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    South Korea’s Ad Spend Predicted to Grow 4.6% in 2021 Following Last Year’s Decline

    South Korea’s Ad Spend Predicted to Grow 4.6% in 2021 Following Last Year’s Decline

    A new report from Cheil Worldwide predicts growth this year after South Korea’s ad spend in 2020 recorded a 0.8% decline.

    By Robert Cameron - Feb 9, 2021

    Image by Mathew Schwartz via Unsplash.

    According to a new report from Cheil Worldwide, South Korea’s ad spend in 2020 recorded 11.99 trillion won, a 0.8% drop compared to the year before. Despite Covid-19, digital ad spend continued its positive growth to offset the pandemic’s impact on the overall ad market, said Cheil.

    In 2020, digital ad spend recorded two-digit growth reaching 5.71 trillion won. Digital ad spend grew 13% year-over-year, accounting for all-time-high 47.6% of all ad spend. Increase in usage of online services due to the pandemic resulted in high growth of digital ad spend.

    Digital ad spend

    Digital ad spend which includes mobile and PC led all ad spend as it grew by 13% year-over-year.

    Mobile ad spend recorded 17.5%, totaling 3.85 trillion won, while search-based ad spend grew by 6.6% to 1.82 trillion won, and display ad spend recorded 29.4% increase to 2 trillion won benefitting from increased demand on video ads said the report.

    PC ad spend also played a major role to offset ad spend decrease in other media sectors. PC ad spend recorded a growth of 4.7% and 1.85 trillion won. Display ad spend on PC recorded 10.5% increase benefitting from remote working and learning.

    Broadcast and print ad spend

    The overall broadcast ad spend, including TV and radio, decreased 8.5% compared to the previous year to 3.46 trillion won.

    Terrestrial TV ad spend dropped 7.7% recording a total of 1.13 trillion won due to postponement of the Summer Olympics and delayed introduction of in-program advertising, combined with the slowdown of the economy. Cable TV and total TV programming ad spend recorded 1.86 trillion won, a 7% drop compared to the previous year. Cable TV ad spend decreased due to reduced sports and stage performance broadcasting. On the other hand, total TV programming ad spend showed growth driven by the success of its music entertainment contents.

    In the print ad spend, newspaper ad spend recorded 1.38 trillion won, a 2.4% drop, while magazine ad spend recorded 235.6 billion won, a 16.8% drop from the previous year.

    OOH (Out of Home) ad spend

    OOH ad spend showed huge drop after being hit hard by Covid-19. OOH ad spend recorded 756 billion won, dropped by 27.2%. This is the first time in ten years OOH ad spend downscaled to seven-billion-won mark after surpassing 8 billion won in 2011. Cinema ad spend dropped 72% recording 60.1 billion won. Ad spends in transportation, shopping malls, and sports stadiums all recorded two-digit decrease.

    South Korea’s 2021 ad spend forecast

    Fueled by economic recovery hopes and consumer confidence boost, South Korea’s ad spend is projected to grow 4.6% year-over-year and record 12.55 trillion won, predicts Cheil.

    Digital ad spend, in particular, is expected to exceed 6 trillion won and account for nearly 50% of the entire ad spend due to continual growth of video ads.

    Meanwhile, broadcast ad spend is expected to grow due to full implementation of in-program advertising in terrestrial TV advertising, and permission to air virtual and indirect advertising of products that previously had advertising time restrictions. Despite favorable factors including the recovery of cinema ad market and expansion of OOH media with consumer touchpoints, the OOH ad spend forecast is similar to the previous year.

     

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