"80 per cent of searches are carried out on mobile" - Baidu on the Chinese opportunity

David Murphy

David Murphy talks AI and mobile with Linda Lin, general manager of Baidu.

Mention Baidu to most people and if they have heard of the company, they will probably tell you it is China’s equivalent to Google, a giant in the search engine world. In fact, there are several strings to the company’s bow in addition to search, including IoT, autonomous cars and social to name but a few, so when I met Baidu general manager Linda Lin in London recently, I was keen to see where she saw the company’s focus.

“Our company mission is to simplify the complex world through technology, and our strategy is to strengthen our mobile foundation and lead in Artificial Intelligence (AI),” she told me. “If I had to choose one, it would be AI. In 2016 we invested 1.6bn RNB (£180m) in R and D in AI and 2bn RNB in 2017. That equates to 15-20 per cent of our total search revenues and it’s also the most across all Chinese companies.

AI, of course, is a multi-pronged tool, so where is the investment going specifically?

“We are leveraging the AI tech in our marketing solutions on top of search so native ads, display ads and branding,” she told me. “We also leverage big data and AI to help our customers to identify and reach their target audience more precisely, through things like voice and image recognition, augmented reality and natural language processing, to engage with the target audience. We use this type of tech to interact and communicate with them better.
"We also have two AI platforms, one for autonomous driving called Apollo, where we have a partnership with 50 automotive companies globally. They make the cars and we have the technology strength. Our first autonomous car will be released this year, a small SUV, but not for use on public roads. Then next year we will have one that looks more like a conventional car.

“The other platform is a native language interaction platform to communicate with smart devices, so washing machines, fridges and TVs for example. It uses natural language processing so the user can instruct the TV to show him a particular movie for instance.” 

In terms of the advertising content then, it appears the paid search results on Baidu are richer than what Google users are used to.
“Yes” said Lin. “There are 18 formats on Baidu. Not just side links but videos and images, and we can also work with feeds, product listings, whatever works best for the industry vertical. We also have some mobile-specific formats, such as a three-image carousel for example."

A key purpose of Lin’s visit, in fact was to raise awareness of the advertising opportunities for Western brands in China using Baidu. Prior to meeting with me, Lin had hosted an event in partnership with the company’s agency, Forward3D, to showcase the opportunity to an audience of Western brands and agencies.

So much for AI, what of the other pillar to the company’s strategy, what Lin calls Baidu’s “mobile foundation?”

“From a search perspective, it is important,” she told me. “80 per cent of searches are carried out on mobile. We have 770m internet users in China and 90 per cent of them are on the smartphone. Even older people use smartphones, and everyone is on WeChat.”

More advanced then, in a mobile sense, than the western world? “Yes,” said Lin, “the market is different, because you have a huge population speaking one language. You don’t need to carry a wallet. People never go to a supermarket, they get a food delivery every day. It feels so convenient in China, no one reads a newspaper, people read the news on the phone.

"Also, people’s spending power is increasing very rapidly, especially among the people born in the ‘80s and ‘90s. They tend to have been educated overseas, so their spending habits are more like westerners, they pay a lot of attention to the quality of life.

“So we need to help brands reach these people. For brands who see good potential in China, and with people’s spending power increasing, it may be the right time for them to get in and use native branding ads on Baidu to grow their brand awareness.”