In recent years, China’s largest video sharing website 56.com has become a marketing partner of premier international brands including P&G, Reckitt Benckiser, Pepsi, McDonald’s and Nestle in the Chinese market. It is not only attributed to the overall robust growth of China’s video industry, but also to the YouTube mode adopted by 56.com that is favored by young users, a major target audience of many brands.
Nowadays, video websites have become an important channel for the Chinese audience to watch movies and TV series and obtain entertainment content. According to the 2011 Survey on Chinese Netizens’ Online Video Applications released by CCNIC (China Internet Network Information Center), China’s online video users amounted to 284 million by December 2010, with an annual growth rate of 18.1 percent, and the number accounted for over 70 percent of the total number of Chinese netizens. It is surprising that China’s video website only took several years to grow into a new medium platform with over 100 million users. It is overtaking traditional media such as newspaper and journal and catching up with TV in its influence.
According to iResearch’s statistics, China’s video industry recorded sales revenue is RMB 2.36 billion in 2010, representing an annual growth rate of 73.2 percent. It is predicted that video websites will be even more attractive to the advertisers in 2011, and the video advertising revenue will continue its rapid growth to reach RMB 5 billion. The expanding market will be shared by leading video websites represented by 56.com.
During the past decade, TV was the most popular advertising platform, accounting for 70 percent of China’s media market. However, the situation is about to change now. With the Chinese government’s promotion of Tri-network Convergence (convergence of telecom network, Internet and cable network), medium convergence has become a new trend with the influence of video websites on the rise. In future, when targeting at an overlapping audience group, the advertisers will evaluate the options of multi-million-user video website and TV, allowing the video websites to share the advertising market previously dominated by TV. As a matter of fact, in China’s larger cities, nearly half of the young people spend more time on video websites than on TV. The technical advantages of video websites in the process of Tri-network Convergence are regarded as helpful in obtaining more users and channels. PPlive, a Chinese video website with a strong technical strength received a $250 million investment this year from Softbank.
Moreover, with an increasing number of people watching videos through mobile Internet devices such as smart phones and iPad, the video websites have seen a great opportunity for future growth. Currently, 56.com is ranked among the top three domestic video websites in terms of traffic via PC. Meanwhile, 56.com is accelerating its plans for mobile terminals including cell phones and iPad. In the near future, 56.com will be able to provide Android and iOS platform users with a smooth watching experience.
Besides obtaining variety show programs through extensive cooperation with TV stations, 56.com also encourages the netizens to upload their cell phone videos, in particular those of fun and interactivity. “We are engaged in building a top entertainment video portal in China. We hope all the Chinese youngsters will enjoy the fun experiences brought by 56.com,” said Kitty Zhou, Founder of 56.com.