Welcome to our April Newsletter.
May holiday will be upon China soon & everyone is watching the travel pattern very keenly. Ctrip is predicting that Macau travel will be larger than pre-pandemic 2019 trips. Both airline & hotel prices have sky-rocketed in the last month and there are no signs of cooling off. Hainan is also bracing for strong travel in the first week of May.
In this issue, we provide update to Search Landscape – the domination of old browser-based search is waning and what that means for marketers, new Baidu restrictions on search – more media & content platforms are enforcing stricter restrictions on advertising.
We have several insights reports – vertical app marketing analysis, invalid traffic report from Miaozhen, Mobile advertising review & forecast for 2021. We wrap up this newsletter with App of the month –Meituan Dianping, its salient features & advertising options & some exclusive format for advertising in Hainan.
From all of us at OctoPlus Media – Stay safe & take care.
Mia C. Chen
CEO & Co-Founder of OctoPlus Media
Data from app tracker Analysys Qianfan shows that as of the third quarter of 2020, the number of mobile internet users in China reached 1.031 billion, with a year-on-year growth of 1.48% and a slight increase of 0.39%. According to past three years data, the growth rate of mobile internet users slowed down significantly, the mobile digital life has become a norm, which can be described as having fully entered the era of inventory. Although the internet user growth slowed, vertical apps still maintained growth, especially social e-commerce, audio, games, and other industry. These apps are the top 3 in user activity, and there is a lot of space for future growth. According to the data, as of September 2020, the coverage time of vertical apps accounts for 26.4% of users, more than 1/4 of the overall market, the traffic proportion is considerable, which is worthy the market’s attention.
User profile analysis of vertical apps traffic
Data shows that vertical applications such as games, tools, and information have an average user size of 300 to 400 million, as do video, reading, lifestyle, and travel.
The game industry has a high proportion of young users, and the label of leisure and entertainment is significant.
The video category is dominated by young women, with users under 35-years old accounting for more than 70%.
The information industry is dominated by middle-aged male users who pay equal attention to lifestyle and business needs.
Users under the age of 30-years old in the lifestyle service industry account for more than 50%, with a wide range of hobbies and interests.
Music industry users are younger, preferring live streaming and education development.
The users in the e-commerce industry are widely distributed and their preferences are diversified.
The users in the travel industry are mainly male, mostly young urban white-collar workers.
Most advertisers, such as education, finance and FMCG, are willing to work with more vertical apps to improve their conversion rates and reach the deeper target, user groups. Brand advertisers are also demanding a combination of capabilities for vertical apps, including targeting, marketing tools, user tagging, and creative planning.
The FMCG industry favors creative and data analysis tools.
The education industry favors creative tools.
The automobile industry favors strong consolidation capabilities.
Local advertisers prefer analytics tools.
The marketing value of vertical apps
Vertical apps are an important channel for users to obtain information and typically have a wealth of user information, so they can help advertisers match and target groups, promote transformation and achieve precision marketing. Data show that users of vertical apps actively overlap and complement each other within 24 hours, covering multiple periods and scenarios. Massive vertical applications can help advertisers to reach users’ decision-making process. At the same time, relying on the rich advertising forms of digital marketing, accurate delivery can be carried out in combination with users and scenarios. By intersecting user groups, hobbies, and intentions from different industries, multi-dimensional access to users can be achieved through integrated channels and unified precipitation of user data can be achieved. 65.2% of surveyed users indicated that under specific consumption scenarios, they have a high click-through rate for advertisements that can match their own needs.
Also, vertical app advertising platform can fully solve the advertising demand, with its technology, data, marketing strategy, advertising form, and other comprehensive advantages, the integration of advertising resources to help advertisers to obtain high-quality vertical application advertising space. After data accumulation, the operation model is used to accurately target users and improve the conversion rate and ROI; At the same time with different marketing tools, improve the efficiency of advertisers’ advertising.
According to data by Miaozhen, losses due to unusual traffic in China’s brand advertising market in 2020 is about 30.5 billion yuan. Unusual traffic and data fraud are recurring problems of the digital marketing industry. Along with the trend of traffic conversion and data assets, it leads to the waste of social resources and property losses, posing a challenge to the healthy development of the digital marketing industry.
