As the world’s second-largest advertising market, China offers boundless opportunities, yet it also presents unique challenges shaped by cultural nuances, fast-paced digital innovation, and distinct consumer behaviors. This dynamism calls for a keen understanding of the market and a willingness to adapt to its rapid evolution.
In this article, we will journey through China’s complex advertising ecosystem, delving into the driving forces behind its growth, key platforms that dominate the landscape, the role of influencers in shaping consumer decisions, and the regulatory environment that governs it.
Proud of the success of the companies we have accompanied throughout the process of advertising in China, we are delivering here some tips and advice for successful advertising campaigns in China.
Paid Advertising Landscape in China
China is one of the fastest-growing and most promising markets in the world. However, there is a difference between what you “can” do in China when it comes to advertising, and what you “should” do in order to have a successful advertising campaign. In fact, the Chinese market is characterized by its constant evolution, and this is why it is essential to do some research before entering it in order to have the best ROI (Return On Investment).
China’s Advertisement Laws
You have to know that in China, the way your brand appears and communicates its message to its target audience goes far beyond its content. In fact, it is essential to understand how your ads are going to be perceived both by Chinese consumers and the government.
In September 2015, the Chinese Government updated its advertising law to protect the interest, health, and safety of its citizens by limiting brands to do fake promotional campaigns. Under this new law, on top of the 49 existing laws, 26 were added defining advertising guidelines. This is why it is important to stay informed and updated with Chinese laws and regulations to successfully advertise without a hitch in China.
If you want to be sure that your advertising campaign respects Chinese laws, you can look at this document: Advertisement Law of the People’s Republic of China.
You also have to take note that since February 2018, WeChat strictly punishes accounts that publish vulgar and false headlines and content. With tighter regulations, it is more important than ever to ensure your WeChat content and ads meet the advertising law’s requirements.
China Digital Advertising Landscape
Digital advertising still has stable growth despite economic tensions in China. In 2019, the total advertising expenditure in the country reached almost 645 billion yuan for the first time. Moreover, it is estimated that ad spending will be driven by the internet and social media, which continues to grow double-digit.
Mobile Ads
With the rising use of smartphones and the booming app economy, mobile advertising contributed to 57% of the media ad revenue in China in 2019 and it is expected to exceed 70% by 2023. According to GMA’s report, in 2021, almost 60% of total media ad expenditures and close to 84% of digital ad spending was dedicated to mobile advertisement thanks to the BAT companies (Baidu, Alibaba, and Tencent) which represents more than ⅔ of China’s advertising market.
Traditional Advertising: A Declining Market in China
In recent years, traditional advertising has been shrinking continuously. Considered “old-fashioned”, it is also more expensive for a company as the ROI is lower than digital advertising. However, if you are willing to, you can still do traditional advertising while running an omnichannel online marketing strategy.
When compared to other traditional advertising channels (like radio or newspaper advertising), TV advertising is the strongest segment and if you’re interested in traditional advertising, we recommend TV ads. Thanks to this channel, you will be able to attract a certain audience that is not using that much social media: elderly people and seniors.
The Best Platforms for Online Advertising in China
The internet advertising market has been expanding at a double-digit growth rate in the past decade. However, when it comes to an advertisement you have to focus not only on the most popular platforms in terms of users but also (and most importantly) on each platform’s infrastructure to see if your advertising campaign fits their services.
Paid Advertising on Baidu, China’s First Search Engine
Considered the “Chinese Google”, Baidu is the most popular Chinese search engine and stands as the 5th most consulted website in the world. As of 2023, Baidu has around 60% of the market share, which means that more than half of the Chinese audience uses it to search the internet, just like we do on Google.
Given the incremental growth in mobile users, Baidu will certainly continue to invest heavily in its mobile ecosystem in order to bring a better user experience to its users. This provides a lucrative opportunity for marketers to reach a wider and more engaged audience base.
To put it simply, Baidu is a step you can’t skip in China. 60% of all first-stage research is conducted based on this search engine. However, to have effective advertising campaigns on Baidu, you need to use Mandarin Chinese keywords in order to enhance your website’s traffic. Baidu is one of the strongest players in the Chinese advertising market.
