Marketing in China is constantly shifting due to the emergence of new platforms and shifts in the way that the average Chinese user consumes content. So, what is the latest trend in the industry?
Toutiao (or Jinri Toutiao), the app from Beijing Bytedance Inc. has recently been making some huge waves in the marketing industry and will likely be one of the largest content providers in the coming years.
In Chinese, ‘Toutiao’ means headline. The slogan of the company is ‘The only true headlines are the things you care about.’ It pushes information users like to their homepage, using a complex algorithm to determine user interests to ensure the experience more personal and distinct than competitors.
In 2017, the platform already had 120 million daily active users. With over 4,000 partnering news portals, Toutiao’s valuation was set at around 20 billion USD. The team is growing, and the Bytedance stock has been attracting attention from investors around the globe. You can see its growth in the graph below.
How does Toutiao work?
First of all, Toutiao is more like a distributor. The firm does not have any original writers. It uses AI technology to organize daily news from partners and gives recommendations on their homepage. (the leftmost button in the bottom bar).
All the featured articles and videos are selected for each user according to their locations, click and browser history, and even phone models.
Toutiao created the function of ‘Toutiao Hao’, which is, companies can register an account to post articles on the platform to gain followers. Various renowned news firms such as CCTV news and People.cn have joined to seek greater exposure through the platform.
Toutiao offers more than just a bulk amount of information. When other competitors still adopt the traditional solemn style of writing, the platform catches the hearts of the younger generation with eye-catching and differently styled news content.
Short Videos & Other Add-ons
Except for news, Toutiao also provides videos for further entertaining the users. Next to the homepage button, you will find a link to ‘Xigua Video’. This function gives users exciting videos under various categories.
The button titled ‘Short Videos’ at the bottom right provides funny short videos and jokes to users. All the videos are around 10 to 15 seconds, covering a range of topics. Toutiao manages to keep users busy with these engaging clips. It is easy for users to watch one after another in a series.
The central red button is the Q&A section and lives streaming section which allows users to engage further with the platform. Toutiao encourages sharing through WeChat to friends, and the content can quickly go viral.
Utilize the Big Social Media Platforms
Toutiao uses other platforms wisely. Users can register through the big social media giants of China, such as QQ, WeChat, and Weibo. The AI of the company can soon analyze the behavior of the users through primary access to their profiles. On the other hand, Toutiao enables users to share their favorite content through these apps too.
Why Should You Stick to the Trend of Toutiao?
1. Magnificent Marketing & Advertising Power
Companies should certainly establish a presence on both WeChat and Weibo when entering the China market. However, aside from these two big platforms, choosing other alternatives can provide more flexibility and variety to your marketing strategies.
Unlike WeChat and Weibo users, content consumption is the principal focus of Toutiao users. There are no additional functions like chatting to pull users away from the new content. On a fundamental basis, the company’s advantages have already outweighed traditional marketing communication platforms.
Imagine obtaining access to Toutiao’s 700 million registered users! 120 million daily active users spend an average time of 76 minutes on the platform, hungering for new information. Placing advertisements on the platform or releasing advertorials can have exceptional effects on your business.
In fact, a big chunk of Toutiao’s revenue comes from advertisement. In 2017, it had already exceeded 15 billion yuan. Bytedance expects the platform to earn 30 to 50 billion from news feed ads in 2018. CEO Zhang Yiming mentioned his next goal would be 10 billion USD in 2020.
It is undeniable that the hottest trend in Chinese advertising is Toutiao. If firms want to enter the market, Toutiao is an excellent choice to go with.
2. Short-Videos-Focused Business
Another problem for firms doing marketing is that it is hard to catch people’s attention today. Users leave and go in split seconds if they are not interested.
Consequently, short videos have arisen as a new popular form of content. The sector is growing fast. Toutiao is not the only platform taking advantage of this new content format, but it has invested heavily into the future of it.
Toutiao has connections with most of the Chinese users’ favorite short videos apps. It is able to aggregate these videos all in one place!
DouYin is a platform beloved by Chinese youngsters. It allows users to watch and produce funny music videos. These 15 seconds clips make it easy to catch user attention. Users can lip sync or dance to the music, while the app provides special effects or filters for editing. Even the latest trending meme the ‘Karma is a bitch’ challenge is from DouYin, showing how influential the platform can be. It is similar to Musical.ly, which Toutiao acquired and later decided to combine with Douyin to expand the user base.
Toutiao took control of another video app Flipagram, following its acquisition of Musical.ly. In the US, the app attracted a huge amount of attention from teenagers. Toutiao is likely to retain more young users and grow its popularity through its exploration and acquisition of these platforms.
Toutiao also operates Xigua Video and Huashan Zhibo. These applications satisfy diverse types of needs. Xigua Video has over 100 million users while Huoshan Zhibo has gathered thousands of powerful Chinese KOLs (Key Opinion Leaders).
The company invested RMB $1 billion to commercialize these platforms. Zhang Yiming stressed the importance of letting content creators make big money and generate values for the users. KOLs are flooding to Toutiao’s platforms to produce more original articles and videos to users.
3. Sticky & Young User Base
Chinese users stay on Toutiao for an average of about 76 minutes a day. The data is impressive as the average time people spend on WeChat is only 66 minutes. The size and stickiness of the user base have been growing exponentially, clearly showcasing the power of marketing on the platform.
Most Toutiao users are male, with a gender ratio of 3:2. Over 85% of them are young people ranging from ages 18 to 30 years old and are mostly concentrated in first or second-tier cities.
The education level of Toutiao users is quite high as well, with 41.3% of them holding a bachelor degree or above. Another interesting note is that 37.8% of the users’ occupations are freelancer, self-employed and private company owners.
From the above data, it is likely that a fair proportion of Toutiao users are young Chinese running their businesses or working as managers. Toutiao can be very helpful when it comes to B2B marketing in China. The platform is also suitable for promoting trendy products to youngsters.
Conclusion on Toutiao
Toutiao is planning to expand to the global market. Three overseas US offices already exist, and the company is now targeting Singapore and Japan. Nevertheless, CEO Zhang Yiming ensures the public that China will still be the primary focus.
Toutiao has enormous potential and is still growing today. China marketers and businesses entering the landscape should certainly stay up to date with it. Under Zhang Yiming’s lead, will Bytedance become the next ‘Facebook’ of China? Only time will tell, but I know for certain we’ll be keeping a close eye on the platform in the coming years here at Dragon Social!
If you have any questions regarding China marketing, feel free to contact the Dragon Social team!