The fastest growth in 2014 will come from Indonesia and Vietnam, driven by booming economic growth. Thailand is expected to show the slowest growth due to economic and political difficulties. Australia’s growth will also be tempered due to the economic slowdown, Magna predicts.
APAC growth is driven by its emerging markets (+12.5 per cent growth in 2014) which continues to be one of the engines of global advertising growth. Emerging markets within APAC will represent $76 billion in 2014, or half of total APAC spend. Emerging Asia, which includes China, India, Indonesia, Malaysia, Pakistan, Philippines, Sri Lanka, Thailand and Vietnam will represent 15 per cent of global ad revenues this year, up from just over 5 per cent a decade ago.
For another view of adspending, please see "DATA POINTS: ZenithOptimedia's latest adspend forecast", also published today.
Television remains the largest media category in the region and is expected to grow 5.6 per cent and make up 41 per cent of the total market this year. Of course, digital media is the fastest growing media category, and Magna predicts it will increase 21 per cent this year to $39.4 billion, accounting for 26 per cent of the market by the end of 2014.
The digital landscape is characterized by a fast shift to mobile usage. Mobile-based advertising spend will represent nearly 20 per cent of all digital spend this year. This is ahead of every region except North America, because of high mobile media usage in advanced markets like Japan and emerging markets such as China, where many consumers are simply “leapfrogging” the PC phase of internet usage, Magna said. What’s more, mobile’s 25.6 per cent CAGR through 2019 nearly matches social (28 per cent) and video (26 per cent) as the fastest growing overall digital categories in the region.
Social remains the fastest growing category within digital, and while it will only represents 7.8 per cent of total digital spend this year, this will increase to 14.0 per cent by 2019. Just over half of that spend will be on mobile devices as social activity migrates to mobile devices. Print continues to decline and represents under 20 per cent of total spend this year, down from over 40 per cent in 2000.
China, the largest market in APAC, will account for $51 billion of advertising spend this year, ahead of Japan’s $43.5 billion. China will see strong growth of over 12 per cent this year as well.
Digital advertising will pass television this year as the largest advertising media in China and will represent more than 40 per cent of the total Chinese spend for the first time. This trails digital share of only Denmark, Netherlands, Sweden and the UK. Mobile will grow to represent just over 12 per cent of the total digital spend in China this year, which is a significant increase from 3.6 per cent in 2010, but still below some of the other APAC markets where mobile technology has higher penetration.
Like most large ad markets, print is seeing significant declines, with total ad spend share of just over 10 per cent compared to over 30 per cent a decade ago. This decline does not show signs of slowing.
Magna estimates the advertising market is finally returning to double-digit growth rates after a slowdown of two years: it will grow by 12.2 per cent this year to $7.0 billion from $6.3 billion. It will accelerate further in 2015 (+13 per cent). National elections accelerated growth and for the first time digital media played an important role in political campaigning, Magna said.
Advertising market is still a duopoly between print and television, which account for 80 per cent of the market and are growing at 10.4 per cent and +9.2 per cent, respectively, in 2014. Digital, like in the previous years will be the fastest growing category at 38 per cent. Within digital media, social is the sub-category growing at the fastest pace. India has become Facebook’s biggest market outside the US with more than 100 million users, a majority of whom being mostly or exclusively mobile users.
Japan saw modest growth in 2013, as advertising spend increased by 1.3 per cent to $42 billion and as a result lost its #2 global ranking to China. Magna Global expects advertising spending to re-accelerate in 2014-2015, mostly because of the newly inflationary environment.
TV advertising will grow +2.6 per cent (15 per cent for pay TV) while radio and magazine ad sales will decline between one and two per cent, respectively. Again, digital media spend of 7 per cent will drive overall ad revenues to reach JPY 741 billion (approx. $7.4 billion), and represent 18 per cent of total market.