Olympics to spur media investment growth

National - As China provides more and more growth for global giants and as local Chinese companies increase focus on brand-building, GroupM China estimates media investment will increase 19% this year with the Beijing Olympics accelerating media investment growth to 29% in 2008, according to an annual study on media forecasts conducted by the agency.

The study revealed that Olympic-based content will be a big draw for advertisers with TV as the dominant medium accounting for more than 70% of all spends. FMCG categories will continue to be the mainstay of television particularly the growing beverage sector. Automobiles and mobile phones will also form a big component.

New media formats such as IPTV, pay channels and mobile marketing are likely to get a big boost from Beijing 2008 due to greater ad and subscription revenue as consumers may be more willing to pay for Olympics related content.

Reflecting the shift from traditional passive viewing behaviour to allowing consumers the individualization of viewing choices and media consumption in the digital space, internet and other digital media spends are likely to double in the next two years from US$1.07bn (HK$8.4bn) to US$2.2bn (HK$17.2bn). 

Newspaper's share of total spend will decrease from 15% now to 11% by the end of 2008 while spend growth for magazines are expected to rise from 22% in 2007 to 28% in 2008.

Overall ratecard inflation will remain heavy at 15% this year, though this will vary by different markets. Estimates on TV inflation next year vary but the agency predicts 25%-30%.

"China is becoming increasingly important in the global economy. This is the first of an annual study specially commissioned to help our marketers navigate this increasingly crucial market," Bessie Lee, CEO for GroupM China said.