China - Trade Promotion and AdvertisingChina - Trade Promotion
China is the world’s second-largest advertising market, featuring consistent double-digit growth and a projected market of more than $105 billion in 2019. Internet ad spending is now rapidly outpacing TV ad spending. In 2018, internet advertising spending in China was over three times the size of TV adverting spending. China's retail boom and increasing competition among retailers is causing China's advertising industry to grow even faster than the economy as a whole.
Many major international advertising firms have established a representative office in China and have teamed up with Chinese partners, through joint ventures and other types of partnerships, to offer their services in the market. Companies new to the market can gain valuable advice from top-notch advertising firms on how to craft an effective advertising strategy that is responsive to Chinese consumer preferences and cultural differences.
The advertising industry in China remains heavily regulated, and the national and provincial governments still exercise control over content. Advertising in China is regulated by the Advertising Law of the People’s Republic of China (Advertising Law), which was updated in 2015. The updates to the Advertising Law introduced several major changes impacting online advertising, health claims, celebrity endorsers, and false advertising.
Major changes include:
- Expanding the law’s purview to include online advertising;
- Obliging telecommunications firms, internet service providers, and websites to remove illegal/misleading advertisements;
- Disallowing dietary supplements companies to imply that they are "necessary" for good health;
- Prohibiting the use of spokespeople in many types of health-related advertising;
- Broadening definitions of "advertising" and "false advertising";
- Restricting children's advertising;
- Restricting tobacco advertising.
Notably, foreign businesses must work with a licensed partner to advertise in China.
The State Administration for Market Regulation’s (SAMR) Advertising Supervision and Management Department acts as the main advertising regulator, but other bodies such as the Ministry of Culture and Tourism and the National Radio and Television Administration’s Media Management Division also play an active role in controlling print and television content. SAMR’s advertising regulator is responsible specifically for regulating advertisements in pursuit of consumer protection.
Social Media MarketingWith China in the midst of a consumer revolution, foreign products that make use of advanced marketing, advertising, and research techniques are leading the way. Brand awareness is increasingly important, and sophisticated advertising is beginning to play a key role in attracting the Chinese consumer. Social media is a crucial aspect of any good marketing strategy in China. In January 2019, there were approximately 1 billion social media users in China, which now accounts for a third of the world’s active social media users.
WeChat is China’s most popular mobile social network application, with over 1 billion daily active users in 2018, accounting for nearly all of the social media users in China. With WeChat, brands can access potential consumers through creative marketing to capture a wide market share in China. The platform allows retailers to feature online stores, has a convenient third-party payment function, and allows for push messages that introduce new product lines or deliver promotions. There are various options for building a brand on WeChat, including a subscription account where brands can push out consistent messaging and a service account to create a platform to manage eCommerce and customer service. Online wallets like WeChat’s own WeChat Pay, or Alibaba’s Alipay, are the payment methods of choice; analysts expect 85% of all online shopping in China will be done on mobile devices by 2021; in the U.S. that number is only 54%.
The Twitter-like Weibo, messaging app QQ, and short video app Douyin are other popular Chinese social media platforms. U.S. companies interested in exploring social media avenues and working with these sorts of social media players should work with a local marketing partner to develop a strategy and support implementation. Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.