Zenith’s China Advertising Forecast: over 47 Bn US$ spending in 2013 in the 5 Asian Chinese countries

11 October 2011 13 h 28 min 8 comments

Every quarter, Zenith will offer to CSN readers its ”China Advertising Forecasts” for the next 2 years.

This special report will cover the 5 Asian Chinese countries which are follwoed by CSN: Mainland China, Hong Kong, Taiwan, Singapore and Malaysia.

For this first special report, we cover the 2011-2013 period.

Worldwide forecasts

 According to ZenithOprimedia’s last forecasts, “global ad expenditure forecast will grow 3.6% in 2011 after a modest slowdown in expenditure growth towards the end of the year
• Growth forecast for 2012 remains a reassuring 5.3%
• This picture is consistent with a history of ad market growth after many previous stock market shocks, assuming the world economy does not deteriorate dramatically
• Developing markets to increase their share of the global ad market from 31.0% in 2010 to 34.9% in 2013
• Internet the fastest-growing medium between 2010 and 2013 (14.6% a year)
• Television to contribute most new ad dollars (46% of total).

“There are now two ‘developing’ markets in the world’s top ten ad markets, and there will be three in 2013. China is now the third-largest ad market in the world, and is catching up quickly with second-placed Japan. In 2005 China was 23% of the size of Japan, in 2010 it was 57% and by 2013 we predict it to be 82%.”

5 Asian Chinese markets

According to Zenith reasearch, advertising spending in these 5 territories will expand from 37,39 Billion US$ in 2011 to 47,05 Bn US$, which means 25,8% growth.

The biggest growth will come from Mainland China (+30,8%) and Malaysia (+14,2%).  

Mainland China’s share of global market will go from 79,4% to 82,6%, with 38,85 Bn US$ ad spending in 2011.

70% growth of internet ad spending

Between 2011 and 2013, only one medium will increase its market share. Ad spending on internet will go from 17,8% to 24,1%, and reach 11,32 Bn US$ in 2013, including 10,67 Bn US$ in Mainland.

. Newspapers will be the biggest loser in ad market share, going from 22,4% to 18,4%.

. Television will keep its position of major medium with 37,6% in 2013 against 38,4% in 2011.


Mainland China

“Ad expenditure rose by 25.3% in 2010, and further double-digit growth is expected every year over our forecast period. Newspapers are still seeing a continuing decline in total market share but internet advertising is growing fast and we predict its share of total spend will rise from around 18.2% in 2010 to 27.5% by the end of 2013.

According to the State Administration of Industry and Commerce (SAIC), advertising revenue for TV soared by 26.8% in 2010, mainly due to the following reasons. More and more advertisers have started operating in lower-tier cities (tiers 3-5), and television is widely used as it is particularly effective in these areas. According to a ZenithOptimedia Mega Touchpoints study of cities across tiers 1 to 5, TV advertising is much more influential in shaping consumers’ purchase decisions in tiers 3-5 than it is in tiers 1-2. The regulations introduced by SARFT – the State Administration of Radio, Film and Television – in January 2010 limiting advertising time to a maximum of 12 minutes per hour, has led television channels to significantly increase their ratecard costs (according to TNS, by an average of 24%). As a result, product placement in TV dramas has become very popular.

SAIC figures have shown a strong rise in OOH advertising revenue in 2010 – by an impressive 42.4%. This was mainly driven by the rapid increase of outdoor sites in places such as office buildings, buses and metros, and streets. It is reported that the total number of OOH sites rose by 58% year-on-year in 2010, to 373,000 units. The ongoing development of high speed rail networks across the country is expected to lead to further growth opportunities for out-of-home advertising.”

Advertising Data: 1999-2010 State Administration of Industry & Commerce except internet, iResearch, and cinema, Agency estimates, 2011-2013

Hong Kong

“In the first quarter of 2011 GDP was up 7.2% yearon-year; the IMF expects it to grow 6.0% over 2011 as a whole. The unemployment rate remained stable at 3.5% between February and April 2011, down from 3.8% in Q4 2010. Inflation rose to 4.6% in April 2011 and it is expected to increase further in the coming months, mainly due to a rise in food prices and rent.

Monitored adspend witnessed an increase of 15% between January and April 2011. However, when we take the higher discounts into consideration, as well as the addition of new channels and changes to internet monitoring methodology, overall spend was up just 10%. The best-performing categories remained banking & finance, cosmetics & skincare,pharmaceuticals & healthcare, property & real estate, and toiletries. Two new TV channels and three digital radio stations are due to launch before the end of the year.”

