Author | Xuan Nuan
Editor | Aduo
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This section interprets the 2023 China Online Advertising Development Report, positioned at B.20,the mind map is as follows:
In 2023, China’s online advertising market showed a healthy development trend, with the widespread application of generative artificial intelligence driving innovation and transformation in the online advertising industry. Micro-short dramas and cloud gaming have brought new growth points, while increased compliance regulation further standardizes industry development.
However, it also faces various problems and challenges: competition in the online advertising industry is intensifying in terms of market size, segmentation, compliance thresholds, and effectiveness evaluation. User privacy, trust crises, copyright issues, and other security risks are increasingly prominent. The complex international situation impacts the global development of China’s online advertising, with abnormal traffic and click issues becoming industry bad habits.
Therefore, this article suggests building a corpus pool, to enhance China’s discourse power in online advertising with new quality productivity, promote the compliant and professional development of the online advertising industry, achieve breakthroughs and new developments led by technology, and jointly build an open, inclusive, and shared advertising ecosystem.
According to CTR Media Intelligence data, the advertising market increased by 6.0% year-on-year in 2023. Third-party data shows that China’s online advertising market ranges from 1 trillion yuan to nearly 600 billion yuan. Although market data varies, it still indicates that China’s advertising industry shows a positive distribution and steady forward development trend.
1. ChatGPT’s deep integration with media society transforms the entire communication ecology, promoting the reproduction of content resources, the re-layout of market resources, and the reconstruction of scene resources, driving the deep transformation of news into information, forming new technologies, new formats, and new models of online advertising communication based on AI large models.
2. The development of China’s online advertising shows the following key characteristics: First, the reconstruction of advertising scene resources. The application upgrade of artificial intelligence and big data has shifted its application in the advertising industry from simple user tag matching to deeper behavior prediction, emotion recognition, and intent understanding.
Second, the re-layout of advertising market resources. The programmatic advertising trading market continues to prosper, with RTB (real-time bidding) and PMP (private market trading) becoming more common, improving the efficiency of advertisers’ cross-platform ad resource purchases through automation and programmatic purchasing processes. Cross-screen and touchpoint integration, leveraging advanced data management and analysis platforms, enables advertisers to achieve unified management and attribution analysis of multi-touch user data, enhancing overall ad coverage and effectiveness.
Third, the optimization of advertising content resources. AI large model-driven text-to-image and text-to-video promote the re-optimization of advertising resources, presenting immersive and interactive features through AI-generated content, providing a new immersive experience with metaverse advertising based on AR/VR technology, thus achieving dimensional development of advertising.
3. Major internet companies are actively deploying and building AI large models, empowering the advertising industry in a comprehensive and systematic way, promoting its automation, intelligence, and efficiency development.
1. In 2023, the advertising revenue of China’s internet companies continued to grow. The overall advertising market concentration is high, with leading companies dominating the market share, with the top ten companies accounting for 96.2%. The three internet giants Alibaba, Tencent, and Baidu continue to lead, holding 75.54% of the online advertising market share. The e-commerce industry continues to maintain a strong growth momentum, with Pinduoduo’s growth being the most remarkable, becoming the fastest-growing e-commerce platform in terms of online advertising revenue, with its fourth-quarter advertising revenue reaching 48.6 billion yuan, a year-on-year surge of 57%, already surpassing JD.com and Meituan.
2. In 2023, the online advertising revenue shares of video platforms, search platforms, social media platforms, and news information platforms were 25%, 9.25%, 8.89%, and 8.63% respectively. Among video platforms, short video platforms have become the second type of channel to exceed 100 billion yuan in revenue scale after e-commerce platforms, with a significant year-on-year increase of 23.28%, reaching 105.84 billion yuan.
3. In 2023, China’s micro-short drama market developed rapidly, becoming a new growth point in the online advertising market. In addition to regular brand placement, the micro-short drama market has also derived various cooperation models such as joint production, naming cooperation, and character endorsement, greatly expanding advertising monetization channels.
4. The cloud gaming market has also entered a period of rapid development. Advertisers are beginning to explore new advertising forms in the virtual world, such as virtual item placement, virtual event sponsorship, and digital human endorsements, opening up an unprecedented new dimension for online advertising.
