2016 will see Asia Pacific overtake North America as the world’s biggest market for digital advertising spend for the first time, according to forecasts from Strategy Analytics.
Digital ad spend in Asia Pacific will rise 18.2% in 2016 to $59.7 billion, while North America will rise 9.6% to $59.5billion.
Asia Pacific’s rise to the top is driven by China which will grow 25.1% to $22.4 billion. China is the world’s second biggest country for digital spend, behind the US ($55.6 billion).
Together, these two countries will account for 44% of global digital ad spend this year.
Alongside China, Japan (4th) and Korea (6th) means Asia Pacific accounts for half of the six biggest digital markets globally. By 2021, APAC’s digital ad market will be 33% bigger than North America’s.
Michael Goodman, digital media director of Strategy Analytics, says: “Advertising is about ‘eyeballs’ and the sheer scale of the Chinese market, along with India and Indonesia, is why the region will overtake North America this year, despite underlying economic weakness in some economies. Millions just can’t compete with billions.”
In terms of how much is spent on digital advertising in relationship to the size of the population, North America spends by far the most per person ($165) followed by Western Europe ($95). Although APAC is the largest market by spend, its huge population means spend per person ($15) is very low compared to the West.
“Asia Pacific’s relatively low ad spend per capita shows the tremendous potential for growth compared to the more saturated markets in the West, particularly with mobile phones removing a barrier to internet access in less developed markets. This will grow the online population dramatically and, consequently, ad spend will follow suit,”Goodman added.
Overall, digital ad spend globally will rise 12.6% in 2016 to $176.7 billion – a 32% share of total advertising spend.
Within digital ad spend, search advertising will account for 52%, display advertising 36% and classifieds, 11%.