The executive presentation to accompany the market entry analysis white paper

1. 6 C H A L L E N G E S U S W E B F I R M S M U S T M E E T
T O S U C C E E D I N C H I N A
Going .CN

2. What This Is
A Report for US Senior Executives at Web Firms trying
to leverage
 The largest Internet audience in the World
 The largest commercial market
 BUT an immature online advertising environment
Whose Revenue Model is based on Online Advertising

3. What We Did

4. What We Found
 Six Unique Challenges
 US Firms Are Unaware or Ignoring these issues
 Bottom Line: No US Web Publisher Is Leading In
China Today
 They have no natural advantage in China

5. Overcome Fear of Labor
 China has a lot of people who need jobs
 Brute force labor in lieu of infrastructure
 Government likes massive headcounts
 Cultural expectations mean face to face is important
 Automation is not a virtue
 Contrary to typical US firm
focus on labor cost saving

6. The Government – Obey, Lobby but Move Ahead
 Multiple government (national and provincial)
authorities and influence
 Multiple, often conflicting, rules and regulations
 Close ties can be beneficial
 Get over the uncertainty
and move ahead
 Ask forgiveness if questioned
 But See the Great Firewall

7. China Has the Largest Online Audience. So What?
 China Internet Audience is 100+% of US Audience
 But China Ad Spend is 5% of US
 And 80% of that goes to 6 players
 Ad Models are unsophisticated
 Ad Buyers are different
 Focusing on brand awareness
 Users Aren’t Transacting
 Set Your Expectations
Accordingly

8. Start at Zero – Build Up to What Makes Sense
 No US Based, Cookie Cutter Solutions
 Rethink Everything for China
 Offering
 Brand
 Model
 Systems
 Local Leadership
And Autonomy
Is KEY

9. Deals Are Person to Person, Bargained For, and You Buy
What You Can See
 Even Online, Guanxi
Matters
 Everything Must Be
Negotiable
 Advertisers Don’t See
Value Unless They See
the Ad

10. The Chinese Internet Will Not Become the US Internet
 Clutter Is Expected
 Entertainment
 Youth
 Community
 Provincial
 Mobile
 Café

11. Final Thoughts
 IF Your Goal Is to Compete in China’s Online Ad
Space, Don’t Wait…
 Don’t Wait Because of These Challenges
 Chinese Internet Is Moving Even Faster than U.S.
 Don’t Wait Because of Ethical Issues
 Ethical Issues Surrounding Media Especially Difficult
 But Not Going to Fundamentally Change; Make Go/No-Go
Decision
 Compete Now

12. http://jamiemba.wordpress.com/