China's advertising industry booms, seeing shift to digital adverts
China is expected to lead advertising industry growth next year, and media agencies see favorable sentiments toward the industry among brand owners.
China, along with the US and UK, made up about 60 percent of the total market size and account for approximately 70 percent of all growth in the industry, according to GroupM's annual advertising forecast.
Digital spending now accounts for nearly 90 percent of the entire advertising market in China, up from less than 80 percent prior to the pandemic, one of the highest rates in the entire world.
This year China's annual advertising growth stood at 18.8 percent. Growth is expected to decelerate toward the high single digits as the pandemic-driven expansion of the industry wanes.
"Performance marketing, social media, and content-related spending posted high double-digit growth in particular in 2021 and will continue to play an important role in the next two to three years," said Chief Executive Officer of Wavemaker China Jose Campon.
GroupM's media investment and brand performance agency Wavemaker, which handles media investment plans for Huawei, Tencent, and emerging brands like Three Squirrels in China, also plans to put more resources into data-related branding and technology infrastructure, he added.
The emergence of social media platforms creates new opportunities for brands to build up their image and better curate brand equity across different channels, he also noted.
A balanced approach for short-term results and long-term brand equity building is crucial for a sustainable customer experience, he commented.
A separate report by IPG Mediabrands' media investment and intelligence unit Magna says that China also recorded its highest growth rate in 10 years with a 16.7 percent increase and a total size of US$98 billion, the second-largest market outside the US.
Globally, digital advertising sales increased 31 percent to reach US$442 billion.
It attributed the digital acceleration toward the increase of digital marketing activity, especially by small businesses who have ramped up their use of social media and search formats.