In HK, advertising spending will grow 4,8 % between 2011 and 2013, from 1,88 Bn US$ to 1,98 Bn US$.

Advertising Data: 1999-2010 HK Adex SRG, AC Nielsen Hong Kong, Admango, 2011-2013 Agency forecasts


“As the global recovery set in, Taiwan’s economy was very healthy in 2010, growing by 11%. The government has upgraded its forecast to 5.1% for 2011. Although the consumer confidence index remained high in the first half of 2011, the growing inflation rate has had a negative effect on domestic consumption. The general rise in oil prices has dealt a blow to Taiwan as it relies strongly on imported commodities. Indeed, the government is planning to tax luxury goods in order to keep rising house prices under control. The devastating earthquake that hit Japan caused short-term damage to Taiwan’s imports and exports. However, it has also brought opportunity for tourism and 3C-related industries.

The optimism surrounding the economic climate had a positive effect on the media market with spend in all media – except magazines – showing double-digit increases for 2010. We expect adspend growth to slow down to 5.0% this year, and to fall by 4.7% in 2012 before recovering in 2013.

Internet put in a remarkable performance last year (+22.3%) and is currently the third-largest medium in terms of adspend. Magazines are feeling the pressure and many publishers have started releasing tablet-compatible versions of their titles.

Q4 2010 saw the launch of Next TV, the first digital television station. Big events usually bring growth to the media market and draw advertisers’ sponsorship. Taiwan’s centenary foundation celebrations this year will no doubt have some impact. The presidential and legislative elections will be held in January of 2012, which we expect will boost media investment in Q4 2011. Furthermore, the launches of the new MRT line and the start of direct flights between Taiwan and Tokyo are expected to increase OOH spending.”

In Taiwan, advertising spending will decrease 3,5% between 2011 and 2013, from 1,94 Bn US$ to 1,87 Bn US$.

Advertising Data: 1999-2000 National Statistics Bureau, 2002-2003 Rainmaker Research, 2004-2010 AC Nielsen, except internet IAMA, 2011-2013 Agency forecasts


Singapore’s economy is forecast to expand by 5.3% in 2011. This is significantly lower than 2010’s impressive performance (+15%), but in line with expectations that growth will be more sedate this year. As always, uncertainties abound especially in the light of the turmoil in the Middle East and Japan, which have dampened the buoyant mood in Asia Pacific. In addition, the Eurozone crisis and the poor state of the US economy are adding pressure to Singapore’s economic growth.

These conditions are having a direct impact on advertising budgets as marketers are becoming increasingly cautious. Nonetheless, digital continues to grow steadily, though it tends to get dispersed across the development of digital assets, social media management, and creative media. The Internet Advertising Bureau (IAB) has forecast strong growth in digital advertising expenditure across display, search, mobile and social media. The government has announced plans to digitize all media and will provide financial backing in order to build and support digital media.”

In Singapore, advertising spending will grow 11% between 2011 and 2013, from 1,8 Bn US$ to 2 Bn US$.

Advertising Data: 1999-2004 AC Nielsen, SRS Adex, 2005-2010 Nielsen Media Research, IAB (internet), 2011-2013 Agency forecasts


“Malaysia recorded GDP growth of 4.6% in Q1 2011, driven by strong domestic and improved external demand, and the recent IMF forecasts predict growth of 5.2% for 2011 as a whole. Private consumption remained healthy amid robust labour market conditions, while private capital spending was sustained by expansion in production capacity and investment in new growth areas.

Total adspend in the year to July 2011 was up 14% compared to the same period last year. This growth was led by increases in the automotive, finance, retail, toiletries and entertainment sectors.

Newspapers and free-to-air TV benefited most, netting increases of RM 269 million (+14%) and RM 116 million (+9%) respectively. In-store media grew by 31%, internet by 25% and radio by 10%, while outdoor, magazines and cinema posted declines of between 3% and 5%. Total spend is projected to increase by 10.4% in 2011.”

In Malaysia, advertising spending will grow 14,2% between 2011 and 2013, from 2 Bn US$ to 2,34 Bn US$.

Advertising Data: 1999-2010 Nielsen Media Research, company reports, (Internet: Agency estimates), 2011-2013 Agency forecasts

ZenithOptimedia Forecast October “Global ad expenditure continues to grow despite stock market turmoil” press release

SOURCE: ZenithOptimedia (4/10/2010)

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