Advertising budget cut expected amidst varying recovery in industries

Around 44% expect the decrease amidst likelihood of budget cuts in numerous sectors.

Advertisers expect a decrease in advertising budget for 2021 amidst numerous business sectors indicating likelihood of budget cuts, according to the latest survey by Nielsen and the Hong Kong Advertisers Association.

Nearly half (44%) of the respondents share this sentiment, with 28% saying that the biggest challenge is a lack of funding.

Overall advertising budget is set to be reduced by 6% in 2021 mainly due to an anticipated 15% budget cut for offline advertising and a 4% budget increase in online advertising. The decline in advertising budget may be milder amidst signs of stabilisation post-Chinese New Year and availability of a territory-wide vaccination scheme.

The budget cut comes as advertisers (73%) believe that rebound across industries would happen in 2021 at varying levels, with the initial recovery stronger and sooner than expected as the Consumer Confidence Index (CCI) has seen a reviving trend approaching pre-crisis levels at 93 during Q4 2020.

The research also found that using measurement and analytics is considered important to ensure return on investment. The 74% of the respondents believe that media effectiveness measurement can help with better marketing decisions.

In particular, analyses about reach and frequency (68%), ad performance (64%), and viewability (60%) have been identified as the top three key performance indicators for effectiveness measurement.

Meanwhile, the survey noted that digital adoption during the pandemic has brought the shift to online advertising, with the advertising budget for 2021 split 64% online and 36% offline.

Online advertising is led by paid social and social networks (16.6%), display advertising (9.8%), and video advertising (9.4%). Whilst for offline advertising, TV (9.6%), print (6.2%), and outdoor-static (5.7%) will get the most allocation.

Nielsen Media Hong Kong vice president Clare Lui understands the possible challenges for traditional businesses to go digital as this is amongst the most common issues they face.

“It’s not an absolute must to build your digital platforms. Nowadays there are options to deploy digitalization, including e-commerce, through partnering with technology vendors or fulfillment suppliers to extend your online footprint,” Lui said.
 

Join Hong Kong Business community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

Top News

Unemployment rate rises to 5.4% from February to April
The total number of unemployed people stands at 206,100.   The unemployment rate rose by 0.4 percentage points to 5.4%  from February to April, when compared to the January to March period.    Based on the data from the Census & Statistics Department (C&SD), the total number of unemployed people from February to April was 206,100, an increase of 17,600 from the preceding three-month period.   Meanwhile, the number of unemployed rose by around 25,000 to 142,000, translating to a rate of 3.8%.   With the increase in the number of jobless and underemployed individuals, total employment dropped to 3,559,200, whilst the labour force fell to 3,765,300.   The deterioration of Hong Kong’s labour market however should see an improvement in the coming months, according to Secretary for Labour & Welfare, Dr Law Chi-kwong.   The receding local epidemic situation and progressive relaxation of social distancing measures, the new round of Consumption Voucher Scheme, and Other relief measures including the 2022 Employment Support Scheme should help drive improvement in the employment sentiment, said the C&SD.  
Economy