Baidu Advertising with Pay-per-click
Unlike Google, Baidu’s DSP/Media Banner ads are not particularly used as the majority of all online advertising is PPC (Pay-per-click). In fact, PPC search results are also perceived differently in China market with more trust in paid search compared to the West. One reason for this is the predominance of PPC throughout the development of Baidu’s platform with Chinese digital players monetizing their websites.
Key features of Baidu PPC
- 2 Lines of Ad Copywriting (although often only 1 will typically show, depending on ad placement).
- Top 5 search results on Baidu
- Brand Zone
- Paid ads / natural search results are harder to distinguish
- Ad keyword bidding prices can fluctuate so the campaign needs to be closely monitored
There are some limitations to Baidu ads, notably for health & pharmaceutical products where you’ll have to speak with a specialist first. If you’re not sure whether you can advertise on Baidu, contact us, we are one of the top digital marketing agencies specializing in China advertising!
The effectiveness of PPC depends on the sector, often either high-value investments or relatively low-scale purchases will thrive on Baidu PPC (e.g. Real Estate & FMCG). Cosmetics are also typically associated with Baidu PPC, as many Chinese customers look for cosmetics product reviews on the search engine.
Baidu’s User Demographic
Baidu’s traffic is all search-based, you tend to have a very qualified set of users who seek to look for information extensively. PPC is one side of reaching out to this audience whilst SEO (Search Engine Optimization) is also a major part of Baidu’s success.
How to Register for Baidu’s Ads
In order to apply for Baidu’s PPC advertising account, you will need to submit a bunch of documents for Baidu to check the potential and seriousness of your company.
These are the following documents and requirements you will need:
- Chinese website
- Business Registration Proof
- Company Bank Details
- A copy of your company chop/seal applied to documents
Paid Advertising on Weibo, China’s Twitter
Launched by Sina Corporation in August 2009, Weibo is one of the biggest social media platforms in China and is a financial success. Boasting over 600 million users with 224 million daily users, this innovative platform is tailoring itself to eCommerce marketing options more effectively than the bulk of its competitors.
In terms of its functionality, Weibo is akin to Twitter with micro-posts, hashtag functionality, and content/video links making up the majority of posted content.
In terms of advertising infrastructure, it is more akin to Facebook than any of its rivals and it is arguably a better platform for advertising than WeChat (that we will talk about below):
- Targeted and very specific so that users can be focused on your advertisement
- More cost-effective, with a lower minimum ad price than WeChat, it is recommended for A/B testing
- Weibo is an Open Network, which is better to expose your social account to local Chinese community
You also have to take into account that Weibo benefits from a profitable partnership with Alibaba when it comes to e-commerce ads. However, if you were planning to advertise to non-Alibaba e-commerce apps, you should know that the app has been putting a limitation on that practice.
The Most Popular Types of Weibo Paid Ads:
Weibo Fan Tunnels
Fan tunnels are the most targeted and intelligent way of reaching new consumers and followers. You can use this in order to promote either a specific post or simply just your account. It works like a ‘headline’, appearing at the top of the user’s news feed.
This type of Weibo ad is particularly effective to build a large following quickly, therefore if you are a new brand in China or on Weibo, that is the way to go. Fan Tunnels focus on the Weibo community, not just existing followers. It will put your content at the top of news feeds based on targeted audiences defined by age, gender, region, interests, and even device types.
You can specify the interests of followers and target other accounts for similar niches. You can select users who follow specific fashion news and fashion-related posts to be targeted for example.
In terms of budget, Fan Tunnels works with CPM (Cost Per Mille). The lowest price would be 5rmb for 1000 views.
Weibo Display Ads
Display ads come in various dimensions on different pages. They are optimized for both the mobile and web versions (although mobile is predominantly used).
When users click on the ads they are redirected to the advertiser’s homepage. Pricing depends on the page placement, size, and keyword association.
Weibo allows a targeted approach with keywords selected for visibility based on user searches, you can also feature displays on other relevant accounts that boast followers in the same niche.
Display ads are mainly put on the search page (in the Discover section), on the Weibo homepage as well as on the side of the user’s news feeds (akin to Facebook Ads).
