BEIJING: Total media advertising expenditure in China is forecast to reach RMB 581bn (US$84.4bn) in 2017 with internet spending accounting for 57.2% of that, according to new figures from GroupM.
In its This Year, Next Year: China Media Industry Forecast, Campaign Asia-Pacific reported, the media agency also noted that the rapid growth of internet spending is set to slow as internet penetration hits saturation point in urban areas and there are fewer new users coming online.
That said, at 21.5% it is still expected to grow almost three times as fast the market overall with mobile the main driver – mobile internet users accounted for 95% of all internet users in China at the end of 2016 and the mobile internet economy is projected to overtake the PC one this year.
And as the country's online shopping habits shift towards mobile, m-commerce sites are coming to be regarded as valuable media properties. Brands need to make traffic, operations, campaigns and design of their brand presence on leading mobile shopping apps a high priority, GroupM advised.
The rise of the internet has inevitably affected TV spending, which is predicted to fall 5.2% in 2017, although it will remain the single most important media type, taking a 31.4% share of all expenditure.
The report added that content marketing has also been a factor in declining TV spend, as the past year saw a near 20% in the number of placement formats; separate research found that product placement, including hosts reading out sponsor names and brand icons flashing in screen corners, grew by 32% in frequency and 41% in broadcast time on satellite channels in 2016.
State-run broadcaster CCTV will be an exception to the TV trend, however, as GroupM indicated ad spend on its channels will rise 5% this year, thanks to investment in popular genres like variety shows and to a changed outlook on the role of advertising.
"It is no longer approaching advertising as a cash cow for CCTV, but sees it as a service to help clients build brands," the report said.
Data sourced from Campaign Asia-Pacific, Advertising Age; additional content by WARC staff