Binary options advertising in China

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Binary options advertising in China. The End?

Already over the internet is a buzz about Binary options advertising in China and Forex. It is no secret that on June 24th Chinese media sites reported that according to an unnamed Baidu official, a decree came down to stop ads by forex brokers starting at 00:00 June 25th. The only exception is for FX brokers with licences in the US, the UK and Hong Kong (NFA, FCA and SFC regulators respectively). The news comes only 2 weeks after Baidu announcing a blanket ban on binary broker ads.

The news is a sobering shower for forex brokers in China who used to rely on the direct client acquisition models. Baidu holds 70% of the entire search traffic in China showing about 6,000,000 searches per month related to forex and binary.

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Although for those lucky few with the right licenses, for the majority of others it’s time to rethink their marketing strategy and re-allocate their budgets to other ways of advertising. With the announcement of the ban on FX and Binary options advertising in China, most FX brokers are reporting sharp spikes of their SEM CPA and the number of brokers advertising on Baidu has visibly reduced.

All of these changes are part of Baidu’s recent campaign to clean up its advertisers after the viral social video of Zexi Wei – a 21 year old cancer patient, who died after receiving an unsuccessful treatment from a clinic he found on Baidu’s paid search.

So does this mean the end of road for retail forex in China and binary options trading?

We don’t think so. Although, on one hand, it definitely complicates the lives of many well established retail forex brands who used to rely on the B2C model more than on B2B for China. At this point it begins to increase demand for advertising social networks. Perhaps the Chinese government will soon put them outside the law. but only time will tell

On the other hand, the demand is still there and market is still growing. It will simply be rerouted to different channels – the main one being IBs and money managers, which has been a prevalent business model in China for many years.

Alternatively, in the last few years, social media, mobile app development, various forms of DSP campaigns and even offline activities have been increasingly rising. The CPL from Baidu grew more than twenty-fold in the past 10 years. So finding new marketing channels has been a priority for the majority of serious market players who noticed the trend early.

What’s next? is that the end about Binary options advertising in China

The evolution of Baidu’s official stance on FX ads is slowly taking shape towards stricter and widely recognized regulating bodies.

A couple years ago the ‘white list’ of regulators included the NFA, FCA, CySEC, ASIC and the New Zealand FSPR. The relative ease with which one could obtain the NZ license led to a number of fraudulent cases in the market, so it wasn’t a surprise when NZ was the first one to be removed from the list.

The large number of customer complaints against IronFX in China is what probably sealed the fate of CySEC. However, what’s unclear is why ASIC was excluded from the list.

With the vast majority of market leaders being FCA regulated, this is the last frontier for FX brokers. Will this arrangement hold after the Brexit? We shall see in the next year or two.

Those with the right marketing mix and unique acquisition channels will win with or without Baidu. If you have the ways and means about Binary options advertising in China, email us, we will gladly give you a few good customers

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