Relevant policies have been introduced and refined: “Internet Advertising Management Measures,” “Advertising Absolute Language Law Enforcement Guidelines,” “Internet Advertising Identifiability Law Enforcement Guidelines (Public Consultation Draft),” “Interim Measures for the Management of Generative Artificial Intelligence Services” (China’s first management regulation specifically targeting the field of generative artificial intelligence research and service), “Minor Protection Regulations on the Internet”
Regarding the definition of generative artificial intelligence (AIGC), it is frequently tested in exam questions. Schools such as Shaanxi Normal University and Shanghai University have included it in their 334 and 440 exams, indicating that this is a key area of focus in technological transformation. The advertising form of “smart advertising” is a product of AIGC’s innovation and transformation in the advertising industry.
In the exploration of the advertising industry, AIGC has achieved a three-way transformation of market, content, and scenarios: by utilizing AI, advertisers can not only achieve “automation and programmatic purchasing processes” in ad placement but also achieve “unified management and attribution analysis of user data”; using intelligent large models to produce advertising content, metaverse advertising based on AR/VR technology has enhanced users’ immersive experience; the overlay of artificial intelligence and big data will allow for deeper excavation of user tags, facilitating precise ad targeting.
Of course, in the process of advertising placement and targeting a broader audience,AIGC has also triggered related ethical risks: first, the copyright ownership and liability risks of AIGC; second, the potential ethical discussions surrounding cultural works brought by AIGC; third, the ethical impact on moral subjectivity brought by AIGC. Meanwhile, the introduction of AI large models through big data sample training into advertising placement will increase the collection and analysis of users’ personal data, raising concerns about data rights and privacy. (Xuefang Jie, Chen Qu, 2024)
Thus, the “Interim Measures for the Management of Generative Artificial Intelligence Services,” as China’s first management regulation specifically targeting the field of generative artificial intelligence research and service, limits and mitigates the misuse of data to a certain extent. This concern regarding big data information bias and ethical risks has already appeared in exam questions, requiring students to pay attention.
In addition, the traffic of micro-short dramas has also realized monetization in advertising placement.In exam questions, there is a greater focus on exploring the reasons for the widespread popularity of online micro-short dramas, namely the excavation of “audience demand”. In a sense, micro-short dramas’ full grasp of rhythm and highlights, along with their deep connection to online novels, clearly distinguishes them from other film and television works. Whether this uniqueness can continue to be implemented under the new regulatory policy on June 1 this year, breaking the homogenization situation and producing more high-quality works is a question worth exploring for interested students.
1. The AI Agent application product “Guiyi Miaoji” from Guiyi Intelligent, based on the large model in the marketing field, has trained a dedicated SEMGPT model suitable for the advertising workflow of various media platforms, providing enterprises with smarter, more precise, and efficient AI advertising placement services.
2. Feizhu has produced 1,000 advertising posters using generative large models, with brands like Heinz, KFC, Nestlé, Tmall, Zhongxuegao, Alipay, and Yili releasing multiple interesting advertisements using AI’s creative forms.
3. Copyright and plagiarism determination related to AIGC: On November 30, 2023, China’s first case regarding AI-generated artwork copyright was adjudicated, ruling that the AI-generated artwork met originality requirements and was recognized as having copyright; the official Qixi Festival greeting image synthesized by AI on the Bilibili website was pointed out by netizens for containing elements suspected of plagiarism from NetEase Games’ “A Dream of Jianghu”.
4. Text-to-video case: The highly watched variety show “Singer 2024” this summer used AI video generation technology for some of its opening video footage, supported by the “Sky Curtain” large model launched by the listed company Wanjing Technology.
First, the focus effect of leading enterprises has increased, and negative effects have gradually emerged. Leading internet companies have squeezed the survival space of small and medium-sized advertisers and traditional media; China’s e-commerce marketing has had a huge impact on the实体经济.
Second, competition in segmented market areas has intensified, especially on short video live streaming platforms, where advertising budgets are shifting towards these high-traffic scenarios, making competition even more fierce.
