APAC to overtake North America as biggest digital ad market
2016 will see Asia-Pacific (APAC) overtake North America as the world’s biggest market for digital advertising spend for the first time, according to the latest advertising forecast from Strategy Analytics.
Digital adspend for the APAC region is expected to rise 18.2% in 2016 to $59.7 billion, whilst North America will rise 9.6% to $59.5 billion.
Its rapid growth is driven by China – the world’s second biggest country for digital spend, behind the US ($55.6 billion) – which will see spend increase by 25.1% to $22.4 billion. Together, China and the US will account for 44% of global digital ad spend this year.
Alongside China, Japan (4th) and Korea (6th) means Asia-Pacific accounts for half of the six biggest digital markets globally. By 2021, its digital ad market is forecast to be 33% bigger than North America’s.
“Advertising is about “eyeballs” and the sheer scale of the Chinese market, along with India and Indonesia, is why Asia-Pacific will overtake North America this year, despite underlying economic weakness in some economies,” said Michael Goodman, Strategy Analytics’ digital media director. “Millions just can’t compete with billions.”
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In terms of how much is spent on digital advertising in relation to the size of the population, North America spends by far the most per person ($165), followed by Western Europe ($95).
Although Asia-Pacific is the largest market by spend, its huge population means spend per person ($15) is significantly lower than the West.
“Asia-Pacific’s relatively low ad spend per capita shows the tremendous potential for growth compared to the more saturated markets in the West, particularly with mobile phones removing a barrier to internet access in less developed markets,” Goodman said.
“This will grow the online population dramatically and, consequently, ad spend will follow suit.”
Overall, digital ad spend globally will rise 12.6% in 2016 to $176.7 billion – a 32% share of total advertising spend. Within digital adspend, search advertising will account for 52%, display advertising 36% and classifieds 11%.
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