Key insights from the report:
1. Invalid growth of the digital advertising market
In 2020, although affected by the pandemic, advertising budget remained strong. The proportion of invalid traffic of digital advertising in 2020 was the same as that in 2019. In terms of invalid traffic of sub-media types, the proportion of invalid clicks in an advertising network is much higher than that of other media, and the fraud of its click is the most detrimental.
2. Invalid traffic on social platforms is more prevalent
There are more and more digital marketing platforms, and the click farming of advertising didn’t spare Weibo, WeChat, Douyin, Xiaohongshu, and other social platforms, and the proportion of invalid traffic on social platforms climbed to more than 50%.
The four industries of luxury goods, maternal and infant, personal care, and beauty place great importance on “seeding” and word-of-mouth marketing, and invalid traffic on social platforms accounts for more than 50%.
3. The fan numbers of leading KOLs have the highest fraud
The average invalid fans of KOL increased by more than 60% compared to 2019, and the phenomenon of traffic fraud worsened.
Maternal, food, beauty, and fashion industries KOL have the highest number of fake fans.
4. More than 30% of the website’s private traffic is invalid, brands should focus more attention to the effectiveness of lead generation campaigns.
The percentage of invalid sales leads on the website increased significantly by more than 30%.
5. The invalid traffic of New TV mainly focuses on the advertisements of family scenes
6. Outdoor activities are restricted by the pandemic, which affects invalid offline advertising traffic
Under the general trend of digitization, compliance and transparency will be the direction that the marketing industry needs to focus on, and it will also require stricter and more complete governance at the regulatory level. All parties in the advertising industry need to explore the establishment of data security solution, restraint mechanism and industry standards. Ensuring data security, more careful use of data and efficient use of media data has to be prioritized in eliminating invalid traffic. This would translater to better ROI, increase media efficiency, and protect the interests of advertisers.
There is no doubt that 2020 will be the year of breakthroughs and innovations in digital marketing. Facing the impact of the pandemic, China’s internet marketing has not only shown great resilience but also provided a basic guarantee for the production line and the real economy.
According to the “2020 Mobile Advertising Industry Report” found that the total number of clicks on the whole platform effect ads decreased by 4.2% year on year in 2020, compared with 2019, the fluctuation range is not large, and remains stable. To improve the quality of traffic, most advertisers tend to run the campaign on large media and DSP platforms and reduce the effort of running the campaign on CPA channels, leading to a decline in the magnitude of putting on CPA.
Data show that the click of advertisements in China’s 1st and 2nd tier cities has decreased significantly, and advertisers are also paying more attention to the acquisition of traffic from the lower tier market. The increase was significant in the northwest, with Qinghai province up 81% and Gansu province up 63%. Beijing and other places, which have historically been larger in magnitude, saw Y-O-Y growth of -6% due to the saturation of market coverage.
– Total platform activations increased 83.4% year-on-year, a significant increase compared to 2019.
– WeChat mini-program has been gradually used by users, open action accounted for 25%.
– More than 60% of users access mini-programs through WeChat chat pages, advertisements, or sharing on Moments.
OTT delivery continues to rise, and brand advertisers attach importance to multidimensional reach.
Mobile terminal brand advertising accounts for 49.25%. At the moment when the mobile terminal has become the mainstream delivery terminal, advertisers’ investment in OTT has increased compared with the past, and OTT terminal brand advertising accounts for 29.05% in 2020.
Marketing and promotion budgets are rising and advertisers are more willing to increase their budgets.
The epidemic has had an impact on the mobile advertising industry, with advertisers choosing to reduce their advertising budgets during the outbreak and increase their spending during the mitigation period. Heading into 2021, more than 80% of advertisers have increased their marketing budgets or stayed the same.
The target trend for 2021 promotion is to attract new users and increase activity.
The proportion focusing on the operation of old customers increased from 29.51% to 61.6%, while the proportion focusing on the acquisition of new customers decreased from 59.84% to 20.5%.
