Yahoo's search is gone, so is Yahoo China

Yahoo announced its 10-year agreement with Microsoft, in which Yahoo will sell its search technology to Microsoft Bing. This 'Giant' in history eventually fails, and in this post, let's briefly review Yahoo's journey in China to see why Yahoo China goes from No.1 to nothing.

Yahoo is one of the earliest Internet companies doing business in China. It announced http://www.yahoo.com.cn in September 1999. FYI, BaiDu is born in 2000 and Google China was founded in 2005. However, it didn't leverage the huge population of China and went to death in less than 10 years.

One big mistake is made by Yahoo China's previous CEO, HongYi Zhou, he acquired "3721 Internet assistant" and changed its name to "Yahoo assistant", which is a malicious software, and since then, Chinese Internet users build a feeling of connection between Yahoo and malicious soft instead of Yahoo and search.  The most ironic thing is that Mr. Zhou founded a software company named "360 network guard" to fight malicious software such as 3721 after he left Yahoo China.

Yahoo may realized its problem and launched Yisou, a new search service in June 2004 to renew its search brand. Actually, Yisou was doing quite well, but it was 2004 already, BaiDu and Google have build their market share too. So instead of focus on the search engine, Yun Ma, acquired Yahoo China with Yahoo's 1 billion investment in its e-commerce company - Alibaba. Yun Ma is a smart guy, he got the capital and in the same time, he leveraged Yahoo's brand in Alibaba's B2B aboard businesses. However, Yahoo, got nothing from the deal and that started the signal of Yahoo China's death.

The image is Yun Ma in signing the agreement between Alibaba and Yahoo:

In May 15th, 2007, Yahoo China changed its name to Chinese Yahoo. By that time, Yun Ma has made his success in TaoBao (the biggest B2C) and Alibaba, he didn't need to care Yahoo China anymore. It was not surprised Yahoo China sold itself to KouBei.com one year later in June 4th 2008. 

Bit by bit, nobody in China uses Yahoo anymore, although they may know ZhiYuan Yang (Jerry Yang). As always, I give Yahoo the best wishes!

Why many successful companies failed in China? They didn't know the rules, they didn't see those wolfs trying to eat their capitals....You have to use the right person with integrity and vision to beat them. 

China Search Engines Market - 2nd Quarter 2009

In the second quarter, Google failed to maintain its first quarter's 30% market share, and BaiDu has a big gain with a market share over 60%, based on a report from a Chinese market research company.

Although Google only made 29.1% in the second quarter, it is still a 64.5% growth compared with its share same time last year. BaiDu maintains its big edge and seems get rid of the negative effects from China's media's exposure of its fake advertising.

The research company also noticed the same market shares of various search engine companies in the mobile search market. It suggest all search engine players to focus on new mobile search R&D to win first in the coming mobile age.

Chinese SNS War - XiaoNei and QQ

QQ Alumni, a Tencent new venture, is giving pressure to XiaoNei, the top SNS site in China. Yizhou Cheng, CEO of XiaoNei, recently changed his nickname to 'We will get the same market with QQ in two years', and XiaoNei is trying to get new users by adding Twitter like features. On the other hand, QQ Alumni added a new feature named 'Freshmen Camp' aiming at those who just graduated from high schools.

The war is just getting started. XiaoNei enjoyed its success by following Facebook and Twitter, and by positioning on the college students. QQ Alumni, which entered the SNS market less than a year, is getting more and more popular relying on the huge user base of its QQ IM software. And QQ just announced they will open a new community SNS site specially for white-collar users. The winner is not clear at this time.

To EffOM, a online marketing company, both are important. Going further with our investigation, XiaoNei's users are mainly those with more advanced education such as college/post-graduate degree, while the main part of QQ Alumni's user base is high-school students who are chatting with QQ all the time.

China's online population set to grow

Below is a press release from Forrester research. The highlights are:

1. China already has the largest online population in the world. Yet, it will rise by nearly 11 percent each year over the next half decade.
2. By 2013, 17 percent of the global online population is in China.
3. The online percentage in US and Europe will increase approximately 3 percent per year.
4. Multinational organizations must understand the dynamics of the shifting global online population to ensure that they are positioned to take advantage of emerging international opportunities.
5. Online marketing will play an important role in the enterprise world.

Attachment: Press release from Forrest research

The number of people online around the world will grow more than 45 percent to 2.2 billion users over the next five years, according to a new report by Forrester Research, Inc. (Nasdaq: FORR). Asia remains the biggest global Internet growth engine: 43 percent of the world's online population will reside in Asia by 2013, with 17 percent of the global online population in China. Growth rates in the US, Western Europe, and the major industrialized nations in Asia Pacific such as Australia, Japan, and South Korea will slow to between 1 percent and 3 percent. The top-line, five-year forecast is available to select Forrester clients in the report "Global Online Population Forecast, 2008-2013"; subscribers to Forrester's ForecastView receive more detailed forecast data.

"While per capita online spending is likely to remain highest in North America, Western Europe, and the developed markets of Asia throughout the next five years, the shifting online population and growing spending power among Asian consumers means that Asian markets will represent a far greater percentage of the total in 2013 than they do today," said Forrester Research Senior Analyst Zia Daniell Wigder. "Multinational organizations must understand the dynamics of the shifting global online population to ensure that they are positioned to take advantage of emerging international opportunities."

