According to data from the Bank of China Research Institute, China’s GDP growth in 2019 is expected to be around 6.1%, which is significantly slower than in previous years. With the increase of risks and challenges, the macroeconomy will still face downward pressure in 2020. Affected by this environment, the digital marketing industry will also get the problems after experienced rapid growth for many years. According to Miaozhen Systems data, as of October 31, 2019, internet advertising traffic fell 11.5% down year-on-year and showing the first reversal of the downward trend. At the same time, artificial intelligence and the new wave of IoT (Internet of Things) growth dividends brought by 5G is also injecting new vitality into digital marketing and bringing more development space and opportunities, driving digital marketing to continue to profound change.
To help brand advertisers and various parties in the industry to formulate marketing plans for 2020, and better layout of digital marketing. Miaozhen Systems, in conjunction with AdMaster and GDMS jointly released the ‘2020 China Digital Marketing Trends‘ report (from now on referred to as “Report”). It is a report that is based on advertisers, media/platforms, agency companies, marketing technology companies and other digital marketing industry chain multi-party surveys. (434 digital marketing practitioners participated, including 221 brand advertisers). The report carried out on China’s digital marketing trends and focused on forecasting and outlooking the direction in 2020 and designed to help brand advertisers and all parties in the industry to accurately assess marketing trends and strive to achieve a higher return on investment in the coming year.
As the ‘vane’ of China’s digital marketing industry, this series of reports have been published for four consecutive years. Because of its excellent reference value, it has become a ‘marketing manual’ that advertisers, media, and agencies must pay attention to the signals.
A quick overview of the highlights of the China Social Media report:
▶ Advertisers’ digital marketing budget has increased by an average of 14%, and the growth rate of digital marketing budget has slowed down for the first time.
▶ 75% of advertisers will increase investment on the mobile terminal; only 9% of advertisers will increase the budget of the PC terminal. Social media has become a mainstream distribution channel.
▶ The social marketing budget has increased by an average of 15%, KOL is still the focus, and the popularity of short video / live broadcasting has increased.
▶ Advertisement visibility is the primary factor affecting traffic quality. 56% of advertisers use ad monitoring and filtering services to combat abnormal traffic.
▶ Digital marketing is continually changing to intelligence. Marketing artificial intelligence has become the most important digital marketing technology for advertisers;
01
The digital marketing budget growth slows for the first time in 2020 with an average increase of 14%
The report shows that the average digital marketing budget of advertisers in 2020 increased by 14%, compared with 17% in 2017, 18% in 2018 and 20% in 2019. The growth rate of the digital marketing budget showed a slowing trend for the first time.
Among them, only 18% of advertisers’ digital marketing budget growth rate is more than 30% in 2020 and fall down 11% from last year. Nearly 30% of advertisers’ digital marketing budget will remain the same as last year and nearly 60% of advertisers’ digital marketing budgets will increase at a low rate. At 10% (including flats and reductions) which increased by 1/4 compared to last year.
02
Social media becomes the main form of delivery on mobile and PC. 75% of advertisers will increase the input of the mobile terminal, and only 9% will increase PC terminal budget.
From the perspective of device terminals, the mobile device is still the mainstream choice for digital marketing. 75% of advertisers will increase their marketing investment on the mobile terminal. The content and marketing ecology of the New TV[1] terminal, which has an increasing number of connected users, have matured and there will be 21% of advertisers to increase the input of New TV, compared with 9% of advertisers who would like to increase the input of the PC. In addition, with the continuous maturity of 5G and supporting technologies, smart device terminals such as IoT / VR / AR have also become an indispensable part of digital marketing.
Note [1]: New TV refers to the large screen of a new home TV with two-way, smart, and human-machine interaction functions, including smart TV OTT, two-way cable DTV, IPTV, and similar channels.
Compared to 2019, advertisers are more willing to put on social platforms and video platforms for the mobile terminal. Among the video platforms, the short video format is trendy, and 68% of advertisers regard it as the focus of delivery.
On the PC side, social media has also surpassed search engines and has become an essential advertising channel for advertisers.
03
The average growth rate of social marketing budget exceeds that of the digital marketing budget. KOL is still the critical point, and short video & live streaming are on the rise
Social marketing has increasingly become the most crucial area of advertisers investing in digital marketing. The report shows that social marketing and its traffic pool are the digital marketing formats that advertisers are most concerned about in 2020 and video advertising and social e-commerce are the second echelons.
In terms of social marketing budget investment, 71% of advertisers will increase social marketing budget in 2020 with an average growth rate of 15%.
With the average growth rate of 21% in 2018 and 2019, the advertiser’s social marketing budget growth rate is consistent with the digital marketing budget growth rate, and there is also a slowing trend. However, in comparison, the average growth rate of the social marketing budget is slightly higher than the digital marketing budget growth.
Among many social marketing channels, KOL promotion is still the primary investment channel for advertisers in 2020. Community operations and private domain traffic has emerged as the key of investment by more than half of advertisers. In addition, advertisers attached importance to short video and live broadcast. This is a significant increase from last year, with a proportion of 53%. Advertisers’ emphasis on the operation of official WeChat accounts has declined compared to the previous year.
In terms of content marketing, 53% of advertisers regard homemade videos / micro movies as a vital point of delivery.
04
Ads visibility is the primary factor affecting traffic quality. 56% of advertisers use ad monitoring and filtering services to combat abnormal traffic
Traffic is an essential resource in the field of digital marketing and represents user attention in front of many devices. Issues such as ad visibility, robot brush volume, brand brush volume and sub-optimal traffic limited the improvement of traffic quality. The resulting abnormal traffic directly affects the effectiveness of marketing and even causes considerable losses to advertisers. According to the calculation of Miaozhen Systems, the damage caused by unusual traffic in the Chinese brand advertising market in 2018 was about 26 billion yuan.
The report shows that 42% of advertisers believe that ad visibility is the most critical factor affecting the quality of traffic, and the second are robot brushing, brand safety and traffic quality. When asked advertisers how to reduce the loss caused by abnormal traffic, 56% of them believe through the use of advertising monitoring and irregular traffic filtering services will be competent to reduce the losses.
The industry has started establishing relevant settlement requirements in contracts, building traffic evaluation standards concerning industry conditions. Using SDK monitoring and advertisers adopt other similar countermeasures in digital marketing practices.
05
Digital marketing is continuously changing to intelligence. Marketing artificial intelligence has become the digital marketing technology that advertisers are most concerned about
2020 will be a year of slowing economic growth, and the digital marketing industry will also face many challenges. However, with the continuous maturity of cutting-edge technologies such as artificial intelligence and 5G, digital marketing will burst out with new vitality and opportunities.
The report shows that in 2020, artificial marketing intelligence will become the most popular digital marketing technology for advertisers. On top of that, data centralization, marketing automation and data collection technologies are also the marketing technologies that advertisers focus on.
The above is an overview of the ‘2020 China Digital Marketing Trends‘ report.
