Part 1: Agency Scope China: A greater value on strategy

Source: © 123rf 123rf Zhujiang River and modern building of financial district at night in Guangzhou China

Agency Scope China 2023/24 follows over six months of in-depth interviews with more than 300 market leaders and senior marketing professionals.

Scopen recently finished a new wave of the Agency Scope Study in collaboration with global independent consultancy R3.

The study is conducted in 10 other markets, enabling the inclusion of global benchmarks in some key criteria.

In this edition, 323 professionals from 242 different companies were interviewed, and 837 client-agency relationships were analysed.
The fieldwork took place between August and November 2023.

Top executives interviewed

The marketing executives interviewed are top executives from the most important advertising companies in China, including users and investors of professional marketing, communication, and advertising services.

They are predominantly women (67%) and mostly work in Shanghai (57%).

On average, they have been with their companies for almost seven years and have held their current position for five and a half years.

Forty-four (44) percent operate at the director level, with 56% defining their role as marketing director/manager.

The companies they work for are mostly foreign multinationals (74%), with the FMCG (45%) sector being the most represented.

Constantly shifting focus and demands

In 2023, as the market entered the post-pandemic reopening phase, economic recovery was slow.

Changes in consumer mindset and market performance indicated a downgrade in consumption power, leading to ongoing evolution in the competitive landscape.

While market leaders are cautious with investments, they are also actively seeking new business growth points, making marketing challenges more dynamic.

In this new environment, the focus and demands of market leaders as well as their relationships with agencies, are constantly shifting.

This report highlights key insights related to the challenges faced by market leaders, their expectations and requirements for collaboration, and the evolving relationships between market leaders and agencies.

12 different agencies to solve marketers’ needs

In China, marketers work with an average of 12.2 different partners to solve all their Marketing-Communication needs.

Integrated Marketing Communication (IMC) agencies (3.7) and activation agencies (3.1) have been, since the first edition of the Agency Scope in China, the most common and numerous agencies engaged by individual brands, followed by media agencies (1.8), PR agencies (1.4) and other types of agencies (2.2).

Greater value placed on strategy

When marketers are asked what type of agency they would prefer to work with to solve their creative needs, 70% (74% in 2022) of respondents stated they would prefer to work with specialised agencies across different disciplines.

Twenty-six (26) percent (14% in 2022) stated they would prefer to work with an IMC agency.

The slight shift towards IMC agencies reflects clients' increasing focus on strategic planning and digital strategy and are attracted to agencies that demonstrate full-funnel thinking.

AI is gaining ground

When marketers were asked if they use any AIGC tools, 38% of respondents answered affirmatively.

The most used ones are DALL-E, Midjourney, Stable Diffusion (58%), and ChatGPT (53%).

The main reason for using them is primarily to Improve efficiencies (89%).

On the other hand, the main opportunities/challenges that they believe will arise from their use by the agencies they work with are a Different talent mix, followed by Improved working processes.