Overview of 1. Advertising Industry Market Concentration

Market concentration refers to the degree of difference between the shares of various enterprises in an industry or a market. usually by the Herfindahl index(HHI)或者克伦贝格指数(CRn)来衡量。赫芬达尔指数是指一个行业或者一个市场中所有企业的市场份额平方和，其值越大，说明市场集中度越高，竞争越不充分;The Kellenberg Index refers to the former in an industry or a market.n家最大企业的市场份额之和，其值越大，说明市场集中度越高，竞争越不充分。

From2022年中国广告行业的赫芬达尔指数和克伦贝格指数来看，这两个指数都低于0.1of the critical values, respectively.0.0081and0.0452(based on revenue), indicating that the overall market concentration in China's advertising industry is not high and competition is more adequate.

From a regional point of view, at present, China's advertising industry-related enterprises have more78.6Wanjia, of which Beijing, Guangdong and other places show a certain aggregation effect, Beijing advertising industry enterprises more.18万家，广东省超过11万家。总体来看我国广告行业企业主体主要分布在东部沿海区域。这表明中国广告行业呈现出一定的区域集中度。

二、广告行业市场集中度低的原因分析

尚普咨询认为，中国广告行业市场集中度低是由多方面因素造成的，主要包括以下几点：

行业竞争激烈。广告行业的准入门槛相对较低，市场上存在大量的中小型广告企业，竞争非常激烈。2022The number of enterprises in China's advertising industry reached78.6Wanjia, year-on-year growth7.4%. Differentiated competition among these companies in terms of price, service, and creativity has led to fragmented market share and low market concentration.

Customer needs are diverse. The customers of the advertising industry are mainly institutions or subjects from all walks of life, and their needs for advertising are different, including the purpose of publicity, the type of audience, the scope of coverage, the way of appeal and so on. This requires advertising companies to provide personalized and customized advertising services according to the needs of different customers, rather than one-size-fits-all standardized services. This has also led to differentiated competition among advertising companies, rather than large-scale competition, and low market concentration.

The media form is changeable. With the development of science and technology and the change of consumer habits, the form of advertising media is constantly innovating and changing. From traditional media such as television, newspapers and magazines, to new media such as the Internet, mobile terminal and social media, to new advertising forms such as implantable, interactive and experiential, advertising media presents the characteristics of diversification, fragmentation and personalization. This requires advertising companies to grasp the characteristics and advantages of different media, flexible choice and use of different media for advertising, rather than relying on a single or fixed media platform. This also leads to diversified competition among advertising enterprises, rather than centralized competition, and low market concentration.

Strategic Suggestions on Improving Market Concentration in 3. Advertising Industry

According to data from Shangpu Consulting Group, the low market concentration of China's advertising industry has certain drawbacks, such as reducing industry efficiency and benefits, increasing industry costs and risks, and affecting industry quality and reputation. Therefore, to enhance the market concentration is the inevitable trend of the development of the advertising industry and the necessary choice. This paper suggests that the advertising industry to enhance market concentration, need to start from the following aspects:

Enhance digital transformation. Digitalization is the mainstream trend of today's era, and it is also an important means to improve the efficiency and accuracy of advertising. Advertising companies should use big data, artificial intelligence, blockchain and other technical means to conduct in-depth analysis and optimization of customer needs, audience characteristics, media effects, etc., to achieve precise positioning and personalized push. At the same time, use digital platforms and tools to improve the level of advertising creativity and production, and increase the attractiveness and influence of advertising content. Through digital transformation, advertising companies can enhance their core competitiveness, increase market share, and increase market concentration.

Expand business scope and coverage area. The customer needs and media forms of the advertising industry are constantly changing. Advertising companies must adapt to market changes, expand their business scope and coverage areas, and achieve diversified development. Advertising companies should choose suitable business areas and media platforms according to their own advantages and characteristics, and provide all-round and integrated advertising services. At the same time, advertising companies should choose suitable regional markets according to market demand and potential, expand market coverage, and increase market influence. By expanding business scope and coverage area, advertising companies can increase the number and loyalty of customers, increase market share, and increase market concentration.

Strengthen brand building and innovation capabilities. Brand is the core asset of advertising companies and an important factor in improving customer trust and satisfaction. Advertising companies should strengthen brand building, establish a good industry image and social reputation, and enhance brand awareness and reputation. At the same time, advertising companies should strengthen their innovation capabilities, and continue to introduce novel, interesting, and valuable advertising content and forms to meet customer needs and audience preferences, and enhance advertising effectiveness and value. By strengthening brand building and innovation capabilities, advertising companies can increase customer stickiness and word-of-mouth communication, increase market share, and increase market concentration.

Strengthen cooperation and alliances. Cooperation is an important way for the development of advertising industry, and it is also an effective way to form scale effect and synergy effect. Advertising companies should strengthen cooperation and alliances, and conduct resource sharing, technical exchanges, and project cooperation with upstream and downstream companies, peer companies, and inter-bank companies to achieve mutual benefit and win-win results. At the same time, advertising companies should actively participate in industry organizations, associations, platforms, etc., communicate with government departments, industry institutions, experts and scholars, policy advocacy, standard formulation, etc., to achieve common development. By strengthening cooperation and alliances, advertising companies can expand their scale and network advantages, increase market share, and increase market concentration.

Conclusion

China's advertising industry is a dynamic and changing industry, which plays an important role in economic and social development. However, the market concentration of China's advertising industry is generally not high, and there are certain problems and challenges. This paper analyzes the current situation and reasons of market concentration in China's advertising industry, and puts forward some strategic suggestions to enhance market concentration, including strengthening digital transformation, expanding business scope and coverage area, strengthening brand building and innovation ability, strengthening cooperation and alliance, etc. It is hoped that this paper can help and enlighten the development of China's advertising industry.