Background of The thirteenth Five-Year Plan

China mobile internet market is expected to exceed 4,672 billion yuan (US$717 billion) in 2016
with 830 million users, an increase by 51.7% and 5% respectively according to Analysis. In 2018, it
will reach 7,654.7 billion yuan (US$1,175 billion) with 890 million users.

Industry structure adjustment

With the adjustment of the global industrial competition pattern and the reshaping of the division of
labor pattern, China's economy has shifted from high-speed growth to "new normal" of medium and
high-speed growth. At the present stage of the transformation of new and old kinetic energy, the
problems existing in China's industrial structure will be more severe. Since the industrial structure
category was brought into the study of economics, the progress of technology has been regarded as
the fundamental power of industrial structure adjustment. At present, the integration of the new
generation Internet technology represented by cloud computing 'big data' mobile Internet and other
industries is triggering a new scientific and technological revolution and industrial revolution,
bringing new opportunities for the transformation and upgrading of China's industrial structure.
In July 2015, the State Council promulgated the <guiding opinions on the" Internet + "action by the
State Council>, pointing out that we should give full play to the role of Internet technology in
promoting industrial upgrading and promote the transformation of production mode and
development mode. So far, the "Internet +" strategy has risen to the national level. In this context, it
is of great significance to study the impact of Internet technology progress on the transformation
and upgrading of China's industrial structure.
As an important manifestation of technological progress, many scholars have also discussed the
impact of Internet technology progress on industrial structure adjustment. Most studies show that
Internet communication technology can promote industrial structure adjustment by changing the
technical efficiency, labor productivity and industry competitiveness.Some studies have examined
the role of emerging IOT technology, and found that the role of IOT technology in value creation,
technology revitalization and industrial structure adjustment is the key to its application in
manufacturing industry. Domestic research started late, mostly through the research on the
integration of China's new generation information technology with the three major industries, it is
found that Internet technology will have a profound impact on the mode of production, mode of
management and value chain of the industry, and then can promote the transformation and
upgrading of industrial structure.

Six profit models of Internet enterprises

1. Advertising draw traffic, the use of Internet traffic advantages, to help other enterprises do
traffic guidance.
 Representative: mushroom street, Meili
said, xiaohongshu etc

Xiaohongshu entreprise analysis

[Founded by Miranda Qu Fang and Charlwin Mao Wenfang in June 2013, Xiaohongshu, a.k.a.
RED or Little Red Book, is a popular Chinese social e-commerce app/platform. Xiaohongshu’s
original product form in mid-2013 was “US Shopping Guide”, which was in PDF format.
Xiaohongshu entered the market from the angle of overseas shopping and successfully captured a
group of urban young women who are pursuing an exquisite lifestyle. Read its product growth story
here.For business specializing in cross-border e-commerce, Xiaohongshu is also an essential
platform. See the comparison of Xiaohongshu with Kaola here.It’s one of the top social media and
influencer marketing platforms for brands in China; 70% of its users were born after 1990
(Generation Z).Xiaohongshu’s monthly active users is over 100 million.Xiaohongshu allows
Chinese users, influencers (KOLs), and celebrities to post and share product reviews, shopping tips,
travel blogs, and lifestyle stories through short videos and photos. It sells products through RED
Mall.In the five months after Xiaohong’s e-commerce model was launched, sales have reached
more than 200 million yuan; as of May 2017, Xiaohongshu’s revenue was nearly 10 billion yuna.]

2. Selling knowledge, transfor a certain

kind of professional knowledge into
images, audio and pictures needed for
Internet communication, so as to obtain
profits by charging users.
Representative: Baidu WenKou

3. Technology output, providing Internet

technology for other enterprises.

Representatives: Alibaba cloud

4. Content output, to provide users with video, music, games.

Representatives: Tencent and Netease
5. Sharing resources, provide information recommendation service of supply and demand
to users and businesses.
Representative: DiDi travel;
6. The sale of goods or services, Integrate offline businesses, integrate the services or
goods provided by businesses into the Internet platform and sell them to consumers to
earn interest margins.
Representative: Ctrip;