China might have more than 400 million internet users, but that does not mean it offers a pleasant market for start-up, writes business and internet analyst Paul Denlinger in Forbes. The recent departure of Google’s search engine from China was only one of many indications of a market that is rather immature, compared to that in the US.
A few of Denlinger’s suggestions (and he might have a few more):
- There is now no healthy online market in China for good market segmentation and lead generation. In the U.S., market segmentation and lead generation are spin-off businesses and services from advertising revenue. Somehow, a new market for lead generation companies needs to be built. This is a good opportunity and area for venture capital firms and entrepreneurs to apply their skills and time.
- Data privacy. One of the main concerns in the market segmentation and lead generation business are consumer privacy rights. These need to be discussed and enforced.
- The search advertising market is still a black box in China. Eventually, the model has to move toward a model where each advertiser manages their own campaigns and adspend. There is no reason why advertisers in other countries can directly manage their own campaigns, but Chinese can’t. And there is no reason why any single company should maintain a quasi-monopoly in this field.