Asians are always on their smartphones, making digital advertising quite important. Source: Shutterstock

Asians are always on their smartphones, making digital advertising quite important. Source: Shutterstock

Dentsu says digital ad spends to grow significantly in APAC

APAC residents can’t look away from their screen, with mobile penetration soaring like never before and screen time severely affecting sleep cycles and attention spans — and that’s exactly why digital advertising is picking up.

Be it Hong Kong, Singapore, Malaysia, or even Australia and New Zealand, smartphone and internet penetration have been on the rise, while the cost of accessing the internet has been on a steep decline.

According to Dentsu Aegis Network’s latest advertising spend forecast, analyzing data from 59 markets suggests that global growth is expected to grow by 3.8 percent this year.

It follows the 4.1 percent growth last year, taking total the investment to US$625 billion.

In APAC, there is a predicted growth of 4.5 percent growth this year, following the 4.6 percent growth last year, taking total investment to US$220 billion.

Geographically speaking, Dentsu forecasted that APAC will be a major growth region, contributing 42 percent of the global increase.

North America will account for 30 percent, Western Europe for 15 percent and Latin America Central and Eastern Europe at 10 percent and 4 percent each.

Malaysia, Singapore to spend more on digital ads

Interestingly, it was found that digital channels dominated close to half of APAC’s share of total ad-spend. Digital will be the leading channel in 26 of 59 markets analyzed, with Malaysia and Singapore joining this list for the first time.

In fact, according to Dentsu’s forecasts that the APAC’s digital share (49 percent) remains ahead of the digital share of total global ad-spend (41 percent).

Among the 14 APAC markets surveyed, China seemed to have the highest digital share (63 percent), followed by Australia (52 percent), New Zealand (49 percent) and Hong Kong (48 percent).

This suggests room for further gains for the region. Within digital, mobile continues to dominate growth with over half of Asia Pacific spend (58 percent) now delivered through mobile devices.

Again, markets such as China – where 76 percent of digital spend is through mobile – suggest the trend has a long way yet to run.

China, Australia, and India see digital spends rise?

According to the Dentsu Aegis Network, growth in India to exceed 10 percent, while China and Australia to see 7 percent and 2.4 percent growth in ad spends — however, digital ad spend isn’t exactly growing in all three.

Specifically, in India, although the ad industry’s revenues are expected to reach US$10.1 billion this year, digital ad spends are only expected to grow by 0.1 percent.

The digital ad market, however, is expected to reach 20.9 percent of all ad spends, with mobile representing 52 percent of the total digital spend.

This is interesting to note, especially in a market where (cheap) Chinese smartphone sales, YouTube subscribers, and Facebook users are all growing rapidly.

Australia and China, on the other hand, are expected to spend a total of AUD16.3 billion (US$11.7 billion) and CNY682.1 billion (US$100 billion) on advertisements this year.

Of China’s US$100 billion, nearly US$63 billion will be spent on digital advertising, representing a 12.5 percent growth according to Dentsu.

In Australia, although digital continues to drive advertising revenue growth,  digital media is only expected to increase by 5.7 percent in 2019.

Either way, the truth is, APAC is seeing unprecedented growth in digital advertising, and a majority of that — now and in the future — will move to mobile marketing, as smartphone ownership increases among people.