Baidu Guide for Clients & Agencies

THE CHINA OPPORTUNITY

Baidu Guide for Clients & Agencies

The World’s Largest Online Economy

China already has the largest online population in the world at 618 million users.

Astonishingly that’s only 46% of their population, so their capacity for growth is enormous.

0

100

200

300

400

500

600

700

618

245

121101

7953

2046

79

10.2

80

39

84 89

Online Population MMs

% of Population Online

Or to Put it Another Way

China

USAUKAustralia

= 50 million online users

They’re Becoming Affluent

The middle classes are expanding beyond the largest cities more rapidly & in greater numbers

than any market has ever witnessed. The number of Middle and Affluent Consumer

HOUSEHOLDS in China will be the same as the US by 2020.

1

13

34

61

57

36

12

53

69

66

39

23

Household annual disposable income

(USD) thousands

Upper affluent >200

Lower affluent $16 - $31.5

Middle Class $9.5 - $16

Emerging Middle $6 - $9.5

Aspirant $4 - $6

Poor <$4

Households MillionsHouseholds Millions

Source BGS Consultants

Urban household disposable income 2020Urban household disposable income 2010

Chinese Online Behavior

Online Spending Habits

33.8% shop online

30.5% pay online

29.1% bank online

Reasons for Going Online

Research Products to Buy – 45.5%

Research for Work – 49.2%

Stay up-to-date, news / events – 51.3%

Most Popular Activities

Search Engine – 76.3%

Online News – 78.5%

Online Music – 82.5%

Online Trust

Chinese online consumers display a high level of trust

when it comes to conducting transactions online.

There is a considerably higher level of trust for brands

that use SEM than SEO. This is because the Chinese

actively purchase only from brands they are familiar

with.

Since the Baidu screening process for advertisers is so

vigorous – the Chinese place a high level of trust in

any brand that has been granted permission to

advertise. Hence, the average CTR for Baidu’s SEM of

4.8%.

The Chinese online behavior is similar to that of Western countries – but they display an

unusually high level of online trust.

Chinese Online Transactions

Online transactions reached $301.9 billion USD in 2013. It is expected to surpass $651 billion

USD in 2017.

$75.03

$127.69

$212.08

$301.11

$398.76

$491.54

$585.94

$673.83

75%

70%

66%

42%

32%

23%

19%

15%

0%

10%

20%

30%

40%

50%

60%

70%

80%

$0.00

$100.00

$200.00

$300.00

$400.00

$500.00

$600.00

$700.00

$800.00

2010 2011 2012 2013 2014e 2015e 2016e 2017e

Transactions USD Billions Growth Rate (%)

Source iResearch, “2013 eCommerce market core value analysis”

BAIDU’S ADVERTISING SOLUTIONS

Baidu Guide for Clients & Agencies

Baidu is China’s Equivalent of Google…

Baidu is the major search engine in China with over 560 million regular users. That’s the

equivalent of all the Google users in Europe and Asia combined.

Population of China: 1.35 billion

Online Population: 618 million

Baidu’s Reach: 556 million

Baidu’s Key Product Offerings

Loyalty 忠诚Purchase 购买Consideration 考虑Familiarity 熟知Awareness 知晓

• Content

Network

• Brand Zone

• Brand Zone

Mini

• Keyword Search (SEM)

• Baidu Wireless (Mobile)

Search Network

How does it work?

Clients and Agencies who are familiar with other

search networks like Google, Bing or Yahoo will

find it easy to set up a Baidu Search campaign.

The same broad process applies. Clients select

keywords and the maximum price they are

prepared to bid on each keyword (Cost per click

– CPC).

Baidu only charges clients when their ad is

selected or “clicked” so they only pay for

performance.

The average cost per click on Baidu is $1.00 for

broad terms which is significantly cheaper than

other search platforms. Specific terms are even

cheaper.

The average click through rate is 4.8% (some of

our clients have CTRs of 25% for specific brand

terms).

