Online advertising expected to exceed 100b yuan

China's online advertising market is expected to have more than 100 billion yuan ($16 billion) in sales this year, boosted by increasingly large sums spent by e-commerce businesses in a booming online shopping market, according to a report released on Wednesday.

Total advertising revenues on the Internet are estimated to increase by 46.8 percent, from 70.39 billion yuan last year to 103.32 billion yuan in 2013, the market research company Data Center of China Internet said in its report.

The growth came even though a weak economy has led many advertisers to tighten their belts.

While advertising through online search engines will account for about 40 percent of total Internet advertising sales this year, "the strong increase of advertising sales through e-commerce websites will be a big driver of the market", said Hu Yanping, general manager of the center.

Chen Gang, deputy director of the School of Journalism and Communication at Peking University, said this year will be a good year for the advertising market, as businesses show more confidence in the economy, and increasingly large sums of money go to Internet advertising from traditional media.

Hu cited the search engine Baidu Inc and e-commerce giant Alibaba Group Holding Ltd as examples.

In 2012, Baidu was expected to register advertising sales of 22.9 billion yuan, while Alibaba collected an estimated 21.5 billion yuan through advertising on its online shopping websites Taobao.com and Tmall.com.

"It's very likely that Alibaba will surpass Baidu in advertising sales this year," Hu said.

Online search sales account for the biggest part of Internet advertising sales, and Baidu is the biggest player in this industry in China. The search engine is also expected to surpass China Central Television in advertising sales in 2012, said the report.

Li Congshan, executive vice-president of Baidu's marketing research institute, said advertising on e-commerce websites is another form of marketing, an alternative to buying key words on search engines. But search engines will continue to take up a large percentage of online advertising revenue.

Advertising on e-commerce websites is expected to contribute 17.5 percent of Internet advertising sales, and advertising on search engines will be the source of 39.3 percent, said the report. Other forms of advertising appear on Web portals, video websites and other places.

Taobao.com and Tmall.com, which together control more than 70 percent of China's online retail market, generate revenues from advertising and commission.

Online vendors have been spending more on advertising on e-commerce websites.

On Nov 11, Alibaba initiated a promotion through Taobao.com and Tmall.com that registered total sales of 19.1 billion yuan in a single day.

This was more than 50 percent bigger than the total online sales in the United States on Cyber Monday, Nov 26, the day after so-called Thanksgiving weekend.

chenlimin@chinadaily.com.cn

(China Daily 01/10/2013 page14)