Australia’s marketers to spend $706m on social channels by 2019, research claims
Australia’s marketers will increase their spending on social media advertising by 24 per cent each year over the next five years, taking total spend in 2019 to $706 million, claims a new report.
The increase is slightly ahead of the Asia Pacific growth rate of 21.6 per cent, according to research firm Forrester which said the pace of growth across the region was slower than expected.
The figures were revealed in a social media advertising spending forecast covering Australia, China, India, Japan and South Korea. Forrester found Australian marketers will spend $241m on social channels in 2014, rising to $322m next year, $410m in 2016, $502m in 2017, $601m in 2018 and $706m in 2019.
Collectively, the five APAC nations will spend $2.17 billion on social marketing this year, rising to $5.8b by 2019, with India seeing the fastest annual compound growth rate of 51.5 per cent to $1b.
Meanwhile, Japan, the most mature market for social advertising with a spend of $864m in 2014, will rise to $1.6bn by 2019, while China will increase from $535m this year to $1.7bn.
Despite the apparently high rates of growth, Forrester analyst Xiaofeng Wang said it was slower than expected.
“While the pace of growth is higher than in the US market, these five countries’ overall social ad spend will still be less than half of that in the US,” Wang said. “With a lower maturity level across the APAC region we would expect a much higher pace of growth but this is not the case.”
She added while Asia has 663 million social users in the five APAC nations there are only 193m in the US – yet marketers are spending twice as much.
Explaining the disparity, Wang social marketers in Asia Pacific are “conservative” in their spending because “they are uncertain about the return on investment”. She added social platforms in the region provide limited ad formats and ad inventories.
Turning to Australia, Wang said Australia’s 14.2 million social users account for more than 74 per cent the online population – higher than South Korea for example – but is a less mature market when it comes to marketing spend. In Japan on the other hand, only 38 per cent of online users are on social media “but they are more ready to engage with brands”.
The report also revealed that 47 per cent Australians access social networking sites on mobile devices at least twice a week, behind metro India (71 per cent), South Korea (53 per cent) and Metro China (70 per cent).
Steve Jones
