What are the important trends in the Internet advertising industry?

Core points of this article: China's Internet advertising market size, China's Internet advertising market competition pattern, etc.

-Market size: China's Internet advertising scale is close to 550 billion yuan in 2021

China's online advertising market size is close to 500 billion yuan in 2020, with a year-on-year growth rate of 13.85%.The significant slowdown in the growth rate of China's online advertising market size in 2020 is mainly attributed to the impact of the epidemic, and some brands have reallocated and planned their online advertising budgets. As the market confidence of brand parties continues to recover and commercial activity further increases, preliminary statistics show that the scale of China's Internet advertising in 2021 may be close to 550 billion yuan.

--Internet advertising market internal competition analysis

--Branded graphic advertising: branded graphic advertising business after years of rapid growth Entering a stable period

Since the user traffic of traditional portals has entered a platform period, and PV has begun to decline under the general trend of mobile Internet, the brand graphic advertising business has entered a stable period after years of rapid growth. On the other hand, advertisers began to seek diversified means of Internet placement such as video and search, and the balanced spending of budgets made the proportion of branded graphic advertising investment decrease.

Traditional portals have the industry's top branding and user stickiness, and the industry is highly concentrated. But from the individual enterprise growth rate, Sogou, Sina in recent years showed negative growth; which only Alibaba still maintain double-digit high growth.

--E-commerce advertising: the rise of Pinduoduo, Alibaba, Jingdong growth rate slowdown

Since the advertising system went on line in April 2017, the new revenue model has brought about a snowball effect, pushing the Pinduoduo platform revenue to realize geometric growth. Pinduoduo platform revenue mainly comes from online advertising and transaction commissions, and other current e-commerce platforms in the business model has consistency, so the rise of Pinduoduo will inevitably seize the rest of the e-commerce business market. 2018-2020, Alibaba, as well as Jingdong advertising revenue growth rate have shown a slowing trend.

--Search engine: Baidu advertising revenue growth rate slowed down, Sohu showed negative growth

From the overall advertising revenue, Baidu advertising revenue growth rate of 5% in 2020, Sohu continued to grow negatively, with a decline in revenue of 16%. From the market growth rate, Baidu entered 2018, advertising revenue growth showed a slowing trend, mainly because its market is eaten up by today's headlines, the United States and other Internet companies. 2017-2020, Sohu advertising revenue continued to show negative growth.

--Social community: rapid growth of advertising revenue in Beili Beili

In the field of social community, the three major portals Tencent social, microblogging, and Beili Beili have maintained a high growth rate. By the end of 2020, Tencent's online advertising business will generate more than 80 billion yuan in revenue in 2020, up 20% year-on-year, benefiting from platform integration and algorithm upgrades, as well as increased demand for advertisements from industries such as education, Internet services and e-commerce platforms.

In 2020, Weibo's advertising and marketing revenue from large customers and small and medium-sized enterprises (SMEs) declined by 7% compared to 2019, which was mainly related to the negative impact of the Xin Guan epidemic on the overall advertising demand side, especially on the demand side in the first half of 2020. In contrast, Beep advertising revenue grew rapidly.

--Video advertising: video advertising growth rate gradually slowed down

The development of video advertising was largely influenced by the development of online video in China. On the one hand, the impact of improved hardware conditions, improved broadband conditions, the increase in network speed, making the user online video viewing experience better, increased willingness to use; on the other hand, because the content of the video site has been greatly improved, the network video companies pay more attention to the quality of the video, and continue to provide high-quality copyrighted film and television content, but also pay more attention to the originality and timeliness, often in the form of the first, webcasting Play, improve the quality of network video, while benefiting from the rapid development of the film and television industry, hot movies, TV dramas and variety shows more and more, led to the prosperity of the network video industry; at the same time, video sites actively take the multi-screen layout strategy, in the cell phone side, tablet side, the computer side of the video can be presented by the video patch ads.

On the whole the growth rate of video advertising is gradually slowing down, but will still be one of the important components of Internet advertising, Tencent video also further illustrates the above situation. 2018-2020, Tencent video as well as Aqiyi video advertising revenue have shown a slowing trend. But the trend of slowing growth in Aqiyi is more obvious.

Comprehensively, the growth rate of branded graphic ads and video ads has gradually slowed down, there is a large gap in the growth rate of advertising revenues of enterprises in the search engine field, and the growth rate of revenues of e-commerce ads as well as some of the dark horse enterprises in the social community ads is higher.

-- The above data refer to China Internet Advertising Industry Market Outlook and Investment Strategy Planning Analysis Report