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An in-depth look at the rise of mobile and the opportunities for advertisers in China
China
From here on in, our report will show the phenomenal mobile opportunity for marketers in the China.
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China is home to 1.4 billion people, with the countrys population growing by one birth every five seconds There are currently 1.1 billion mobile subscriptions in China In 2012, Chinas mobile market increased by an additional 10 million subscriptions each month There are already 290 million smartphone users within China Room for significant growth exists too, with smartphone penetration currently only equivalent to 22% of the countrys population
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Many consumers now regularly visit news sites from their mobile web browsers; such sites now account for 62% of mobile web traffic in China Over one-fifth of consumers state having a wide range of apps is a key purchase consideration when looking for a new mobile phone 67% of Chinese consumers use instant messaging apps such as Tencents WeChat, which alone has over 300 million users Mobile gaming accounts for 32% of total time spent on mobile devices by Chinese consumers Streaming online music is exceedingly popular, with nearly three-fifths of Chinese smartphone streaming via mobile
Increases in mobile Internet activity are a direct result of Chinese telecommunications companies targeting such regions. The urban mobile market is very competitive, and in attempting to reach more consumers, telcos have started to broaden their horizons. China Mobile, Chinas largest telco with over 735 million subscribers, created the Agricultural Information Service, in a successful attempt to bolster rural subscribers. The service provides advice to farmers regarding how best to raise crops. It also offers weather, news and information updates regarding the latest market prices of various products. However, while rural areas do represent fertile ground for telcos, the Chinese government hopes to move 250 million rural residents into newly constructed towns and cities over the next 12 years. This increasing migration will see urban regions remain the substratum for mobile companies.
Nevertheless, increasing mobile Internet penetration is leading to rather advanced mobile behaviours among Chinese consumers. Many now regularly visit news sites from their mobile web browsers; such sites now account for 62% of mobile web traffic in China. Other top websites visited via mobile include search engines, literature pages, micro-blogs and music sites.
increasing migration to urban areas will see urban regions remain the substratum for mobile companies. Many now regularly visit news sites from their mobile web browsers; such sites now account for 62% of mobile web traffic in China.
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Currently, there are 597.6 million social media users in China: This equates to 44% of Chinas whole population In 2012 alone, Chinese consumers clocked up 19 million years worth of time on social networks Qzone is currently the largest social media channel in China, with an estimated 598 million active users Despite only accounting for 30% of Chinas population, Sina Weibo users consume 54% of total goods and services within the country
There is a strong consumer desire to use social networks when on the go, with 74% of smartphone consumers accessing social on their device
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There is a strong consumer desire to use social networks when on the go, with 74% of smartphone consumers accessing social on their device. There are currently over 467 million users of mobile instant messaging apps such as Tencents WeChat.
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There are effectively two brick walls in China a physical border and a firewall where information is controlled entering and leaving the country Alternatives to western services are taking the place of large global firms - PayPal was blocked within the country until recently, leaving the market open to local firm Alipay There are now more patent applications filed by Chinese companies than those based in the US Local manufacturers such as Huawei and Lenovo have become regional powerhouses and are likely to start challenging large global players in the future Chinese manufacturers have more than doubled their share in the smartphone market within a year to 29%
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Local manufacturers such as Huawei and Lenovo have become regional powerhouses and are likely to start challenging large global players such as Apple and Google in the future.
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Mobile advertising as a percentage of online ad revenue in China lags considerably behind advanced tech economies, with a mere 3.3% of digital adspend going on mobile However, despite slowdowns in overall ad revenue in the region, digital advertising will help Chinese ad spend rise to over $45bn this year
In the US, 65% of smartphone owners are equally or more comfortable with mobile ads as those on TV or desktop/laptop; in China this figure is 49%
The efforts to monetize the inventory are also inconsistent between networks with many only working on a CPA or CPC model By the end of last year, in-app mobile display advertising was said to be worth roughly $283 million
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Mobile advertising as a percentage of online ad revenue in China lags considerably behind advanced tech economies, with a mere 3.3% of digital adspend going on mobile.
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Where in western countries iOS is a significant part of this market, Android is estimated to take 80% of Chinese mobile game revenue. This is due to the proliferation of cheap Android handsets in the region.
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It was predicted that by the end of last year, in-app mobile display advertising would be worth roughly $283 million in 2012. In itself this seems relatively small, but when compared to mobile search in China which was expected to take $189 billion last year, it is very significant.
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Bibliography
BBC, China economic growth lower than forecast, 15 April 2013 Bloomberg, China industrial-profit growth accelerates as sales increase, 27 May 2013 Bloomberg, Google finally leads in China in app ad sales, 22 August 2012 China Daily, A golden age for gaming on the go, 6 May 2013 China Internet Watch, Chinas Mobile Ad Spending 2010 -2016, 20 August 2012 CIA World Factbook eMarketer, Despite digital growth, total ad spending slows in China, APAC, 20 June 2013 Engadget, Keepin it real fake: HTC One gets a convincing plastic clone (video), 14 July 2013 Forbes, RenRen rides Chinas social networking and gaming, 3 May 2013 Huawei, Huawei Ascend P6 (Black), accessed 13 August 2013 Inmobi, What it takes to win in the Chinese app market, 17 June 2013 Inmobi, 59% of global mobile web users are now as comfortable with mobile advertising as they are with TV or online advertising, 27 February 2013 International Business Times, China;s largest music producers tell streaming services to charge for premium content, 3 June 2013 NDTV, China embarking on vast program of urbanisation, accessed 9 August 2013 New Media Trend Watch, China Mobile Devices, accessed 9 August 2013
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Bibliography
Nielsen, The Mobile Consumer: A Global Snapshot, February 2013 Nielsen, Mobile Consumer Report 2013 Research and Markets, China Mobile Game Industry Report, 2012 -2015, October 2012 Reuters, Chinas Tencent messaging app may no longer be free govt official, 31 March 2013 State of Digital, Chinese social media: in China it is not about Facebook, 28 May 2013 TechNode, M-commerce in rural China: Three cases, 21 January 2013 The Economist, Patent applications, 15 December 2012 The Global Warming Policy Foundation, China & India are building 4 new coal power plants every week, 14th November 2012 Warc, Asia drives mobile handset growth, 15 May 2013 Warc, Mobile gaming booms in China, 26 February 2013 WARC, Asia drives mobile handset growth, 15 May 2013 We Are Social, Social Digital and Mobile in China, January 2013 Wikipedia, Tencent Holdings, accessed 7 August 2013 ZDNet, Alibabas Aliyun OS hopes to be Android of China, 10 September 2012 ZDNet, China music sites urged to start charging users, 4 June 2013
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