In 2020, China’s online population was projected to grow up to 914.1 million by 2020, representing 65.6% of the population, with figures for 2022 projected at 975 million, even with declining growth rates due to a huge base effect.

Fast-forward two years and extensive data indicates that this number has crossed the one billion mark already. Exciting times indeed for B2B and B2C businesses tapping into China’s market.

This month, IPPWORLD put together 8 key insights from various reports, including South China Morning Post’s China Internet Report 2020, on China’s internet growth.

Number of internet users in China 2008 - 2021

1) Over a billion internet users, 99% on mobile

The astronomical growth potential in China is nothing new to anyone in business, let alone marketers. However, in order to truly get our heads around how much growth we are talking about here, consider the two comparisons below:

  • The number of mobile internet users in China alone is more than the number of mobile internet users in the US, the UK, Canada, Russia, France, Mexico and Germany combined.
  • From 2019 to 2020, China’s mobile internet population grew by 80 million, while its US counterpart grew by 8 million users.

These statistics clearly indicate how pervasive the use of internet on smartphones is in China. It is no wonder then that there is so much buzz around the rise in the country’s potential for digital marketing.

2) Generation Z and younger in China are hyper-connected

Unlike their predecessors, the younger population in China have much greater access to the internet and are using it in ways the previous generation can only imagine.

The government-affiliated China Internet Network Information Center and the Chinese Communist Youth League report that 93% of its underage population are already internet users, not just in urban China but also in rural areas. The COVID-19 pandemic has played a huge role in this, as classrooms moved from school to online platforms.

Streaming apps like Douyin (China’s TikTok) and Kuaishou are a huge favourite, used by 46% of this demographic group who spend as much time on these platforms as the rest of the population spends on other social networks.

3) COVID-19 lockdown and the spike in daily internet use

Needless to say, as the world retreated indoors during the worst of the pandemic, both working and studying from home, China was no exception. Indeed, the average number of hours spent online rose to 7.2 hours from 5.6 hours pre-COVID.

The Chinese have always been far ahead of many other nationalities in terms of online shopping but pandemic times brought about a jump in numbers, with even more consumers turning to the internet to shop for necessities as well as for services such as banking, fitness, streaming of entertainment, etc.

While restrictions in most of China may be easing off these days, the past 2 years have seen China’s virtual horizon stretch significantly and this will only continue in the years to come.

4) China’s heavy reliance on mobile payments

QR codes are the way to go when it comes to payment. Smartphones are not just used for the internet but, with digital wallets like WeChat Pay and AliPay, the Chinese have quick access to contactless payment without the hassle of carrying wads of cash around. With contactless payments becoming the norm, this reliance has only intensified.

In terms of growth, China saw a 185 million increase in smartphone payment between 2019 and 2020, as compared to 7 million in the US. More than half the population prefers this method of payment, compared to 21% in the US, once again emphasising the pervasiveness of mobile internet use in the Republic.

5) Expect 40% of the world’s 5G subscribers to be in China by 2025

China clocks in as the highest number of consumers among other contenders, with 70% of consumers intending to upgrade to 5G (see chart below), compared to 42% in the US, 23% in the UK and 61% in South Korea. Not only that, 78% of Chinese respondents are also willing to pay extra for 5G, according to South China Morning Post’s 2020 China Internet Report.

China's 5G subscribers - China Internet Report 2020

This mass adoption will be assisted by the development of 5G infrastructure worth USD$25 billion countrywide and in turn, a mass of 5G smartphones released into the market over the next few years.

By 2025, almost half of all smartphones in China will have switched to 5G, accounting for almost half of China’s mobile connections. That’s an estimated 600 to 800 million Chinese people, compared to 2020’s 160-175 million.

6) More middle-aged on mobile

Between 2019 and 2020, the number of users aged above 41 increased by 14%, as more people were compelled to rely on digital products and services as a result of the pandemic. This was a significantly larger number than those aged 25-40, which grew by only around 3% and for those under 25, by 1%.

It should be clear to businesses that want to market in China that they will have to consider appealing to a wider target audience, including the older generation, for their apps and websites. This includes even the apps and websites that have traditionally been perceived as more appealing to those aged 30 and below.

7) Top 2 apps that ranked highest in growth: Work productivity apps and short video apps

Not surprisingly, 2020 saw a massive surge in the use of work productivity apps, as companies took to work-from-home arrangements that year. From 127 million monthly active users (MAUs) in March 2019 to 435 million by March 2020, an increase of a whopping 242%!

The China Internet Report indicates that over a short 10 days, from the 28th January to the 6th February, these three work productivity apps became the most downloaded iOS apps in China – DingTalk, WeChat Work and Tencent Meeting.

Second highest were short video apps, with MAUs rising by 123 million to 870 million during that same 1-year period. But because short video apps were already popular in China before the lockdown, the overall increase was only 16%.

8) The increasing popularity of live-streaming

Live-streaming in China has seen a steady evolution in three phases:

  • Phase 1 (2012-2017): live-streaming is mostly used for gaming, sports and teen culture.
  • Phase 2 (2017-2019): the emergence of live commerce for shopping, particularly fast-moving consumer goods (FMCG) and online companionship, where Key Opinion Leaders (KOLs) would stream normal activities from their day.
  • Phase 3 (2019-current): Live-streaming becomes a favourite for brands from a number of sectors, such as international luxury goods, real estate, travel and tourism, and automotive industries.

In one famous live-stream in April 2019, it was even used to sell a US $5.6 million rocket, by China’s “livestream queen”, Viya!

With a value of more than US $16 billion, it is crucial for brands to understand the world of live-streaming if they want to market effectively to consumers in China.

In Summary

From this brief overview, it is pretty clear that China’s internet growth lies pretty much in the smartphone sector. These major factors make China an attractive market indeed for digital marketing expansion:

  • the major adoption of 5G in the coming years
  • online trends accelerated by COVID-19
  • the widening demographics of digital channels users, and
  • potential for further immense growth as 500 million people have yet to come online.

If China is one of the markets your brand is planning to enter, let IPPWORLD assist you in your creative translation (transcreation) and localisation needs into the Chinese language, so that you can cater to a rapidly growing consumer population that is heavily mobile-centric.