~ New research reveals overconfidence could result in financial, legal and HR risks for US brands
SAN FRANCISCO, Jan. 16, 2020 /PRNewswire/ -- LEWIS, the global marketing consultancy, today revealed findings from its "Bay to Bay" research campaign. LEWIS surveyed 351 U.S. marketers on their perceptions of and priorities for the Chinese market. The findings reveal that, while the market remains a priority for most, a perception of overconfidence amongst U.S. senior marketers is leaving brands open to risk in the world's second largest economy.
The research is the next iteration in the LEWIS Bay to Bay series – referring to the dual centers of gravity in the San Francisco and China Greater Bay areas. The series was launched in 2018 to explore global innovation, entrepreneurialism and leadership culture while supporting dialogue and conversation between the two regions.
The results reveal that China is still a key market for the majority of brands:
- 71% are currently marketing their products or services in China
- 80% feel their marketing has been extremely or very successful
- 62% are increasing marketing and communications budgets in China
- 55% are planning to increase budgets next year
While 80% of respondents believe they completely or mostly understand marketing practices in China and 88% are very confident in their ability to accurately measure campaigns in the country, 77% cite a lack of transparency in the marketing industry as a barrier to their marketing efforts.
The survey reveals that 23% of respondents feel it is either extremely or very difficult to market in China, highlighting wasted marketing efforts and investment and exposing knowledge gaps in two key areas:
- Market Understanding:
- Technical Knowledge:
"The results of the survey present a stark contrast between the success U.S. marketers feel they are having in China, versus their understanding of the market. This speaks to general overconfidence among U.S. brands and, in a market as complex and rapidly evolving as China, this has the potential to present unnecessary risk," comments Matt Robbins, Vice President of Insight and Research at LEWIS.
When asked about marketing priorities for the future, 88% of respondents believe expanding their marketing and communications programs outside of tier-one cities is very or extremely important.
However, the current focus remains on the upper middle class, with 90% targeting this group and 80% feeling that Chinese consumers are still more influenced by marketing of luxury or internationally renowned brands than lower-tier brands.
Of respondents whose companies are working with marketing or communications agencies in China, 67% are working with local Chinese agencies headquartered in China and 77% are working with global agencies with Chinese offices.
"While the global headlines may paint a sense of tension between the U.S. and China, it is clear that at a business level, China continues to be a priority for marketers. However, gaining a clear understanding and good guidance at a local level is key to avoiding missteps and reaching untapped audiences," adds Robbins.
To read the full report, please visit: lws.co/baytobayreport.
As part of the continuing Bay to Bay series, LEWIS will also be hosting a series of podcasts designed to address key questions U.S. marketers have when operating in China. Visit baytobay.com to learn more.
LEWIS is a global marketing consultancy built to help and inspire brands to grow. It provides a full spectrum of marketing, communications and digital services to deliver tangible business impact for clients. The company has over 500 staff across 27 offices throughout Asia, Europe and North America. www.teamlewis.com.
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