OOH Beyond Summits

Transcription

1 OOH

2 2 Summary: In recent years, OOH has grown rapidly in China. It has become the third largest advertising media following TV and online media in China. The development of digital OOH provides advertisers with convenient and creative opportunities. Connected with digital media, it also brings some truly innovative marketing concepts. More data access makes the media more attractive to advertisers than ever before. In the first half of 2017, among all the forms of OOH ads, the growth of video media s rate card was the highest. Website industry spent most in OOH ads among all industries, while the growth rate of software and beverage industry s expenditure on OOH ads was the highest and the lowest respectively.

3 3 Advantages of OOH Longer time of exposure, 24-hour display of the ad information High flexibility and low restriction in size, shape and color High flexibility in location and could penetrate in many destinations Lower costs, higher benefits, and cost-effective Reach viewers with no limits, wide distribution Reflecting public welfare and human care

4 4 In the first half of 2017, China s OOH ads expenditure amounted to CNY million, up 11% compared with the same period of the previous year. OOH Ad Expenditure in China (million yuan) 70,000 63,165 60,000 52,382 56,754 11% 50,000 40,000 30,000 20,000 10, H H H1 Source: CODC

5 5 In 2017, traditional OOH s advertising revenue kept decreasing, but the drop was lower than that of Moreover, OOH s ad area went down by 13.5% than Growth Rate of Traditional OOH s Advertising Revenue in 2017 Growth Rate of OOH s Ad Area in % % % -1.0% -4% -8% -2% -12% -9.8% -3% -3.1% -16% -15.3% -4% -20% Source: CTR Market Research

6 6 In the first half of 2017, among all forms of OOH ads, the growth rate of video media s advertising revenue was the highest, reaching 15%, followed by online media, reaching 11%. Growth Rate of Various OOH s Advertising Revenue(2017H1 VS 2016H1) 16% 15.0% 14% 12% 10% 11.0% 10.0% 8% 6% 4% 2% 7.0% 7.0% 6.0% 4.0% 2.0% 0% Video Media Online Media Railway Station Airport Waiting Room Metro Bus Body Single Media Source: CODC

7 7 In the first half of 2017, most Top 15 OOH advertisers increased their OOH ad expenditure except real estate, beverage, alcohol and cosmetics industry. 120% H1 Growth Rate of TOP 15 OOH Advertisers Ad Expenditure 100% 2016H1 (year-on-year growth) 2017H1 (year-on-year growth) 84% 80% 98% 60% 40% 20% 0% -20% -40% 74% 2% 10% 12% 7% 0% 74% 35% -16% -8% -5% -1% 21% -26% 46% 13% 26% -4% 0% -12% 23% 3% -22% -1% -16% 32% -9% 10% 7% -12% Source: CODC

8 8 In all levels of markets, OOH ads in the third-tier market saw the largest increase, with a year-onyear growth of 12% in the first half of 2017, while the growth rate of the second-tier market slowed down. OOH Ad Expenditure in Various Markets 2016H1 (year-on-year growth) 2017H1 (year-on-year growth) 14% 12% 10% 10% 11% 12% 8% 8% 6% 5% 4% 3% 2% 0% First-tier Market Second-tier Market Third-tier Market Source: CODC

9 9 Ranking of City Monthly Expenditure on Traditional OOH Ads in Nov 2017 Source: CODC Ranking City Growth of OOH Ad Expenditure Growth of Ads Resource 1 Shanghai -10.4% -29.6% 2 Wuhan 184.3% -17.8% 3 Beijing -3.7% -3.4% 4 Guangzhou -5.1% -7.5% 5 Shenzhen -14.7% -16.4% 6 Jinan -64.6% -67.4% 7 Nanjing -5.9% -5.8% 8 Shenyang 1.9% 2.7% 9 Chengdu -9.8% -9.3% 10 Hangzhou 14.8% 10.7% 11 Changchun -0.2% 6.7% 12 Zhengzhou 19.2% 12.4% 13 Dalian 5.6% 5.5% 14 Fuzhou 35.9% 6.7% 15 Qingdao -7.7% -17.3% 16 Harbin 5.0% 5.0% 17 Kunming -36.1% -41.7% 18 Suzhou -3.1% 0.1% 19 Tianjin -7.3% -12.0% 20 Xi an -8.1% -15.4% 21 Changsha -17.3% -13.6% 22 Shijiazhuang 13.1% 6.1% 23 Ningbo 4.4% 3.8% 24 Chongqing 14.9% 10.6%