Weibo users
Weibo users are “young”, indeed 68% of them are age between 15-30 years old. This is an important factor to bear in mind with your brand and product placement.
Weibo also is a highly active and animated community. Users expect a high level of engagement/quicker response times, one reason for this is this is a platform dominated by Key Opinion Leaders, paid ads are one thing but capturing the attention of expectant Chinese consumers with an active account is another.
Paid Advertising on WeChat, the Most Popular Chinese Social Media Platforms
Introduced in 2011 by Tencent, WeChat is one of China’s top tech companies. With 1.2 billion monthly active users, it is the most popular messaging app in China and it can be used to do everything from hailing a cab to booking a hospital appointment — and payments can be made by WeChat Pay. But WeChat is a closed platform and account holders can see only what their friends post, which means brands can interact with subscribers on a personalized level.
Three Types of WeChat Paid Ads:
WeChat Ads are always a hot topic in China, some will preach their effectiveness whilst others are skeptical. The key is budget allocation, WeChat ads do require a higher level of initial investment than other popular social media platforms. The purpose of WeChat ads is mainly to attract followers while engaging new ones.
From our experience, there is a magic number when it comes to WeChat: 10,000 followers. This number is an important key factor for your future growth with more re-posts, shares, and an animated community engaging with your brand & business.
WeChat Moment Ads
WeChat moment ads were launched in 2015 when 25 brands including Coca-Cola and Mercedes-Benz took part in the first testing campaign. Moments ads tend to be best for brands that already have a certain level of engagement in China.
WeChat Moments Ads include:
- Brand name and profile picture
- Up to 40 characters and description
- Link to an html5 webpage that’s hosted on Tencent’s server
- Up to 6 pictures or 6-15 seconds of short videos
- You can target users according to their location, interest, age, gender, device, and phone network.
When it comes to the location there are three categories including Beijing & Shanghai, 35 first and second-tier cities, and non-specific cities.
For small/medium companies or companies in the service or B2B industry, social media advertising channels such as KOL, WeChat banner ads, and Tencent ads on QQ may be a smarter choice.
The starting price for Moments ads is 50,000 RMB in mainland China as well if you are targeting foreign Chinese tourists.
WeChat Banner Ads
There is another form of advertising on WeChat termed “banner advertising”. These banners are very much like the ad banners you would see on a website. In the context of WeChat, they are featured at the bottom of a message written by an Official WeChat Account, either a subscription or service account.
It has three components:
- WeChat article: WeChat banner ads appear at the bottom of a WeChat article written by another WeChat Official Account.
- Ad banner: the banner contains a logo, account name, and headline. When clicked, it takes the users to a page containing additional information about the brand/product.
- Call to action: this takes users to another landing page, see below for detail.
The banner ads can drive users to follow WeChat Official Account, download an app, claim a coupon code, buy a product, signup for a link, or to a customized landing page.
WeChat banner advertising is the most typical way to grow your WeChat followers with a stable ROI. Thus, it is important to run a few test campaigns with different content to calculate the CPA. A WeChat follower costs between 8 RMB – 20 RMB depending on your targeting and how well you optimize the campaign. It’s a good method to get started on WeChat.
The minimum investment in Banner ads is 50,000 RMB through the WeChat platform.
Douyin, the Chinese TikTok
As one of the most popular short-video apps in China, Douyin is expected to reach 800 million daily active users in 2023. Both Douyin and TikTok are owned by Bytedance, a Chinese tech company.
Douyin literally means “vibrant music” and we can say that its name perfectly matches the short-form videos (less than the 60s) allowing users to combine it with dynamic background music and creative filters.
In order to be successful in Douyin’s sphere, you will need to have a verified business account.
In order to do so, you will need to visit Douyin’s official website where you can verify the business account by providing information such as the type of account, its category, account operator information, and relevant company registration information and documents.
There are 2 types of ads on Douyin:
- Brand Takeover: The Ad Appears on the loading page of the app for a day and redirects to a brand’s landing page or hashtag challenge on Douyin
- Native Ads: Native ads appear in users’ feeds. They can be video or picture and the duration range between 5 to 15 seconds. This type of ad supports CTA and can redirect users outside of the app.
