WPP, the marketing services giant, has snapped up another Chinese agency, its second in as many weeks.
The UK-based group said that its Bates Asia brand had bought 51% of Chengdu Apex Advertising for an undisclosed sum, according to AFX. The deal had not been confirmed on WPP's website at the time of writing.
Last month, WPP's Ogilvy & Mather bought 70% of Beijing Century Harmony Advertising, an internet ad agency -- see this EngagingChina post.
At this rate, there soon will not be many independent ad agencies left in China.
WPP expects China to become its third largest market by the Beijing
Olympics in 2008. It is already the fourth most important, behind the
US, the UK and Spain.
CNBC Europe has an interesting interview in which WPP's CEO Martin Sorrell explains his Asia strategy, available as a podcast on WPP's website (mp3).
Incidentally, Sorrell made some great comments on China at last week's Media Convergence Forum in New York.
While I'm generally wary of conferences with a "convergence" theme, Sorrell can be relied on to keep his listeners' feet firmly on the ground. The two challenges that most worried him -- and by extension anyone in the advertising business -- are China and the internet.
The first challenge he apparently plans to solve in time-honoured fashion: buying up local agencies. But the challenge posed by new internet is more troubling. He told Advertising Age:
The technology bit is much more difficult -- figuring out what the devil is going to happen in technology. I am sure that there are four or five very bright Chinese engineers in some garage in Shanghai who are coming up the next Google."
Always ready with a juicy figure, he said there were 465,000 engineering graduates a year coming out of China as opposed to 65,000 in the US. Be afraid.
