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China’s online advertising revenues rose 40 per cent last year – to a record 154 billion Yuan.
(US$24.6 billion), according to iResearch Consulting Group.
The strong rise occurred despite slowing economic growth and subdued consumer spending. But it did come at a time online shopping rose by a similar rate.
iResearch said in a report that the rise was slightly lower in percentage terms than the previous year, predicting the sector might now be entering a new “maturity age”.
“Some traditional internet media faced slow growth… while some showed strong momentum driven by new advertising technology and emerging forms of advertising. Moreover, the brand advertisers’ spending flocked {from traditional media} to digital media.”
According to iResearch, keyword search advertising made up 28.5 per cent of the total spend, the share up two per cent on 2013.
Next was eCommerce advertising with market share of 26 per cent, a slight fall compared with 2013. Brand graphic advertising occupied 21.2 per cent.
Advertising on portals and social media increased, mainly due toTencent’s Guangdiantong advertising service and Sina’s Weibo.
“It reflected that internet enterprises more efficiently match advertising demand with advertising sources via data analysis and technology in order to raise their advertising revenues.”
In-video advertising revenues also maintained a high growth rate in China in 2014, due to widespread interest the World Cup in Brazil and popular variety shows such as I Am Singer II, Where are we going? Dad II, and Voice China III.
“Moreover, well-known brand advertisers attached more importance to online video and their increasing online video advertising budget contributed to growth of in-video advertising revenues,” said iResearch.
The biggest player in China’s online ad market remains Baidu’s, China’s equivalent of Google, which is blocked in the mainland. Baidu’s ad revenues surpassed 49 billion Yuan in 2014, increasing 53.5 per cent from 2013. Taobao gained 37.5 billion Yuan in revenues, ranking second. Together, Baidu and Taobao accounted for 56.2 per cent of the total online advertising market.
iQiyi & PPS, Qihoo 360 and Tencent all posted good revenue growth. iQiyi & PPS increased their investment in exclusive broadcast of quality content and kept adding more user-generated content. Moreover, it managed to monetise its mobile business and increase its advertising revenue.
Qihoo 360 raised brand awareness of its search business in 2014, increasing traffic, which boosted its market share. Search became the core contributor of Qihoo 360’s advertising revenue.
iResearch predicts a broadening of WeChat’s advertising sources and development of Guangdiantong mobile advertising networks will push up Tencent’s ad revenue.
