Publicis Groupe SA and Interpublic Group of Cos., hoping to capitalize on projections for fast-paced growth in the country, are now planning to launch digital-ad buying units in China, company executives say.
Most large advertising companies, like Publicis, have been investing in China for several years through acquisitions and partnerships—a move that provided a crucial buffer during the economic downturn in the U.S. and Europe. WPP PLC, in particular, has established a strong foothold in China by snapping up companies and aggressively pursuing partners for specialty areas.
The next frontier is the business of buying online ads—a lucrative sector that has become a sophisticated business in the U.S. Advertising companies are looking to take their expertise and apply it to China’s fast-growing digital market, where the Internet population now ranks as the largest in the world. The efforts are likely to face some hurdles though, ranging from technology issues to relations with the Chinese government.
The total Chinese ad market is expected to grow 14.4% this year to $21.1 billion. Of that, Internet ad revenues are expected to reach $2.5 billion, up 25% from 2009, according to Interpublic’s media agency Magna Global. In comparison, U.S. ad revenue will increase 3.4% this year to $138.9 billion, with Internet advertising growing 13% to $25.7 billion.
See full article at: China Web Ads Are New Frontier – WSJ.com.
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