According to Statistics from Analysys International’s Seasonal Survey of the ChineseOnline Video Market in2015Q1, the Chinese online video advertising revenue reached 4.11 billion Yuan, down 21.9% compared to 2014Q4. It is 38.6% higher than 2014Q1. From overall market share perspective, Youku.com, Iqiyi.com and Tencent Video top the list in terms of advertising revenue in 2015Q1.
Analysys International holds that, because of seasonal impacts, less was budgeted for advertising in 2015Q1. It is therefore revenue declined compared with 2014Q4. However, the revenue increased rapidly as compared with 2014Q1.
According to statistics from Analysys International, 2015Q1 mobile client video advertising revenue reached 1.47 billion Yuan, accounting for 35.8% of overall online video advertisingrevenue. As the traffic by mobile client increased rapidly, the value of mobile advertising is gradually recognized among advertiser. Mobile client commercialization is rapidly taken effect withincreasing market share.
From the perspective of Chinese online video advertising market share in 2015Q1, Youku.com, Iqiyi.com and Tencent video top the list by advertising revenue. From the perspective of online video market performance, companies rationalize operation and investment. Chinese online video companies achieved organic growth by content, business mode and technology to accelerate innovation.
In content operation, online video companies stress more on generating self-produced premium video content and integrating with external distribution channels. With more investment and experience accumulated from self-produced content, a few high quality videos series debuted in 2015Q1, for example, fashion reality show “Falling In Love With Super Model” from Iqiyi.com, online fantasy series “Falling Down” from Sohu video, etc. In addition to self-investment, online video companies are encouraged to host external video content. For instance, after the merge from Sohu video and 56.com, “we media” from health, travel and IT channel are promoted with shared profit; product “Shi-Ping-Hao” from fun.tv attracts traditional media to integrate vertically with different industries to form an open online video platform. Hence the online video companies are focusing more on self-produced video and encouraged to host premium external video to achieve sustainable growth.
In business mode, online video companies are addressing the business growth through marketing mode and technology innovation. From marketing mode, content marketing and video merchandising become new effective marketing solutions. By fully exploring the value from video content, online video companies inject the brand in a manner acceptable to users to cater advertiser with agile and effective marketing solutions. Take video merchandising as example, with resource alignment from Youku.com and Alibaba.com, Iqiyi.com and JD.com, PPTV.com and suning.com, online video companies become key marketing channel. In technology innovation, online video companies focus on the applications of cloud platform and big data analytics and develop corresponding commercial products to exploit marketing value. For example, “pp cloud” and “pp radar” from pptv.com, “hui-yan-shi-TA” from sohu.com are relying big data to tag difference group of users to conduct marketing with relevancy. What is more, virtual reality (VR) is gradually becoming as a key area of development among online video companies. With the user experience optimization by online video companies, smart video is the new area for the development. Take iqiyi,com for example, it provides3-D and 4-D movie, Dolby sound effect content creation, video content production with VR; baofeng.com introduces hardware “baofengmojing” to elevate the video watching experience.
With rationality and innovation in Chinese online video market, online video companies would benefit from higher return over investment. User watching experience elevation bought by content and technology innovation would attract user to pay for service bill and hence improve online video companies’revenue structure. What is more, following smart phone and smart TV, smart watch and electric-powered vehicle etc. would develop into a key channel for video content, hence to some extend, generate more value from online video content.
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