Toutiao, China’s Buzzfeed
Launched in 2012 and translated as “Headlines”, Toutiao was developed by the same company as Douyin, the Bytedance Chinese tech company. Toutiao is one of China’s largest mobile apps for content creation and news aggregation, you could also call it the “Buzzfeed” of China. It recorded 1 billion monthly active users as of July 2023.
You have to consider Toutiao as an effective way of gaining Chinese consumers’ attention. In fact, they are spending more time on Douyin and Toutiao than on WeChat. However, by analyzing the type of content users interact with, when we can see that the company’s algorithm models generate a tailored feed list of posts for each Toutiao’er. They also accept account settlements based on performance (CPC, CPA..).
There are 3 types of paid ads on Toutiao:
- Take Over Ads: displayed on fullscreen when opening the app
- Streaming feed Ads: video format ads that blend into users’ feeds for a seamless experience.
- Feed Ads: feed ads appear in users’ feeds. They can be in various formats. This type of ad supports CTA and can redirect users outside of the app.
Kuaishou, the Biggest Competitor of Douyin
As one of the most famous short video apps in China, Kuaishou has more than 300 million daily active users, and 80% of users are born after 1990, among which the average of using time can achieve more than 60 minutes per person per day. Moreover, 19 million people have earned income from Kuaishou.
In the user distribution, users in first-tier cities only account for 10%, while users in second and third-tier cities are the main users of Kuaishou.
So, compared to Douyin, your advertising strategy should target second and third-tier cities.
Zhihu, China’s Q&A Forum
Launched in 2011, Zhihu stands out from its competitors by providing high-quality questions and credible answers. In fact, instead of turning to their friends to ask questions, the Chinese are asking questions on Zhihu.
As of 2023, it had 200 million registered users, and over 120 million answers becoming China’s largest knowledge-sharing community. Zhihu recorded an impressive 45 million ADU, 45 million questions, and 1.2 billion answers!
The tagline “Discover a bigger world”, is definitely an important source for Chinese netizens to obtain expert knowledge and insights into various topics. By using this platform to advertise your company, you will be able to catch users’ attention, have a high income, high consumption power, and strong educational background, and are capable of discussing more high-level, technical, and premium topics.
Live Streaming: A New Way of Advertising
In 2020, the Covid-19 pandemic had a huge (positive) impact on Taobao Live’s development. The number of new merchants on Taobao Live for example increased by 719% from January to February. Other platforms and apps also benefited from this increase in demand and all live-streaming platforms are trying to follow this trend. Platforms like Douyin and Kuaishou which have a huge number of users are also promoting brands and products on their platforms.
For instance, Li Jiaqi (Austin Li), known as the “King of Lipstick” in China sold 15,000 lipsticks in just five minutes through the Taobao Live app. He has a large community on social media, with more than 40 million fans on Douyin, where he usually live-streams his recommended beauty products.
In fact, live streaming is removing barriers between brands and consumers in the advertising industry. While it is focused on driving short-term sales, it enables local and international businesses to improve their marketing efficiency by combining brand marketing and performance marketing.
These live-streaming shows are simply a new generation of ads. Because it is live, audience members can interact with the influencer, who can charm the audience to purchase more. So if you have the opportunity to do so, consider this advertising method as it would increase your sales significantly in the long term but also your reputation & visibility. By being closer to Chinese consumers you will be able to demonstrate your products live, promote your brand, and most importantly, obtain their feedback instantly.
Our field of expertise
The advertising ecosystem in China is a rich environment, so you will need to talk about it with an expert in this sector.
Innovative and ROI-oriented business strategies are essential in the digital era. Digitalization has changed customers’ behaviors at a greater speed and scale than ever before. This reality is indeed more important in China, where companies must change and rethink their advertisements through innovative digital marketing strategies.
Digital consulting agencies play a critical role in helping foreign companies build leadership, business architecture, and organizational models that are necessary to get a successful ROI in China.
GMA Digital Consulting Agency analyzes the needs that will drive the implementation of your business model. We execute digital strategies and provide market surveys for your business in order to give you the best of the Chinese market.
There are a host of options not covered here so if you have a serious project please contact our team for an in-depth consultation on developing your interests in China.