behaviour, and apply these considerations to strategy and execution of a digital program targeting Chinese consumers.
Through the years, our Chinese colleagues have developed skills in working with Western marketers as well bringing the local experience of marketing execution and consumer insights.
What trends are you currently seeing vis-à-vis Chinese consumers’ preference for foreign vs. domestic brands?
There is a very strong preference for foreign brands and we believe that this strong desire to interact with and purchase foreign brands will continue well into the future. With that said, there is a rising trend among wealthy Chinese consumers to buy domestic brands. China’s first lady, Peng Liyuan, has been seen wearing domestically designed and produced clothing and fashion apparel, as domestic brands have continued to shed their reputation as inferior. The Chinese consumers are always trying to display their individuality through fashion and consumption, so new “one of a kind” boutiques are becoming more popular.
What are the characteristics of foreign products or services that successfully appeal to Chinese consumers? How important is nationality when it comes to telling the story of a brand?
Chinese consumers are smart and savvy. It is widely accepted now that Chinese are sophisticated consumers in their tastes and the ways they research and engage with brands.
Generally, they tend to look for value in every purchase—even at the luxury end of the market. The important thing is identifying what value the foreign product offers. Ten to twenty years ago, just being foreign was enough for a brand, but now things are changing and the quality of Chinese products has risen considerably; now foreign products must compete on price, quality and brand image. The story behind your brand is becoming a central theme in the minds of Chinese consumers and your story in China is also becoming important. Consumer products and food and beverages—think wines, cheese, milk and baby formula—tend to be strong sellers for foreign companies. Much of the brand story of those goods centers around perceived quality (wine), novelty (cheese) and safety (milk and baby formula).
You work with Western companies interested in selling their goods in China, as well as with Chinese consumers who will hopefully buy them. What is your approach to successfully connecting these two very different sides, both culturally and financially?
We think it is more a matter of culture these days. Financially, China offers consumers at every price range, and a continuously expanding pool of buyers. There are now more millionaires living in China than any other country. Often, with many of China’s large cities you can see people driving Bentleys and shopping at Prada while at the same time you will see shoppers eating 10 RMB noodles. So, no matter what your product is there are consumers in China in that price range.
Culturally it is a little more challenging but the way Digital Jungle address this is by using content and social media marketing. We have deep insights through our research programs and understand that Chinese consumers are more trusting of peer views, recommendations and friend referrals over traditional advertisements. So, using social media marketing and leveraging research allows us to effectively reach our clients intended audience.
Your clients are from a wide variety of organizations and you specialize in promoting a number of very specific sectors, including real estate, higher education, imported foods, and consumer brands. Is there a difference in how you approach each one when formulating a new marketing strategy?
Digital Jungle knows that every client and product is different and therefore we create a marketing strategy that addresses the goals identified for each client. With that said we tend to focus on search, social media and content marketing, so many of the underlying platforms are similar (like Baidu, Sina Weibo or WeChat) but the application of these tools is quite different. As you can imagine, marketing candy bars and marketing MBAs requires two very different strategies, even if the communication platform employed is the same.
Content marketing has become central to the promotion strategies of leading companies nearly everywhere today. What are some of the unique features and challenges of the content marketing landscape in China?
Content marketing is about telling impactful stories that resonate in the minds of the intended audience. This remains true throughout the world, so there are unique features with distribution but the core remains the same and Digital Jungle has built a team that is tasked with creating inspiring and engaging stories—content that will resonate and be shared. When creating content with a Chinese audience in mind, the type of content, the form of that content and the method in which this content is read/engaged all play into the strategy. For example, Chinese tend to read content via mobile device/smartphone and they tend to prefer watching a video, not reading a long story.
What online platforms will gain the most traction in the next few years and why will they be important to digital marketing? How will they help you promote your clients’ products?
We have been seeing a lot of growth in WeChat. The platform is relatively new but seems very promising. Although we see a lot of marketers struggle to understand how to leverage and position WeChat, Digital Jungle sees this more as a mobile, social CRM. This O2O platform should replace email as the main method of communication with members and it will make personal 1:1 communications more achievable going forward. We see WeChat as an important platform because of its adoption rates, high levels of engagements and high level of authenticity of its users (registering requiring using a real phone number). It also provides brands a direct line to consumers’ phones and therefore into their awareness.
The success of your business relies heavily on communicating products in new ways and effective cross-cultural communication would seem important here. Have you ever experienced difficulties with your own Western employees not understanding aspects of Chinese culture, or vice versa? If so, how did you handle it?
Effective cross-cultural communication in any organisation is never easy or obvious. That said, we encourage a culture of learning within Digital Jungle that has Chinese and Western team members work together and work through mistakes if any are made. Within a workplace that encourages learning, we expect that informal coaching and idea exchange help grow team and interpersonal understanding. This helps the team become stronger and also allows the company to better service our clients. We are all about expanding our knowledge as practitioners and being better at what we do.
In your mind, what is the difference between modernization and Westernization and how does your company help to market foreign goods while allowing consumers to remain feeling distinctly Chinese?
The term “modernization” is the advancement of economy and country, moving away from an agricultural economy to a production and information economy. This is done by the people within the country or culture. “Westernization” is the adoption of a Western culture by another group of people whose own culture is different.
With said, Chinese people don’t want to become ‘Western’. Chinese like to purchase consumer Western goods and services as these brands represent status and level within Chinese society. It is this move towards a more materialistic, ego driven culture that is having an impact on consumer behaviour but it remains a Chinese, not Western, culture.
Digital Jungle helps foreign companies navigate this evolving consumer behaviour as applied to their goods or services; in terms of content, this would be the brand story and the platforms by which it is conveyed as uniquely Chinese.
Although a native of Australia, Dr. Mathew McDougall has been involved in the Chinese Internet and media industries for nearly nine years. Dr. McDougall is currently the CEO and founder of Digital Jungle, a leading Chinese social media marketing agency.