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Internet Advertising as Share of Adspend

Economic

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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.

 Analysis

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%

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