BackDigital to overtake TV ad revenue by 2017 in Asia-Pacific: report
Although TV will remain a critical medium, its regional advertising share will decline, as ad spending in Australia and China shift to digital
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New Delhi: Net advertising revenue in the Asia-Pacific will grow at 5.8% in 2016 and at a compound annual growth rate (CAGR) of 5.5% for 2015-20, reflecting stable but moderate growth across both mature and emerging markets in the region.
India and China will continue to be the fastest growing ad markets in the region, expanding in excess of 10% and 8%, respectively, according to a new report by advisory, research and consulting firm Media Partners Asia. The revenue growth across 14 markets has been measured after discounts.
The share of digital media in the advertising market in Asia-Pacific is projected to overtake that of television by 2017 and increase to 44.2% by 2020, up from 30.7% in 2015.
The biggest contributors to this growth will be Australia, China, Korea, Japan and Taiwan.
Although television will remain a critical advertising medium, its regional advertising share will decline, as ad spending in Australia and China shift to digital. However, television will continue to be the biggest advertising medium in key markets such as India, Japan and Korea even in 2020.
“Unlike most markets, India’s media industry continues to see simultaneous explosion of growth across platforms, from traditional media like radio having completed its phase-III auctions during the year to the roll-out of 4G services which will further propel growth of new media/digital platforms," according to Mihir Shah, vice-president at Media Partners Asia.
Television and print still remain dominant. “Vernacular newspaper advertising continues to drive growth in print media, while television continues to offer the highest reach," Shah said.
GroupM chief executive C.V.L. Srinivas said, “Convergence technologies will blur the definitions of television and digital in the very near future but broadcasting as we know it will continue to thrive."
“Even in the most mature markets, television continues to thrive despite the growth of digital media," he added.
The Media Partners Asia report forecasts that over the next five years, the fastest growing markets in Asia-Pacific will be India at 10.7%, China at 8.4% and Indonesia at 8.2%.
China is expected to build on its position as the region’s largest ad market, having overtaken Japan in 2012. By 2020, China’s net advertising revenue will total more than $85 billion. Japan will remain the region’s second-largest ad market, followed by Australia, India, Korea and Indonesia.
In 2015, the net advertising revenue in Asia-Pacific grew by 5.3%, the slowest rate of growth since 2009. However, at 10.8%, India grew faster than China at 8.5%. Advertising expenditure growth continued to remain slow in Indonesia and contracted in Singapore, Malaysia and Hong Kong.
Overall, the advertising spending in south-east Asia grew by only 1.5% in 2015 as multinational advertisers were tight-fisted with their budgets. Expenditure by domestic brands also softened.
The Australian advertising market partially recovered to a growth of 2.8% in 2015. Japan, too, saw the same rate of growth in the year.
According to the Media Partners Asia report, south-east Asia will see incremental growth in television’s share of advertising, from 54.0% in 2015 to 54.9% by 2020, driven by the launch of digital terrestrial TV (DTT) in the Philippines and Thailand and a rebound in free-to-air TV demand across Indonesia.
In the Asia-Pacific, on average, Media Partners Asia projects that TV’s share of total advertising will decline from 36.5% in 2015 to 30.7% by 2020.
Founded in 2001, Media Partners Asia focuses on media and telecommunications industries in the Asia-Pacific with operations in Hong Kong, Singapore and India.
The firm evaluates 19 markets in the region and covers sectors, including advertising, broadcasting, content creation, digital (including online video), mobile, pay TV and broadband.
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