Sun Peilin, an analyst in EnfoDesk  recently pointed out that the market size of Chinese mobile internet reached 158.8 billion yuan by the end of 2012, with 750 billion users.

According to EnfoDesk, there are several reasons for the slight decline of the growth rate this year:

• Large base of the market size has some impact on the growth rate
• The difficulty of payment for mobile game, reading and music is the main cause of the decline

The cooperation of mobile e-business and mobile advertising platform has confronted with advertising fee problem.

Two major factors  of the phenomenon that the number of user is on the rise but the actual value is limited.

• The fast increase of smartphone user
• The relatively limited inventory of smartphone

These two are the basic reasons for the present problem of the market. It is predicted that this trend will last in 2013

• The inventory of smartphone will be over 50%, with an decline in the quarterly sales growth rate
• Market  investment cools and the application developers pay more attention to gaining profits from users and advertisers
• Users’ willingness to pay will greatly change. High-earning companies in the field of mobile game will spring up
• The cooperation of mobile e-business and mobile advertising platform is becoming more extensive and intensive

According to the data from comScore, Letv’s number of unique viewers in February is about 100 million, making it the third largets video network behind Youku and Tencent.

In March 2013, Youku, Tencent and LETV remained the top three video networks. LETV, many people outside China may not be familiar with, is a public listed company on Shenzhen Stock Exchange, focusing on wide variety of drama series and movies.

According to The State of Mobile Benchmark report released by Adobe in April, almost half of China mobile internet visits are from Android devices, compared to slightly over one third from iOS devices.

Zhou Hongyi, the CEO of Qihoo 360, had ever said that Jack Ma, CEO of Tencent, has successfully got the first ticket on the train of China mobile internet. However, Ma added that it was just a standing-only one. Well, who is the most promising on mobile internet in China?

Seen from the chart above, it is obvious that three apps developed by Tencent rank at the first, second and fifth respectively in terms of total number of app downloads. Sina Weibo has a total number of 500 million users, 75% of whom has used mobile client to log in.

Tencent and Sina are very promising players on China mobile Internet; but, others like Baidu, Alibaba and Qihoo won’t just sit and watch.

According to GlobalWebIndex, over half  of the top 15 social media sites in the world are from China.

One minute is equal to 60 seconds, which seems really short. However, during this short period, a variety of things is taking place.

And what is happening on the constantly changing internet in ONE minute? According to the data provided by Intel, an amount of 47,000 apps are downloaded. Amazon sells products with their value of USD 83,000. And, there are over 6 million views on Facebook.

As on China internet, what changes is taking place in one minute? The chart above is ready to show you.

According to the recent data released by iResearch, China online advertising market has almost reached 20 billion yuan, which indicates that the overall market has stepped into a new round of development.

When it comes to the aspect of enterprises, the overall trend is stable with LETV and Qihoo 360 growing rapidly. 

Sohu recently declared that Sohu News mobile apps users have reached a hundred million, being the first one in China. The number of media cooperating with Sohu client-side is over 550, with total subscription over 0.45 billion.

In the meantime, Sohu welcomes all forms of media such as radio and TV to co-build an “Any media-platform”.

According to EndoDesk, Sohu News client-side is the most frequently downloaded in China with downloads share of 31.8%, followed by NetEase News and Tencent News with 18.0% of 10.2% market share respectively.

Some insiders told that Sohu client-side has become the third largest mobile platform after Sina Weibo and WeChat. At the same time, Sohu aims to take the advantage of its any media platform to surpass Sina Weibo and WeChat in the transformation of mobile media.

According to a report of EnfoDesk, QQ browser, UC browser and Oupeng browser (excluding Opera) were the top three in the accumulative account market share of China’s third party browser, with 40.6%, 33.0% and 8.3% market share by total users by the end of the Q4.

And we can also see that UC browser, QQ browser and Oupeng browser (excluding Opera) are also the top three counting the total number of active account  with market share of  39.8%, 37.2% and 7.0% respectively in Q4.

