Web usage levels growing rapidly in China

12 March 2010

BEIJING: Many consumers in China are now spending a majority of their free time using the internet, McKinsey has revealed.

According to figures from the China Internet Network Information Center, there were 384 million web users in the world's most populous nation in 2009, an increase of 50% year-on-year.

The number of people in the rapidly-growing market accessing this medium via their mobile phone also doubled, to 233 million, in this period, largely due to the broader roll-out of 3G services in the country.

"The Chinese are obsessed with the internet," McKinsey's study argued. "The PC is fast replacing the TV set as an entertainment hub, and emotions run high over who gets to log on and for how long."

In evidence of this, it reported that residents of the 60 biggest cities in China committed around 70% of their leisure time to this activity last year, a figure that stood at 50% for many smaller towns.

More specifically, netizens typically utilised this channel for reasons like playing games, sending and receiving messages, downloading music and films, and shopping, rather than for work purposes.

Some 20% of the 18–44 year old demographic research all of their potential purchases online, and frequently use ecommerce sites like Taobao, which sells prepaid cards at post offices.

Internet advertising revenues have also expanded by between 20% and 30% on an annual basis in the recent past in China, dwarfing the rate of growth recorded by print media.

Nokia, the telecoms giant, is one company that has attempted to tap in to the popularity of the web, partnering with Youku, a video-sharing portal similar to YouTube, to broadcast a live concert.

The Finnish firm also formed a tie-up with Tudou, a similar web platform, to run a competition giving participants the chance to win 1 million yuan ($147k; €107k; £97k).

In both of these cases, McKinsey said, millions of Nokia subscribers accessed this material using their handsets.

In a similar fashion, Nestlé allied with Youku and Kaixin, a social network, to produce a drama series, called Camera Café, promoting its Nescafé brand.

This branded content took the form of a variety of short clips, and was based around the conversations people have during coffee breaks at work.

Moreover, an increasing number of brands are hiring agencies like CIC, the Chinese Web Union and Daqi to help monitor, and respond to, electronic word-of-mouth about their products.

Data sourced from McKinsey; additional content by Warc staff