Baidu - China's very own search engine brand
The recent offer by Microsoft to acquire Yahoo! brings to the fore yet again the high stakes involved in the online world. With a few dominant players and billions of dollars at stake, the online world of commerce, advertising and search is just starting to heat up. No where is this hotter than in China, the world's second largest Internet market. Even though Google and Yahoo! are the worldwide leaders in search, they have taken a beating in the highly complex and competitive online market in China. The Chinese online market is controlled by China's own brand: Baidu.
Baidu controls 57% of the Chinese search market, while the global search leader Google comes in a distant second with 18.7% and Yahoo! a close third with 13.6% of the search market. With the online search market amounting to US$260 million in 2006 and estimated to grow by 50% to 60% compounded annually over the next three years, the competition seems to be just starting.
This highlights the complexities of the Chinese market. Even though Google and Yahoo! have the resources and technological know how, the unique cultural and ethnic nuances of China makes knowledge of the people and their language a strategic competence. It also helps Baidu that it is a homegrown brand with a very strong brand identity that inspires and rallies the Chinese population and those together have effectively managed to take on global giants.
Given that China has millions of small and medium sized businesses that are yearning to capitalize on the enormous market opportunities, Baidu can yet again leverage its "Chineseness" and continue to grow. That only 130 million Chinese, a mere 10% of the population, are online compared to almost 60% to 70% in the US, Japan and South Korea offers Baidu an even better opportunity to surge ahead with its position of brand leadership.
Baidu has so far waged a very successful fight against the global giants. With the affluent Chinese aspiring to anything global, it will be a tough road ahead for Baidu to balance its brand experience. The competition is heating up and none of the search engine brands will disregard China in their portfolio.
Baidu controls 57% of the Chinese search market, while the global search leader Google comes in a distant second with 18.7% and Yahoo! a close third with 13.6% of the search market. With the online search market amounting to US$260 million in 2006 and estimated to grow by 50% to 60% compounded annually over the next three years, the competition seems to be just starting.
This highlights the complexities of the Chinese market. Even though Google and Yahoo! have the resources and technological know how, the unique cultural and ethnic nuances of China makes knowledge of the people and their language a strategic competence. It also helps Baidu that it is a homegrown brand with a very strong brand identity that inspires and rallies the Chinese population and those together have effectively managed to take on global giants.
Given that China has millions of small and medium sized businesses that are yearning to capitalize on the enormous market opportunities, Baidu can yet again leverage its "Chineseness" and continue to grow. That only 130 million Chinese, a mere 10% of the population, are online compared to almost 60% to 70% in the US, Japan and South Korea offers Baidu an even better opportunity to surge ahead with its position of brand leadership.
Baidu has so far waged a very successful fight against the global giants. With the affluent Chinese aspiring to anything global, it will be a tough road ahead for Baidu to balance its brand experience. The competition is heating up and none of the search engine brands will disregard China in their portfolio.
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