- Emerging markets in Asia show the fastest programmatic growth in 2014 at 73%
- This will account for a total spend of over USD 500 million
- Korea and Taiwan comprise the lion’s share of that spend
- Malaysia and Singapore will reach and surpass 30% RTB market share by 2018
While a successful programmatic infrastructure is not built overnight, the lessons learned from developed programmatic markets continue to translate to younger markets that are now entering this field. This shift towards programmatic has created what Magna Global, the strategic global media unit of IPG Mediabrands, dubs as the fast growth programmatic rates. In its latest research ‘The International State of Programmatic’ that delves into the state of the programmatic industry in 24 markets across the globe, Magna Global has reiterated that Asia is already one of the most important programmatic markets, globally.
Some of the key findings from the report
- Magna Global predicts a total global programmatic CAGR of 31% through 2017 and a 38% CAGR for RTB during this period.
- RTB penetration in many growth markets will reach the same levels as in many of the largest programmatic markets.
- Globally, North America is by far the leading programmatic market, accounting for more than half of the world’s total programmatic spend.
- In Asia, the combined size of Japan, China and Australia’s programmatic markets are six times larger than the rest of those in developing APAC.
- However, it is the developing Asia region which is showing the fastest programmatic growth in 2014 of 73% with a total spend of over USD 500 million.
- In the developing Asia region, Korea represents the largest share of the total programmatic spend among developing Asian markets with a total of USD 237 million in 2014.
- Malaysia and Singapore’s RTB penetration will grow to 30% by 2018 and will eventually lead and surpass that of China.
- Desktop display represents 94% of total RTB spend, with the remaining 6% representing video and mobile RTB. Social represents the majority of non-RTB programmatic spend in our researched Asian markets.
“Traditional media – the broadcasting and the media buying was designed to homogenise perceptions by painting vast swathes of highly interesting and unique individuals with a very fat collective brush. It was almost communist in its insensitivity to their uniqueness, annoying due to frequent lack of relevance, and required vast operational resources that sometimes felt pre-industrial. Programmatic is the new way – where intelligent, fast learning, adaptive autobots can precision- target messages for max relevance and impact, often in real time. While human insights and inspirations will continue to provide the mutant new pathways to these autobots, the job of finding the optimal best within the give space and constraints, is now moved to algorithms. Programmatic is already transforming the lower funnel, and will more and more impact the upper funnel investments as well,” said Prashant Kumar, President of IPG Mediabrands, World Markets Asia.
The Big Picture
The report shows that North America is by far the leading programmatic market, accounting for more than half of the world’s total programmatic spend. This is followed by other big players such as Australia, Japan, China and the UK. However, the growth rate of less mature markets shows a rapid acceleration in the industry; while the top 10 programmatic markets are growing by 39 per cent this year, the medium and smaller markets will grow between 57 per cent and 66 per cent in 2014.
While Korea will dominate the programmatic share in the region this year (USD 237 million), Malaysia and Singapore will become the #1 and #2 RTB markets in 2014 with USD 12 million and USD 10 million of spend respectively. RTB and non-RTB purchases will represent 25 per cent of total display spend in developing Asia in 2014.
Total RTB spend will be USD 54 million in 2014 but in the following years, RTB shares will vary significantly between low penetration markets such as Korea and Taiwan, and Malaysia and Singapore which will top 30 per cent RTB market share by 2018.
RTB being newer than non-RTB programmatic in most markets, will grow to over 50 per cent of the total display market by 2018.
The conclusions in this report were derived from interviews with senior executives representing programmatic trading desks, DSPs and publishers, existing Magna Global research, and other publicly available information.