Growth in newspaper advertising predicted

PUBLISHED : Wednesday, 13 June, 2012, 12:00am
UPDATED : Wednesday, 13 June, 2012, 12:00am


Newspaper and television advertising will grow strongly in Hong Kong through to 2016, PricewaterhouseCoopers said yesterday.

The global consultancy said surging numbers of consumers using smartphones and other mobile devices will also increase opportunities for digital delivery of content and advertising.

It forecast in a report that while Hong Kong newspapers' circulation would fall at a compound annual rate of 0.4 per cent over the next five years, the industry's advertising revenues would still rise by a compound annual growth rate (CAGR) of 7.1 per cent over the same period.

This is compared with a 12.2 per cent CAGR in advertising revenue forecast for Indonesia, 6 per cent for the mainland, 0.1 per cent for Japan and minus 5.4 per cent for Australia.

'Due to their ability to reach a mass audience, newspapers in Hong Kong are still considered by most advertisers to be one of the most effective means of advertising,' said Cecilia Yau, PwC Hong Kong's entertainment and media partner.

The city appears to be bucking the broader global trend. The report says globally newspapers' share of advertising will shrink to 13 per cent of the total by 2016 from 17 per cent at the end of last year. It says the global advertising market will grow by a 6.4 per cent CAGR over the five years.

Spending on digital platforms will grow to 34 per cent of the total by 2016 from 23 per cent at the end of last year, it says. Television is expected to remain a strong advertising platform, but its market share is forecast to fall one percentage point over the period to 33 per cent.

China overtook Germany last year as the third-largest media market, after the United States and Japan. It is expected to clinch the second place in 2016, according to PwC, which predicts a 12 per cent CAGR for China's entertainment and media industry between now and 2016.