David Blecken
Feb 24, 2016

Online drives adspend increase in Japan: Dentsu

TOKYO - Japanese advertising spend rose 0.3 percent in 2015 to ¥6,170 billion (US$55.1 billion), with internet advertising up by 10.2 percent, according to figures from Dentsu.

Online drives adspend increase in Japan: Dentsu

The figures in Dentsu’s report show that advertising spend in the market has increased for a fourth consecutive year, even as personal consumption remained sluggish.

As one might expect, spending on traditional channels fell across the board, declining 2.4 percent overall to ¥2,869 billion (US$25.6 billion). Newspapers fell the most (6.2 percent), followed by magazines (2.3 percent), radio (1.4 percent) and TV (1.2 percent) including terrestrial and satellite.

The increase in online spending included smartphone and video advertising, as well as what Dentsu terms “ads using new advertising technologies”. Internet advertising totaled ¥1,159.4 billion (US$10.3 billion).

Dentsu noted that the overall uptick in spend had been expected, based on factors such as improved corporate performance and growth in household incomes. But it said those factors were offset by a fall in consumer purchasing following the government’s decision to raise consumption tax in 2014.

Spending rose in six of 21 industry sectors that Dentsu monitors. Categories that showed increased activity included:

  • Precision instruments and office supplies (up 9.7 percent, led by watches and fountain pens)
  • Information and communications (up 5.1 percent, led by online games and online retail)
  • Energy, materials and machinery (up 4.1 percent, led by gas and electric power companies)
  • Foodstuffs (up close to 2.7 percent, led by direct-marketed dietary supplements and health foods)
  • Transportation and leisure (up more than 2.2 percent, led by membership sports clubs and theme parks)

Categories where spending fell included:

  • Hobbies and sporting goods (down 15.5 percent, led by decreased advertising for audio recordings and toys related to popular character franchises)
  • Automobiles and related products (down 11 percent, led by decreased advertising for K-cars (small vehicles), sedans, station wagons and hatchbacks)
  • Beverages and cigarettes (down 8.2 percent, led by decreased advertising for canned coffee and ‘beer-like’ alcoholic beverages)
  • Home electric appliances and AV equipment (down 8.1 percent, led by decreased advertising for coffee makers, air purifiers and LCD TVs)
  • Household products (down 7.3 percent, led by decreased advertising for specialised mattresses, furniture and functional frying pans and pots)
  • Real estate and housing facilities (down 5 percent, led by decreased advertising for general housing and rental housing)

Dentsu did not disclose an outlook for 2016. But Shusaku Kannan, the principal spokesperson for the company, noted that the ratio of advertising spend to GDP had been around 1.2 to 1.3 over the past five years. "We expect that Japan's economy will grow at cruising speed," he said.

Kannan cited the approaching Olympic Games, the election of the house of councillors, electricity liberisation, ongoing regional revitalisation efforts of local economies and "steady growth" of the national economy as cause for optimism for the advertising industry. He indicated that the growth of non-traditional channels would continue.

"As seen in every country, internet spending will continue to rise in Japan as well," Kannan said. 


Related Articles

Just Published

14 hours ago

Adidas displays Rick-and-Morty-style inflatable ...

To mark the release of the Adidas X Speedportal boots, giant inflatable heads of Mo Salah and Vivianne Miedema can be seen floating across London.

14 hours ago

Will brands ‘trade down’, financially, to PR as ...

With the Bank of England predicting that we will soon enter a recession, the UK waits nervously, but there is hope that, among the chaos, the consumer PR industry will be afforded a new opportunity to shine.

14 hours ago

Do brands have a place on a social platform that ...

Social network Hey You reminds you to call your loved ones once a week, then fades into the background, leaning into a trend of desire for more authenticity on social media.

2 days ago

Dentsu continues strong growth trajectory in Q2

The network's Customer Transformation & Technology division grew 22.25%, powering overall gains for a second straight quarter. Protracted sale of the Russian business dilutes net gains.