From 2021, advertisers will use more platforms/tools for marketing promotion to achieve the appeal of automated marketing to reduce costs and improve efficiency. Also, KOL/ social promotion analysis platform is gradually being paid attention to by advertisers.
The family scenarios filled with business opportunities
Users with three to five smart devices in their homes accounted for 41.7%, while those with six to eight smart devices accounted for 35.7%. So there’s a lot of business potential in the home scene.
Brand advertising reaches mainly young people and consumers in the new first-tier cities
– 52.2% of males and 47.8% of females;
– 45.0% of users aged 25-34 years old;
– New first-tier cities accounted for 26.5% of the total, and the TGI index also reached 125, higher than the average level of mobile Internet users.
Mobile video is the main marketing space, and the marketing potential of mobile games needs to be further explored
– Mobile video application coverage reached 95.5%
– Short video and integrated online video applications have a high coverage rate
– Video and vertical online video apps have high consumer activity
In today’s digital era of mobile, tremendous changes have taken place in terms of content from production method to the transmission path. At the same time, with the development of the mobile internet, there are some new changes in the information environment and users’ search needs, but the essence of search is still the acquisition of content. Aurora Mobile recently released a research report on content search trends. Here are some key insights:
1. Users not only search on a platform but choose the platform according to their content needs
Nearly 70% of users use more than three platforms to search information on average each day, and they will choose the appropriate search platform according to different search and content needs. Taking short video as an example, users use short video platforms most frequently when searching for daily life questions, entertainment-related information, and new product information. On the contrary, the usage of social platforms is the most prominent in search of knowledge learning.
2. In the context of the content, users have a strong search demand
Independent search platforms still have the advantage, topping the list with 71.5% usage. Short video platform is the 2nd most used search platform while social platforms is ranked 3rd. The utilization rate of e-commerce, news and information, and long video platforms ranked 4th, 5th, and 6th respectively.
3. Searching at all times has become the norm
77.4% of all searches are on content platforms; 90.5% of users have the experience of searching on social media, short video, long video, e-commerce shopping, news and information platforms
4. Searching at all times has become the norm
Search users on short video platforms are highly receptive to information, and search is driven by the mentality of liking new things. In addition to entertainment information, users will search for content such as daily life issues and child education on the short video platform.
Search users on social platforms are more sensible and easy to satisfy, and have enough trust in the platform. Life, education and entertainment searches are more common.
Search users on e-commerce platforms have a high tolerance for content and are willing to obtain life and learning-related content through such platforms.
Search users of news and information platforms are more rational and purposeful, and they have enough trust in the platform’s grasp of the content.
Search users on long video platforms have clear goals and are not easily influenced by others. Content is the most authentic restoration of users’ personal preferences.
5. Independent search platforms have limitations
There are however, limitations to independent search platforms, including the need for users to supplement their search and spending time filtering because of the high repetition of information; or too many ads that affect user experience. On the contrary, the content ecological search can better meet users’ needs, such as convenience and quick search, short time consuming, more accurate search results, strong relevance and high matching degree with keywords, and search results can exceed users’ expectations and improve user experience.
Forecast for mobile advertising industry
Thus, with the change of users’ search behavior, the traditional independent search engine can no longer meet all the needs of users. In the past few years, short videos have gradually become an emerging content carrier, with an annual growth rate of more than 60%. With the popularization of the era of mobile internet, content becomes more abundant. A large number of platforms and APPs have emerged, and users have begun to shift to content platforms. Some use WeChat to search for official account content, some use Zhihu to search for answers to questions, while others use Toutiao to search for news. During the Spring Festival in 2020, the primary source of middle-aged and elderly users on the pandemic was from Douyin.
