China Daily Global Edition (USA)
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Ad firms increasingly take business online
China’s advertising and marketing companies are moving rapidly toward the online and mobile sector, and some are eyeing bigger markets abroad, thanks to a growing number of smartphone users.
As Frost & Sullivan, an international consulting company, recently reported, China’s mobile marketing management business has seen a leap from 58.6 billion yuan ($9.25 billion) in 2012 to 216.9 billion yuan in 2016 with an annual growth rate of 38.7 percent.
The consultancy also predicted that by 2020 online marketing management will surpass the offline market in China, accounting for 52.3 percent of the market share, and is expected to grow to 767.1 billion yuan by 2021.
China now has the world’s largest number of mobile phone users and businesses are responding to this. Yannick Bollore, CEO of Havas Group, one of the world’s largest marketing companies, remarked on how quickly China is heading to the online and mobile market.
“I think it is a revolution. Digital technology is going to change completely how we communicate,” Bollore said. “We used to express messages from television and radio using a top-down method. But now it is different. There are so many Chinese people who have WeChat accounts.”
And digital and mobile is where Chinese advertising and marketing companies are heading.
“There is a promising future for a marketing management platform specializing in one aspect,” said Hu Jian, founder of Inplayable.com, a Beijingbased mobile advertising platform, the world’s first marketing company specializing in mobile game demos.
Game users are forced to watch adverts in the middle of a game, which significantly lowers the user experience. Hu and his team employ interactive technology that allows users to interact with the adverts.
“The game makers are willing to put 50 to 60 percent of their revenue into advertising,” Hu said.
He said the mobile advertising market for games was about $25 billion in 2017, and would grow to $35 billion by 2020.
The company is targeting overseas markets including North America, Japan and South Korea, and Hu is expecting revenue of 100 million yuan in 2018.
The industry was excited by the recent Nasdaq listing of iClick Interactive Asia Group Ltd, a milestone in the company’s quest toward global markets.
It is China’s largest independent online marketing technology platform with a 5.4 percent domestic market share. Driven by mobile technology and big data, the platform has analyzed about 670 million netizens in China, and more than 70 percent of its revenue comes from the mobile side, according to the company’s prospectus.
Sammy Hsieh, co-founder and CEO of iClick, said the company’s ambitions are not limited to the digital marketing sector. “Data and technology will not only be used for marketing, iClick will expand its advantage to other fields.”