November 05, 2002
WPP, the world's leading advertising, market research and branding communications group announced today that it had acquired 25% of the well established Shanghai Advertising Limited - one of China's pioneer advertising groups.
The WPP group owns some of the advertising and market research world's best known brands including Ogilvy and Mather, Research International, J. Walter Thompson and Young and Rubicom.
WPP started taking a serious look at the Asia Pacific market several years ago eyeing some of Asia's best known marketing, advertising and brand professionals as well as straight-out corporate acquisitions. However the worldwide slump in advertising following hard on the Asian financial crisis caused the group to backpedal furiously on expansion in the Asia Pacific.
While public statements by WPP bosses continue to be bearish on advertising market recovery world wide, WPP's latest move mirrors the trend of multinationals in many industries to target China specifically regardless.
China may indeed be a special case, as it's potential, especially in the advertising market, is undisputed. China is the fastest growing advertising market in the world, as Chinese consumers find their disposable income and affection for consumer items growing.
The level of risks also are undisputed, but with partners like the Japanese agency Hakuhodo who also have a partnership with Shanghai Advertising called Shanghai Hakuhodo, risks are reduced somewhat.
Shanghai Advertising Limited has had a strong relationship with Ogilvy & Mather Advertising, a WPP company, for 11 years. In 1991, Ogilvy & Mather Advertising Shanghai, the first joint venture between Ogilvy & Mather Advertising and Shanghai Advertising Limited, was established. Subsequently, Ogilvy Public Relations Worldwide Shanghai was set up in 1995. After 11 years, the Ogilvy Group is the largest communications group in China.
WPP’s CEO Martin Sorrell, summarized the investment as follows: “The Chinese advertising market is the fastest growing market in the world. Within the next 10 years, it is expected to become one of the top three markets. WPP has relied not only on the support of WPP companies, but also on direct investment. WPP will continue to increase its business portfolio in China and deliver the best service to our clients from every aspect.”
Sorrell also stated, “WPP’s collaboration with Shanghai East Best International, Shanghai Advertising Limited and Hakuhodo, has turned Shanghai Advertising Limited into the first company with capital investment from China, Japan and the UK. With a unique multinational business background advantage, Shanghai Advertising Limited is confident that it can serve any client whether local, Japanese or Western.”
Published November 05, 2002 07:37 AM in China PRC
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