China’s Internet Advertising Market 2025 H1: Entering the Era of Regulated Maturity
- Alice
- 3 hours ago
- 3 min read
The first half of 2025 marked a period of both consolidation and transformation for China’s internet advertising market. All data and insights in this article are drawn from QuestMobile’s 2025 H1 Internet Advertising Market Report. Overall market size reached RMB 359.85 billion, representing a year-on-year increase of 5.6%. While growth remains steady rather than explosive, the sector is entering what many analysts describe as a “regulated maturity phase”, driven by evolving policy oversight and the continued concentration of traffic on leading platforms.
Regulation and Market Order
Over the past year, regulation has accelerated across multiple fronts. Authorities have sharpened oversight on data security, “covert advertising”, platform transparency, and even outbound ad placements. The regulatory emphasis has been on ensuring fair competition, protecting user rights, and encouraging a healthier advertising ecosystem. This increasing clarity has reduced uncertainty for advertisers while pushing platforms towards more standardised and transparent practices.
Market Concentration: Top Three Platforms Dominate
The advertising landscape continues to be dominated by three giants: Taobao, Douyin, and WeChat. These platforms account for almost half of total hard advertising revenue, with market shares of 22.5%, 19.1%, and 10.8% respectively. This concentration underscores the limited room for smaller players in attracting major brand budgets, though mid-tier platforms still demonstrate pockets of growth.
From an end-device perspective, mobile remains unrivalled. Nearly 89% of total ad revenue in H1 2025 came from mobile, with OTT and smart hardware contributing 9% and PCs just 2.1%. The mobile channel’s dominance highlights the necessity for brands to optimise creative and placements for smartphone-centric consumption habits.
Industry Advertising Dynamics
Sector-specific investment patterns highlight both resilience and shifting demand. Beauty and personal care remains the single most dynamic vertical, with ad spend reaching RMB 72.45 billion, up 19% year-on-year. Apparel and food & beverage followed with RMB 20.23 billion and RMB 17.32 billion respectively, each recording moderate but consistent growth.
Notably, the mother-and-baby category surged by 32.4% to RMB 13.26 billion, reflecting the positive impact of government childcare subsidy policies. In contrast, traditional hardware-led industries such as home appliances (-21.8%), transport (-9.3%), and IT electronics (-7%) saw significant declines in advertising outlay. This divergence points to a two-speed market in which consumer-driven lifestyle sectors thrive while capital-intensive industries retrench.
Media Preferences and Audience Penetration
Consumer behaviour in lower-tier markets provides key guidance for advertisers. Among 19- to 35-year-olds in June 2025, penetration rates above 50% were recorded across Gaode Maps, Douyin, QQ, Weibo, Baidu Maps, JD.com, Pinduoduo, and Kuaishou. These platforms represent the most effective channels for reaching younger, value-conscious demographics outside top-tier cities.
Yet penetration alone does not tell the full story. Platforms such as Mango TV, Bilibili, and NetEase Cloud Music, despite lower reach, demonstrate disproportionately high user preference indices (TGI), suggesting they can deliver targeted value when integrated into broader media mixes.
Media Value and Platform Ranking
June 2025 ranking of “Top Commercial Value Apps” further highlights the competitive environment. Douyin leads with a QMVI index of 867.78, followed by Taobao (691.09) and WeChat (573.12). Kuaishou, Xiaohongshu, and Jinri Toutiao also feature prominently, illustrating the continued relevance of short video, e-commerce, and news aggregation as key ad channels.
These findings align with the growing importance of content integration. For example, Gucci’s May 2025 campaigns on Douyin and WeChat boosted both ad exposure and private traffic by more than 70% month-on-month, showing how tightly linked content seeding and private domain operations have become.
Multi-Channel Strategies: Hard and Soft Advertising
One notable trend has been the rise of integrated campaigns across e-commerce and lifestyle platforms. In June 2025, more than half of hard ad spending in categories such as beauty, appliances, and sports was directed at channel-based media, underscoring their role as conversion drivers. Meanwhile, Xiaohongshu has strengthened its position as a bridge between “soft” lifestyle content and direct commerce. In fact, advertiser integration with Taobao and JD has allowed users to click from Xiaohongshu notes directly to product pages, creating seamless closed-loop experiences.
Conclusion
The first half of 2025 confirms that China’s internet advertising market is no longer in its freewheeling growth phase but has instead entered a period of structured expansion underpinned by regulation, platform consolidation, and technological innovation. For brands, the challenge is not simply securing exposure but navigating an increasingly sophisticated ecosystem where consumer touchpoints, emotional triggers, and AI-powered interactions converge. Those able to build integrated strategies that balance hard ad efficiency with content-led engagement will be best positioned to capture growth in the next phase of the market.