china search covers search marketing in china
DESCRIPTION
This is a dive into Search Marketing for Fashion brands in China.TRANSCRIPT
Fast Fashion Approaching
China
Who are Baidu; Baidu are China’s largest search engine, and the 5th largest website in the world.
Through their various properties they touch 100% of China’s online population monthly
We are an international partner to Baidu, working with international brands to
increase their presence in China through Baidu’s various marketing channels
Who are we;
An Overview of China
The Economy, the Internet and Consumers
China’s Market PositionThe middle classes are expanding beyond the largest cities more rapidly & in greater numbers than any market has ever witnessed. The number of Middle and Affluent Consumer HOUSEHOLDS in China will be the same as the US by 2020
1
13
34
61
57
36
12
53
69
66
39
23
Household annual disposable income(USD) thousands
Upper affluent >200Lower affluent $16 - $31.5Middle Class $9.5 - $16Emerging Middle $6 - $9.5Aspirant $4 - $6Poor <$4
Households MillionsHouseholds Millions
Source BGS Consultants
Urban household disposable income 2020Urban household disposable income 2010
MACMiddle & Affluent Consumers
is MAC Households in China
2005 = 11,000,000
2011 = 50,000,000
2020 = 140,000,000*
*That’s around the same number, if not more as this classification in the USA
Source BCG
China’s Online Population
China already has the largest online population in the world at 618 million users. Astonishingly that’s only 46% of their population, so their capacity for growth is enormous
China USA India Japan Brazil UK Australia0
100
200
300
400
500
600
700
618
245
121101
7953
2045.7
79
10.2
80
39
84 89
Online Population MMs
% of Population online
Source: China Internet Network Information Center
China’s Online PopulationInteresting Comparison Of China’s Online Population
China
USAUKAustralia
= 50 million online users
Source: China Internet Network Information Center
• As of end 2013, there were 618 million internet users in China – the world’s biggest internet user population. The internet penetration rate has now reached 45.7%.
• There are slightly more male internet users in China (55.9%) than female (44.1%).
• While nearly three quarters (73.4%) of China’s internet users are going online via their PCs, more than two thirds (69.3%) also do so from their mobile devices.
• China’s students represent 30.2% of China’s online population.
• The rural areas of China account for 26.5% of the total internet population, or 156 million internet users.
• China’s online community is expected to exceed 700 million by 2016.
• As a guide, in recent years, China’s internet population has grown by approximately 10 million people monthly (equivalent to half the population of Australia).
China’s Digital Demographics
China’s Digital Credentials
1,351,000,000
51% Urban
Total Population
Urban vs. Rural
618,000,000
45.7%
Internet Users
Internet Penetration
1,198,500
88.7%
Mobile Subscribers
Mobile Penetration
798,200,000
59.1%
Tencent QQ Users
Social Network Penetration
Source: US Census, CNNIC, Tencent, Mobithinking
China’s Online User Behavior
Activities Online
9Source: Nielsen, GlobalWebIndex Wave 6
Search Engines
80%Watched Video
72%
Listened to Music
77%Instant Messenger
67%
Uploaded Photos
60%
Activities Performed Online % of Users
REVIEWED A PRODUCT OR BRAND ONLINE 74.58
USED WEBMAIL 74.08
WATCHED A VIDEO CLIP 71.64
USED INTERNET BANKING 71.29
PURCHASED A PRODUCT ONLINE 70.79
USED INSTANT MESSENGER 67.2
UPLOADED PHOTOS ONLINE 60.47
USED ONLINE OFFICE APPLICATIONS 59.62
POST COMMENT ON FORUM / BBS 55.63
MANAGE YOUR SOCIAL NETWORK PROFILE 54.04
LEFT A COMMENT ON A STORY ON A WEBSITE 53.39
USED A MICRO BLOGGING SERVICE 52.04
BGHT PROD/SERV THROUGH GROUP BUYING SITE 49.55
China’s E-commerce
What Drives Consumers Activity
Source: GlobalWebIndex Wave 6, Bain, CNNIC
• China surpassed the USA as the largest e-commerce market globally in 2013 at a market size of USD $265 billion.
• Analysts estimate the Chinese market to be worth CNY 3.3 trillion (USD $540 billion) by 2015.
• E-commerce growth was driven largely by mobile: 40.7% of online shoppers used a mobile device to browse e-commerce merchandise.
• 53.6% browsed a merchandiser’s mobile app instead of accessing its main web site through their device’s internet browser.
• In Tier 4 cities the average shopper spends 27% of disposable income through e-tail
What Chinese Users Buy Online % of UsersCLOTHES 51.69SHOES 40.98BOOKS 33A GIFT FOR SOMEONE 23.18MOBILE PHONE 22.03PERSONAL ITEMS; WATCHES / HANDBAGS, ETC 21.68BEER 21.44FILMS 18.25TRAVEL E.G. PLANE TICKETS / HOTEL 16.15BROADBAND / HI-SPEED INTERNET 13.91HEALTHCARE AND PHARMACEUTICAL PRODUCTS 13.56WINE / SPIRITS 12.71HOLIDAY (IN MY OWN COUNTRY) 12.66MUSIC 12.46FINANCIAL PRODUCT E.G. INSURANCE 9.27NONE OF THE ABOVE 8.23DESKTOP COMPUTER 7.53FURNITURE / HOME EQUIPMENT 7.03LAPTOP (BIGGER THAN 10” SCREEN) 5.98
Fashion Takes a Larger Share of Wallet
Compared to other markets, Apparel is a market leader for spend
Source; McKinsey
China’s market size in perspective;
A 24 hour Singles day sales event on 11th November 2013 saw USD $5.75 billion of sales over Alibaba’s two market leading e-
commerce platforms.
Compare this amount with Black Friday in the US, which netted only USD $1.46 billion
So, a huge market, with incredible growth still to come. Connected
consumers, with growing disposable income and a high propensity to transact
online, in fashion…
…What next.
THE BASICS STILL REPRESENT THE BIGGEST SINGLE OPPORTUNITY
VS.
Or, even better…
E-wallets (provided by marketplaces e.g. AliPay & TenPay) and COD are the preferred payment
methods across e-commerce.
The Credit Card network of choice is China UnionPay with over 300 million credit cards in circulation inside China. Over 3bn Globally
Local customer service is a must when selling in China.
The simple ability for staff to communicate with customers will differentiate your offering and make your products seem more accessible.
Be mobile ready. Last year around 1,670,000,000
payments were made via mobile phones.
Totaling a value of US$1.6trillion
Consider Working with a Marketplace as well as Your Own SiteThey are Dominant
Source; McKinsey
Understand your local positioning;
Colin Currie, MD of Adidas in China recently stated that unlike other markets, Adidas in China is more of a lifestyle brand, so his
competitors are more like H&M and Zara as opposed to traditional sports brands
Understanding Advertising on Baidu
Gucci – Paid Search Result
Gucci - BrandZone
Gucci – Baidu Knowledge
Gucci – Image Zone
Gucci – Baidu Wiki
Gucci – Baidu Video Search
Contact DetailsWe hope you enjoyed our presentation and we look forward to hearing from you.
Grant McCarthy
Executive Director
Email: [email protected]?
That was a lot of info, and we have a lot more. For these slides or more
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