Study: 80% of ad spend in China will come from digital media by 2024

The digital media market share in China will continue to expand, with 80% of total local advertising spending expected to come from digital media by 2024, according to the latest report by dentsu China. 

The 2023 Q1 media landscape report by dentsu China highlights opportunities and challenges facing the media industry; the potential impacts of emerging technologies on media and advertising; and provides valuable tips for brands to stay ahead of the curve to optimally achieve marketing objectives amidst economic headwinds, in order to help brands navigate the evolving and complex media environment.

In terms of ad spending, the size of China’s advertising market in 2022 slightly increased compared to the previous year. Looking forward into 2023, with further easing and optimisation of epidemic preventive and control measures, as well as the economic and business recovery cycle, China’s domestic consumer demand will gradually improve, resulting in an increase in growth rate of local ad spend in the next three years, according to the report. 

Furthermore, the report predicted that Bytedance, Meituan and Bilibili will be the new oligarchs, replacing Baidu, Alibaba and Tencent (BAT). Bytedance has 1.9 billion monthly active users (MAU) and the gross merchandise value is 236.6 billion, followed by Meituan, which has recorded 477 million MAU and 114.8 billion BAT, while Bilibili has recorded 190 million MAU and 12 billion GMV.

In terms of OTT media, the report showed that OTT activation terminals are concentrated in second, third and fourth tier cities, accounting for 74% of the total, in which the second-tier cities have the largest activation scale (28%), reaching 71.6 million units, an increase of 25.6% over the same period last year. It is followed by fourth cities (24%), reaching 61.89 million units and an increase of 11.6% over the same period last year.

“Businesses, marketers and advertisers need to stay informed of the latest trends and developments, to ride the economic headwinds going into the year. The advertising space does not stand still and is very sensitive to cyclicality,” said Deric Wong, CEO of dentsu China.

"Looking to unfolding developments, continuing to innovate, adapting to new formats - to reflect, redefine strategies and resources to reach target audiences for businesses. Afterall, we are here to solve problems and support the industry in important ways, that bring value,” Wong added.

Furthermore, the report has identified four media trends in 2024, they are: data and tech will empower precise marketing, full-chain solutions will be prevalent, short videos will shift from being a trend, to a new norm, as well as KOL will reshape the rules of content seeding.

MARKETING-INTERACTIVE has reached out to dentsu China for further information.

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