This is according to OMD China’s Transcend 2018 report, which provides a macro-view of the country’s media landscape, and illustrates an ecosystem in flux.
Key to marketers is the shortage of video inventory, driven by significant rating declines. More and more, brands have to fight for prime-time spots on CCTV (state) and PSTV (provincial) if they are to reach a wide audience.
According to R3, Chinese TV media cost inflation averaged 5% in 2017, with Global Web Index finding a 31% year-on-year revenue increase on CCTV.
Online TV is also taking a hit as a result of a 72% rise in ad-clutter since 2013. Users are moving toward membership-based services in greater numbers, partly to avoid advertising.
Meanwhile, the proliferation of content that has resulted from falling production costs has also driven a need for quality branded content, especially non-video content, which has become extremely commoditised, the paper added.
Launching the report, Bhasker Jaiswal, managing Partner of OMD China remarked: “With the ever-changing landscape, increasing competition, the lack of data in certain sectors and further BAT consolidation [Baidu, Alibaba, Tencent], the challenges for marketers only continue to rise.”
Elsewhere, the mobile app landscape is stabilizing following a period of volatility. From the second half of 2017 onwards, the top apps list has been largely unchanged. The report found that in mobile video specifically, 95.7% of all video traffic flowed through the top five video apps.
There are benefits to this. “With consolidation, brands can now build long-term relationships with the hero apps by concentrating their spending, tapping into better inventory and creative executions via partnerships,” the authors wrote.
Conversely, OTT faces the opposite problem. Despite spend growth of 160% in 2017, the market remains fragmented, and will resemble “the Wild West for the next 20 months”.
Data sourced from OMD China, WARC