Ad spending growth expected to rise

China's advertising market will maintain slow growth at 6 percent in 2014, an industry report forecast, pointing to another year of bright opportunities for Internet businesses and a struggle for traditional outlets.

Total advertising spending through the Internet grew 46 percent in 2013. It was the fastest-growing medium last year, according to the China Media and Market Trends 2014 report, released by CTR and Kantar Group, a leading market research, insight and consultancy network.

Total advertising spending in 2013 increased by 6.4 percent year-on-year, a slight recovery from 4.5 percent the year before.

Advertising spending in the television sector increased 9.6 percent last year, with total advertising time down 7 percent, pushing up advertising prices and creating rapid growth in multiple advertisement formats such as inserts and events.

The growth rate of traditional print media such as newspapers and magazines declined by 8 percent and 6.6 percent respectively. Radio and outdoor ads maintained a slight increase.

Last year the number of media outlets for advertisers declined because different platforms created clearer positioning. CTR's research showed the percentage of advertising companies that selected five separate media outlets was down to 68 percent from 80 percent, revealing further consolidation.

Benedicte Nilsson, strategy director and head of live return on investment at ZenithOptimedia China, said the slowdown in the growth of advertising expenditure could be a result of the market shifting. "The slowdown is minimal," she said. "Digital and mobile media are key areas and are very promising."

Nilsson is confident about the advertising market in China because growth is assessed against the emerging Chinese middle-class families who have more purchasing power and are becoming targets for advertisers. The growth of the market is therefore led by sectors like consumer goods and personal care products,where both local and international brands are competing for their share of the pie.

ZenithOptimedia predicts global advertising expenditures will grow by 5.3 percent in 2014, reaching $532 billion by the end of the year. China is forecast to be the second-largest contributor of new-advertising expenditures, making up 16 percent of additional advertising dollars from 2013 to 2016, behind the United States' 26 percent of the $90 billion expected to be added to global advertising expenditures.

In 2013, total advertising expenditure in China reached $40.94 billion, ranking it No 3 in the top 10 market, according to ZenithOptimedia.

The marketing consultancy has forecast bright trends for digital media, highlighted by the growth of online video, fueled by people flocking to online video sites to watch TV content rather than regular TV.

Mobile emerges as a key battlefield for advertisers. They are targeting a higher-income customer who can afford a smartphone or tablet, ZenithOptimedai said.

The arrival of 4G technology will revolutionize users' interaction with mobile phones, according to CTR's findings, which showed 20 percent of regular Internet users refresh their mobiles 96 times a day, equivalent to an average of six times every waking hour.

Nearly 70 percent of mobile users regularly concentrate on just 10 mobile applications.