June 18, 2013

At Cannes: VW and PepsiCo on succeeding in China, Contagious on the world in five years

Posted by: in Europe|North America

“Is it really true to say that China is a rising empire?” asked Alexei Orlov, chief marketing officer for Volkswagen Group China, during the session “How to Reach a Billion Eyeballs” at the Cannes Lions International Festival of Creativity today. “I would say they’re a returning empire,” he said, reminding the audience that China is responsible for inventions like paper and gunpowder, even toilet paper, and home to some of the largest global brands, including Lenovo and Huawei. China now contributes more than a third of VW’s worldwide sales, Orlov said: The automaker sold 2.1 million cars in China in 2012, 37 percent of global sales.

Despite the vigorous marketplace, VW ranked an abysmal 126th in terms of desirability in China three years ago. “There’s a big difference between need and desire,” Orlov said. To amp up its desirability, VW launched “The People’s Car Project,” which allowed consumers to suggest designs for cars—more than 260,000 were submitted—one of which the company produced. Orlov said it was the biggest crowdsourced product to date. In 2012, VW moved up to 76th most desired brand.

Orlov followed a presentation by PepsiCo China CEO Richard Lee, who pointed out that China’s rapid development has come at a cost: the loss of family values. For instance, while Chinese New Year is the most important season in the country—with some 700 million Chinese traveling to celebrate with their family each year—70 percent of youth question the tradition of going home for the holiday. Last year PepsiCo sought to remind youth of the importance of family and culture with a campaign focused on rebuilding family bonds. Spreading the message that family is the root to happiness, “Bring Happiness Home” included a 22-minute film, music videos, outdoor ads, bus wraps, social media, QR codes on packaging, content marketing and more.

Transmedia campaigns such as this are imperative in China, as media is extremely fragmented and cluttered, and the online world is even more diverse. Mobile penetration is at 80 percent, with more people accessing the Internet via the mobile than the PC. Awareness of Pepsi’s campaign, which was endorsed by the government, reached 86 percent. And Pepsi successfully reunited 1,000 people with loved ones who wouldn’t have been able to make the Chinese New Year trip. “PepsiCo believes in performance with purpose,” Lee said. “Don’t underestimate the importance of purpose in the equation. Every business objective should come with a purpose.” 

The day of sessions at Cannes ended with a seminar hosted by Contagious that imagined what the world will look like 60 months from now. Contagious co-founder and editorial director Paul Kemp-Robertson envisions a little less marketing and a little more service design, IP creation and empathetic ecosystems. He and fellow presenter James Kirkham, managing director of Holler, talked about the projected rise in affective interfaces, cognitive computing, epidermal electronics, haptic (or sensory) experiences and advanced motion tracking.

Kemp-Robertson emphasized that “the future is about being intuitive, not intrusive,” meaning that “brands shouldn’t add technology in our lives unless it truly enhances the experience.” One of the duo’s parting thoughts: “Good technology is no excuse for a bad idea.” Amen to that!

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