SY Lau, president of Tencent online media group and senior executive vice president of Tencent, spoke at the Cannes International Festival of Creativity where he engaged in a one-on-one conversation with Maurice Levy, chairman and CEO of Publicis.

From their discussion, we can distill down the three key factors driving the internet in China today:

The Digital Economy

Rapid development, greater dynamism and increasing integration with offline industries have made China’sdigital economy more sophisticated, SY Lau said, and its development has now exceeded the level in Western countries thanks to the unprecedented growth of China’s mobile Internet. Nearly 90 percent of Chinese Internet users go on line via mobile devices while in the U.S. it is only about 60 percent. The digital economy is contributing more and more to China’s overall economy and The Boston Consulting Group predicts that by 2016 it will comprise 6.9 percent of the nation’s GDP.

One of the most remarkable features of China’s Internet development has been its integration with offline industries. As an example, SY Lau pointed to the real-time taxi-booking app DiDi Call-A-Cab, which has attracted over 220 million users in 16 months. 

Digital Consumer Behavior

With easy access to e-commerce, product information and secured e-payment, digitalization has allowed the online consumption power of the Chinese people to soar, particularly in the smaller cities. The Internet has enabled Chinese consumers to enjoy the benefits of global pricing thanks to reduced channel cost, while transparency of information eliminates unfair pricing. Within the next decade 75 percent of China’s middle class will come from third and fourth-tier cities.

In addition, there has been an emergence of “smart consumers” who turn to social media and other online resources for product information, making them better-informed buyers. This works both ways: consumers can give timely feedback to producers, who in turn can optimize the production process and volume to reduce waste. Consumers’ participation in production decision-making is now a reality.

China’s Digital Marketing Eco-environment

As to whether social media and social apps like WeChat, Tencent’s popular messaging communication service, are a bane or boon for brands, SY Lau responded that WeChat is far more than a social media, but also an interface with the new economic ecosystem established by the mobile Internet. Its aim is to partner with offline businesses for a mobile-first world, and to support and supplement the entire ecosystem. For brands, the value of WeChat is the opportunity it presents to combine content with community and commerce, serving to build a win-for-all relationship between media, brands, and users.

With everything connected by the mobile Internet, brands in China must shift their roles from persuaders to enablers, SY Lau remarked. Brands need to pay closer attention to the purchasing path of users, focusing on closing the deal rather than touch points alone. Since the mobile Internet is decentralizing information and distribution, brands will need more agile applications of marketing resources so users can enjoy faster and more customized services.



SY Lau concluded that it was still important to hold on to the very core of marketing – outstanding creativity and moving content, and not to get lost along the way of digitalization. In the future, the ultimate winning agencies will be those that realize an ideal blend of creativity and technology.

To see a full review of the session, visit PR Newswire here.