The adspend market share of the Internet medium varies greatly from country to country. In South Korea Internet the adspend share is 30.1% but in Indonesia it is only 0.03%. The top three countries are South Korea with 30.1%, Canada with 26.9% and Australia with 25.8%.
Availability of the Internet to consumers is an important factor. This has been measured by Internet World Stats by determining the penetration of the Internet – the percentage of the population that can access it. These figures vary widely also. The country with the highest penetration in 2012 in the APAC/APEC region is Australia with 88.8% followed by New Zealand with 88%. The countries with the lowest penetration are Papua New Guinea with 2.1% and India with 11.4%. The world penetration total is 34.3% with 2.4 billion users.
There is a general correlation between penetration and adspend market share but there are significant exceptions. For example Singapore has a high penetration rate of 75% but a low rate of Internet adspend – only 7.5% of market share. Also Thailand has 30% penetration but Internet has only 0.5% of market share.
The economies with the highest predicted growth rates are Philippines and Hong Kong. The Philippines is predicted to grow 122%% from 3.2% in 2012 to 7.1% in 2015. Hong Kong is predicted to grow 125% from 2.4% to 5.4% over the same period.
There are two strong trends in virtually all countries:
– The Internet share of adspend is growing rapidly
– The number of Internet users is increasing as Internet penetration grows. In some countries they are nearing saturation.
As mentioned in other posts the challenge for regulators and industry is to establish best practice advertising regulatory regimes to ensure advertising on the Internet is legal, decent, honest, truthful and socially responsible.
The analysis that follows combines adspend Internet market share data taken from ZenithOptimedia and penetration data taken from Internet World Stats. The 2012 adspend share is actual, the 2015 adspend share is projected, the penetration data (% of population with access to Internet) is actual for 2012.
Country Adspend 2012 Adspend 2015 Penetration 2012
South Korea 30.1% 31.9% 82.5%
Canada 26.9% 35.3% 83.0%
Australia 25.8% 35.1% 88.8%
Japan 21.1% 23.5% 79.5%
Taiwan 19.9% 24.4% 75.4%
Russia 19.7% 28.9% 47.7%
USA 19.0% 27.8% 78.1%
China 17.8% 26.6% 40.1%
New Zealand 17.7% 23.9% 88.0%
Singapore 7.5% 11.6% 75.0%
Chile 7.3% 11.3% 58.6%
Peru 4.4% 7.2% 36.5%
India 3.5% 6.0% 11.4%
Philippines 3.2% 7.1% 32.4%
Malaysia 3.0% 4.3% 60.7%
Hong Kong 2.4% 5.4% 74.5%
Vietnam 1.2% 1.8% 33.9%
Pakistan 0.9% 1.4% 15.3%
Thailand 0.5% 0.7% 30.0%
Indonesia 0.03% 0.03% 22.1%
Brunei NA NA 78.0%
Mexico NA NA 36.5%
Sri Lanka NA NA 15.0%
PNG NA NA 2.1%
The Internet share of advertising expenditure (adspend) is growing every year. ZenithOptimedia reports that in 2012 Internet advertising in Asia-Pacific had 17.8% share of total adspend. The Internet was the third largest medium with television being the largest and newspapers second. But adspend is growing at about 13% pa so by 2014 it is predicted that Internet adspend will overtake newspapers and be firmly in second place behind television.
In the APEC/APAC countries of South Korea, Canada, Japan, Taiwan and Russia the Internet is already in second place. It is predicted that in Canada and Australia the Internet will be the largest media in terms of adspend in 2014.
Internet ads are effective according to recently released Ipsos research on online users. In the Asia-Pacific region;
– 48% had looked at/read an ad for a brand or product
– 43% had watched a commercial for a brand or product
– 29% had clicked on a banner/pop-up for a brand or product
All three figures are slightly higher than the world average.
This quite dramatic change in market share has been challenging to regulators. It was quickly addressed by advertising self-regulatory organisations (SROs) in many countries that merely applied their advertising codes to the new medium. The thrust of SROs is to self-regulate all advertising regardless of medium. As a result self-regulation tends to have strengthened in countries where SROs follow best practice self-regulation. This has been strengthened with the online industry in individual countries forming an Interactive Advertising Bureau (IAB) who in turn have developed Codes of Conduct.
Government regulation often tends to be media specific. Broadcast media are Government regulated in most countries, particularly television which has advertising caps and quite strict requirements about children’s programs and advertising. Because the Internet has no country borders such Government regulation for the Internet is impractical. However the Government does have an important role in setting the regulatory framework and the SROs have the role of implementation by way of codes and a complaints system. This is an example of best practice regulation.
Advertising expenditure (adspend) in the APAC region grew 5.8% in the first quarter of 2013 compared with the same quarter in 2012. This compared with global growth of only 1.9% but was second to Latin America with an outstanding 11.9% growth. Adspend in Europe declined 4.4% and North America was flat.
The data comes from Nielsen’s quarterly Global AdView Pulse report. Nielsen reports, “The best performers in the region were China, Indonesia and Philippines, which all saw roughly 20 percent growth. Japan was the only country where ad spend decreased (down 1.1%).”
As adpsend is a driver of economic growth the future is positive for the APAC region.