APAC Future of TV Martech

Dentsu report predicts a shiny growth story for APAC markets in 2021 and beyond

By Amit Bapna, Editor-at-large

July 13, 2021 | 5 min read

Amid all the doom and gloom scenarios that businesses are facing, the Japanese communication group Dentsu is confident that advertising investment is forecast to grow by 10.4% globally in 2021. As per the unusually optimistic findings of the latest Dentsu ad spend report, which combines data from 59 markets, “$634bn will be spent globally with all regions enjoying positive growth.”

Is growth for the APAC markets around the corner?

Market-wise recovery

The APAC growth story is looking rather shiny as per the report findings, with the ad spend in the region expected to grow by 8.0% to $229bn. The report predicts that APAC spend will rise past pre-pandemic levels, a year sooner than previously predicted.
Within the region, China is expected to grow to exceed pre-pandemic levels in 2021. Australia and India are two large markets that are also forecasting particularly high growth rates in 2021.

Industry-wise recovery

In APAC’s key markets, the travel and transport sectors were two sectors badly impacted and will continue to be affected by the uncertainty of the past year and see a muted increase in demand (4.9%).
In contrast, media and entertainment is forecast to have a robust growth of 9.7%.

Medium-wise recovery

It is not so surprising that digital media is the one showing the sharpest growth curve. In APAC, the 6.2% rise in digital spend last year is forecast to grow by 12.8% in 2021 to reach $124.5bn, representing a whopping 54% share of total ad spend. The subsets of social and video are also in a good space, with growth projected at 33.4% and 10.8% respectively. Search is predicted to grow at 7.8%, reaching $23.1bn in 2021.
The projection on offline/linear ad spend is not as positive, with spend levels in APAC likely to remain below pre-pandemic levels in 2021. It will see growth of 2.8% to $104.8bn, following a 15% decline in 2020, as per the findings.

There has been a sense of enhanced marketing activity on the back of regional live events such as the Tokyo Olympics and Paralympics, which are driving growth in linear TV ad spend in APAC (3.9% increase in 2021 to reach $59.2bn). However, per the Dentsu data the shift towards Connected TV (CTV) and Over The Top (OTT), as well as audiences moving more toward digital media consumption, is going to keep linear TV spend on a tight leash and below pre-pandemic levels until beyond 2021.

Even as most channels are projected to return to growth in 2021 (and cinema likely to grow by 2022), the prediction for print is not so good. As per the report, print is seeing a slight decline in 2021 (–2.7%) and is expected to continue declining in 2022 as it continues to evolve towards new modes of digital delivery. It would be interesting to see what the print industry would look like in a post-pandemic world – if it is still around by then.

Experts speak

The APAC recovery, in general, has been subject of talk, especially last year as many of the European markets and the US market were still languishing in the aftermath of Covid-19. Against that backdrop, it is interesting to see that two of the markets in the top five contributors of ad spend growth are from the APAC region – China and Japan.

According to Ashish Bhasin, chief executive APAC, Dentsu International: there is a lot to get excited about in APAC, notwithstanding the predicted GDP increase of 7.3%. Australia, India, China and Japan are expected to deliver strong numbers – either via growth or contribution – to overall adspend. While China continues to see strong levels of growth driven by digital and OOH, Japan’s growth will be buoyed by events like the 2020 Olympic & Paralympic Games, and the House of Representative elections ad-spends.”

Two other large markets - Australia and India are also forecasting growth in ad spend, backed by a stronger economic recovery in Australia and a resurgence in digital advertising in India, he adds, even as interestingly in India, TV continues to be the main contributor with a 40.9% share. “The India recovery is expected to be steady though not sudden, by the festive season. In addition, the timely arrival of monsoons also bodes well, particularly for the rural markets,” according to Bhasin.
With the pandemic having served as a stimulus to accelerate digital adoption, digital media will continue to drive ad revenue growth this year, according to Prerna Mehrotra, chief executive officer media APAC and managing director media Singapore, and there will be more investments diverted towards the digitalization of OOH channels.
Programmatic DOOH will also be a key growth driver in the future, she added, and “with the growing numbers of SSPs and DSPs partnerships and an increasing demand for location-based solutions to ad-reaching consumers in these times of uncertainty, advertisers will benefit from the speed, flexibility and the targeting capability that the medium will provide”.