The Internet user base is increasing in every area of the world. Regional highlights include:

 * North America. Online penetration in the US is set to rise from 73 percent to 82 percent over the next five years, representing about a 3 percent annual growth rate. By 2013, US online penetration will be on par with the most highly penetrated markets of Europe and Asia, such as the Netherlands, the UK, Japan, and South Korea.

* Europe. Europe's Internet growth will be fueled by the continent's emerging markets. Internet usage in Russia and Turkey will grow by almost 8 percent annually, while growth in Spain's online population will increase by an average of more than 5 percent each year.

* Asia. China's online population (already the largest in the world) will rise by nearly 11 percent each year over the next half decade. Other Asian countries with substantial online growth rates include India, Indonesia, Pakistan, and the Philippines. By contrast, growth rates in some of the more mature markets such as Japan and South Korea will rise by less than 2 percent each year.

* Latin America. Brazil is currently the fourth largest market in the world in terms of number of Internet users, but despite a 7 percent annual growth rate over the next five years, it will drop to the No. 5 position in 2010 when it is surpassed by India.

* Africa and the Middle East. The countries of the Middle East and Africa currently represent just 8 percent of the global online population but over the next five years will see some of the highest growth rates in the world, around 13 percent. Egypt, Iran, and Nigeria are among the countries with the highest growth rates in the region.

Countries With The Most Internet Users: 2008

 1. US
 2. China
 3. Japan
 4. Brazil
 5. Germany

Countries With The Most Internet Users: 2013

 1. China
 2. US
 3. India
 4. Japan
 5. Brazil

Top websites in China in July, 2009

In effOM, as a professional online marketing service provider, we keep learning the latest trends in the Chinese web community.

One good practice in China SEO is to know what are the most popular websites so that we can focus our efforts to the most important places. The following table is based on the data collected up to June, 2009. And the ranking was done in terms of total visiting sessions.

Chinese Top Websites July 2009

1. http://www.baidu.com - Chinese most used search engine.
2. http://www.qq.com - Tencent Co. Chinese largest IM software.
3. http://www.sina.com.cn - SINA, news portal.
4. http://www.hao123.com - a BAIDU subsidiary company, provide directory services.
5. http://www.163.com - Netease, news portal.
6. http://www.sohu.com - SOHU, news portal.
7. http://www.youku.com - Largest video sharing website in China.
8. http://www.g.cn - GOOGLE
9. http://www.soso.com - Tencent Co. Search engine services provider.
10. http://www.taobao.com - Chinese largest B2C provider.

Potential top websites July 2009

1. http://www.tudou.com
2. http://www.xiaonei.com
3. http://www.xunlei.com
4. http://www.kaixin001.com
5. http://www.gougou.com  
   

Based on our estimate, all these 15 websites can cover 90 percentage of Chinese Internet users.

effOM's connections building

As a leading online marketing services provider, effOM is always working on building good relationships with these top websites. To best serve our clients, we have working groups in each of the websites. And we are advertise partners to the big search engine services providers such as Baidu, Google, 163, soso and gougou.

Contact Us

We are here to help your business getting better. 

Please drop us a line if you have questions for anything in China.

Email: effomweb@gmail.com

Phone: Tim 662-SEO-TECH ( 662-736-8324)

About us

Who are we

We are geeks interested in online marketing and social media.

We believe tracking and improving can make your marketing campaign more effective.

We are from different backgrounds such as Computer Science, Math and Statistics.

What do we do

We are working hard to make your China/US online marketing effective and efficient.

EffOM will help you, your product and your business by building your online branding. We use not only SEO but also social media, news portal, PPC, etc to do effective online marketing.

Contact Online marketing team

You can reach us by email: effomweb@gmail.com.

You can also call us: Tim 662-SEO-TECH ( 662-736-8324)

We are more than happy to meet and discuss with you if you are around Boston.

Business with China

The opportunities are in China and you should extend your business to China and share China's growth, it is not that difficult and you will not regret.

Basic facts

* The average annual GDP growth rate in China is 9.7% between 1979 and 2006.

* The sales of retails industry goes to 700 billion and the annual growth rate is 8.5%.

* China has been the second large electricity consumer and producer since 1996, although its average electricity usage per person is only 1/6 of that in developed countries. China's national grid plans to invest $111.4 billion to expand its grid capacity in 2006-2010.

China is leading the world economy recovery

IMF and World Bank predictions of 5% - 6% growth earlier this year were upgraded to 7.2% in May, however, our sources in Beijing report an 8% growth- as predicted by the PRC itself. This growth is largely due to the government's 4000 billion yuan injection into the economy, approximately 25% of which is channeled into the country's infrastructure. The impact of the investment can already be seen in China's growing demand for energy.

According to the Nautilus Institute publication by By Jia Xijin and Zhao Yusi, "Of the 4000 billion RMB investment, sustainable housing projects account for 280 billion, rural livelihood and rural infrastructure projects account for 370 billion, railways, highways, airports, and power grids in urban and rural areas account for 1800 billion, medical and health as well as culture and education projects account for 40 billion, investment in environmental projects account for 350 billion, independent innovation and structural adjustment account for 160 billion, and post-disaster restoration and reconstruction account for 1000 billion."

No doubt, China will be profitable for you.