China's advertising industry continues to maintain double-digit growth, global advertisers do not hide their envious eyes, while Chinese advertisers give the same eyes to their counterparts who are reaping the fruits of the Internet advertising field.The data of a statistical survey on the development of China's Internet released in July 2005 showed that the number of Internet users, the number of Internet-accessed computers and the number of Web sites in China have reached 103 million people respectively, 45.6 million and 677500 respectively. Correspondingly, the entire online advertising market has maintained a high growth rate. 2004 China's online advertising market excluding search engines grew from 1.08 billion yuan in 2003 to 1.9 billion yuan, a market growth rate of nearly 70%. However, what is more attractive is the other two figures there are 1.2 billion Chinese people do not have access to the Internet; at present, China's online advertising market accounted for less than 1.4% of the overall advertising market in China, far lower than the international average of about 5% of the level.
However, while more and more companies are planning to significantly increase the amount of online advertising next year, many advertising agencies are still lingering at the door of online advertising. Instead of hesitating, they are clueless. Macro data gives confidence, but specific decision-making actions must be based on knowledge and analysis of various market factors.
Network advertising agency market "threshold" low, rich returns
IResearch survey report shows that at present in China has engaged in network advertising agency advertising company more than 100, to network advertising agency advertising company more than 20. The rapid development of online advertising agencies is only relative to the previous sparse situation. Considering the background that the Internet is rising to be one of the most powerful media, such a scale of online advertising agency team is really small. We see many local companies among the top online advertising agencies. On the one hand, this is a reward for some of these companies to stick to the online advertising position, on the other hand, it shows that the threshold of entry of the network advertising agency is still low, and has not yet entered the white-hot stage of fierce competition.
At present, the specialization of online advertising agencies is still basically expressed in the division of services by industry. In this regard, local companies seem to reflect more positively. Most of the international advertising companies still maintain the "all-you-can-eat" posture. 90% of Genesis Miracle Advertising's clients come from the online game industry, Century Huamei Advertising has the largest number of cell phone clients, and most of the advertisers of Crestone Advertising come from the automobile industry. Xinhai Heng, Jiahua Hengshun, Longtuo and other advertising companies are mainly real estate advertisers, Red Horse Media, the new economic cooperation mainly serves the education and other types of industry customers. This relatively single professional division of labor phenomenon shows that the field of online advertising is not a high standard of specialization services, the integration of online media resources is not strong.
In 2004, Chinese advertisers*** placed 1.9 billion yuan of online advertising expenses in the online advertising market, of which 700 million yuan was directly placed by advertisers in the form of framework agreements and sponsorships, etc., while the rest of 1.2 billion yuan (1 billion yuan of brand marketing expenses; 200 million yuan of effect marketing expenses) was entrusted by advertisers to online advertising agents for online media placement, from which online advertising agents received 200 million yuan of revenue. After receiving 200 million yuan in revenue, the agents spent 1 billion yuan to the online media. 2004's online advertising agency fee collection ratio was around 16.67%, which shows that the industry's return is more reasonable, the overall operation is more standardized, and the degree of competition is relatively low. As the total amount of online advertising and the number of agents increase, it is conceivable that this ratio will gradually decline. However, due to the rapid expansion of the overall market size, it will ensure that a relatively high level of return on services will be maintained for a long time.
So it can be said that time and speed are the most critical factors that can determine success or failure in entering the online advertising service field. The sooner and faster you cross that still low threshold, the higher your chances of success.
Table 1: Scale of major online advertising agencies in China in 2004
(excluding other revenues such as technology and production)
Agency company name online advertising media agency amount (yuan)
Interpretation advertising (Goodyear) 14,000
Huayang Lianzhong+Transnational 14,000
Dentsu advertising 10,000
Bosheng Yunfeng-Hongye Shengda 8000
Shengshi Great Wall 6000
Century Huamei 5000
Genesis Miracle 4200
Keyshitsu 4000
Tengxin 3500
Linzidayang 2400
McKenna 2000
Quanzhou Frontier Culture 1200
McKenna 2000
McKenna 2000
Tengxin ads (good news) p>Quanzhou Frontier Culture 1200
Jingxin Advertising 1000
Sunshine Plus 600
Traditional advertisers have strong resources
In terms of online advertising agency service providers, there are too many "buckets of gold" waiting for them to tap. "Waiting for them to dig. The most convenient way is to "graft". Who can convince traditional media advertisers to "dabble" in online media, who has found a "gold mine". Almost all of the advertisers who have already "dipped their toes in the water" have taken an attitude of additional advertising on online media.
It is undeniable that China's online advertisers are more concentrated in terms of industry distribution, and IResearch's survey report shows that IT, network services, mobile communications, transportation and automotive, and real estate were the top five industries for online advertisers in 2004, while the fast-moving consumer goods industry, which has been pinned with high hopes, is still in a state of stagnation. Advertisers in some of the top industries in the advertising market still haven't changed their inertia of focusing on traditional media led by TV. At the same time, however, this situation can still be considered a "positive" scenario, because the growth in the number of online advertisers can be seen with enough confidence as a "reserve resource". 3,225 online advertisers in 2004, an increase of 1,435 compared to 2003. In 2004, there were 3,225 online advertisers, an increase of 1,435 advertisers compared to 2003, and 2,514 advertisers compared to 2002, an almost geometric increase. And it's safe to say that the new online advertisers are basically a diversion from traditional media.
