CCTV pre-sale auction raises record 15b yuan

China Central Television, the foremost State television broadcaster, raised record revenue of 15.88 billion yuan ($2.54 billion) during the pre-sale auction held Sunday for its 2013 prime-time advertisement slots, up 11.39 percent year-on-year.

Top bidders during the 14-hour auction came, like last year, from industries such as food and beverage, finance and home appliances. Sichuan-based liquor maker Jiannanchun ranked No.1 with ad spending of 608 million yuan for several slots.

Home appliances retailer Gome, as well as major liquor producers Moutai and Wuliangye, paid over 1 billion yuan in total for a sponsored announcement on CCTV's prime-time news program Xinwen Lianbo. The same slot was worth only 656 million yuan in 2012.

A 10-second slot on Xinwen Lianbo raised a total of 3.65 billion yuan during the auction.

"CCTV still holds the leading position in the advertisement market in China, with around 75 percent market share at present," Li Guangdou, head of Beijing-based brand consultancy Wondersee, told the Global Times Sunday.

This is the 19th year for the national broadcaster to hold such an auction, and annual growth in advertisement revenue has remained above 12 percent over the past 5 years, beating the average growth of China's GDP. In last year's auction for the 2012 advertisement slots, CCTV raised 14.25 billion yuan, up 12.54 percent year-on-year.

However, experts have forecast a slowdown for the broadcaster's revenue growth in the future.

"CCTV's leading position in the sector will remain unchallenged in the next two to three years, but after that the market will surely become less concentrated," said Zheng Xueqin, chief researcher at China Brand Research Institute, attributing the predicted change to challenges from other local TV stations.

In the past, local TV stations usually launched their pre-sale auctions after CCTV's, but this year local broadcasters started pre-sales ahead of time, trying to earn a bigger share of the advertisement market.

East China's local TV station Zhejiang TV has raised 1.67 billion yuan from its auctions, with the advertisement slots for its popular program The Voice of China contributing around 60 percent.

Zheng noted that local TV stations have won audiences with quality entertainment shows, and although CCTV is also making efforts in that regard, its national broadcast nature makes it hard for CCTV to compete in more lighthearted arenas.

TV advertisement is also facing challenges from new media, according to Li from Wondersee. The TV advertisement sector grew only about 4.7 percent during the first half of this year, said Li, but online ads grew over 40 percent during the same period.

CCTV's annual ad-slot auction has been considered a barometer for the Chinese economy, with strong growth taken as a sign that companies are confident about economic growth next year.