China Advertising Industry Report, 2009-2010

Chinese traditional media witnessed steady progression in 2009, while online advertising outshined the others, characterizing high degree of brand penetration, high accuracy, huge target audience, etc., and being increasingly welcomed by advertisers.

The market size of Chinese online advertising in 2009 hit RMB20.7 billion. Among the various major network media, the online advertising revenue of Baidu ranked the first, reaching as high as RMB4.45 billion, and followed closely by Google, Sina, and Taobao which took the 2nd to 4th places, respectively. Search engines and portal websites still dominated the segmented markets of online advertising. E-business media with the representative of Taobao and video media represented by Youku and Tudou began highlighting their values, and China online advertising market started to take on pluralistic development.

In 2009, Chinese market of radio advertising was sized by RMB13.3 billion, of which, the revenue of radio stations was RMB7.583 billion, up 4.51% compared with 2008; the market size of TV advertising turned out to be RMB114.74 billion or so, wherein, the revenue of TV station was RMB65.403 billion, an increase of 7.36% against 2008. It is estimated that the total revenue of TV advertising will see a slight decline in 2010 owing to the implementation of the Measures for Management on Radio and Television Broadcasting (No.61 Decree). The advertising resources of powerful TV media are even scarcer; accordingly, there will be more opportunities for product placement and soft-sell advertising.

In 2009, the market size of China print media was approximately RMB91 billion, of which, the market of newspaper advertising reached about RMB71.89 billion and that of magazine advertising RMB19.11 billion or so. The development of newspaper media is declining while that of magazine is rising. The access threshold of newspaper is quite high, competitions mainly exist in big newspapers, the profit model tends to be diversified, and the profit margin is relatively narrow. On the contrary, the access threshold of magazine is comparably low, magazines of various categories have their own readers, with the profit primarily from advertising and with relatively higher profitability.

In 2009, the market size of China outdoor media approximated RMB41 billion. The development of large-scale outdoor billboards was restricted by policies. The rapidly growing LCD TV advertising in buses and subways replaced the LCD TV media in commercial buildings, enjoying the top advertising share of outdoor electronic screen media. Along with the development of urban transportation, media in public vehicles is more likely to become the mainstream.

With the rapid progress of 3G, the operators give top priority to develop various mobile applications including cell phone media. In early 2010, the Internet user group of China Mobile reached 233 million, creating lucrative market space for wireless advertising.

This report casts light on the current development and development prospect in 2010 and key media corporations of online advertising, print advertising, TV & radio advertising, outdoor advertising, and wireless advertising.