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PETALING JAYA: Malaysia’s total advertising expenditure (adex) is expected to grow by 9% to RM6.6bil next year, fuelled by digital advertising formats and a healthy economic growth, according to Magna’s global advertising forecast.
With consumer behaviour now back to normal, it said real gross domestic product (GDP) is projected to grow by 4.4% in 2023.
Digital adex, on the other hand, is anticipated to grow by 13% to reach 62% of total budgets.
This would be led by mobile devices, which is forecast to increase by 213% and represents 73% of total digital budgets.
Magna is one of the leading global media investment and intelligence companies.
It is the global media investment and intelligence agency within the IPG Mediabrands network, which is the media and marketing solutions division of New York-listed Interpublic Group. Mediabrands Malaysia is part of the Interpublic Group.
For this year, media owners’ advertising revenue in the country is projected to increase by 13% to reach RM6bil, it added.
Commenting on the advertising revenue, Mediabrands Malaysia chief investment officer Fan Chen Yip said: “For the 2023 outlook, our optimistic 9% growth to RM6.6bil is impressive in comparison to the Asia-Pacific growth rate of 5.2% in 2022 and 6.1% projection for 2023.,
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“We must, however, highlight that these growth rates are uneven across different categories of media, with digital unsurprisingly taking even more share of revenue.”
Forecasting further ahead into the next five years, he expects digital to take a dominant position of 75% of advertising revenue.
While Malaysian media owners have ramped up significantly in terms of digital capabilities, there is still much work and innovation to be done, he said.
Vincent Letang, executive vice-president, global market research at Magna and author of the report, said adex slowed down in the second half of 2022 because of economic uncertainty and issues affecting digital advertising formats, but traditional editorial media managed to grow by 2.5%.
For the Asia-Pacific market, Mediabrands Asia-Pacific chief executive officer Leigh Terry said: “The region’s advertising revenue is expected to grow by 5% this year, following the 2021 rebound (18%).
“In 2023, the region’s ad market will expand by 6%, which is slightly higher than the global average of 5% and in line with the pre-Covid-19 long-term regional growth.
“Growth will be powered by large markets such as Australia (8% in 2022, 5% expected in 2023) and India (15% in 2022, 14% projected in 2023).
“In 2023, Asia-Pacific advertising revenue will increase to US$263bil (RM1.2 trillion), 23% above the pre-Covid spending level, largely driven by digital advertising growth (70%).”
Meanwhile, Magna Asia-Pacific managing director Gurpreet Singh said South Asia is an exception where linear media is still showing good growth.,