WT China Case Study
This case studies the business strategy and expansion of JWT China from the late 1990s to 2008. As part of one of the world's largest marketing communications network, JWT China grew into one of the largest integrated communications companies in China operating from offices in various parts of the country. The case delivers a thorough history of and inclusive insights into China's advertising industry and the challenges for foreign and domestic firms operating within a highly regulated media environment controlled by the Chinese government. Moreover, this case offers understandings and perceptions into the structure of the highly segmented Chinese consumers market, exploring the socio-economic disparities in income access as well as culturally determined consumer behavior across different regions and urban and rural areas. The case allows us to explore how these trends might impact JWT's advertising and marketing strategies in the future and how to evaluate JWT's business expansion in China dealing with local and foreign competition.
II. Problems and Situation:
The biggest problem of JWT is how to adapt with China’s fast-growing economy and rapid rise of consumption. With the growing economy, there will be more competitors from both international and local areas. Therefore, JWT China has to strategize its expansion to take advantage of a bigger market share. The second problem of JWT China is “their consumers were becoming increasingly individualistic and demanding participants in the marketplace” . This change requires JWT to constantly re-evaluating its channel and advertising approaches for a more sophisticated consumer markets. In the other words, JWT China has to always investigate and learn about their consumers’ trends, cultures. characteristics, wants and needs to meet their changing requirements. III. Key Issues:
The foreign company should be careful by making business in China because of the Chinese consumer behavior, their history and culture. As a major advertising agency, JWT should be very careful with the multinational commercials in order to avoid the conflict and have a positive impact. Since Chinese consumers can be characterized as very highly traditional, their culture and history should be taken in high considerations. As one of the major companies on the Chinese market, JWT is able to quickly and easily secure its great market share and major role on the market. However, as there is a problem with Chinese income gap, the company should try to target cheaper goods and services, which can bring more profit and advantages. By using marketing and advertising strategies for more affordable products, JWT will explore different segments of Chinese consumers; it will affect them and will bring the positive impact over itself. Although China is the fastest grow country and has a great ability of inventing the new technology, adopt the new and transform its traditional media understanding to the new media, TV, newspapers and radio still have the greatest impact over the Chinese population. Having in mind, every second person of China uses computer and internet; Chinese consumers are not willing to adopt the new advertising media as a primary source. Using the data from some research we can say that China is a country without a middle class. Because of the difference in the social status of Chinese, there is a significant problem- how to find and determine that middle class. The government also has a great impact over the advertising agencies in China. The law has some regulation for advertising contents, and prohibits some wordings that are not appropriate for the Chinese consumers. Advertising agencies in China were subject to the Advertisement Law of People’s Republic of China. Dealing with local clients also is a challenge for JWT compared with foreign clients since it is difficult to convince the local ones to implement advertising strategies that had long-term...
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