For @TechBuzzChina investor trip, one of our expert speakers is former exec at iResearch, now at Minervaadvisory.net. Here are some insights she shared:
1/ Tier 4 & below cities (rural China) = 62% of total mobile MAU in China.
If you include Tier 3, it’s 77%.
1/ Tier 4 & below cities (rural China) = 62% of total mobile MAU in China.
If you include Tier 3, it’s 77%.
2/ A main theme last few yrs in Chinese internet is growth of rural consumer internet, esp e-commerce. Here you see total rural e-commerce $ volume increased by ~7x in 3 years, and almost 3x’ed as % of total online sales from 6.5% in 2014 to 17.4% in 2017.
3/ Will this fast upward trend in rural consumption in China continue? Possibly. Disposable income per capita expected to grow more quickly in Tier 3 & below cities than Tier 1 & 2 cities (Beijing, Shanghai, Hangzhou, etc.) to $10K in 2030 (vs $4K+ now).
4/ While this graph says China’s online sales as % of total retail sales is still “low” at 23.6% for 2018, I just want to highlight that the same % forecasted for US for this year is just 10.7%. So, low or very high already, a matter of perspective.
5/ E-commerce is especially robust for consumer electronics and home appliances where online sales account for 40%+ of total sales already in China. It’s fresh food (sub 5%) that everyone has their eyes on, not dissimilar from in the US.
6/ Similar to rest of world, digital ad spend is higher than traditional in China. However in China, TV ads are already just 18%, whereas it’s still nearly 30% in US. Mobile internet, too, is already at 30%. China is already super digital, in case it’s not obvious.
7/ Online advertising market share by spend type in China: in 2018, e-commerce is largest and growing (32%), search is declining quickly (24%), short video expected to be 7% in 2020, nearly the same as online video (longer-form).
8/ Finally, ever wonder why Chinese search engines suck ... they’ve maxed out the total % of ads legally allowed: 30% of search results. No wonder I can’t find anything. What’s the comparable statistic on Google etc? Someone wanna jump in?
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