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Fast-growing travel industry spends more on ads

May Zhao

General Manager of Media Intelligence

TV & Movie 16.12.2015 / 05:00

Egg money full

Tourism industry's spending on traditional media ad grew 6.7% from a year ago, compared with 5.9% decline of the overall traditional media ad spending.

As Chinese people's income enters a higher level, the bright spot of consumption has switched from material needs to emotional/service needs - cultural, entertainment and tourism industries have been enjoying sizzling growth these years. Compared with outbound travel, domestic travel still has the lion's share of the whole market. In 2014, Chinese tourists made 107 million overseas trips, a tiny figure compared with 3.61 billion domestic trips.

Kantar Media's Global TGI data across eight markets also showed that China is the only country whose traveller number had a significant year-on-year increase. Advertisement is the barometer of an industry's prosperity. Given the healthy growth of travel industry, tourism advertisement spending on traditional media increased 6.7% from a year ago, compared with the 5.9% yearly decline of the overall traditional media ad spending.

Country/city branding advertisement backbone of travel ads

 1216-EN-2015 Travel Ad Spending Table

* Data source: CTR Media Intelligence

* Monitoring scope: TV, radio, newspaper, magazine, non-digital out-of-home, office LED screens, public transport screens.

From the theme perspective, country/city branding is the backbone of tourism advertisement and continues to grow significantly at 16%. These advertisements not only display the beautiful scenes and historical sites of a country/city, but also promotes the attraction of the spirit of a country/city. The first city branding advertisement appeared in 1999 when Weihai City, Shandong Province, bought a city branding TV commercial on CCTV-4. In recent years, people are seeing more city branding commercials on TV screens not from Chinese cities, but foreign cities as well. This is another proof of how foreign markets are putting up more efforts to attract Chinese tourists. According to the World Tourism Organization, China has been the world's largest source of outbound travellers since 2012.

Explosive increase of online travel brands' advertisement

Online travel brands, though current share of advertisement share is small, have shown strong momentum in marketing spending. In 2014, it grew by 4.3 times from a year ago. In 2015, it continued to grow by 38% from the previous year, the fastest growing sub category of travel industry. Its share has also jumped from 1% in 2013 to an estimated 8% in this year.

CTR Media Intelligence data has shown a steady growth of online travel brands: it expanded from 36 in 2013 to 43 in 2015. However, the concentration of advertisement spending is very high: the top 10 biggest buyers accounted for 98% of all spending. Supported by several rounds of fundraising, or even IPOs, the sophisticated brands will move on to build their brand and expand to traditional offline consumers by buying ads in traditional media, such as TV. After several years' competition, Ctrip, Tuniu and LY.com have emerged as three distant leaders of this segment. In the fourth quarter of 2014, Tuniu plunked 130 million yuan to become the naming sponsor of "If You Are the One (Jiangsu Satellite TV)" and "Here Comes the Bride (Tianjin Satellite TV)". Its commercials featuring popular Taiwan celebrity father/son Jimmy and Kimi Lin have been shown on multiple channels in China, apparently with lots of marketing budget behind the campaign. Alitrip, supported by Alibaba Group, is a new big buyer of traditional ads, which accounted for 3% of this segment's ad spending in 2015. In the future, it is expected to spend even more on advertisement.

Reality shows preferred by travel brands

The first season of "Where Are We Going, Dad?" (Hunan Satellite TV, 2013) have successfully brought new travellers to the scenic spots that appeared in the reality show and hence created many of successful partnerships between scenic spots/cities/countries with reality shows. Tuniu, for example, sponsored two popular travel-themed reality shows "Divas hit the road" (Hunan Satellite TV) and "Sisters over Flowers" (Dragon TV) and reaped good returns. CTR's research has showed that 43% of "Sisters over Flowers" audiences were aware of the brand's advertisement, 30% said they liked the brand more and 27% said they were more likely to buy from the website. The cooperation between travel websites and TV reality shows has become even closer recently with many shows having travel brands and scenic spots/cities/countries as their "official travel partners" and embed them into the programmes.

Source: CTR

Editor's notes

* Advertisement of travel industry include those from parks/scenic spots, country/city branding, tourism products and service agencies, hotels, travel websites and their products.

* To know more information, data and analysis of China's advertisement market, please contact us.

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