Android and iOS together have become the first application platform of first and second tier vendors, while the customers who used the mobile phone browser of old platform such as Symbian, MTK, Java, are switching to Android and iOS devices rapidly and sustainedly.

EnfoDesk believed that? QQ browser and UC browser still tightly led the market, Oupeng browser ranks the second, Baidu browser and 360 browser are strongly rising. Competition among these browsers will be intense.

The market of China’s third party cellphone browser will be worth waiting for in 2013 under the competition of capability and resources of products, channels and capital.

These data has the extremely high reference value from e-commerce sites Alipay supported excluding Taobao in 2012.

The population characteristics of online shopping customers

1. For the age, young people were the key group

Online shopping customers under 30 years old were more than 60%, the customers who were over 40 years old were about 10% in the e-commerce sites excluding Taobao, which indicates that the online shopping users are younger.

2. From the customers’ regional distribution, the online shopping was popular to third and fourth tier cities.

The customers of e-commerce sites excluding Taobao mainly distributed in first or second tier cities, ratio to 67.9%. And the annual statement from alipay showed online payment customers of fourth tier cities increased to 64% and online payment amount increased to 68% in 2012, of which all overtook the first and second tier cities. The online shopping was popularizing from developed regions to the less developed regions step by step. The development speed of small cities should not be ignored.

The Guangdong province had most customers of e-commerce sites excluding Taobao, followed by Shanghai, Jiangsu, Zhejiang and Beijing. Based on the data from CNNIC, the absolute value of Shanghai netizen population ranted 13 in the whole country in 2012. Balance of the alipay data, the permeability of online shopping in Shanghai was very high. The online shopping customers of the first five provinces were more than 50%, the customers of the first ten provinces were about 70%, which showed the regional concentration was pretty high.

The behaviors of online shopping customers

1. The online shopping age distribution: 40% customers’ online shopping age was under 2 years. The new online customers whose online shopping age was under 1 year reached 23.4%.

2. Shopping frequency: most online customers shop online just one time every month

70% customers of e-commerce sites excluding Taobao were shopping online just one time every month. The customers who were shopping more than three times every month were less than 15%. It’s very important for e-commerces to increase online shopping activities.

3. The time distribution in online shopping: the customers’ enthusiasm was higher on working day in online shopping

The customers’ enthusiasm was higher on working day in online shopping, while the online shopping customers significantly reduced on weekend. The customers could arrange their time freely and went shopping in mall on weekends or holidays. However, on working days, the customers did not have much time to go shopping outside, so they preferred to choosing convenient online shopping.

The time of customer in online shopping is consistant with the work and rest time. The period of online shopping mainly focused on working hours and rest time at home. The customers prefer shopping online when working than at home time. The customers’ passion was a little low during rush hour and mealtimes. The sellers could adjust the strategies to content the customers’ shopping requirements according to the time distribution in online shopping.

4. The unit price distribution of customers: the unit price of over 70% customers in online shopping was under 200 RMB.

The customers who spent more than 1000 RMB one time in e-commerce sites excluding Taobao were about 9%, while 70% customers spent under 200 RMB. So the major customers preferred cheep goods in online shopping at present.

5. Shopping preferences: costumes and jewelry category are the all people’s favorite

What the customers loved to buy were costumes and jewelry. The household products were the third category which females loved to buy, the fifth category which males loved to buy. It showed females loved buying household more than males. 3C digital products were the third category females loved to buy, the fourth category males loved to buy. It showed males loved digital products compare with females.

The top two shopping preferences at all ages were costumes and jewelry, while the top five shopping preferences showed some difference with customers’ age increase. For example, the household products were the fifth favor of the customers under 24 years old, while from 25 years old  the household products were up to the third; the maternal and child supplies became one of the top five favor of the customers aged 30 to 39. The data showed the major online shopping people chose late marriage and late childbearing. The customers who were over 60 years old prefer to buying foods online. The shopping preferences of foods were the top five. Buying foods online is convenient for the elderly people who did not move.

