Baidu is the most popular search engine in China, but the market is becoming increasingly competitive. The last 18 months has seen Qihoo 360 eat into Baidu’s market share.
The rise of mobile users has also affected Baidu. Where once people used a desktop device to connect to the internet, now they use a smartphone or tablet. This affects Baidu because of the use of apps on mobile.
Increasing competition from China’s two e-commerce giants is another factor to consider when analysing Baidu. Alibaba and Tencent’s dominance of e-commerce in China has marginalised Baidu. At times it seems that Baidu has struggled to adapt.
It is important to consider all of these elements when trying to understand Baidu. In this blog post I will look at these factors in detail. I want to build an overall picture of what every company ought to know about Baidu.
First I want to ask, why is it important to understand Baidu?
The Chinese internet industry is worth 600.41 billion Yuan (US$9.7 billion). According to the China Internet Network Information Center (CNNIC) by 2017 this will increase to 1.72315 trillion Yuan (US$2.8 trillion). The internet is big business in China. If you want to do business online then you will inevitably need to understand Baidu.
Since August 2012 Baidu’s search engine market share has dropped from 81% to 59%. During this same period Qihoo 360 has seen its market share rise from just over 1% to 25%.
At the end of 2013 there were 618 million internet users in China according to CNNIC. Of these people 81%, or 500 million people, connected to the internet via mobile.
One reason Baidu has seen its market share drop is the fact that it has been slow to recognise the increasing importance of mobile in China. Many mobile users will use apps rather than a search engine.
Alibaba recognised this and users of Taobao (C2C) and Tmall (B2C) will use those apps to search those particular stores rather than searching on Baidu. Even the respective websites have excellent search functionality meaning that people often do this to search for items rather than using a search engine.
Baidu, having recognised this problem though, is improving its mobile presence. Of course there is the Baidu mobile app, but Baidu’s participation in the Tizen Association is a sign of its commitment to competing with Alibaba and Tencent in the mobile realm.
The new Tizen smartphone OS could incorporate Baidu as the default search engine. This could increase Baidu’s influence on mobile and would strengthen its drive to compete with China’s biggest two e-commerce companies.
Then there is Qihoo 360. So.com has become China’s second most popular search engine in a remarkably short period of time. It doesn’t usually provide results that are near the level of Baidu and is nowhere near as effective.
But so.com is the default search engine on Qihoo 360’s internet browser. People who use this browser tend to stick with the default search engine, rather than changing to Baidu.
According to official statistics, Google holds less than 2% of the search engine market in China. But I believe this to be misleading. The reason for this is the high use of VPNs and proxies in China.
The problem is finding information to back up this point of view. But anecdotal evidence would suggest that many sites that are blocked in China are actually used on a daily basis. It is also why at Nanjing Marketing Group we find that in some cases we see Google bringing in a third the traffic of Baidu.
Google is seen as a place to search for foreign products and brands. Foreigners who live in China, but cannot read Chinese are very likely to use a proxy and search on Google. Chinese readers may well do the same.
Saying all this, I still think that Baidu is the best place to start if you are looking to enter the Chinese market. I’ll explain my reasons why below.
Baidu is being constantly updated so this means it is always improving and getting better. It is always developing new products and services. This partly stems from the competition of Qihoo 360 as I mentioned above.
In an increasingly competitive market place it has to evolve to stay relevant to its users. For marketers this means keeping up-to-date with important changes and new developments.
Below I have listed Baidu’s key products with an explanation of each. I have also listed the most important services that Baidu provides. Finally I’ve made a list of the most useful functions you can use on Baidu’s search engine.
This product is similar to Google AdWords, but usually has a lower cost per click (CPC) than Google. Setting up an account can take up to two weeks. I’d recommend using a local agency to do this as documents and landing pages will need to be translated to Chinese.
This is similar to Google display network. Users of a Baidu pay per click account can also use Baidu’s content network. There are 600,000 websites that partner with Baidu to display the banner ads. The best feature of this product is the useful remarketing functionality built into the display network.
Brand Zone is an exclusive product to Baidu. It lets a company tailor content on a page take-over including a fixed price eye-catching brand logo and company introduction. It’s an expensive service, but with average click through rates (CTR) of 50 per cent it’s favourable compared to Baidu (average PPC CTR of 1 per cent) and Google (average PPC CTR of 0.2 per cent).
Baidu’s analysis platform is called Tongji. If you’re going to run a Baidu pay per click advertising campaign I’d say it’s a must to use this service to analyse the campaign performance.
Baidu’s Webmaster tools is called Zhanzhang. It’s useful to help get your website indexed on Baidu quickly and easily. It’s nowhere near as powerful as Google Webmaster tools, but it’s helpful to get your site optimised, creating a better online experience for users.
This is where the organic and paid search results will appear. The distinction between the paid and organic search results is not as clear as on Google. For paid search results using competitive keywords the first page of the SERPS may show no organic search results at all.
This area is an online themed community helping people to share information in a public forum. It’s kind of like a Baidu microblog. Community members can open forums to find out and share information. If a forum has not been created then Baidu automatically does this using the specific search terms used
This is a collective intelligence platform that actively encourages participants to share knowledge. The service allows registered users of Baidu to put forward a question and other registered users to leave an answer and obtain credits. It is possible to use the service without being registered, but you are then unable to collect credits and improve your authority.
Baidu’s version of Wikipedia lets anyone use a Baidu account to write a page about a topic. The information on baike is seen as authentic and it provides lots of useful information just as Wikipedia does.
Only 46% of the population in China are connected to the internet. In the USA around 80% of the population is connected, so there is still room for growth in China. Any business looking to capitalise on this future growth should start by using Baidu as part of its online marketing strategy in China.
Baidu has the highest usage amongst all the search engines in China. It has a highly developed ad platform as well as always developing and improving its products and services.
Finally, it’s important to note that it’s vital to be on Baidu for brand awareness. If your brand isn’t on Baidu then many Chinese netizens won’t even consider it to be a well-known brand at all.
What do you think of Baidu and the services it provides? Leave a comment below and tell me what you think.