Behind the “Great Firewall”: Online Advertising in China [1/2]

Advertising opportunities in China

China is the fastest-growing of all major economies. It is second only to the United States in terms of nominal GDP and leads the world in GDP (PPP) ranking since 2013, a powerful metric which estimates Gross Domestic Product through the lens of Purchasing Power Parity (PPP). With its robust technological advancements and a population of 1.4 billion—over 800 million of which are active internet users—this is a market full of opportunities that should not be overlooked.

In fact, of the 3.8 billion internet users worldwide, China alone accounts for 21% of these users, meaning there are more people online there than in any other country. It is also the second largest market in global advertising in terms of spending, and some signs suggest it could be making a faster recovery from the COVID-19 crisis than other global markets. Online advertising in China can be a real challenge for outsiders, however, given its distinctive media landscape, internet culture, and regulatory environment. This article will shine a light into China’s unique digital universe, and provide a few insights on how one might approach the significant opportunities for digital marketing in China.

China’s advertising laws

China’s willingness to restrict its internet users’ online experience and censor web content is usually where the average outsider’s knowledge begins and ends. While it is true that the Chinese online regulatory environment is strict, it is also one that you can navigate successfully if you play by the rules. Advertisers need to understand a little more detail about China’s strict advertising laws and ad approval process. Here are, by way of example, just a few key regulations that need to be taken into account:

• Superlative qualifications such as “most,” “best,” or “most popular,” and vague claims such as “recommended by experts,” are strictly forbidden.
• Advertisers caught using these could face fines anywhere from 200,000 RMB to 1,000,000 RMB.
• The act of drinking cannot be graphically depicted in alcohol advertisements.
• All tobacco-related advertisements are prohibited.
• Advertisements for infant milk formula cannot claim to be substitutes for breast milk.

One prominent example of how not to advertise in China is the case of Crest. In 2015, the toothpaste brand owned by Procter & Gamble was fined nearly 1,000,000 USD, the biggest fine for false advertising in mainland China to date. Crest had claimed in a television advertisement that its toothpaste had teeth-whitening capabilities after just one day of use. The regulatory body deemed this to be a fraudulent claim and pointed to the heavy alteration of the advertisement’s images as evidence.