Baidu recently released the latest policy notice, starting April 12, 2021, users who sign up for a Baidu advertising account can only advertise their business on the Baidu search engine via a Baidu-hosted landing page, which means Baidu ads will no longer link to external websites. This new policy is based on the Chinese government’s commercial risk control policy but also due to offer more device scalability with their landing page engine “Jimuyu”(基木鱼) while also preventing businesses from using redirects on website URLs once the website has been approved for an ICP license and by Baidu. To comprehensively increase the management of content security, the rectification is expected to be completed on September 30. For the specific industries affected, please refer to the following information:
April 30: Plastic Surgery, Medical Services, Health Products/Medicines, Medical Devices, Logistics, Sports and Sports Equipment, Maternal and Child Products, Consumer Goods, IT/ Consumer Electronics
May 27: Electronic, Real estate, Food and beverage, Entertainment media, Bags and clothing, Business services
June 29: Agriculture, Forestry, Chemical and energy, Machinery and equipment, Education and training, Life services, Games, Tourism services
July 29: Transportation, Public transportation, Others
August 31: Communications, Software
September 30: Commodity trading, Online services, Investment, and franchise, Financial services
About Baidu Jimuyu
Jimuyu (基木鱼) is a website builder within the Baidu PPC Account. B2B and B2C businesses can easily create fast-loading mini websites/landing pages, HTML5 sites, and mini-apps for their products and services.
Choose from more than 1,000 themes from various industries, blog sites, stores, app downloads, video streaming, and more. Easily run marketing tactics like PPC ads, track conversions, and analyze the results.
Baidu Jimuyu (基木鱼) was initially launched as a tool to help customers who don’t have a website and don’t operate it. It provided a lot of convenience for customers, and Baidu indicated that more powerful upgrades were coming. With the continuous development of the Jimuyu hosting page and the comprehensive tracking of the transformation link, it is of great reference value and direction to use the transformation data of Jimuyu as reference and analysis for the account with unstable effect. The transformation data and optimization ideas have great reference value. After continuous update and optimization, now the Jimuyu data has been able to present close to the self-built website, but also continue to enrich and increase the design of the page template so that the page optimization has a greater space.
Exception: Whitelisted Companies
Companies that meet one of the following criteria can still advertise on Baidu with their website after April 12, 2021:
Companies that meet one of the following criteria can still advertise on Baidu with their website after April 12, 2021:
Fortune Global 500 companies
Brands need to provide compelling proof and documentation if apply for whitelisting.
What does the new policy mean for the marketing industry?
In addition to the traditional form of strategy and marketing will be affected, is a new challenge for the optimizer, some functions may be a failure in marketing, landing pages are now more inclined to how to design a landing page with a high conversion rate, such as according to the different needs of the business design different landing page, according to the different product design guidance document, etc.
But the implementation of the new policy also means that all advertisers are on the same starting line. It is the top priority to thoroughly study the functions of Baidu Jimuyu (基木鱼) and serve the client more comprehensively.
Contact us for more details on Baidu’s new policy and solutions.
DianPing is China’s leading local lifestyle and transaction platform, and the world’s first-ever independent third-party consumer review website. DianPing not only provides users with information services such as merchant information, consumer reviews, and consumer discounts but also provides O2O (Online to Offline) transaction services such as group purchases, restaurant reservations, food delivery, membership, and so on.
In 2015, Dazhong Dianping merged with Meituan and they are now known as Meituan-Dianping (美团点评).
Hainan Duty-Free – China’s largest duty-free island
In the National 14th Five-Year Plan (2021 – 2025), Hainan will be built into the largest tax-free island and financial district in China. Duty-free efforts adopted the island-wide customs seal to implement zero tariffs on the trade in goods and greatly liberalized the access system of Hainan Free Trade Port.
At the same time, Hainan duty-free shops also became a hot spot for Chinese buyers during the pandemic. There is traffics volume with more than 10 million people and actual shoppers reached more than 4.48 million, together with sales exceeding 27.4 billion RMB, a year-on-year increase of 103.7%, making Hainan a consumer paradise.
New marketing opportunities for brands that wish to target Chinese consumers
Based on the current situation and opportunities in Hainan, we are working together with Dianping and developed an exclusive module for Hainan Duty-Free. This allows brands to enjoy the traffic entrance of Hainan duty-free shops for 1 whole year and help brands to promote exclusively on the topic page. It is expected to attract more than 25 million Hainan duty-free visitors throughout the year.
Hainan Dianping – Ads example
– End of the Newsletter –
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