Latest ad blitz by Chinese auto site Youxin falls flat; traffic dives

14 May 2017

Youxin, one of China’s big three used-vehicles transaction platforms alongside RenRenChe and Guazi ershouche, is facing up to some harsh realities in 2017.

Beijing-based Youxin (otherwise known as Uxin) secured a very promising investment of $500 million U.S. in January, led by TPG and Jeneration Capital. The company’s senior management indicated that approximately $300 million U.S. of this funding would be directed toward the expanded advertising presence needed to go head-to-head in what is being touted as an ongoing “ad war” with Guazi (NYSE: WUBA), and Tencent-backed RenRenChe.

The latest advertising campaign was the company’s second, big ad push, and followed on the heels of a similar one in late 2015 and early 2016, traditionally the high season for Chinese car sales. In 2015, Youxin purchased a 60-second TV slot during the finals of China’s massively popular “The Voice of China” reality show, for approximately RMB 30 million ($4.3 million U.S.), and a series of slots during the “Running Man 3” variety show for RMB 180 million. Both programs are broadcast on the state-run CCTV network.   

           Wang Baoqiang for Youxin

Yet, while the ad blitz in 2015 was a considerable success, this year’s campaign, anchored by movie star Wang Baoqiang, fell flat with consumers.

According to the independent analytics site, Youxin’s monthly active users have fallen from 3.4 million in December to 2.3 million in March – a shocking drop-off, especially in light of the company’s advertising expenditure.   

Partly to blame for the drop was the growing presence of Guazi, which has been pulling in new users, especially mobile users, very steadily during the past calendar year. With recent announcements that it would be deepening strategic ties with former parent company, and with an increasingly nationwide presence in auto financing, this trend seems set to continue, and Youxin may be realizing that it has played its best hand. 

There have been 12 million used-vehicle sales in China so far in 2017, an increase of 20 percent year-on-year.


Tom Marling

Tom is a PhD candidate in Chinese History at Hong Kong Baptist University, and former PR consultant in Mainland China. He joined the AIM Group in 2016 as a writer/analyst.