According to TNS, UC mobile leads mobile app facetime but is closely followed by Mobile QQ, WeChat and Weibo.

The top five smartphone apps in China were dominated by social networking and communication related apps.

The  netizens in Tier 1, 2 , 3 and 4 cities have different behavior because of different economic development and living environment.

According to CNRS, the netizens in Tier 1 and Tier 2 cities pay more attention to the practical applications related to life living, while netizens in the Tier 3 and Tier 4 cities place greater emphasis on the entertainment.

Since last Wednesday, Sina Weibo integrated a new module into its content stream to continue its monetization attempt after its promoted Weibo post attempt.

When a Weibo user publishes a post containing link to an individual product page on Taobao, this module will be inserted right below that post showing related product information. Other users will be able to click and find out more details on Taobao.

Top 10 downstream websites on Sina Weibo represent 27.2% of the total, among which Taobao took 8.2% (source: Sina Weibo annual report 2012). So, it makes sense Sina capitalize on this with this partnership. It’s probably charged on a commission model  based on referred traffic or sales; and, the details is not disclosed at the moment.

In addition to a normal version for regular individual users, Sina Weibo has an enterprise version for companies, just like the Facebook Page idea. Sina is also testing a different version for media like this one.

In media edition of Sina Weibo, it has articles section besides the weibo posts stream. The articles are imported from RSS feed and auto-formated and displayed in one of eight available templates.

Weibo posts published via media edition are also displayed differently like this one:

An extra “card” will be displayed below the Weibo post including news thumbnail, headline and a summary. This will no doubt lead to higher click through rate.

This is just a beginning. Sina may launch multiple versions for further attempts on monetization, such as special version for e-commerce platforms like Taobao.

According to Experian Hitwise,  tmall.com was the most popular B2C website in China with 432,456,034 visits in March 2013, followed by jd.com and 51buy.com. There were also conerns that the visits growth rate of Tmall was up to 53%,  far exceeding that of jd.com.

Taobao Doll 15 (Photo credit: bfishadow)

The annual financial report of Alipay, part of Alibaba Group, showed that half of Alipay revenue came from Taobao. In the top 10 cities of per capita Alipay expenditure listed in the statement of account, four cities of Taiwan are included. Perhaps more surprising is that Taiwan’s Chiayi City climbs atop. The per capita Alipay expenditure of Chiayi is 180% of Hangzhou, where the headquarters of Alipay locates.

At the present stage, the volume of business transactions of Taiwan accounts for less than 1% of the total volume of Taobao. In 2012, Taobao officially set up an office in Taiwan. While on 11 November, 2012, the total sales volume of Taobao reached 19.1 billion yuan, which amounted to twenty times the daily volume of retail sales of Hong Kong. This indicated that Taobao has the ability to deal with 1205 orders in one second. This is almost four times the speed that Amazon.com made during the Christmas in 2012. Analysis suggests that there are 16.8 million netizens in Taiwan, as many as four times the that of Hongkong. 

Chen Yuqiao, the CMO of pgmall.com.tw, which is the largest lady bags manufacturer in Taiwan, said that Taobao will reshuffle the online shopping industry of Taiwan. Huang Wengui, the COO of mayuki.com.tw held nothing back when talked about Taobao. He said that Taobao is the best online shopping platform in the world and the second one is RaKuTen.

Half of the goods from Taobao shipped to Taiwan are taken on by Dong-Feng Express Company. The VP of this company roughly estimated that there are 10,000 packages shipped to Taiwan every day. That is, there are at least 3.65 million packages shipped to Taiwan every year via Taobao.

Taobao estimated that there will be 3 million Taiwan users after three years. At that time, one in seven Taiwanese can buy directly from Mainland through Taobao. This will have a impact on Taiwan’s roadside stalls, which have the same source of goods.

