Asia Pacific ad revenues rise 6.1% as online video begins growth spurt
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Rebecca Hawkes
| 28 March 2018

Advertising revenue across the Asia Pacific has increased by 6.1% in 2017 to reach US$173 billion, with television accounting for $53 billion, according to a study from Media Partners Asia (MPA).

MPA's total figures consider advertising revenues across TV, Internet, print, out-of-home, radio and cinema. The study shows that thanks to the growth of online advertising, revenues are also forecast to grow another 6.2% in 2018 to reach almost $184 million. Gains are expected in almost all of the 14 major markets in the region assessed by the analysts.

MPA expects net ad spend in the Asia Pacific to total $226 billion by 2022, having grown by a 5.5% CAGR from 2017, although TV advertising is set to fall in most countries.

"Market momentum for Asia Pacific as a whole should hold steady over 2018 and 2019, but we expect a slight deceleration from 2020 as online advertising, increasingly the main engine of growth across the region, settles into a gentler trajectory in some large ad markets," said Vivek Couto (pictured), executive director, Media Partners Asia. "Much of digital's growth will be driven by China, which should retain more than 60% of online advertising in Asia Pacific over our forecast period."

"Traditional TV advertising is now in or on the verge of decline in most countries, having peaked at US$54 billion across the region in 2017. That said, India, Indonesia, the Philippines and Thailand are notable exceptions, underscoring the ongoing importance of mass-market broadcast as a platform for reach and awareness in these growth economies. Overall, TV advertising should contract very slightly from 2017 to 2022, at a -0.1% CAGR," he added.

Online video advertising is entering what MPA terms 'a red-hot growth phase', with high-speed broadband becoming more prevalent. MPA forecasts that by 2022, online video platforms will contribute at least 10% of all advertising in Australia, China, Hong Kong, Indonesia, Malaysia, New Zealand, Singapore, Taiwan and Vietnam. Last year, Taiwan was the sole country to record such a high level of ad spend on video streaming sites.

In Australia and China, online video spend will be almost equal to TV's share over the next five years, with Hong Kong and New Zealand following closely.

Overall, China dominates the Asia Pacific ad market, with a net spend of over $86 billion in 2017 - a 9.9% increase on 2016. The country's mobile connectivity explosion saw online platforms gaining a 56% share of the total pie, with the slice expected to rise to 68% by 2022. This represents a CAGR of 11.3%, according to the MPA study, Asia Pacific Advertising Trends 2018.

In India, net ad spend in 2017 slowed to 6.9% after three successive years of double-digit growth - but still reached a total of $9 billion. MPA expects India to become the fastest growing ad market in the Asia-Pacific over the next five years, with a 10.9% CAGR to reach $15 billion by 2022.

The ad markets of Philippines and Thailand also show growth potential, with a 10.8% CAGR and 8% CAGR respectively between 2017 and 2022. Australia, Hong Kong, Malaysia and Singapore are also on an upward trend, said MPA.

Online advertising as a whole is set to dominate the market, and registered 18.1% regional growth in 2017 to pass US$76 billion. A projected 14.4% growth in 2018 would take the total to US$87 billion this year, said MPA. Though overall, this sector's will slow by 2022, with a CAGR of 11.1%. Excluding China this figure reverts to 10.8%, and the rise - from a low base - in India, the Philippines and Vietnam should still exceed 20%.