Third, compliance pressure and thresholds have increased, with companies facing higher thresholds in obtaining and using user data, resulting in increased difficulty of market access.
Fourth, the standards for evaluating advertising effectiveness have changed, with greater emphasis on multi-dimensional indicators such as conversion rates, retention rates, and brand influence.
First, data leakage and privacy protection. To achieve precise advertising push, advertising platforms often need to collect a large amount of user data, which easily leads to data abuse or even data leakage.
Second, false advertising and trust crises. Combating false advertising, malicious clicks, and traffic fraud remains a key focus of regulatory authorities.
Third, copyright infringement and content compliance. Some online advertisements may involve unauthorized use of others’ intellectual property or publish content related to pornography, gambling, drugs, etc., violating relevant laws, regulations, and social ethics. It is worth noting that the copyright ownership issue of AI-generated advertising works also needs to be clarified urgently.
First, policy-based bans and reviews. At least 33 states in the U.S. have restricted the use of TikTok, and in addition, some cities, government-affiliated workplaces, and university campuses have also issued bans. The Indian government has ordered the ban of about 300 Chinese applications, including Douyin, WeChat, UC Browser, etc., citing “national security” and requiring all telecommunications operators and internet service providers not to use Chinese software and hardware.
Second, technology blockades and supply chain restrictions. Especially in the context of increasing Sino-U.S. technological competition, the U.S. and other developed countries have intensified export restrictions on sensitive technologies, particularly in high-tech fields, covering artificial intelligence, quantum computing, etc., not only restricting the export of key hardware but also imposing strict controls on software, technology transfers, and intellectual property licensing. Meanwhile, other economies, such as the EU, are also beginning to evaluate and consider implementing export controls on key technologies.
Third, negative media propaganda. In the international public opinion arena, Western governments and some politicians often use social media and mainstream media to report negatively on Chinese products, frequently questioning their data processing and privacy protection measures, and even sensationalizing topics like “spy software” and “information monitoring,” creating doubts and even public opinion rejection of normal overseas advertising operations and internet companies going global.
In pursuit of online traffic and creating hype for false brands, abnormal clicks and exposures of advertisements occur. This not only makes advertising performance indicators such as click-through rates (CTR) and conversion rates (CVR) unreliable due to abnormal data, affecting advertisers’ decision-making and optimization direction, but also negatively impacts user experience, such as slow page loading and invasion of user privacy (e.g., collecting user information without consent), leading to a decrease in users’ favorability towards brands.
Despite the steady development of the advertising market in 2023, the concentration effect of leading companies is evident, and the effectiveness of live streaming sales is further declining. Leading streamers are seeking other growth points, with Xiaoyang Ge and Xinba engaging in short dramas, and Li Jiaqi entering the entertainment industry (not only participating in “Brother Who Overcomes Thorns 4”, but also having his assistant Zhu Wangwang join “My Home That Girl 2024”).
With the cost of online marketing equaling or even exceeding offline placement costs, advertisers’ options will naturally narrow down to the higher-traffic short video track, with unique fields like cloud gaming and micro-short dramas receiving more support. Meanwhile, due to rising costs, market access and advertising effectiveness evaluation standards are also changing accordingly.
Data abuse, false advertising, and copyright issues have always existed, but with the introduction of AIGC,these problems have further generalized: The contradiction between the need for privacy protection and data training for large models, the ease of mass production of false advertisements due to the lowered barriers to content creation through AIGC, and the copyright issues associated with AIGC have already been outlined in the previous interpretation. The problem of abnormal advertising exposure is another urgent issue that needs to be resolved.
Meanwhile, China’s global development of online advertising is also facing some impacts. Policy blockades, technological blockades, and negative public opinion are primarily government actions, while the latter also involves the dominance and broader coverage of Western media. Of course, during the Palestinian-Israeli conflict, it has been found that Western media is not without flaws in public opinion control. The energy of grassroots media and self-transmission in global communication deserves attention.
1. Deepen the management and supervision of training data. Based on the laws of online advertising development and internet communication, standard-setting and data governance should be implemented simultaneously.
