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China second biggest programmatic spender in the world behind the US

Chinese marketers spent more than US$5.3 billion on programmatic advertising in 2017, placing them second in the world behind the United States.

In Zenith’s latest marketing forecast, the United States’ programmatic expenditure was valued at US$32.6 billion – 57 per cent of the global total.

Although China currently spends just a sixth of its Western counterpart’s budget on automated buying, the market has “scope for plenty of future growth”, Zenith said. Currently, only 29 per cent of digital display advertising is traded programmatically in China.

However, China still has a number of issues to overcome when it comes to the programmatic ecosystem. The largest tech companies such as Baidu, Tencent and Qihoo have their own ad exchanges protocols which are not open to real time bidding ad exchanges, while publishers are bound by restrictions on what types of advertisers they can accept. 

At the same time, as Unilever senior vice president for global media, Luis De Como, pointed out this year that “more work is to be done” to improve China’s ad fraud rate and transparency.

Elsewhere in Asia, programmatic adspend remains much lower. Neighbouring Taiwan spent US$82m in 2017. In India, programmatic expenditure was valued at just US$85 million and 9 per cent of total digital adspend.

Meanwhile, Malaysian advertisers spent US$61m on programmatic this year, of which 57 per cent was allocated for display and and 30 per cent for video, while the remainder was spent on native.

Globally, it is expected that two thirds of the world’s digital display advertising will be traded programmatically by 2019, up from 59 per cent in 2017.

The value of advertising sold programmatically will rise from US$57.5bn in 2017 to US$84.9bn in 2019, growing at an average rate of 21 per cent a year.

“Brands are tying together programmatic technology with unique consumer datasets and machine-learning to optimise their digital communications,” said Vittorio Bonori, Zenith’s global brand president. “This allows them to respond in real time to consumer behaviour and continually improve upon campaign results, delivering greater brand growth.”

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