“I have been in China for a long time and I thought this kind of thing was impossible, how did you do it?” That was my first question for Larry Namer, the legendary Hollywood producer and writer who founded “E! Entertainment Television” and built it into a $3.5 billion dollar company. The “thing” I was referring to was the novelty of a foreign company successfully creating, producing, selling and airing original TV and Web TV shows in China, in Chinese, written with Chinese people, about China-specific issues, that delivers audience coveted by consumer product and luxury brands.
“I was amazed at how much younger the people with money were in China. The average Chanel buyer there is 20 years younger than in the West” said Mr. Namer. “These are young people who watch Western shows and buy Western products, and increasingly watch their TV on the internet. We saw an opportunity to put that all together.” Namer and veteran TV executive Larry Pompadur founded “Metan Development” in 2009, a US company with led by American executives and staffed by Chinese nationals that produces original programming for China. Namer is the chief creative force and runs the company day-to-day, but aside from Namer, all of the company’s employees, (in China and the U.S.) are native Chinese who attended Radio, Film and TV programs at U.S. universities. Metan partners with Meitian Me You, a Chinese production company for production and shooting of the shows in China.
All of this has been a boon for brands and products associated with Metan shows.
For more than ten years I have helped consumer product, retail and luxury companies navigate the complicated world of building their brands and selling their products to Chinese consumers. One of the most complex aspects of the business is marketing, advertising and brand building. Advertising in particular is expensive, highly fragmented and hard to measure in China.
Therefore, helping clients understand the important role that popular culture vehicles like movies and TV shows, social media, peer recommendations, and internet engagement play in brand building, loyalty and sales has been a key focus of my work. Over the last four years especially, this has taught me that sophisticated Chinese citizens are not only consumers of products, but voracious “information consumers” as well, and that the latter helps the former.
There are more than 2,000 TV stations in China, one of the largest newspaper industries in the world, a fast growing movie industry, and now, close to 500 million internet users who chat, blog, shop, argue and watch TV shows and movies on millions of web sites.
“There are about 400 million people who now watch TV on the Internet in China, mostly on their laptops, and there are more than 100 Western TV shows licensed by giant video sites like TUDOU and YOUKU that are very popular” commented Mr. Namer.
Increasingly those shows are having a huge impact on the products Chinese consumers choose to buy. A memorable example is Tory Burch. When Chinese women went online and started watching “Gossip Girl” (the NY based show which followed the fortunes of four rich girls in the “Big City”) became an instant hit. Eventually, the characters were seen carrying Tory Burch handbags and Tory Burch made a cameo on the show. Almost overnight Tory Burch bags became a must have for young adults in China, everyone was talking about the brand and sales spiked. Tory Burch officially entered China in 2011.
This, and other similar examples, showed that the impact of popular culture as a brand builder and purchase motivator in China was huge. Larry Namer and Metan Development took this trend to the next level.
Seeing the growth in importance of Internet TV viewing (in addition to the 1 billion people who watch broadcast TV) and the impact quality programs could have for brands featured on the right shows, the company set out to create original programming for Chinese audiences that would meld the love of Western shows and production values with content that was of, by, and for China.
Metan’s first hit, and still one of its most popular Internet and TV shows, is “Hello Hollywood!” The show is a colorful mix of gossip, news and entertainment and is full of glamorous images of celebrities, California living and the brands and retailers that cloth, feed, house and entertain the Hollywood elite. The show can be seen on 45 stations in China and six in the U.S. and averages more than 10 million viewers and another 11 million on the Internet.
From there the company started production of original TV series for the Internet. The first was Planet Homebuddies (now called Modern Life) a sitcom about young, urban, white collar workers who live at home (common in China). It was shown on the five biggest web portals, Youku, Tudou, iQiyi, PPTV and Sina, ranking No.7 on Tudou after the first episode was released with a record 3 million viewers in the first week.
Then came “Return to Da Fu Tsun” a comedy-drama series developed by Mr. Namer. After finding early success in Beijing and selling his company, a father decides to move his family back to the rural village of Da Fu Tsun (大福村) to re-learn the meaning of family values and community. The show was shown online and on CCTV-8 and attracts 10 million viewers and another 4 million online. To put these viewer numbers in perspective, popular Cable shows in the U.S. attract 2-5 million viewers per week. The big finale of “Breaking Bad” drew 10.3 million.
The business model is simple and effective. In the case of shows for broadcast TV, the stations buy the shows and then sell advertising around them. In the case of Internet shows, the portals pay Metan to license the show. Then both sides sell advertising around it. What both models have in common is that they both utilize “product integration”, the insertion of products, brands and retailers into the show, to generate revenue.
There are three levels at which a brand can participate:
1. The product is featured in the background or foreground
2. The product is used by the characters
3. The product is essential to the plot and can drive an episode or a season
Usually Metan gets the first, anchor brand/product in, then they license the show and both companies seek other brands and products for integration.
Competition for shows has grown fierce between rival portals and most demand exclusivity, increasing the value of quality shows. Additionally pirate sites are on the decline because the portals are paying big money for content and have convinced the government to crack down on them to protect their investments.
Baccardi, Lavazza Coffee and Lee Jeans have all been featured on Planet Homebuddies, with noticeable results. Baccardi was a plot driver on Planet Homebuddies. One of the main characters wanted to become a bartender and live the high life in Shanghai. He attends an 8 week course at the “Baccardi school of Bartending.” Baccardi’s name, spirits and ethos were a major plot driver and feature.
Mr. Namer has created a win-win-win situation for all involved. The audience gets the kind of content they love, the stations and portals get big traffic and great revenues, brands reach target audiences with measurable effects on brand awareness, popularity and sales, and Metan Development makes money doing what it does best; creating engaging and relevant entertainment that is both popular and profitable.
“We are writing original scripts, re-casting it, and instead of four rich girls from New York it will be four rich girls from Shanghai” said Namer.
I’ve learned that this kind of “thing” is not impossible in China, all it took was a savvy Hollywood veteran, a strong Chinese production team, the development of Internet TV viewing and an understanding of what Chinese viewers wanted and how brands could benefit for.