Chinese Ad Growth Driven by Digital

Online and mobile formats will spearhead a period of rapid advertising growth in China, according to forecasts from WPP’s GroupM.

A report released yesterday, titled “This Year, Next Year: China,” predicts that total ad spend in the region will grow 20 percent from 2007 to 2008, reaching a sum of $32 billion.

In that period, online (including mobile) is predicted to be China’s fastest growing ad medium, experiencing 65 percent year on year revenue growth, and accounting for 7.3 percent of total ad spend in 2008, worth $2.3 billion.

The report predicts in 2009, digital revenues will grow a further 40 percent year on year, representing 8.5 percent of total ad spend, or over $3.2 billion. This leap is attributed to a surge in advertising surrounding this year’s Olympic games in Beijing. Growth will ultimately slow in 2009.

In terms of advertiser verticals, automotive, IT, real estate, and network services are attracting the greatest online spend, all of which are predicted to grow considerably during 2008.

According to the report, the most popular online activities among an estimated Chinese Internet audience of 228 million users include online music, which reached 86 percent of the online population in January 2008, and online gaming, experienced by 120 million users in 2007.