Have Your Cake and Eat It (or why there are so many local agencies in China)

Someone I know was approached last year by the Chinese Marketing Director of a major International company with a proposition to jointly set up a database marketing agency in Shanghai.

The shareholding of this new agency is 50% held by the Chinese Marketing Director and 50% held by the person I know, who is running the agency on a day to day basis.

They have one Client, who is investing an ever increasing amount of money in database marketing. Can you guess who their Client is?

Yes...their Client is the SAME International company that the Marketing Director works for.








This is NOT unusual, and is one of the reasons why there are so many local agencies in China - they are quickly set up to take advantage of approved marketing spend that might otherwise go to a legitimate agency. It is also THE key reason why it is so difficult to extract implementation-type work from Chinese Clients.

For those of us who refuse to play by the local rules, we face this every day.