Behind the "powerful combination", Jiang Nanchun decrypts "Focus Media + Alipay"

The elevator media industry has witnessed another "earthquake".

Recently, next to the elevator advertising screens in many office buildings, there has appeared a blue - and - white circular machine. It is a new product jointly launched by Focus Media (hereinafter referred to as "Focus") and Alipay. The giants in their respective fields have installed Alipay's "Tap to Pay" function in elevator lobbies. As long as a mobile phone with Alipay is brought close to the machine, red envelopes issued by different merchants will pop up. These red envelopes can be used as deductions for online shopping or be redeemed for offline consumption.

What has shaken the industry is that Focus' 3 million elevator locations will pave the way for the "Tap to Pay" function in a very short time. Meanwhile, the closed - loop formed by data and sales has propelled the elevator media industry into a higher - dimensional war.

On August 8th, when Jiang Nanchun, the chairman of Focus Media, was interviewed by China Entrepreneur about this cooperation, he said that he had thought about linking elevator ads with mobile phones 10 years ago. However, limited by technology, the project couldn't be continuously promoted. Ten years later, the popularization of NFC (Near Field Communication) technology has made it feasible to connect mobile phones with elevator advertising screens. Thus, Focus and Alipay hit it off and this cooperation came into being.

In April this year, Focus just announced the acquisition of Xinchao Media, a leading company in the elevator advertising industry, and became an absolute leader in the outdoor advertising industry. However, for a long time, elevator media has been firmly "confined" within the advertising screens and it has been difficult to expand outward.

Focus has tried to use physical cards and QR codes on advertising screens to connect the sales process, but the results were not ideal. In Jiang Nanchun's words, these methods were "not convenient enough". The "Tap to Pay" function has well solved this problem. Users don't need to scan QR codes. As long as a mobile phone with Alipay touches the machine, red envelope vouchers, takeaway recommendations that meet the precise needs will pop up.

Ding Junjie, the dean of the National Advertising Research Institute, described Focus' 3 million elevator locations as "the capillaries of the city". When the capillaries are connected to Alipay's digital nerve - center system, the needs of the city are gathered, and elevator advertising has changed from "broadcasting to the public" to "touching to purchase".

Jiang Nanchun said that this is an "exchange of two - way values" and regarded it as a form of "future business model". Elevator advertising is no longer an information bombardment. It has become an entrance to online traffic and can convert the impulse to consume into actual purchasing power.

Before the end of the interview, he specifically mentioned the social significance of this cooperation with Alipay. He said that he hopes to promote the recovery of the consumer market through this form of cooperation and set a new benchmark for the synergy of brand advertising effectiveness.

The following is a summary (with some deletions) of Jiang Nanchun's exclusive interview with China Entrepreneur:

The Idea Ten Years Ago

More than a decade ago, I launched something called a "Q Card" in China. Press a button on Focus' machine and a card would come out. Bind this card to your mobile phone via SMS. If you are interested in a Focus advertisement, tap the card on it, which is like giving a "like" to the ad. Then, the coupon of the advertised brand will be sent to your mobile phone.

However, this project was not successful at that time, and there were three reasons.

First, 4 million users bound this card, but users needed to bind a physical card, which was quite annoying. The card was often lost, and users had to make it into a small pendant and attach it to their mobile phones, which became a threshold. Today, our cooperation with Alipay eliminates the need for that physical card because mobile phones already have NFC.

Second, in the past, pushing coupons via SMS was costly. Now, after tapping, the coupons can pop up immediately. Once users collect them, the coupons will be stored in their Alipay card packages.

Third, it required a large number of coupons and the ability to conduct transactions. Now, the coupons issued by Focus and Alipay can be directly clicked to be redeemed on e - commerce platforms or in offline stores, which solves this problem.

Previously, Focus ads also had user interactions, such as scanning QR codes. But when you see an ad on the elevator - entrance screen and take out your phone to scan the code after getting interested, the ad may have already passed. It's a bit better for printed posters, but the chance to scan the code on the screen is rare.

However, scanning a QR code on an elevator poster with a mobile phone involves three steps, which is still quite troublesome. Now, with just one "tap", the coupon will be issued whether it's a poster or a screen ad. Users can tap as soon as they see it.