10 10 In 2017, in the Top 5 industries that have the most expenditure on traditional OOH ads, the post and telecommunication industry and real estate/construction engineering industry showed a declining trend compared with the same period of the previous year; while the rest three industries increased their expenditure. Top 5 Industries That Have the Most Expenditure on Traditional OOH Ads (2017 VS 2016) 10% 5% 0% 4.3% 6.0% 0.7% -5% -3.7% -10% -15% -20% -25% -19.1% Telecommunication Business & Service Real estate/construction Entertainment & Leisure Transportation Source: CTR Market Research

11 11 Growth Rate of TOP 5 Categories of Main Industries Spending on Traditional OOH Ads in 2017 Post and Telecommunications Category Growth Rate in 2017 Website -2.2% Business and Service Industry Category Growth Rate in 2017 Retail Service 5.8% Communication Products 8.4% Medical/Health care Institutions -14.7% Whole Network Service 89.1% Education/Training 36.3% Data Multi-media Service -37.4% Photo Studio/Wedding Photo/Printing Service 297.0% Mobile Internet Service -72.6% Cosmetology/Hairdressing/Body fitting 11.5% Source: CTR Market Research

12 12 Growth Rate of TOP 5 Categories of Main Industries Spending on Traditional OOH Ads in 2017 Entertainment and Leisure Category Growth in 2017 Category Transportation Growth in 2017 Entertainment and Leisure Service 25.2% Transportation-others 16.3% Tourism/Regional Image -16.7% Vehicle -17.8% Sporting Goods and Service -9.8% Transportation-Corporate Image 6.3% Entertainment and Leisure Corporate Image 175.8% Transportation Service -41.9% Toy/Video Game 108.5% Motor Related Service -28.3% Source: CTR Market Research

13 13 Number of Brands in Each Industry for OOH Ads and Each Brand s Ad Expenditure Number of Brands Ranking Category 2015H1 2016H1 2017H VS VS Website % -10% 2 Entertainment & Leisure % 4% 3 Service Industry % -1% 4 Software % 33% 5 Real Estate % -18% 6 Beverage % -4% 7 Transportation % 9% 8 Communication % 9% 9 Finance % -24% 10 Alcohol % -6% 11 Building Equipment & Service % 1% 12 Food % -8% 13 Cosmetics % 4% 14 Household Goods % -1% 15 Education Industry % 21% Other Industries % -11% Total % -5% Source: CODC Each Brand s Contribution (thousand) 2015H1 2016H1 2017H VS VS % 13% % 6% % 13% % 1% % 2% % -2% % 33% % 61% % 67% % 7% % 82% % 12% % -5% % 34% % 64% % 20% % 17%

14 14 In the first half of 2017, website industry spent most in OOH ads among all industries, but the growth rate slowed down. The expenditure on metro, airport, and single media decreased. The Industry with the Highest Expenditure on OOH Ads Industry Category Media Category 2016 H1 (yearon-year growth) 2017 H1 (yearon-year growth) Video Media 84% 19% Metro 62% -23% Waiting Room Ads 140% -6% Website Bus Body 11% 8% Railway Station -2% 3% Airport 446% -13% Single Media 33% -29% Online Media 118% -11% Total 74% 2% Source: CODC

