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31 January 2008
Hong Kong
The online advertising market in China finished 2007 showing healthy growth, hitting RMB9.4 billion spent on display advertising, according to the latest AdRelevance Report from Nielsen Online.
AdRelevance is a Nielsen service that tracks and analyzes online advertising, industry trends, advertiser activities and campaigns. According to AdRelevance, the value of online display advertising in China reached RMB 2.8billion in the fourth quarter of 2007, an increase of a further six percent from the previous quarter, bringing the total 2007 online ad spending to RMB 9.4 billion or US$1.3 billion.
Compared to the US, where online advertising took off much earlier, China registered only one-tenth of online advertising in the US, showing the enormous potential for China’s online advertising market which is certainly on a fast track in the lead up to the Olympics and with the rapid growth in Internet penetration. In 2007, total online advertising value for the US recorded US$10 billion .
The value of online display ads for each of the first three quarters of 2007 was RMB 1.7 billion, 2.3 billion, 2.6 billion and 2.8 billion respectively (See chart 1). The biggest growth for online display advertising in China was recorded in the second quarter, with ad spend skyrocketing by 35 percent, while the peak occurred in September, with RMB 1 billion spending recorded in just September alone, the highest month of growth for the year
In 2007, approximately 3,097 advertisers and 27,000 campaigns were advertised online. Automobile (22%), IT/Electronics (20%), FMCG (10%) and Finance (9%) continued to be the top four sectors contributing to the overall growth of the online advertising market, with the Entertainment (9%) sector also making inroads into the top five. Spending for the top five sectors accounted for over 70 percent of total ad spend in the China online market.
The Top Online Advertisers in China
“At the moment China’s online advertising market continues to be very much driven by the top 500 enterprises and multi-national advertisers. Compared to the traditional media, there is huge room for growth with the potential for small and medium size advertisers to beef up their advertising efforts online” said Sail Ma, Research Analytic Director, Nielsen Online, China & Southeast Asia. ”It’s also worth noting that while vertical websites featuring specific content like entertainment or IT etc have been successful in attracting ad spending, portals are still holding a leading position among advertisers when it comes to allocating advertising dollars online.
The ad value of the top 50 advertisers online accounted for 46 percent of total online advertising market, and 31 percent of the total number of campaigns. Topping the list with the biggest Online advertising spend in 2007 were Mazda, Toyota and Lenovo. China Mobile and Mengniu were the only two local Chinese brands on the list.
Expectation for 2008
According to Nielsen Online, the growth momentum of China’s online display advertising market in recent years has set the stage for an even greater and faster growth in 2008 in view of the Olympic Games. It is expected that growth in 2008 will be at least 50 percent more than that of 2007
According to Mr Ma, “The online advertising market will continue to grow in tandem with the rising internet penetration in China. We also expect FMCG, Entertainment, Finance and Media to lead the growth in 2008.”
About Nielsen Online
Nielsen Online, a service of The Nielsen Company, delivers comprehensive, independent measurement and analysis of online audiences, advertising, video, consumer-generated media, word of mouth, commerce and consumer behavior, and includes products previously marketed under the Nielsen//NetRatings and Nielsen BuzzMetrics brands. With high quality, technology-driven products and services, Nielsen Online enables clients to make informed business decisions regarding their Internet, digital and marketing strategies. For more information, please visit www.nielsen-online.com.
About The Nielsen Company
The Nielsen Company is a global information and media company with leading market positions in marketing information (ACNielsen), media information (Nielsen Media Research), online intelligence (Nielsen Online and BuzzMetrics), mobile measurement, trade shows and business publications (Billboard, The Hollywood Reporter, Adweek). The privately held company is active in more than 100 countries, with headquarters in Haarlem, the Netherlands, and New York, USA. For more information, please visit, www.nielsen.com
www.nielsen.com.
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