At present, the main force is still the big brands with abundant budgets, and the most expensive advertiser in 2004 was Samsung Electronics, which spent 59.1 million yuan, followed by China Mobile and Ebay, which spent 40.47 million yuan and 40.02 million yuan respectively. As the value of Internet media is generally recognized by the society, it is believed that more and more powerful brands will appear at the top of the placement list. The Internet has the media quality of unlimited extension space, which is increasingly attractive to advertisers who are tired of fighting in the limited space of traditional media, and the gold content of the "King of Bid" in online media will be continuously improved. The data results of the 16th survey of China Internet Network Information Center released in July 2005 (see Table 2) show that the industry distribution of online advertisers will be further enriched. Demand is the market, the market is irresistible power.
The online advertising market is in its "golden age"
The development of the online advertising market must rely on the growth of online media itself. At the same time, the lucrative revenues generated by online advertising have also contributed to the healthy development of online media. It can even be said that the Internet can usher in the "second spring" thanks to online advertising.
Of course, the revenue situation of online media is not balanced; in 2004, the top five revenue generating media, which mainly consisted of web portals, generated 1.24 billion yuan in revenue, accounting for 65% of the total revenue of online media. Sina remains the dominant player in China's online advertising market, leading the portal camp in terms of visits and clients, with more than 500 million yuan in online advertising revenue in 2004, advertising revenue that already rivals that of some of the traditional large media conglomerates.
Table 2: Which products or services on the Internet users think are not enough to satisfy their needs (multiple choice)
Computers, computer accessories (such as memory, hard disk) and computer peripherals (such as printers, scanners, etc.) 19.0%
Books, newspapers, magazines, and other paper publications 17.4%
Mobile phones 14.9%
Audio-visual products (including CDs, VCDs, DVDs, etc.) 14.2%
Home appliances 13.3%
Computer software 13.1%
Clothing 12.9%
Travel ticketing and hotel booking services 12.0%
Education and learning services (paying for enrollment in online schools, training courses, etc.) 11.9%
Digital cameras 10.8%
Food 10.3%
MP3 players 9.7%
Other digital electronic products 9.3%
Life and household goods and services 9.3%
Pharmaceuticals and healthcare supplies and services 9.2%
Paid subscriptions and paid membership services 7.6%
Flowers, cakes and other gift services 7.5%
Financial management, insurance products and services 7.5%
IP phone cards, cell phone recharge cards and other point cards 6.8%
Sports supplies 6.6%
Office supplies 6.4%
Online game supplies (including game cards, virtual props, etc.) 6.1%
Makeup supplies (including game cards, virtual props, etc.) 6.1%
Makeup supplies 5.2%
Other 1.8%
The emergence of this situation reflects the inevitability of the law of market value on the one hand, and on the other hand, it also shows that most of the value of the online media, especially the value of a large number of unique media, has not been effectively explored. The high concentration of online advertising, and the prevalence of large areas of high-quality resource blindness, show that the online advertising market is in the "golden age", and the "song of the gold miners" will become the main theme of the development of the online advertising market in the near future.
As the most open and free emerging media, compared with traditional media, the Internet has a unique advantage in capital operation and resource integration. It can be said that the commercial Internet is a premature child born by capital. And since its birth, it has been growing in the constant reorganization and merger. In China, this feature of the Internet media performance is particularly valuable, in the industry and outside the integration of resources can be carried out more quickly and flexibly, but also for the network advertising marketing market to create and develop the most powerful support. Moreover, the merger and reorganization of online media is completely capital-led, from the marketing purpose, clear positioning, more conducive to the development of advertising and marketing activities.
At the same time, the concept of specialization of online media is almost inherent in all kinds of websites with a clear division of labor. The so-called professional online media now refers to a more segmented positioning of the characteristics of the site. 2004, China's professional online media has increased dramatically in the number of online media with a certain degree of online advertising professional sales team from more than 40 online media has risen sharply to about 80. These specialized websites have become the target of the increasingly formed online media groups with portals as their core. For example, Sohu purchased 17173, a media specializing in online games, and Focus, a media specializing in real estate; Yahoo China took advantage of the merger and acquisition process with 3721 to localize the management of its online advertising operation staff. It is worth noting that online game communities and other types of online communities, has a huge user traffic, but has not yet played a good advertising value, these communities and new forms of new communities such as Blog has a great potential for the development of online advertising.
To make a visual analogy, the search engine market is somewhat similar to the traditional advertising in the field of outdoor advertising, marketing value can not be underestimated. iResearch statistics show that in 2004, China's search engine market size of 690 million yuan, an annual growth rate of 147%. 2005 China's search engine market will reach 1.2 billion yuan, an annual growth rate of 74 percent. 74%.
The diversification of online media provides a broad stage for online advertising, and at the same time, it will also put forward higher professional requirements for online advertising agents. Therefore, after experiencing the current low-threshold period of the online advertising market, will be faced with the requirements of the network media on the level of professionalism of the service, network advertising agencies should prepare for a rainy day.