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Ad spending slides 8.8% in first half of 2019

Martin Guo

Editor-in-Chief, Kantar China Insights

TV & Movie 21.08.2019 / 18:36

TV sets in Great Wall 2 col

Rate card spending on multiple media began to decline since Q3, 2018. The decline narrowed in Q2, 2019.

The total rate card ad spending in the first half of 2019 in China monitored by CTR (Note) declined by 8.8% from a year ago. The slide for traditional media was bigger, which lost 12.8% of ad revenue from a year ago.

2016 - 2019 1H ad spending change year-on-year

CN 1H Ad Spending Change 2016 - 2019

As the confidence of ad buyers fluctuated, China’s ad spending again entered a downward spiral since Q3, 2018. The decline from a year ago narrowed in Q2, 2019. The previous downward spiral was between Q2, 2016 and Q1, 2017.

2016 - 2019 ad spending change by quarter  

CN Quarterly Ad Spending Change 2016 - 2019

Media

The decline is happening across all media formats under CTR’s monitoring, from traditional media to out-of-home to Internet display ads.

Among traditional media, the rate card ad spending on TV dropped 12.4% and on radio declined 9.7%. TV stations at all levels were suffering from ad spending and air time slides: that for Central-level channels (CCTV channels) and provincial-satellite TV channels all lost nearly 10%. The loss of print media ad spending remained the same as in corresponding time of last year.

Traditional out-of-home media widened its decline to 18.9%. Other out-of-home media formats remained the main growth engine of ad spending, but their increases are much smaller than before: the rate card ad spending growth rates on lift screens, lift posters and cinema pre-roll ads have receded to around 5%. 

Ad spending year-on-year change by media formats, 2018 1H vs 2019 1H 

CN 1H Ad Spending By Media 2018 Vs 2019

Ad buying industries

From the advertiser perspective, the top 10 biggest ad buying industries are: food, beverage, telecommunications, drug/healthcare, commercial services, entertainment and leisure, transportation, cosmetics/toiletries, IT products and services as well as alcohol. Among them, only food (16.4%) and transportation (5.0%) expanded their ad spending.

Ad spending year-on-year change by industries, 2018 1H vs 2019 1H

CN 1H Ad Spending Top 10 Industry 2018 Vs 2019

FMCG brands, such as food and beverage brands, focused their spending on TV: TV accounted for 78.3% of food ad spending while it was 83.6% for beverage. It is even more so for drug/healthcare ad spending – 96.3% was spent on TV. Telecom brands, most of whom are Internet companies, spent 50% of advertising budget on their home ground: Internet media.

Industries that have more local brands, such as commercial services as well as entertainment and leisure, have increased their ad spending on screens and posters in lifts.

Brands

Among the top 20 ad buying brands, drug/healthcare brands have significantly cut their spending. Eight of top 20 came from food and beverage industries and all of them largely increased their spending. A couple of new brands made the ranking for the first time, such as wedding photo shooting service provider/app Bojue Photography (铂爵旅拍), Chinese infant milk powder Junlebao (君乐宝) and Chinese cheese maker Milkground (妙可蓝多). Chinese food giant brand Master Kong (康师傅) also made it to the top 20 ad buying ranking for the first time in the first half of 2019. 

2019 1H Top 20 Ad Buying Brands

2019 1H Top 20 Ad Buying Brands

Source: CTR

Editor's notes

Note: Media scope: TV, radio, newspaper, magazine, traditional out-of-home, screens and posters in lifts, cinema pre-roll ads, display ads on major Internet portals (excluding on mobile devices). For detailed definition of ad spending volume, please check the Chinese version article.

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