15 15 In the first half of 2017, the growth rate of software industry s expenditure on OOH ads was the highest among all industries, Pinduoduo, 16wifi, and Yidianzixun mainly advertised on bus body, while Alipay returned to advertise on railway media. The Industry with the Highest Growth Rate Expenditure on OOH Ads Industry Category Media Category 2016H1 (yearon-year growth) 2017H1 (yearon-year growth) Video Media 71% 22% Metro 96% 70% Waiting Room Ads 166% 65% Software Bus Body -5% 212% Railway Station 60% 21% Airport -32% 122% Single Media 100% -19% Online Media 644% 8% Total 74% 35% Source: CODC

16 16 In the first half of 2017, Yili, Red Bull and some main brands in the industry decreased the ads expenditure on waiting room, street network, and bus body, resulting a continuous negative growth in the beverage industry. The Industry with the Lowest Growth Rate Expenditure on OOH Ads Industry Category Media Category 2016H1 (yearon-year growth) 2017H1 (yearon-year growth) Video Media -6% 3% Metro 21% 2% Waiting Room Ads -4% -42% Beverage Bus Body -21% -23% Railway Station 40% 12% Airport 38% -37% Single Media -9% -16% Online Media -18% -45% Total -1% -5% Source: CODC

17 17 According to the data in the first half of 2017, the brands spending on OOH ads were mainly domestic brands, accounting for two thirds of the total, followed by international brands, with the proportion of 15%. 2017H1 Type of Brands Spending On OOH Ads Domestic Brands 3% 2% 2% International Brands 15% Joint Venture Brands Government Organs Hong Kong, Macao, Taiwan Brands 76% Professional Organs/Institutions Overseas Professional Organs/Institutions Others Source: CODC

18 18 Among all types of OOH video media, the ads expenditure on building LCDS ranked the first for three consecutive years, with a continuous year-on-year growth but a slowed down growth rate. Moreover, in the first half of 2017, the ads expenditure on bus TV has the biggest increase, while that of metro electronic screens dropped remarkably. Type of OOH Video Media Ad Expenditure (million yuan) Year-on-year Growth Real Growth 2015H1 2016H1 2017H1 2016H1 2017H1 2016H1 2017H1 Building LCD % 20% 25% 20% Street Electronic Screen % 26% -8% 7% Metro Electronic Screen % -33% 98% -33% Metro TV % 29% -2% 29% Bus TV % 45% -43% 45% Total % 20% 9% 16% Source: CODC

19 19 In 2017, traditional OOH ads in e-commerce industry saw the fastest growth, especially OOH ads of JD.COM, Tmall, and Suning. It was worth noting that the year-on-year growth rate of OFO shared bike s traditional OOH ads reached up to 1000% in Top 10 Brands That Spend Most on OOH Ad and Its Growth Rate (2017 VS 2016) JD.COM 0.7% Tmall -3.2% Suning 14.2% MI 42.8% Quanjing 18.1% OPPO 109.8% VIVO 38.3% Mentholatum -7.7% OFO shared bike 0.0% China Mobile -14.6% Source: CTR Market Research

20 20 According to Nielsen's research on posters, the information of outdoor poster is more likely to stand out than other advertisements (such as newspapers, online, mobile or radio). Source: Nielsen Brand TOP 20 OOH Ad Expenditure Brands Media Distribution in Aug 2018 Traditional OOH Elevator TV Elevator Poster Cinema Video Traffic Video TV Radio Newspaper Magazine Tmall Chezhibao Xiwang Gani Mengniu Suning KFC Xin MI BBK Didi Youku&Tudou Xiaoguan Tea Xiaotiancai Pinduoduo Bashi Toutiao Shenzhou Jinli Wozhuliangyuan Momo

21 21 In 2016, the OOH ad budget accounted for 12% of the total advertising budgets, of which the highest was communication industry, accounting for 20% Proportion of OOH Ad Budget in Total Marketing Budget for Different Industries Telecommunication 20% Internet Finance 14% 15% FMCG Automobile 10% 11% Pharmaceutical 7% Total 12% Source: CTR

