The prospect of global media & outlook of Vietnam market in 2016

Through observing the happenings in the communication activities last year (2014-2015), based on the analysis of statistical data, the researchers find two primary themes in 2016 and 5 comments on the marketing communications in Vietnam which continue to grow rapidly in 2016 and following years.

 

The shift to digital: Redefining business models

Spending on media continues to shift from traditional to digital products and services at a rapid pace. By 2019, we believe digital spending will account for more than 50 percent of overall media spend. Within this, digital video spending will overtake physical spending by 2018, two years earlier than we had previously forecast. Digital, consisting of Internet and mobile advertising, will become the largest advertising category by 2017, surpassing TV one year earlier than forecast, and mobile will more than double its share of the digital ad market.

This rapid digital shift is being driven in part by the growing number of connected consumers, the expansion of mobile telephony, and elevated mobile broadband adoption. As it continues, it will not only expand the digital share of the media wallet, but have a structural effect on almost all media sub-sectors, redefining business models.

Another important change we find is the rise of global content intermediation and integration, as leading social-networking platforms, both personal and professional, provide videos, music, and news from outside sources directly to their users.

We also see a third key change: As digital media gain ground, advertisers are increasingly accepting the validity and persuasiveness of advertising on these media. Besides, we should not forget that traditional media remain a considerable factor.

 

 

The rise of Asia and the development of Global Advertising

 

Developing markets are playing an increasingly critical role in global media growth, not only because traditional media in these regions remain strong, but because these markets, from Mexico and China to India and Malaysia, anticipate healthy economic expansion and increasing household incomes—particularly in Asia Pacific (AP) and Central and Eastern Europe (CEE). This growth will boost both advertising and content spend across the region. In fact, the media market in AP will be the largest source of absolute growth for the global industry over the next five years.

 

 

Total global spending by category (US $ millions)

 

The analysis & forecasts on the global media

 

  • Digital Advertising continues to grow rapidly

Digital advertising was the fastest-growing category in 2014, with a 16.1 percent increase, followed by video games at 14.3 percent and broadband at 9.2 percent. Both digital advertising and broadband are entirely digital, and growth in video games was fueled by its digital components. This pattern reflects the underlying transition of the market from traditional to digital media.

We expect digital advertising, video games, and broadband to continue to be the fastest-growing segments over the next five years. Total global media spending will rise from US $1.6 trillion in 2014 to a projected US $2.1 trillion in 2019, a 5.1 percent compounded annual increase.

  • Consumer spending for the media

For consumer spending as a whole, digital components rose 11.2 percent in 2014 and accounted for 46.2 percent of the market. Traditional components of the market increased only 1 percent in 2014.

 

Global consumer spending by category (US $ millions)

  • Digital advertising catch up TV

The key development in the market is the shift in advertising from traditional to digital media. As the fixed and mobile broadband universe has grown, media usage has steadily transitioned from traditional to digital. Advertisers have followed consumers, allocating more resources to digital channels...

 

 

Global advertising shares by category (percent)

 

  • Key global drivers impact the global media

Broadband expansion will drive overall digital spending.

Growth in the broadband universe will drive digital spending in three ways. First, growth in the number of fixed broadband and mobile broadband subscriptions will generate US $195 billion in incremental subscription spending. Second, the expanding broadband universe will attract new advertising. Finally, opportunities for digital spending on the part of consumers will multiply.

 

 

Global spending by digital/non-digital status (US $ millions)

Mobile will become the principal digital platform.

Media access through mobile devices is the fastest-growing sector of global media spending. The advent of smartphones and tablets has substantially improved the mobile broadband experience, contributing greatly to the surge in mobile broadband penetration.

Approaching broadband maturity in many countries will lead to slower consumer spending growth.

Consumer spending as a whole rose at a 6.1 percent CAGR between 2009 and 2014. Because of the slowdown in broadband growth, we project overall consumer spending growth to drop to 5.0 percent compounded annually to 2019, despite expected improvement in economic growth.

Overall, global media spending will drop from 5.8 percent compounded annual growth over the past five years to a 5.1 percent compounded annual growth rate over the next five years.

Spending to access content without buying it is gaining momentum.

In the 2014 GMR, consumers are spending less to buy and own content, while spending more to simply gain access to content without owning it. That trend is gaining momentum.

Over the next five years, we project spending on content purchases to fall at an 8.4 percent CAGR, while spending on content access will increase at a 19.2 percent CAGR.

A new print equilibrium is on the horizon.

Daily newspapers and consumer magazines have been hurt more than other segments by the transition to digital. The content contained in newspapers and consumer magazines can often be obtained much faster and for free over the Internet.

Over the next five years, the fixed and mobile broadband subscriber bases will continue to increase and many of the new broadband subscribers will migrate from print to digital, as previous new broadband households have done before them. However, growth in the broadband universe will moderate over the next five years, which means there will be less of an incremental impact on print media than in the past.

 

Marketing communications perspective verdict in 2016 in Vietnam of Masso Consulting

 

In the above global trend analysis, based on Vietnam market observations & practical experience in the media industry in recent years, Masso Consulting boldly make statements to the trends in 2016 for Vietnam market:

  • The development of digital media & media / digital advertising will continue to grow strongly in 2016 and the following years, especially through mobile marketing, video marketing and social network. Advertising via mobile phones will grow sharply, especially the support of Smartphone & 4G network is expected to be deployed this year. LOSOMO model, although Masso Consulting was expected to boom in Vietnam from 2 years ago (http://massogroup.com/insights/8107-losomo-thay-doi-cuoc-choi.html) will continue to thrive, especially movement of Vietnam consumers Selfie, and the post's favorite photo of young friends on social networks.

 

 

  • Print advertising will therefore continue to decline, except some dedicated magazines. However, some forms of traditional advertising (TV) still retain the current positions, especially outdoor advertising (OOH) will continue to develop in Vietnam due to specific Outdoor (motorcycles) and the development of OOH  technologies (eg LEDs).

 

  • Content Marketing) will reach the peak, but the saturation and overloaded volume of content will require brands seeking creative content strategy. Creative content will therefore be decisive in the competition of netizens view.

 

  • Marketing experience, integrating online and offline (IMC), took offline marketing activities as content and create favorable conditions for consumers in the transition between the two channels (styled Omnichannel) would be likely to be applied  and researched by brandes in Vietnam in 2016 and the following years.

Source: Mckinsey Quarterly

Translation & analysis by Masso Consulting (www.MASSOGROUP.com)

For more information about the report please email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Ho Chi Minh City, 04th January, 2016

 


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