Slowing Chinese Economy Still Driving Double-Digit Ad Growth

Amid worries and varying opinions about the state of the Chinese economy, the world’s second-largest behind the U.S., GroupM has issued a new ad spend forecast for the country. The WPP unit predicts that spending in the country will growth 10.7% to an estimated $70 billion versus a year ago.

China is key to global ad spending growth, per GroupM, whose forecasters believe that the country will contribute 40% of new spending globally in measured media this year.

The forecast comes amid recent downgrades to the country’s predicted economic growth this year. In late May the IMF for example, predicted the Chinese economy would grow 7.75%, not the 8% it had predicted earlier.

Magna Global’s ad forecast for the country this year is 11.6% slightly higher than the GroupM prediction. But both forecasters say ad spending in the country will climb steadily over the next several years. Next year GroupM predicts another 11.8% ad spend growth for the country.  Magna Global predicts spending will grow 12.1% there in 2014 and by 2016 will pass Japan to become the second largest media market in the world behind the U.S.



According to GroupM, TV still dominates with 51% of all ad expenditures, but notes that TV’s share has been declining the last three years. With a steady growth in IPTV subscribers, the firm said, advertisers need to think more about TV search and targeted advertising.

But the big growth driver continues to be Internet spending, per GroupM. With 560 million Internet users, the Internet ad sector is expected to grow 36% this year and another 34% in 2014. 

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