Unlike Google, Baidu requires payment in

advance for campaigns. Funds are added to

your client’s account and their ads will run until

those funds are depleted.

Targeting Campaigns

Campaigns can be targeted by day part or geo

targeting (regions of mainland China, major

cities, Japan, rest of world).

Baidu’s SEM solution works similarly to Google – Clients select keywords and choose a price

per click they they are prepared to pay.

Search Network

What does it look like?

Baidu’s search results look very similar to

Google’s.

The results at the top / centre of the page are

“exact matches” to the keyword that the Baidu

user has typed in.

Results below the red box are organic search

results.

The red box on the right shows “broad matches”

to the keywords that the Baidu users typed in.

A brand’s position on the page is influenced by

their CPC (the highest bidder for the keyword

appears at the top of the page) and the website

quality score.

Just like on other search platforms, Baidu doesn’t publish the exact algorithm that gets a site

to the top advertising slot. We do know, however, that it’s a combination of quality score and

maximum keyword bid.

The quality score refers to how relevant Baidu

feels each keyword is for your client’s website.

If you’re the highest bidder, but have a low

quality score for a given keyword, you won’t be

given the top paid search slot.

Content Network

How does it work?

Baidu tracks where web users go, what sites

they visit, what search terms they use and what

they say on social networks.

The result is a very rich detailed profile that

advertising clients can use, to target exactly the

right audience for their products.

Banner ads have an advantage over pure search

results in that they can use imagery, flash, text,

and levels of interactivity that a website user is

more likely to engage with.

It’s also great for clients whose campaign

objectives include extending brand awareness.

The use of logos, colours, and imagery will do a

much better job of extending the reach of a

client’s brand than search results alone.

The average CTR is 2-3%, but increases to 5% if

retargeting is used.

Baidu only charges client when their banner is

selected or “clicked” so they only pay for

performance.

The average cost per click is only 0.20 USD on

Content Network making it a great choice for

clients on a limited budget.

For the latest list of sites in the network – (make

sure you view it on Google Chrome so you can

translate the content to English)

http://wm123.baidu.com/.

If your clients need to work on their brand recognition, then Baidu Content Network is the right

choice. More than 600,000 sites in China, with over 80 billion daily impressions.

What is the Baidu Content Network?

Baidu’s Banner network covers more than 600,000 sites which receive more than 80 billion

daily impressions.

Target users by:

• Gender

• Age

• Location

• Interests

• Sectors

• Visitors to specific sites

• Clicked on ads previously

Retarget users by:

• Who visited your website

• Abandoned a shopping basket

• Registered, but yet to purchase

• Retargeting keywords (competitors / banned

terms)

Retargeting Increases CTR to 4-5%

What is the Baidu Content Network?

There are a wide variety of banner formats available on the platform – we recommend clients

prepare their ads in a minimum of 10 different sizes.

Embedded ads - Available in 18 different

sizes and in JPG, GIF or SWF formats.

Floating ads - move down the page and stay in the users

line of vision. Available in 3 sizes and in JPG, GIF or SWF

formats.

Brand Zone

How does it work?

Brand Zone is Baidu’s equivalent of a home

page take over. Brand Zone clients can “own”

the space above the fold whenever one of their

brand terms is searched on Baidu.

Instead of just a search listing, Brand Zone

provides true brand exposure, ensuring users

know who you are long before they make it to

your website.

Best of all – Brands can also “own” their brand

related keywords exclusively. No other Baidu

advertiser can use their keywords. Their

competitors can no longer capitalize on their

brand equity.

There is no equivalent of this on other search

engines.

Impressively, Brand Zone campaigns enjoy an

average click through rate (CTR) of 60-80%.

Compare that to the Baidu SEM average CTR of

4.8%.

More than half of everyone that views a Brand

Zone campaign interacts with it. That’s a

measurable proof of brand awareness.

Brand Zone represents the best possible exposure for clients who already have a “known” brand

in China. This service is generally utilised by clients whose brands are household names.

