As of September 2024, the scale of monthly active users (MAUs) in China's mobile internet sector reached 1.244 billion, reflecting a 1.7% year-on-year growth. Notably, first-tier, new first-tier, and second-tier cities experienced a strong rebound, collectively adding over 50 million users. These cities now account for 9.8%, 18.5%, and 19.7% of the total user base, signalling a shift away from the previous growth model dominated by lower-tier cities. This trend underscores the increasing importance of internal economic drivers in sustaining China's digital economy.
Growth Drivers in the Digital Ecosystem
The steady expansion of digital infrastructure remains a cornerstone of market vitality. By August 2024, China had established 4.042 million 5G base stations, serving 970 million users. This robust infrastructure has supported a diverse range of digital consumption scenarios, seamlessly integrating online and offline experiences. From content consumption to product purchases and service transactions, this convergence has driven user engagement to new heights. In September 2024, average monthly internet usage per person reached 164.7 hours, representing a 4.3% increase year-on-year. This demonstrates the enduring appeal of a rich content ecosystem and high-quality digital services.
Industry Dynamics and Trends
The Travel Services Industry has shown remarkable performance in 2024. Data from August reveals that leading platforms like Ctrip and Qunar maintained high levels of monthly active users. Moreover, the share of active users from tier-4 and smaller cities increased to 24.5%, reflecting a 0.8% year-on-year rise, which highlights the untapped potential of lower-tier cities in driving tourism consumption.
In the e-commerce sector, competition has intensified. As of September, leading platforms such as Taobao, JD.com, and Pinduoduo collectively commanded over 90% of the market traffic. Meanwhile, Douyin Mall emerged as a new powerhouse, leveraging its innovative "product-to-consumer" model to achieve a 40-fold increase in traffic year-on-year.
The advertising market also witnessed notable shifts. Data shows that industries such as beauty, fashion, and food dominated ad spending. Among them, outdoor sports and IT electronics brands demonstrated higher levels of ad concentration. Content marketing strategies like Olympic-themed campaigns, IP collaborations, and short-form drama marketing have fueled waves of engagement and conversion, driving consumer activity across sectors.
AI-Powered Transformation and Innovation
Generative Artificial Intelligence (AIGC) achieved a breakthrough in 2024, emerging as a pivotal force in digital economic transformation. By September, AIGC applications reached 79.1 million MAUs, growing 393.9% year-on-year. Leading applications such as Doubao and Wen Xiaoyan have seamlessly integrated into users' daily lives, boasting strong three-day retention rates of 39.1% and 31.2%, respectively.
The rise of intelligent entity platforms has further democratized AI participation, enabling individuals and small businesses to create AI-driven entities with minimal effort. Platforms like Tencent Yuanqi and iFlytek Xinghuo have introduced innovative tools, fostering greater participation in AI ecosystems and lowering entry barriers.
The Popularity of Sports and IP Collaboration Marketing
The 2024 Paris Olympics ignited widespread enthusiasm, serving as a catalyst for sports-themed and brand marketing campaigns. Companies leveraged Olympic-themed pop-up stores and events to engage users and enhance brand visibility. Simultaneously, IP collaboration marketing emerged as a powerful strategy to captivate younger consumers. For instance, Luckin Coffee's collaboration with "Black Myth: Wukong" significantly expanded its user base, showcasing the immense potential of IP-brand synergies.
Evolution of Content Ecosystems and Consumption Patterns
In 2024, China’s content platforms underwent profound transformation. The short video industry continued its upward trajectory, with MAUs surpassing 1 billion. Platforms such as Douyin and Kuaishou capitalized on diverse content offerings to attract users, while OTT platforms like Galaxy Kiwi and Mango TV gained traction due to their immersive experiences, becoming preferred channels for premium brand advertising.
In the gaming sector, “Black Myth: Wukong” emerged as a cultural phenomenon. This domestically developed AAA game not only captured a massive player base but also fueled marketing momentum through cross-industry collaborations, solidifying its status as a standout success in 2024.
Shifts in Consumer Behavior
Consumers in first- and new first-tier cities demonstrated enhanced purchasing power. Data shows that nearly 29% of active users have a monthly online spending capacity exceeding ¥2,000, with 5.5 million new users joining this group year-on-year. Furthermore, richer content ecosystems are encouraging users to engage more deeply with fewer but higher-quality interactions. While monthly app session counts declined by 2.7%, total time spent increased, reflecting a shift toward more meaningful engagement.
Platforms like Douyin and Xiaohongshu have strengthened emotional connections between brands and consumers through innovative content marketing. Douyin’s integration of short video and e-commerce features, in particular, has proven effective in capturing the attention of younger demographics.
Market Outlook
Looking ahead, the convergence of AI, 5G, and content marketing will continue to shape the evolution of China’s digital market. The rapid rise of intelligent entity ecosystems, coupled with accelerated platform distribution, offers businesses novel opportunities to engage consumers and drive innovation. As both urban and rural consumption potential unfolds, brands will need to adopt increasingly diversified strategies in marketing and channel development.
Leverage the power of AI-driven innovation and dynamic consumer insights to thrive in China's evolving digital market. Partner with us to unlock your brand’s potential and drive growth in this transformative landscape. Contact us today to learn more!
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