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WORLD / Wall Street Journal Exclusive
Marketers tuned in to TV habits
(WSJ)
Updated: 2007-07-30 12:39
http://online.wsj.com/public/article/SB118574671889881610-quYu2upgMHCNTcF4j
49fJN2_fhc_20070805.html?mod=regionallinks
SHANGHAI -- For most market researchers, China's vast interior has long
been uncharted territory. But that is starting to change, as economic
ripples from the country's booming cities create wealthier rural
consumers -- and draw attention from companies and their ad agencies.
Less than two years ago, AGB Nielsen Media, which tracks TV-viewing
habits outside the US, monitored audiences in 11 of China's biggest
cities, including Beijing, Shanghai and Guangzhou. It wasn't even
interested in villagers who lived on the outskirts of these metropolises.
Today, it has nearly 10,000 "people meters," which gather data on who is
watching what and when, across a much broader area, including rural parts
of Liaoning province in the northeast and Sichuan province in the
southwest. The meters cover 56 million city dwellers and 315 million
"nonurban" Chinese.
One insight: Nonurban people watch more television during the daytime,
compared with people in big cities; researchers hadn't fully grasped
that, AGB Nielsen says. In part, that is because farmers and shopkeepers
are more likely to come home for lunch, researchers say.
For companies such as Procter & Gamble and Coca-Cola, which are looking
to widen their reach in China, that is important information, allowing
them to potentially reach more people, while spending less ad money by
buying cheaper daytime commercial slots.
"If you decide not to measure those outside of the city, you are losing
two-thirds of the population as they watch TV," says Alberto Colussi,
chairman of AGB Nielsen's management board.
As the spending power of China's rural population grows, that is a
serious oversight. According to AGB Nielsen, in the areas it covers
today, 31.6 million urban homes have a monthly income of 1,500 yuan
($198) or more, while in the nonurban areas there are 31.3 million homes
in that bracket.
Gathering data on rural Chinese can be difficult and costly. There are
sharp differences in regional tastes and habits, making it hazardous to
generalize. Even the languages spoken from one part of the country to
another vary widely.
But as consumer-product manufacturers and other companies push into
less-developed markets, market-data firms are working harder to fill
knowledge gaps.
AGB Nielsen plans to double its number of meters and expand coverage to
16 provinces and cities representing 870 million viewers before the 2008
Beijing Olympics. The cost of adding meters means the company won't be
profitable in China for now, says Mr. Colussi. Still, he says, it is
essential.
AGB Nielsen's main competitor in China, CSM Media Research, a joint
venture between China's CTR Market Research and London-based market-data
and information company TNS Group, collects data from 45,000 homes,
representing 1.19 billion viewers in China.
CSM Media uses people meters for major urban households. In smaller
cities and villages, the company generally has viewers fill out a daily
journal, which is less expensive but can be less accurate. As the TV ad
markets in these smaller localities grow, the company is replacing
journals with meters.
Advertisers are willing to pay more for better data as China's economy
grows, says Mark Patterson, chief operating officer for GroupM Asia
Pacific. GroupM, the media-buying arm of WPP Group, is the world's
biggest ad-space buyer, and spends $1.4 billion a year in China.
GroupM expects the ad market in China to grow to 184.98 billion yuan this
year, up from 155.76 billion yuan in 2006. About 70% of the spending will
go for TV ads. Next year, industry analysts estimate, the Beijing
Olympics will give the ad market an additional 30% boost.
Since reliable data are scarce outside big cities, Mr. Patterson says,
"we have to do our own crude research as well. We deep-dive into certain
Chinese cities to learn about Chinese viewing habits" through household
interviews. GroupM also buys ratings data from both AGB Nielsen and CSM.
Using data from multiple sources can help, says Glen Murphy, managing
director for ACNielsen China, which does market research for clients on a
project basis and also compiles store-sales data.
"There isn't an established long-term discipline around collecting and
using information throughout the country. So, if you compare it to the
U.S., where the economy is well-developed and they have an 80-year
history of measuring and collecting information on what consumers are
doing...that's all still developing in China," says Mr. Murphy.
ACNielsen has been surveying the China market for clients since 1983, but
data collection in smaller cities can be a challenge. Unlike in major
cities, few stores have electronic-sales data. ACNielsen researchers
count stock in stores and collect purchase invoices at sample outlets.
ACNielsen has doubled its staff to 1,600 in the past two years in China
to expand monitoring, says Mr. Murphy.
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