Brand Zone

What to expect

Costs for Brand Zone are bespoke and offer a

fixed price for unlimited clicks. They’re based on

the volume expected for each keyword used.

This is not a cheap option and hence only cost

effective for blue chip brands who can expect

huge traffic levels.

Keep in mind that Brand Zone campaigns can

only use keywords owned by the brand – and

they can only be used on exact match (not broad

match).

So if you own a hotel called Oceanside Hotel in

San Francisco, you would be able to use:

“Oceanside Hotel San Francisco” or

“Oceanside Hotel”

but not

“San Fransico Hotel” or

“Hotel”

Protect yourself from the competition by exclusively owning your brand terms on Baidu.

Brand Zone Matrix

Brand Zone campaigns display on both desktop and mobile platforms as well as 5 of Baidu’s

most popular internal platforms.

Video SearchOver 120 million in daily

traffic

Mobile Keyword SearchOver 40% of Baidu’s audience

Desktop Keyword Search

Image SearchChina’s biggest image search with

over 250 million daily users

News SearchChina’s biggest news

search platform

Baidu KnowledgeZhidao - China’s biggest knowledge

portal (Yahoo Answers)

BRAND ZONE

Wiki ZoneChina’s biggest Wiki site

Brand Zone - Desktop

This successful campaign from Burberry includes logos, videos, animated gifs, multiple product photos, latest

news, deep links, and social media. (Translated from Chinese using Google Translate)

Brand Zone - Desktop

Chanel’s Brand Zone campaign includes logos, latest news results, product promotions, links

to videos, their official television commercial, social media links, downloads, and links to their

iPhone app. (Translated from Chinese using Google Translate)

Brand Zone – Desktop

Rolex dominates their competition with this campaign showing animated gifs and a full table of

their biggest selling range for men and women. (Translated from Chinese from Google

Translate)

Brand Zone – Baidu News Portal

Baidu News comes with customized ‘official news’ and ‘news module’.

v

Brand Zone – Baidu Video Portal

Baidu Video comes with official HD video, business introduction and a takeover presence.

Brand Zone – Baidu Image Search

Baidu Standard Image comes with a extra large rotating picture at the top and Baidu Advanced

Image will have the first page dedicated to one brand with four big rotating pictures.

Brand Zone – Baidu Knowledge

Baidu Knowledge Portal comes with customized information and large image of the brand.

Brand Zone – Baidu Wiki

Baidu Wiki Portal comes with customized information, keywords, and links.

Brand Zone Mini

How does it work?

As the name implies, Brand Zone mini is a

smaller version of the full Brand Zone product.

Brand Zone mini only takes up 1/3 of the area

above the fold but like full Brand Zone – it offers

exclusivity over brand terms on the platform and

unrivaled brand exposure.

Brand Zone mini is also available on the Baidu

Knowledge portal – China’s largest knowledge

portal (equivalent to Yahoo Answers).

Charging model is based on performance –

CPM, promotion area and length of

campaign.

Cost and Targeting

Unlike full Brand Zone, mini can be geo targeted

to specific Chinese provinces – making the

campaign even more cost effective.

The costs of brand zone mini are bespoke and

based on keyword volume, geo-targeting, and

campaign length.

Estimate between $3 – 8k per month.

Brand Zone Mini is an alternative for clients who wish to explore the Brand Zone format on a

smaller budget. It helps to create awareness for clients whose brands are still trying to

establish themselves as household names.

Brand Zone Mini Ad Formats

v

Baidu Search

Result Page

Baidu

Knowledge

ACCOUNT OPENING PROCEDURE

Baidu Guide for Clients & Agencies

How is Baidu Different?

Baidu is pre-pay

It works a little like a pre-pay mobile phone.

Clients add funds to their accounts and their

campaigns run until those funds run out. They

can add a top up at any time.

Everything is in Simplified Chinese

We see an 85% drop off rate whenever Baidu

users see a page in English. As a minimum

clients should commit to a Chinese language

landing page.