22 22 Metro Media: From 2000 to 2020, with the acceleration of the planning and construction of China's rail transit, the number of metro cities and metro lines will increase significantly, and it is expected to reach 33 and 1,777 respectively by The Number of Metro Cities and Lines in China Number of metro cities Number of metro lines ,777 2,500 2, E 1,500 1, Source: Posterscope China

23 23 Metro Media: The Yangtze River Delta and the Pearl River Delta will be the most intensive regions for metro construction in Main cities include Qingdao, Zhengzhou, Hefei, Ningbo, Nanchang, Changsha, Guiyang, Fuzhou, and Nanning, etc. Cities with Metro constructed before 2010 (15) Cities with Metro constructed during (4) Cities with Metro constructed during (9) Source: China Industry Research Report

24 24 Metro Media: From 2012 to 2016, the expenditure of advertising on metro media has gradually increased and reached billion yuan in 2016, of which the website industry has the largest amount of investment, with larger growth rate. In 2016, website ads accounted for the highest share of all industries on the metro media, reaching 27%, followed by entertainment, leisure and service industries. Metro Ads in China (billion yuan) Distribution of Metro Ads in % 27% Website Entertainment & Leisure Service Industry % 4% 5% 5% 6% 13% 17% Real Estate Software Communication Beverage Finance Others Source: CODC

25 25 Airport Media: From 2009 to 2016, with the increasingly stronger transporting capacity of China s airlines, airport s media also saw a significant development in China. Moreover, eastern region is still the hub of airport transportation. In terms of passenger capacity, airports in Beijing, Shanghai and Guangzhou accounted for about 30% of all the airports in China. 1, Airport Passenger Capacity in China (100 million person-times) Airport Passenger Capacity by Region 2016 Eastern region Northeast region Central region Western region 29.6% 10.0% 6.1% 54.2% Source: Civil Aviation Industry Communique 2016

26 26 High-Speed Rail Media: New technology, late start, and rapid development are main features of high speed railway industry in China. As of 2016, China s railway mileage have extended to 22,000 kilometers. Railway Mileage in China (km) Cover 28 Provinces 20,000 15,000 11,152 16,000 19,000 4 Municipalities directly under the central government 160 prefecture-level cities 250 county-level cities 10,000 9,396 6,000 7,500 5, , Source: Ministry of Railways

27 27 High-speed rail media: With the gradual increase of the total mileage of high-speed rail in China, the expenditure of advertising in high-speed rail media will also increase significantly, and it is expected to increase to 5.8 billion yuan by Expenditure of High-Speed Rail Ads in China (billion yuan) E 2019E 2020E Source: Abaogao.com

28 28 Cinema Ads: As of 2017, the total box office in the Chinese movie market was 55.9 billion yuan, an increase of 22.9% over The number of Chinese film audience has reached 1.62 billion person times, an year-on-year increase of 18.1%. Box Office in China (billion yuan) Film Audience in China (million person-times) Box-office(billion yuan) 49.3% % 29 Growth rate % 3.6% 60% 50% 40% 30% 20% 10% 1,800 1,600 1,400 1,200 1, Viewing Person-times(million) Growth rate 51.8% 1, % 1,372 1, % 33.9% 32.5% 30.2% % % % 50% 40% 30% 20% 10% % % Source: The State General Administration of Press and Publication, Ent Group

29 29 Cinema Ads: In 2017, the third-tier, fourth-tier and fifth-tier cities in China contributed to more box office. With the increasing consumption level of youth group in small towns, the film market will have more incremental opportunities China s Box Office Distributed by City First-tier City Second-tier City Third-tier City Fourth-tier City Fifth-tier City 100% 80% 60% 4% 5% 5% 6% 7% 10% 11% 12% 13% 14% 17% 17% 18% 18% 19% 40% 44% 43% 42% 41% 40% 20% 24% 23% 22% 22% 20% 0% Source: Ent Group

