KOREA – Cheil Worldwide revealed that Korean adspend is expected to grow by 3.8 percent in 2014, the increase advanced by the country’s rebounding economy and sporting events such as the Winter Olympics, the FIFA World Cup, and the Incheon Asian Games.
In a press release, Cheil said, “The Bank of Korea has forecasted the country’s economic growth rate for 2014 and 2015 to be 3.8 percent and 4.0% percent respectively, with improving domestic consumption and investment and constant export momentum. It is good news to the advertising market which is highly correlated with economic growth.”
The positive outlook for the year follows a slow growth in the country’s adspend in 2013. According to Cheil, Korea’s adspend increased by only 2.2 percent in the previous year, due to prolonged recession, growing household debt, and no major events.
“However, it is worth noting that the fluctuation of spending by media has widened in line with changing media consumption patterns even in the midst of such a low growth trend. Ad spent growth has shown great variation across media as consumers’ preference has changed amid the low growth trend,” Cheil said.
“To put it differently, the fall of traditional media such as terrestrial TV, newspapers and magazines continued while new media such as IPTV and mobile dramatically expanded. It implies that competition among media has intensified,” it explained.
Cheil reported a shrink in traditional media such as TV and print, even as male fashion magazines presented a continued growth.
Terrestrial TV adspend decreased from 20.6 percent to 19.1 percent, though there was a surge in IPTV and satellite TV adspend, presenting a growth of 61.7 percent and 16.2 percent respectively.
There was also a decrease in adspend on newspapers and magazines, with a negative growth of 6.6 percent and 8.4 percent respectively.
Meanwhile, internet media continued its momentum in 2013, though its growth has slowed down to 2.5 percent against 2012.
At the same time, Korean mobile media adspend boomed in 2013, growing at a staggering 119 percent due to high smartphone penetration as well as expansion of its high-speed internet infrastructure.