It takes time to open an account

It takes approximately 1 week to open a new

account once Baidu have all the necessary

documentation.

Opening accounts in restricted industries such

as pharmaceuticals, finance, and the medical

industry can take significantly longer.

No Agency accounts

Unlike Google, there’s no concept of an agency

account on Baidu. That means that every client

(in fact every domain) must have a separate

Baidu account and be individually approved by

Baidu.

However, agencies using a bid management tool

can continue managing accounts in the same

way. We can provide an API to Baidu to allow

your accounts to be managed seamlessly.

What works on Google won’t necessarily

work on Baidu

It’s not just a matter of language. The Chinese

search in a very different way to Western

cultures. You need more than just translation,

you need localisation by SEM experts.

Baidu doesn’t operate like other search platforms. Here’s some of the key differences.

Getting Started on Baidu

Keywords

• Send us any keywords you’re currently using for other search campaigns such as Google or

Yahoo. Alternatively we can prepare a bespoke keyword proposal.

• We’ll check how many Baidu users have typed in each keyword in the past 30 days to gauge

demand.

• This allows us to present a budget estimate. You can refine your keywords and budget until you

have a mix you’re comfortable with.

We can help you select and translate your keywords for Baidu.

Opening a Baidu Account

Open your account online

• To get started–open your account online at

http://signup.chinasearchint.com/

• You’ll need a copy of your business

registration certificate and a screenshot of

your Chinese home page that clearly shows

the URL.

• Minimum spend is $2,000 USD per month for

3 months.

• Our online account opening portal will use

the details you provide to pre-fill out all the

necessary documentation to open your

account.

• Each page of the pdf produced needs to be

signed by the brand (not the agency) and

returned to us.

Documents produced by the online portal

1. Letters of Commitment – These 2 contracts

commit the advertiser to not break any

Chinese laws.

2. A “V Qualification” certificate – which verifies

your site to the be the authentic and official

site for your brand.

3. Proof of Authorization – Declares who is

able to sign on behalf of the brand.

We can take you through the (rather lengthy)

account opening procedure step-by-step to

ensure a smooth and hassle free process.

New accounts need to provide a number of documents to Baidu before your account can be

opened.

INTRODUCTION TO CHINA SEARCH

INTERNATIONAL

Baidu Guide for Clients & Agencies

China Search International

Overview

We are Baidu’s International Partner, not an agency. That means our business model does not rely on charging management fees.

In fact – the only charge you or your clients will ever see from us is a 2.5% processing fee to cover our banking and foreign exchange fees. In essence we are paid by Baidu to sell Baidu.

With offices in Singapore, California, Hong Kong, Sydney and London we’ve guided hundred of clients through the complex Baidu processes.

We’ve all worked previously at major brands / agencies in the UK, USA and Australia so we understand your requirements and the importance of managing your client’s expectations.

The result is that we’re well placed to help your clients launch on Baidu in the most cost effective and hassle free way.

Some of our more well known clients

Baidu’s Largest International Partner – Over 15,000 Clients Outside of China.

Opening a Baidu Account

Our free services include:

• Translation of all documents for submission to Baidu

• Facilitation of the account opening process

• Provision of bespoke keyword lists where required

• Translation / localisation and volume checking of keywords and ad copy

• Loading of keywords into the client’s Baidu account ready for launch

• Bid Management API application on the client’s behalf

• On-going technical support

• Issuing of invoices in the client’s preferred currency and transferring of funds into the

client’s Baidu account.

• Full training on how to manage accounts on Baidu (use of the Baidu console)

• Provision of research decks on relevant sectors and updates in the Chinese market

• Pitch Support (provision of keyword proposals, research, and recommendations)

Because we’re not an agency – we don’t charge a management fee. All our services are free.

Getting in Touch

Should you have additional questions, please

don’t hesitate to get in touch:

Kevin J. Carney

VP, Agency Partnerships & Strategic Accounts

KCarney@ntent.com

(646) 561-8643

www.baiduint.com