30 30 Cinema Ads: In 2017, the revenue from video and TV commercials continued to rise, but the growth rate slowed down to 25.5%. In the Top 5 industries spent most on cinema video advertising, computer and office automation products have experienced the largest increase, with doubled growth rate. 50% Growth Rate of Cinema Video s Ad Publishing Revenue in % 140% Top 5 Industries Spent Most on Cinema Video Ads (2017 VS 2016) 40% 110% 102.8% 30% 25.5% 80% 20% 50% 10% 20% 19.3% 6.9% -1.4% 8.8% 0% % Transportation Activity Communication Computer & Office Cosmestics/Bathroom Automation Products Supplies Source: CTR Market Research

31 31 Cinema Ads: In 2017, cinema video advertising developed rapidly, and most brands increased the delivery of such outdoor advertising. Among them, Momo s expenditure on cinema video ads has increased by more than 1000% compared with last year. Brands That Have Spent Most on Cinema Video Ads (2017 VS 2016) Momo Ford Youku & Tudou Tmall Huanbei VIVO AISTZX JD.com Pepsi Hanhoo >1000% 4.1% 52.1% 7.9% 53.0% 93.0% 38.2% 204.3% 233.9% 501.7% Source: CTR Market Research

32 32 OOH Advertising Tips Timing According to the research, the best time to display OOH ads is when the audience are commuting, shopping, waiting for departures or on the expressway. Most audience view OOH ads when they are waiting for traffic lights and bus or taxi. Meanwhile, OOH ads have different performance on weekdays and weekends. The reason is that 81% of the audience have regular routes in their commuting to school or work on weekdays. However, their mood, routes, and exposures to OOH are usually different when the audience go to visit friends, go shopping and outings on weekends. This phenomenon shows the law between the audience's outdoor activities and outdoor media, that is, the golden time of OOH ads is the weekend and commuting time. Therefore, for advertisers who want to promote their brands in OOH media, choosing outdoor advertising in prime time will have a multiplier effect. Source: CODC 2015

33 33 OOH Advertising Tips Location Though the exposure rate of OOH ads in commercial area is higher, such area with a load of OOH ads can easily distract audience s attention. Hence, audience usually have deeper impression on OOH ads in noncommercial area. Most audience who are exposed to OOH ads at the airport and on the expressway are high-end customers, though places like airports have a relatively lower exposure rate. Ad Displaying Location Reach rate Downtown area 80% Street & Vehicle 60% Waiting area 50% Housing & Telephone booth & Metro Station 30%-40% Railway station & Airport & working area 20-30% Expressway 20% Therefore, advertisers can't only focus on CBD areas. Non-commercial areas, airports, highways, and high-end community are also worthwhile choices. Meanwhile, advertisers also need to differentiate between different brands and different audiences. Source: CODC 2015

34 OOH Marketing Trends Prediction Acceleration of OOH Ads Mobile Connection Real-time Data and Digital Function Easier to Access to OOH for Small Businesses More Immersive Experience of OOH According to the OOH media and smartphone Digital connectivity allows A new generation of click Advertisers will seek new prediction of Magna are merging. Mobile location outdoor media advertisers to buy OOH ads space ways to integrate immersive Global, the average data can provide new to fine-tune their has brought greater VR and AR experience into growth rate of OOH ads capabilities for measuring OOH positioning by using accessibility to the media. the delivery of OOH would reach 4% in visibility by connecting outdoor detailed demographic information for customers. activities with store sales. data.

35 35 Top 10 OOH Company Focus Media Air Media Clear Media Vision China Media JCDecaux Bus Online T Media Tom Outdoor Dahe Media Bailintimes Source: Chinabgao

36 Your Global All-media Marketer Visit our website to learn more: We have collaborating offices in SH HK TYO SEL SYD MOS BER LON PAR ROM NYC SF