Google takes in-app ad lead in China

28 August 2012

BEIJING: Google, the online giant, has assumed an early lead in China's in-app advertising market, a major success for the company given its previous travails in the country.

AdMob, the advertising network Google purchased in 2010, now serves 7.9bn ads to mobile app users in China every month, and has also signed up over 10,000 registered developers domestically.

Figures from iResearch, the insights provider, drawn from a sample of 60 apps in Apple's local App Store, suggested 45% of ads were supplied by AdMob, ahead of Domob, in second place on just 9%.

"In app-based advertising, Google's AdMob has an advantage," Ada Wang, an analyst at iResearch, told Bloomberg. "The technology has developed longer and is being used in other markets."

According to iResearch's estimates, in-app advertising will yield some $283m in revenues this year, making it a bigger sector than paid search on wireless devices.

Google began redirecting Chinese visitors to its search engine to the Hong Kong version of this service in 2010, due to censorship concerns, and has seen its share of category revenues fall to 15.7%, trailing Baidu on 78.6%.

"Since 2010, Google has been trying many things to keep its presence in China," Steven Chang, chief executive officer of ZenithOptimedia in China, said. "AdMob now has quite a significant share of the market."

Chukong, the mobile gaming company, plans to invest over $1m with AdMob during 2012. The firm's "Fishing Joy" was the most popular game among users of Google's Android operating system in the first quarter.

"Mobile advertising is better at targeting users than desktop-based ads because they can be more personalised," said Chen Haozhi, the chief executive officer of Chukong.

Hylink Advertising, the digital marketing group, bought a large portion of AdMob's inventory for the recent Olympic Games in London, which it then sold to brands like Chevrolet and BMW, the auto marques.

"At the moment, in the field of mobile Internet, Google has a clear advantage," Su Tong, the chief executive officer of Hylink Advertising, said. "The market is heading the way of mobile."

For its part, Baidu is currently tapping developers to help create a range of apps. Kaiser Kuo, a Baidu spokesman, stated that it has not yet rolled out a "full scale" in-app ad service. "Mobile search will continue to be important," he added.

Data sourced from Bloomberg; additional content by Warc staff