Recently Sina Weibo held an introduction and marketing event to promote its Weibo Promoted Post. This new form of marketing feature, similar to Facebook’s Promoted Posts, enable weibo posts to reach more Weibo users, showing up on top of Weibo users’ content stream.

Sina will charge advertisers based on the total impressions delivered (CPM model) or the CPE (cost per Engagement) including number of re-post, comments, clicks, likes and etc. CPM CPM bid starts at 5 yuan and CPE starts at 0.5 yuan. Advertisers are required to top up a minimum amount of 3,000 yuan for deposit when opening accounts.

The cost of Weibo Promoted Posts is acceptable to SMEs, compared to display ads on Weibo which usually costs at least a few thousand dollars.

It was officially unveiled on 18 March and disliked by some Weibo users. Most feedback received were negative. Some users even claimed that they will not log in Sina Weibo again if the advertising posts continue to show up.

In our opinion, the main reason for users’ disgust against this new form of ad is largely due to the irrelevancy and low quality of the promoted post content; Sina has a lot of catch up to do on accuracy of demographic targeting capabilities.Besides targeting accuracy, another concern advertisers may have is invalid clicks from people like competitors.

The structural difference between China E-tail and the United States, Europe, and Japan is that independent merchants account for only 10 percent of e-tailing sales in China. In other countries mentioned above, dominant model involves brick-and-mortar retailers or pure-play online merchants, which run their own sites and handle the details of commerce. Although still in the early stages of growth, China’s e-tail ecosystem is profitable.

According to a research conducted by Mckinsey, e-tailing is powering the consumption of China. By analyzing consumption patterns in 266 Chinese cities accounting for over 70 percent of online retail sales, Mckinsey found that:

a dollar of online consumption replaces roughly 60 cents of sales in offline stores and generates around 40 cents of incremental consumption.

E-tailing’s impact is more pronounced in China’s underdeveloped small and midsize cities. In their research, McKinsey found that while incomes in these urban areas are lower, their online shoppers spend almost as much money online as do people in some larger, more prosperous cities—and also spend a larger portion of their disposable income online.

Apparel, household products, and recreation and education are the categories where price discounts are greatest. They are also the three largest online retail segments.

McKinsey points out that China’s retailing industry will probably follow a trajectory different from that of retail sectors in other markets because of the combined effects of the complexities of store expansion and a distinctive model of e-tailing. McKinsey forecasts that China’s retailing industry will pass directly from the regional to the multichannel one.

McKinsey also forecasts that by 2020, as 15 to 20 percent annual growth rates (before inflation) continue, e-tailing could generate $420 billion to $650 billion in sales, and China’s market will equal that of the United States, Japan, the United Kingdom, Germany, and France combined today.

In the future, e-tailing will continue to transform the retail sector. The efficiency edge of e-tailing will forece brick-and-mortar retailers to modernize and pave the way to a more efficient coordination of supply and demand across the Chinese economy. Many of China’s store-based retailers and the manufacturers that supply them have yet to fully embrace multichannel strategies. The heady growth of e-tailing will also cause a growing shortage of talent. For those merchants who want to operate independently, McKinsey suggests them to focus on superior customer service, fast and reliable delivery, a better shopping experience or more targeted marketing. For new entrants, marketplace is a good way of testing a market’s temperature.

At the same time, e-tailing innovation is creating more competition. China’s new marketplace sellers are expanding internationally, global consumer-goods players should be ready to face competition from Chinese small and midsize enterprises and microbusinesses selling directly through marketplaces in emerging economies.

According to iResearch, Search was the most popular Internet service in China in January with 454 million users coverage, followed by online video and online community.

According to Enfodesk, the two main online third-party travel agencies, Ctrip and eLong together accounted for approximately 61.6% of the market share in 2012, up from 55.4% in 2011.