In 2003, Focus Media pioneered digital outdoor advertising in China, LCD displays in leading positions in commercial buildings that have high traffic and waiting times, such as lobbies and waiting areas had by elevator. The company lettable area of ​​building owners and advertising sold, 12-minute walk loops with 30 seconds of advertising. This offering advertisers targeted to middle and high income consumers access and was far more effective than traditional television advertising … Read more »

In 2003, Focus Media pioneered digital outdoor advertising in China, LCD displays in leading positions in commercial buildings that have high traffic and waiting times, such as lobbies and waiting areas had by elevator. The company lettable area of ​​building owners and advertising sold, 12-minute walk loops with 30 seconds of advertising. This offering advertisers targeted to middle and high income consumers access and was far more effective than traditional television advertising. Only targeted consumers saw the ads, such as people with low incomes do not come to these buildings, and consumers prefer to watch ads while they waited in comparison with nothing to do (as opposed to TV ads, which they perceived to be a nuisance). Once a company has established itself in this market, as the majority of construction contracts, it was difficult to remove. Focus Media is investing heavily to quickly gain control of this market. It was soon profitable, and acquired other companies in related businesses. Focus Media went public on the Nasdaq in 2005 and began acquiring other companies advertising. By 2007, it had included revenue of more than $ 500 million, more than $ 250 million in cash, with a market capitalization of $ 6.5 billion and was in the Nasdaq 100 non-financial companies. In light of the rapid, successful growth, the company was optimistic about the future. There were indications that it could acquire SINA, the leading Chinese Internet portal. Expansion into other countries was also a possibility. Given this success, the case asks students to consider how the company should best proceed.
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from
George Foster,
Ning Jia,
David W. Hoyt
Source: Stanford Graduate School of Business
19 pages.
Release Date: 9 March 2009. Prod #: E330A-PDF-ENG
Focus Media (A): Building a Chinese media giant HBR case solution