The coupons can be used to buy things on Tmall or in offline stores like FamilyMart. So, this idea perfectly realizes my wish from more than a decade ago to make Focus screens interact with users.

In January this year, I had a meeting with the management of Ant Group to discuss combining the "Tap to Pay" function with elevators. The more we talked, the more excited we became. Focus' advantage lies in its 3 million elevator locations, and 400 million people pass by them every day. By the end of the year, the number of "Tap to Pay" locations laid out by Focus can increase to 2 million, adding more scenarios for Alipay.

"Tailored for Each Individual"

Focus can be regarded as the "infrastructure" of the advertising industry and the "core facility" for a brand to be popularized.

In today's Chinese outdoor advertising market, Focus is far ahead. In terms of market value, Focus is also the world's largest outdoor media company. I believe this is inseparable from years of continuous technological iterations.

What iterations have we made in the past few years? First, regarding our screens, the original screens played content via inserted cards. After Alibaba invested in Focus in 2018, the content pushed on our screens can be changed in real - time every day.

Second, with the big - data system, after assigning consumption labels to scenarios such as residential communities and office buildings, we can send different ads to different scenarios based on big data, which is relatively more accurate.

Third, data can be fed back. The data on which ads have been viewed in which communities can be fed back to the "Tmall Data Bank" of advertising clients. We can know the changes in some indicators between those who have seen Focus ads and those who haven't. There is an average increase of 20% - 50% in effectiveness indicators such as adding to cart, following, collecting, browsing, and placing orders.

I believe that Focus has led the industry during these continuous iterations. I've also observed overseas outdoor media. Whether it's precise distribution, data feedback, or effectiveness evaluation, I think Chinese companies are world - leading.

After the data is fed back and analyzed in the background, and then reinvested based on the platform's analysis results, this logic is effective. However, the presentation and attribution of advertising effectiveness are not direct. I've always felt that there is a lack of direct interaction.

Photography: Deng Pan

The idea of combining the "Tap to Pay" function with elevator ads brings us three benefits.

First, we used to have a problem. When clients have three or five ad creatives, we have no way to tell which one is better. We can only know after running the ads for a while because offline ads need a certain amount of accumulation and reaction time. Now, if I'm given three ads and run them in three areas of Shanghai, by seeing which one gets more taps, I can tell which ad is more attractive. This is what we call "scoring" the creatives.

Second, it can leave an "anchor point" for impulse. Sometimes, users get excited and are about to take out their phones to scan the QR code, but suddenly someone calls them to a meeting, so they don't take the final action. Now, when you see something, just tap it, and you can collect the coupon in one second and use it at any time later. So, I think it leaves a spark for impulse.

Third, in the future, we can issue precise coupons to consumers. Currently, we issue various general coupons and platform coupons to consumers. As consumers tap more, the platform will gradually understand which coupons and ads different customers are interested in.

Now, we already have more than 1 million "taps" every day. By the end of the year, it may reach 5 - 10 million times. Through interaction with users, we will know more about what they really want. Focus' original building TV ads were for overall market promotion. The smart screens and frames can be "tailored for each building". Through the "Tap to Pay" function, in the future, issuing coupons can also be "tailored for each individual".

Make the Interaction Smoother

I value two dimensions in this cooperation with Alipay.

One is the interaction dimension. Alipay's NFC technology has made interaction very simple. Previously, interaction involved three steps and took 5 seconds. Now, it only takes one step and 1 second to complete. Don't underestimate the saved few seconds. In essence, it's a matter of whether consumers will develop the habit of "tapping". I think NFC technology has made such interaction frictionless and very smooth.

Second, I value Alipay's user base and ecosystem. It has a huge user group of 1 billion daily active users. Almost everyone in the city has Alipay, so the "Tap to Pay" function will become very popular. There are many brand mini - programs on Alipay's large ecosystem. Through these mini - programs, users can directly use coupons to make purchases, which has seamlessly formed an effective transaction connection.

Previously, I thought that when clients ran ads, they just hoped that consumers would make purchases. Now, I hope that after changing consumers' mindsets, we can stimulate them to buy more quickly. In this way, the effectiveness of brand advertising will be presented more quickly, and the link is clear. We can clearly see in the background which office buildings and apartment buildings have a high conversion rate, when there are more people grabbing coupons, which coupons have a high redemption rate, and which have repeat purchases. This will improve the efficiency of brand communication.

