New ads cash in on web series

Creative advertisements online are being increasingly used in streamed Chinese serials, and are expected to surpass 2 billion yuan ($311 million) in sales revenue this year, up from 800 million yuan in 2016.

Product manufacturers and service providers are tapping this relatively new form of advertising for branding opportunities. They partner with web serials' production teams to create sponsored content closely related to the original storyline.

This is how the so-called creative ads work: In a 2017 web serial Princess Agents, an ancient Chinese royal expresses his love to a princess, only to be rebuffed yet again. Next, he encounters a handmaid dressed in a typical ancient Chinese outfit, who, surprisingly, whips out a smartphone and introduces him to an online dating app - and the audience takes a while to figure the artistes are part of an ad for the app.

According to data from EntGroup Inc, a consultancy specializing in China's media and entertainment industry, creative ads usually follow original content and feature the same artistes in their on-screen costumes, making the ad almost indistinguishable from the original content for the first few seconds - long enough to hold the audience's attention and pique their interest.

"That's good enough to let sponsoring brands to pay," said a business insider from Talent Television and Film Co Ltd who sought anonymity.

Data from Youku, a video-streaming site owned by Alibaba Group, also suggests that creative ads may have contributed an average 30 percent growth to revenues of streaming platforms. It cited news website people.cn in its report.

"The price (of such ads) surged over 10 times in the past two years," said the business insider. "For brands, it's all worth it as creative ads work more efficiently to grasp the audience's attention and keep them watching. People are intrigued at first, and then laugh if the ads are imaginative or captivating. Mostly importantly, they'll talk about the ads, which helps spread word-of-mouth and reaches even those who don't watch such shows, like a meme."

According to people.cn, the rate-card for creative ads has reached an average 1.5 million yuan for a 15-to 30-second commercial on Youku. The figure is even higher on iQiyi, which is also a video streaming website and Youku's major rival - between 2 million yuan and 2.5 million yuan for a spot on web series commanding traffic of over 1.5 billion visits.

"Usually, the production team seeks an agency to contact potential advertisers and write for the sketch," the interviewee said. "But sometimes the production team does all these on its own. It all depends on the situation."

In addition to creative ads, video-streaming platforms may have their own ad breaks. "Creative ads weren't that popular when they first came to the market," said the source. "The turning point was The Mystic Nine (an adventure web series) in 2016, which earned about 50 million yuan from creative ads."