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Internet advertising catching up to magazine advertising February 22, 2007

Posted by fukumimi in Economy & Business, Internet, Japan, Media.
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[note: title and some text edited because it was pointed out that I can’t read 4 digit numbers properly…]

Dentsu, the Japanese advertising agency, has released statistics for the Japanese advertising market. Link

The total market size was just shy of 6 trillion yen (5.9954 trillion yen), which equates to around $50 billion, a 0.6% increase on the previous year.

Breakdown by medium shows that of the mass media channels (total 3.58 trillion yen), TV has the largest share at 2 trillion yen, newspapers at 999 billion yen, magazine advertising at 389 billion yen, and radio at 174 billion yen.
All 4 mass media posted year-on-year decreases, with newspapers taking the biggest hit (down 3.8%, TV was down 2%, and the others were also between 1-2% down).

On the other hand, most of the sales promotion (SP) advertising market (total 2 trillion yen), posted growth, with OOH, transportation and POP sectors posting the strongest growth of more than 3% each.

The big story is that internet advertising posted 363 billion yen in sales in 2006, 29.3% year-on-year growth, and now surpasses is on track to overtake (edited) the magazine advertising market. (The growth is down from 54.8% the previous year, though) Internet advertising accounted for 6% of the total advertising spend. The numbers for internet advertising include mobile internet, which is already a well established market in Japan.

I’ve always wondered if people not on flat rate data packages get annoyed by the fact that they are paying to have advertising displayed on their screens. I would have thought that banner ads (which is common on the mobile screen) account for a significant amount of data.

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Comments»

1. Adamu - February 22, 2007

That’s not how I read that press release… It looks like online ad spending is still just under that for magazine ads, but as the English Nikkei noted they have “closed the gap” and have doubled in just 2 years.

2. fukumimi - February 22, 2007

Yup, my mistake, now fixed.

Clearly I am now number blind after having been spending way too many hours in recent weeks staring at spreadsheets….. – which also explains the light posting of late.

3. Japan News for February 23, 2007 » Japan Probe - February 23, 2007

[…] Japanese internet advertising posted 363 billion yen in sales in 2006, 29.3% year-on-year growth, and is on track to overtake the magazine advertising market. [Link] […]

4. Eddie Wolfe - March 3, 2007

I wonder how much of that internet marketing advertising equates to sales…..compared to other media. I know that Google PPC costs the earth for the big boys when they are bidding on high converting keywords.

5. Mutantfrog Travelogue » Blog Archive » Online ads in Japan not as booming as you might think - April 2, 2007

[…] month, Dentsu announced that Internet ad spending surged in 2006. It beat out radio spending in 2004 and is poised to […]

6. Merben John Salarda - May 10, 2007

I think it’s only a matter of time before the World-Wide-Web dominates the advertising market. It has more upside than traditional advertising methods and the online community is always growing. This is a great time to have an online business such as an Internet ad agency and other online ventures.

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