China's Internet advertising market sees steady improvement in 2021: report

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In 2021, the Internet advertising market steadily improved, and the new development pattern has taken solid new steps, said a report released on Jan. 13, 2021.

The 2021 China Internet Advertising Data Report said the Internet industry benefited from the growth of domestic demand and achieved 543.5 billion RMB in advertising revenue (excluding Hong Kong, Macao and Taiwan) in 2021, a year-on-year increase of 9.32 percent, with the growth rate slowing by 4.53 percentage points from the previous year.

According to the report, e-commerce platforms continue to take up the top spot in advertising channels, and their market share has continued to grow in the past five years. In 2021, they continued to account for more than one-third of total market revenue.

Thanks to the rapid development of live video and live-streaming broadcasting, the advertising revenue generated by video platforms has continued to increase at a rapid pace, rising by 30.28 percent, and with a market share that has increased to 21.66 percent, which is far ahead of search platforms (10.43 percent) and social media platforms (9.77 percent), becoming the second-largest advertising platform category for the second year in a row.

Affected by the pandemic and the overall economic situation, the concentration of the advertising market has increased compared to last year. The market share of the top ten companies in the industry rebounded to reach 92.42 percent in 2020, nearing the level achieved in 2019 (at 94.85 percent), while the market share of the top four major companies operating in the industry in China has meanwhile further increased to 78.2 percent.

From the perspective of individual industries and categories, personal care and maternal and infant product categories have delivered a growth rate of 58.7 percent, surpassing food and beverage for the first time in five years with a market size of 178.748 billion yuan, becoming the largest category in the Internet advertising market.

The education and training industry, affected by relevant policies, underwent a cliff-like decline in 2021. Annual revenue in this individual category fell by 69.6 percent, and the overall income scale shrunk, falling back to the level of five years ago.

The report indicated that, by being spearheaded by the Winter Olympics, sports may become an important growth area for the advertising industry. The upgrading of mass sports consumption will create a broader space for the Internet economy to continue expanding. A trillion-RMB market with multi-sector, multi-sports, and multi-industry integrated development is taking shape.

It was also noted that the "Dual Carbon Strategy" will profoundly affect the Internet industry structure. New energy vehicles provide more possibilities for Internet marketing and will become an important part of the transformation of China's national economic structure.

The report, which has been released for the past six consecutive years, was jointly released by Zhongguancun Interactive Marketing Laboratory in conjunction with PricewaterhouseCoopers, Miaozhen Marketing Academy, the School of Journalism and Communication of Beijing Normal University, and Hylink Digital Solutions Co., Ltd.