News

Digital to soar to 45% of overall APAC ad spend in 2018

Digital advertising expenditure is to see its biggest growth surge in Asia-Pacific to date, according to the latest forecast by Zenith.

Amid concern about cuts to digital advertising budgets, the media agency is predicting that advertisers will spend 40.2 per cent of their budgets on digital ads globally, and 45 per cent in the APAC region.

The latest numbers mark a 13 per cent rise in regional digital expenditure over the past three years.

Leading the charge in Asia is China, where digital growth is expected to soar by 60 per cent. Following directly behind are neighbouring Taiwan and South Korea, which are predicted to see 53 per cent and 44 per cent growth respectively.

China in particular was cited for surpassing expectations after its unexpected economic uplift last year.

According to the report: “Investment in manufacturing has picked up, and business confidence has increased. China is the world’s second biggest ad market, accounting for 15 per cent of global adspend, so an upgrade here has a big effect on the global total.”

In addition to a 13 per cent rise in digital ad spend, China’s television industry also saw a small uplift of one per cent.

Across all ad spend, 2018 is expected to be stronger year for APAC than the previous, with growth forecasted to hit 6.2 per cent, rising from 4.9 per cent in 2016. However, Zenith has so far remained cautious in its outlook towards 2019 with growth expected to drop to 5.7 per cent and then back to 4.9 by 2020.

When divided up into its different segment, ‘fast-track Asia’, which encompasses emerging markets in the South East region, is expected to perform the best globally in 2018 with growth of 7.4 per cent.

Advanced Asia, which also includes Australia and New Zealand, alongside South Korea and China, was forecasted to grow by 3.8 per cent, putting it ahead of the United States, but in third place behind Latin America.

Japan on the other hand remains “stuck in its rut of persistent low growth” with an average ad spend growth of 2.1 per cent a year between 2017 and 2020, putting it in second-from-last place behind the Middle East.

Meanwhile, in terms of mediums, the decline of print globally is expected to continue through to 2020, with newspapers and magazines shrinking at average rates of 5 per cent and 6 per cent a year respectively.

Television, which peaked at 39.1 per cent expenditure share in 2012, fell to 34.1 per cent in 2017, and will be 31.2 per cent in 2020 – its lowest since 1981.

“We are observing sustained ROI from digital transformation,” said Vittorio Bonori, Zenith’s global brand president. “And we are now at the forefront of a transformation as brands shift budgets along the consumer journey, benefit from powerful algorithms and advanced machine learning techniques, and invest in new e-commerce solutions. This transformation is at the heart of driving brand growth.”

ADVERTISEMENT

Get the latest media and marketing industry news (and views) direct to your inbox.

Sign up to the free Mumbrella Asia newsletter now.

 

SUBSCRIBE

Sign up to our free daily update to get the latest in media and marketing