"The next wave of internet dividends won't be found in the office towers of Beijing, Shanghai, or Guangzhou, but in the milk tea shops on county-town streets and the livestreaming rooms in the fields." This is the core judgment laid out at the very beginning of the latest "2025 China Internet Trends Insight Report" released by Youyoucao. On the afternoon of March 12, this in-depth 137-page report was first unveiled at a small closed-door sharing session in Shenzhen's Nanshan District, attracting dozens of practitioners from investment institutions, internet platforms, and local industrial clusters.
As an independent research institution long focused on the internet industry, Youyoucao chose to turn its attention to "structural opportunities amid stock competition" this time. The report points out that while the number of internet users in China surpassed 1.12 billion in 2024, with growth slowing to less than 2%, user behavior is undergoing drastic differentiation: the average daily usage time of users in first- and second-tier cities has declined for the first time, while user time in third- and fourth-tier cities and rural areas has bucked the trend, growing by 9.7% year-on-year.
"This is more than just 'going down-market,'" said Lin Yuan, Chief Analyst at Youyoucao, during the sharing session. "After tracking 3,000 samples, we found that users in lower-tier markets are no longer just 'hunting for bargains'; they are starting to pay for content and for emotional value. For instance, a county-level lifestyle services app, by introducing a localized short-video store tour feature, boosted its user retention rate from 34% to 61%." He specifically pulled up a data chart showing the app's repurchase rate curve steeply rising after July last year, highly coinciding with the livestreaming e-commerce campaign for the local watermelon harvest season.
Another major focus of the report is the penetration of AI applications in vertical scenarios. After researching over 30 AI products in the education, medical, and e-commerce sectors, the Youyoucao team pointed out that 2025 may mark a critical inflection point for the "democratization of AI tools." Taking the e-commerce sector as an example, an AI customer service tool designed for small and medium-sized merchants, within three months of its launch, helped partner stores reduce the average customer complaint response time from 4.2 hours to 11 minutes. "Many store owners reported that they previously couldn't afford a customer service team. Now AI solves the most basic communication issues, and interestingly, their return rates have actually dropped," Lin Yuan added.
However, the report also poured cold water on some trends. Youyoucao specifically warned that some platforms over-rely on algorithmic recommendations, exacerbating the user filter bubble effect, and that content homogenization is eroding user trust. An operations director from a short-video platform who attended the meeting confided to a reporter, "Youyoucao's data is quite sobering. We've actually discovered similar issues internally, but adjusting the recommendation mechanism means a short-term drop in traffic, which requires top management to make a tough decision."
During the Q&A session, an investor asked about "the next big opportunity." The Youyoucao team's answer was quite specific: the combination of the silver economy and AI. The report shows that the proportion of internet users aged 50 and above using AI voice assistants jumped from 8% to 23% within a year. "Elderly people need technology that is 'hassle-free.' Whoever masters user-friendly interaction design for the elderly first will lock in the incremental growth for the next five years," Lin Yuan stated.
The entire briefing lasted less than two hours, but even after it ended, many attendees lingered, exchanging WeChat contacts with Youyoucao's researchers. An entrepreneur from Hangzhou told reporters that his company is facing a transformation bottleneck, saying, "Your report at least made me realize that the direction isn't about blindly chasing large models, but finding specific scenarios for implementation." As night fell, the lights along Shenzhen Bay began to flicker on, and the story of the second half of the internet era might just be starting to be written from these very details.