Now, if the signal of the "Tap to Pay" function is poor in the elevator, Alipay has also come up with a solution. A rain of red envelopes will pop up, prompting users to "wait a little bit". As soon as the elevator door opens, the red envelopes will be loaded immediately.

The Alipay team has worked with us for five or six months since January this year. We also invited Pan Hu, a well - known design and packaging expert in the industry, to design a set of white "Tap to Pay" terminals for us, which took a month. Then, Alipay's factory started to customize this set of equipment with new molds.

So far, 400,000 units have been installed. I estimate that by the end of the year, the number may exceed 2 million. The redemption rate of some product coupons is quite good. For some brands with high - value discounts, the redemption rate far exceeds our prediction, and the average order value is high, and the next - day retention rate is also high.

Connect Branding and Effectiveness

After Alibaba invested in Focus in 2018, we started the digital transformation. Now, the interaction of the "Tap to Pay" function is what I've always wanted to do. The advantage of digitalization is to connect branding and effectiveness.

Focus' scenario reach represents "branding", and Alipay's digital tools represent "effectiveness". The "Tap to Pay" function is like a thread that smoothly connects branding and effectiveness, shortening the path from brand exposure to direct sales results.

Second, it creates a measurable closed - loop. It becomes transparent and attributable whether an offline ad creative is effective or whether a purchase is made after seeing an ad. This will enable brands to invest more precisely and have more analytical closed - loops.

Third, it forms a closed - loop with sales. Through the "Tap to Pay" function, Focus' physical scenarios are connected to Alipay's digital ecosystem. It has become a smart service terminal that connects and serves users. Previously, it was just an advertising screen. Now, it has become a digital traffic entrance. This is an evolution from an offline scenario to an online smart terminal.

This evolution is a transformation of Focus advertising in the digital age. It is no longer just a one - way information bombardment but a two - way value exchange. This may be the future of business, where advertising can not only reach a wide audience but also achieve precise matching, not only for brand exposure but also for triggering consumer demand.

The top leaders of both companies regard this as the "Number One Project" and concentrate their superior forces on it. The CEOs of both companies have two requirements for product design: one is simplicity, and the other is safety. "Simplicity" should be taken to the extreme, and "safety" is our bottom line.

Future Business

This matter is very meaningful. Leaving aside the commercial value, I think it has social value - promoting the recovery of the consumer market. We are also thinking about how to stimulate users' needs and ensure that both users and merchants can gain value.

Under the relatively high pressure of market competition, there is actually a call in the market for brand advertising to bring sales results as soon as possible. I've also been thinking about how to make each exposure of a brand in the elevator not only for mind - share occupation but also for that final push to drive the closed - loop of branding - effectiveness conversion.

Now, online traffic is also very expensive. I'm often asked by entrepreneurs that with the increasing cost of online traffic and the relatively slow conversion path of offline ads, how can there be growth?

The "Tap to Pay" function provides a new answer. We've transformed the elevator spaces that 400 million people pass through every day into a digital traffic entrance. The 3 million elevators are like a natural traffic pool, gathering the mainstream consumption power.

This is also the first time that offline ads have successfully run through the e - commerce conversion link. In this era of scarce traffic, a physical scenario like Focus with extremely high interaction efficiency will be the key to breaking the deadlock. So, I feel that we are on a fast track of branding - effectiveness synergy.

I think physical scenarios multiplied by data algorithms equal future business. Alipay's 1 billion daily active users have changed advertising from a wide - net approach to precise matching. Focus has transformed the 400 million daily active users from bored waiting into triggers of consumption impulse, enabling timely conversion of consumer demand.

Its breakthrough lies in breaking the bottleneck of the long conversion link between traditional advertising and brand exposure. It makes every scenario reach have the possibility of commercial conversion. So, from an industry perspective, it has reshaped the commercial value of offline scenarios and provided a new paradigm for brand digital operation.

As our cooperation with the Alipay ecosystem continues to expand, I think more brands will use this smart entrance to get closer to people's daily lives and release their business potential, injecting more lasting impetus into the consumer market.

This article is from the WeChat official account "China Entrepreneur Magazine" (ID: iceo - com - cn). Author: Li Xiaotian, Editor: Zhang Hao. Republished by 36Kr with authorization.