Biggest growth in digital adspend to come from APAC: Carat


In its latest forecasting report, media network Carat has estimated that advertising spend in Asia Pacific is set to grow by a solid 5.2% in 2015.

Carat’s latest global advertising expenditure forecasts show digital media with a predicted US$17.1 billion or a 15.7% increase in spend in 2015. Accounting for the rise in mobile ad spend globally (50%) and online video (21.1%) predicted in 2015, Carat forecasts that digital will account for more than a quarter of all advertising spend in 2016 with a market share of 25.9%.

In Asia Pacific, the highest advertising spend is seen in China, with the total advertising market in China in 2016 forecasted to grow by 8.1%.

TV share of spend at 55.8% continues to dominate although there are signs of TV’s share slowly decreasing, down 2.1% percentage points to 53.7% share predicted for 2016.

TV sees a moderate growth rate of 5% in 2015 and 4% in 2016.

Faced with digital growth, faster broadband speeds and growth in smartphones, TV broadcasters are actively venturing into the digital realm, building their own online video platforms.

APAC growth by market

Digital media spending, which makes up the second largest portion of advertising spend in China at 20.5% this year, is driving growth in the total market by 29.8% in 2015.

Within this, search spends are growing at 23.8%, mobile at 55% and display including online video at 18.7%.

In 2015 advertising spend in Japan is expected to show a gradual growth with a year-on-year increase of 0.9% forecast.  The advertising market in Japan is forecast to continue positive growth into 2016, with a further increase of 1.2%.

In India following the formation of a stable government in 2014, economic prospects look bright, said Carat.  Advertising spend increased by 8.7% in 2014 and are forecast to leap by double digits of 11.0% in 2015.  Further growth of 11.3% is predicted for 2016.

Globally, digital media spend is forecast to increase by US$17.1 billion this year – to reach 23.9% of total global media spend in 2015.  Digital’s growth far outpaces all other media types with a forecast increase of 15.7% in 2015 and 13.8% in 2016.

Growth by region

Growth in digital spend is high in all regions.  The highest is Asia Pacific at 20.1% in 2015, followed by an impressive 16.4% in North America and 16.2% in Latin America.

Mobile spend is notably rising dramatically at 49.7% in 2015 across all regions. With the increase in smartphone ownership rates and data usage, mobile plays an integral part in how consumers access information, view content, browse products and purchase services and goods.

A factor potentially impeding investment in mobile is the difficulty in proving the return on investment(ROI) for more traditional businesses. Much of the early investment in mobile advertising has been amongst pure-play, app economy brands and business for whom there is an easily demonstrable ROI for investing in mobile.

According to the report, mobility is the primary reason behind social’s explosive growth. Facebook and Twitter will continue to be the leaders in the mobile social space. Facebook’s cost effective solution to advertisers, non-intrusive native advertising experience to audiences, targeting capabilities and selection of ad formats makes it the most viable advertising investment.  Meanwhile, Twitter’s introduction of Promoted Video for advertisers provides a unique way for brands to post videos that users can play in their timelines.

Online Video has a 21.6% forecast for 2015, with growth partly driven by a shift of investment away from TV.  Expectations are particularly high for original content. In the US, nearly half (48%) of online video budgets will go to ’made for digital’ video.

Display spend including video and social is forecast to increase by 15.8% in 2015.  However it is Search that continues to command the highest share of total digital spend at 45%, with growth of 12.6% this year and 11.5% in 2016.

TV commands a market share of 42.2% globally in 2015, with share of spend above the global average in APAC.

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