MARKETERS relying heavily on advertising will not last long in the fast-maturing mainland market, says soft drink giant Coca-Cola. Advertisements now have a grip on consumer behaviour in China, but it is one which is fast disappearing, according to Coca-Cola China division marketing head Ian Rowden. 'That kind of influence can be both an advantage and an Achilles heel to the marketer. For now, people are translating advertising into consumption. As you get more advertisements, people get wary and cynical as they get more ad-literate,' he said. While Coca-Cola maintains high visibility with print and broadcast advertisements, it focuses on building infrastructure projects and a long-term consumer franchise. It is a formula with proven success. The first bottling plants were set up in Shanghai and Tianjin in 1927. The brand's presence was built through sponsorship of community programmes and events in line with Coke's youthful image. Coca-Cola, which is produced at 13 mainland sites, is the leading soft drink in China, commanding 15 per cent of the market. Coke's example seems to have gone largely unheeded by marketers as they pumped US$1.9 billion worth of advertisements into China since last year. Once branded an evil by the state, advertising has made a fierce comeback. Spending on advertisements jumped 43 per cent last year, five times the level of 1989, according to China Information Services. This far outdistances the global rate of only four per cent. The dramatic increase was partly due to the rise in the cost of air time and print space. However, despite inflation it is still relatively cheap to advertise in China. In the United States it costs US$500 per person reached and $200 in Hong Kong compared with just $1 in China. After almost four decades of inactivity, it is now one of the fastest-growing advertising industries in the world. About 23,000 agencies employ 244,000 people, and most of the agencies are less than two years old. Television is by far the favoured medium, accounting for a third of the total spent on advertising. Although there is only one television set per eight people in the country, the ratio is misleading, according to Justin Cahill, a researcher at Frank Small and Associates. Penetration in urban centres, where people enjoy higher disposable income, is up to 70 per cent. 'Television really is the medium which reaches the most people. The Chinese are becoming couch potatoes,' AMI China division head Angela Leung said. Mainland television stations produce 80 per cent of the commercials in China. The absence of mainland agencies in the beginning meant the state-run media had a dual advantage of selling time and the firm's own production facilities to clients. International agencies operating in China use a mix of mainland-produced and internationally used commercials, as well as those from Hong Kong and Taiwan. The quality of commercials being produced in China is quickly improving, with exposure to international standards set by foreign agencies, said J Walter Thompson China agencies group managing director Ron Chromie. 'In Hong Kong, commercials are beautifully executed but without a strong idea behind them. In China, advertising clearly has a lot of ideas, but is not necessarily driven by sound strategy,' he said. Advertising re-emerged on the mainland only after 1979. Most advertisements until now consisted of straight product photographs, usually farm machinery, with a contact number inscribed on the back. Little surprise then, that advertisements need to be to the point and literal. Print is the second most used advertising vehicle. Even with hyperactive consumers, marketers face great difficulties such as spiralling costs and scarcity of reliable and accurate information. 'There is no international agency making money in China,' Mr Chromie said. Most national media is under centrally imposed rules on allocation of space. Space is scare and payment no guarantee that advertisements will be shown on time, if at all. Lack of reliable viewership and readership data also make planning strategy a game of hit and miss. Private companies are stepping in to fill the gap. In one instance, a study by Taiwan researchers Field Force Marketing Services in Beijing, Shanghai and Guangzhou showed per capita income in the three key cities was double that given by official estimates. There is also a discrepancy in charging practices. China's advertising industry discriminates against foreign-invested companies with its three-tier rate structure. Joint-ventures are charged twice as much as domestic firms, while foreign companies without a production arm in China are charged five times as much to buy space in Chinese media. The diversity of regions is another formidable challenge to marketers who must understand their consumers.