Healthcare Drives Baidu’s Revenue
Healthcare has always been the top revenue generator for Baidu, leaving big budget holders like the travel, education and eCommerce sectors far behind.
The Healthcare sector loves paid advertisement for 3 reasons:
High Conversion Search Intent
The essence of healthcare requires its customers to imitate the interaction, while the search engine’s mechanism of search query and display is the best channel.
Anonymity of Sensitive Condition Searches
Second, for certain healthcare categories that require privacy protection, like sex-related issues, teenage pregnancy and plastic surgery, search engines provide patients with a secure channel to find and communicate with experts online without getting embarrassed having a face-to-face meeting with a doctor.
Third, China deregulated the healthcare/clinic sector in the 1990s, which spawned a large number of private clinics.
Compared with public hospitals, the private clinics are smaller and less well known, however are much more agile and aggressive in advertising spending. When they discover the benefits of Baidu SEM in generating online enquiries, and leverage it as a competitive advantage against public hospitals which tend to have no ad budgets, their SEM budget ends up doubling every month.
You might wonder why this isn’t already common knowledge. Regulation is the reason that the clinics and Baidu retain a low profile in respect of the amount of SEM being used. Healthcare advertising has always been considered a sensitive issue, especially when it comes to prescription drugs and surgery and treatment, which are usually banned from promotion by the authorities.
This also explains why Baidu doesn’t provide research data on the healthcare sector, while it does provide lots of search data on the travel, education, finance and gaming sectors, which can be found in data.baidu.com.
However, even without search data support, Baidu’s SEM sales to the healthcare sector are still growing strong, as Search Engine Marketing advertisements still go by keywords, which makes it difficult for regulators to define whether it’s legal or not, as they need to check each advertisement on a case by case basis to find out.
On the other hand, Baidu is reluctant to be strict with those ads on the border of violating the rules, which would obviously dilute its overall sales volume, profits and their performance on Nasdaq.
This positive situation for Baidu continued with the Cost per Click (CPC) for the keyword ‘Best Male Hospital in Beijing” rising as high as 800 RMB until CCTV revealed that Baidu was allowing fake drugs to be advertised using SEM.
Accordingly, Baidu’s Sales Department has attempted to redeem itself by changing its policy and by blacklisting more than 1,000 keywords, including cancer, hypertension, diabetes, the names of several sexually transmitted diseases, and treatment-related terms such as ‘prescription’ and ‘cure’. It also banned medical practices dealing with pregnancy, abortion, etc from SEM sales.
This action by Baidu has impacted clinics a lot and many of them have changed their strategy to use more SEO, though it won’t cover their loss from SEM in the short run. This action also gives the big healthcare brands an opportunity to gain, simply by following the steps of clinics in focusing on SEO and providing customers with higher quality products, better website content and more professional online consultation.
So there are significant opportunities arising for SEO practitioners to target the Healthcare industry in China as a potentially lucrative source of revenue growth going forward.