2. The primary task is to innovate and upgrade China’s advertising technology and supporting software, to formulate a forward-looking national online advertising development strategy outline with clear timelines and phased implementation paths, leading various forces to achieve strong cooperation and collective breakthroughs, jointly promoting technological progress and industrial upgrading in the advertising industry.Secondly, focus on flexible narratives and soft communication, while enhancing the endogenous communication power of China’s digital advertising system. Actively participate in the formulation of international advertising standards and norms to strive for discourse power in the field of international advertising standards.
1. Formulate macro policies that align with the characteristics and development needs of the artificial intelligence industry, supporting the widespread integration of artificial intelligence, blockchain, big data, cloud computing, metaverse, and the latest technologies such as ChatGPT in the advertising field.
2. Strengthen the construction of regulations and the standardization of platform operations, enhance the construction of the online advertising regulatory team, and improve regulatory technical means, such as using big data analysis and artificial intelligence to monitor and screen illegal advertisements in real-time. Especially in the fields of artificial intelligence users, user privacy protection, algorithm management, metaverse development, and online intellectual property protection, priority should be given to formulating and updating relevant legal provisions to build a rigorous set of standards and market rules for the online advertising industry.
3. Improve the self-regulatory mechanism and credit system of the industry, fully leverage the leading and exemplary role of major internet advertising giants, strengthen existing advertising industry self-regulatory organizations such as advertising associations and chambers of commerce, and empower them with the responsibility to formulate industry norms, supervise member behavior, and mediate disputes, promoting advertisers, advertising agencies, and advertising publishing platforms to jointly maintain industry order. In addition, establish a credit evaluation system for the advertising industry, publicly and transparently record and disclose the credit status of advertisers and advertising service agencies, which helps regulate advertising market order, protect consumer rights, and promote healthy and sustainable development of the advertising industry.
First, invest in technological research and innovation.
Second, integrate and optimize the industry.
Third, explore emerging fields and cross-border integration.
First, improve infrastructure construction. Focus on optimizing IaaS (Infrastructure as a Service), SaaS (Software as a Service), PaaS (Platform as a Service), and MaaS (Mobility as a Service). Especially optimize advertising trading platforms to enable advertisers, advertising agents, media resource providers, and other service providers to easily access and realize free trading and real-time bidding of advertising resources. Create universal API interfaces and SDK tools to support the integration of various advertising forms and technologies, simplify advertising placement and management processes, and deploy advanced IoT advertising solutions.
Second, strengthen cooperation among advertising participants. Actively advocate and promote deep cooperation and collaborative innovation among diverse participants such as advertisers, advertising agencies, content creators, technology service providers, and data service companies.
Third, expand international markets. Pay close attention to the interests and cooperation demands of large multinational advertising clients operating in China, such as Procter & Gamble and Unilever, and strive to deepen mutually beneficial cooperation with them. Seize this opportunity to actively promote the expansion of China’s online advertising industry and its supporting systems to the European and American markets and even globally, enhancing the influence of China’s online advertising industry in the global market and achieving international leapfrog development.
For the current situation and existing problems, the solutions are derived from the ecological layout, industry compliance, and technological innovation. The digital advertising ecosystem, as a focal point for advertising development, requires technological innovation, but more importantly, it needs industry compliance and professionalism. On this basis, improving infrastructure construction, strengthening connections between advertising participants, and actively integrating into international markets are conducive to establishing an open, inclusive, and shared advertising ecosystem.
This proposal requires attention to the concept of “new quality productivity.” In the interpretation of “new quality productivity” by Zhang Lin from Chongqing University, it essentially refers to advanced productivity, characterized by high technology, high efficiency, and high quality, with the leap of laborers, labor materials, labor objects, and their optimized combinations as its basic connotation.
Focusing on the advertising industry, AIGC is undoubtedly a typical example of new quality productivity. “Deepening the management and supervision of training data” is about standard-setting and effective governance for the implementation of AIGC technology in the advertising industry; “providing innovation and upgrading of China’s advertising technology and supporting software” refers to upgrading labor materials. Meanwhile, for the development of the advertising industry, optimization can also be made from both talent and advertising ecology, namely “leading various forces to achieve strong cooperation and collective breakthroughs,” “strengthening the construction of the online advertising regulatory team,” “focusing on flexible narratives and soft communication,” “actively participating in the formulation of international advertising standards and norms,” and “improving the self-regulatory mechanism and credit system of the industry.”
1. The satisfaction of audience demand by online micro-short dramas (Hainan University 334, 2024)
2. The information bias caused by AIGC (Hainan University 334, 2024)
3. AIGC (Hainan University 440, 2024) (Nanjing University 440, 2024) (Inner Mongolia University 440, 2024) (Xiamen University 334, 2024) (Shandong University 440, 2024) (Shaanxi Normal University 334/440, 2024) (Shanghai University 334/440, 2024)
4. Discuss the current status, future trends, and ethical risks of AIGC based on case studies. (Not less than 800 words) (Nanjing Forestry University 334, 2024)
5. Smart advertising (Henan University 334, 2024)
6. The impact of artificial intelligence technology on advertising operation processes and effectiveness (Huazhong Agricultural University 334, 2024)
7. The pros and cons of virtual digital humans as advertising spokespersons compared to real people (Shanghai Normal University 440, 2024)
8. Programmatic buying (Beijing Jiaotong University 334/852, 2024) (Shanghai Normal University 804, 2024)
9. Briefly describe programmatic buying in advertising (Xi’an Foreign Languages University 656, 2024)
What ethical risks exist in the advertising industry due to AIGC as a new production method?
As a special category of mass communication, advertising communication faces various ethical risks when optimizing and upgrading the various processes of advertising execution using AIGC. This question can be analyzed in conjunction with the three key characteristics of the innovative transformation brought by AIGC to online advertising:
First, the reconstruction of advertising scene resources. From simple user tag matching to deeper behavior prediction, emotion recognition, and intent understanding, a large amount of user data is required. In this process, how to avoid excessive collection of user data, ensure data security, and periodically update qualitative data for precise ad targeting becomes an ethical risk that needs to be considered in the upgrade of “user tags”.
Second, the re-layout of advertising market resources. In automated and programmatic purchasing, how to avoid big data information bias, that is, “while algorithms achieve public opinion transmission, they may form opinion biases in the ideological field; algorithmic decision-making, a mechanism that runs through the governance process of public service demands; a small error or discrimination in algorithmic decision-making can evolve into a chain reaction in subsequent decisions, seriously affecting individuals, groups, and society. Moreover, the opacity of algorithmic decision-making may lead to blurred ethical standards.” (Xuefang Jie, Chen Qu, 2024)
In the context of advertising resource purchasing, algorithmic decision-making belongs to the platform side. For advertisers and executors, understanding relevant systems and norms becomes essential. How to avoid issues like “big data killing familiarity” and information bias in algorithmic decision-making is an ethical risk that should be considered by the “data management and analysis platform”.
Third, the optimization of advertising content resources. Utilizing AI large models for advertising content production will involve three aspects: First, unclear copyright; second, the homogenization limited by the level of technological implementation, and the subjective uniqueness of artistic creation is also questioned (this is particularly evident in the content field, such as the AI agreement of Tomato Novel being controversial); third, advertising content related to public topics and human society, using AI generation can easily lead to backlashes (this type of marketing can easily backfire, as seen with the negative public opinion caused by job loss anxiety in July).
From this perspective, the current use of AIGC for content generation is still more of a superficial technological imagination, namely in technology scenarios, graphic design, and some video clips. Its level of intelligence, under current technology, remains limited. In advertising execution, the most critical and easily occurring issue is actually the excessive overlap of materials, namely issues of “plagiarism” and copyright ownership.
1. Data concerns: The struggle between personal demands, market rules, and moral norms
2. Algorithmic decision-making: Ethical ambiguity under technological efficiency
3. Content presentation: Brilliant technological imagination versus poor creative discovery
1. “China New Media Development Report (2024)”
2. Xuefang Jie, Chen Qu. Value Alignment: Research on the Ethical Risks and Precise Co-Governance Paths of Artificial Intelligence Cultural Technology Ethics in the AIGC Era [J]. Journal of Lanzhou University (Social Sciences Edition)
3. Zhang Lin. Several Important Statements by Xi Jinping on Developing New Quality Productivity [J/OL]. Party Literature