DAN Global Ad Spend 2019 MASTER FINAL 010219

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February

2019

February

GlobalAd SpendForecasts

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The forecast and insights published in this report were compiled from around the Dentsu Aegis Network and are based on our localmarket expertise. The figures were then consolidated and where relevant adjusted centrally in light of global macro-economic drivers.The report includes country, region and global estimates and forecasts for the following media, Television, Digital Media including Display, Online Video, Social Media, Search, Classified, Mobile, Newspapers, Magazines, OOH, Radio and Cinema, as well as share by medium data.

Thank you to all the markets for their forecast, insights and local market expertise and to the Creative Services team.

FOR ANY ADDITIONAL INFORMATION ON THIS REPORT, PLEASE CONTACT:

Caitlin Tuvesson, Dentsu Aegis Network, +44 (0) 203 535 9974, [email protected]

Lin Liu, Dentsu Aegis Network, +44 (0) 207 550 3451, [email protected]

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CONTENTS

ASIA PACIFIC

AustraliaChinaHong KongIndiaIndonesiaJapanMalaysiaNew ZealandPhilippinesSingaporeSouth KoreaTaiwanThailandVietnam

LATIN AMERICA

ArgentinaBrazilColombiaMexico

GLOBAL SUMMARY

COUNTRY BY COUNTRY FORECASTS

WESTERN EUROPE

AustriaBelgiumDenmarkFinlandFranceGermanyGreeceIrelandItalyNetherlandsNorwayPortugalSpainSwedenSwitzerlandUK

9121518212427303336394245485154

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CENTRAL & EASTERN EUROPE

BulgariaCzech RepublicEstoniaHungaryLatviaLithuaniaPolandRomaniaRussiaSlovak RepublicTurkey

NORTH AMERICA

CanadaUSA

5861646770737679828588

57

91

9295

99103107110116119124127130133136139143146

98

150153156159

149

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CONTENTS

MIDDLE EAST & NORTH AFRICA

MENAEgyptLebanon

APPENDICES

Global Market Sizes andGrowth RatesTelevision NewspaperMagazineRadio CinemaOOHDigital

163166169

162

172

173

177179181183185187189191

% SHARE OF AD EXPENDITURE BY MEDIA Television NewspaperMagazineRadio CinemaOOHDigital

Exchange Rates

193195197199201203205

207

ROW

South Africa

176

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KEY HEADLINES 1. Global growth is forecast at 3.8% in 2019, amounting to US$625 billion,

reflecting a relatively benign economic environment and continued broad-based recovery.

2. The pace of ad spend growth is decelerating from 4.1% in 2018. In 32 out of the 59 markets included in our forecasts, growth is forecast to slow down in 2019, but globally growth will likely accelerate to 4.3%in 2020.

3. Despite political uncertainties around Brexit, we’ve upgraded the UK’s ad spend forecast from 4.7% to 6.1% in 2019, reflecting the digital maturity of the UK market.

4. Digital remains the dominant force in ad spend and is forecast to cross the 40%-mark for the first time in 2019.

5. In the US, digital is predicted to overtake TV’s share of 2019 ad spend for the first time.

6. Mobile remains the fastest growing platform and is forecast to grow by 19.2% in 2019.

7. In China, Mobile is forecast to account for more than three-quarters of 2019 digital ad spend for the first time.

8. In 2019, TV is expected to make up just over one-third of global ad spend, its lowest share since our forecasts began in 2000.

9. Television’s ad spend growth is forecast to decline to 0.5% in 2019, but is expected to show some signs of recovery by 2020, reaching 1.6%.

10.Online video is forecast to grow by one-fifth in 2019 and is the fastest growing category within digital ad spend, driven by viewing habits on mobile devices and the popularity of streaming services.

A picture of modest growth globallyThe latest Dentsu Aegis Network Ad Spend forecasts show that growth is likely to hit 3.8% in 2019 (see Figure 1), amounting to US$625 billion. As a leading indicator of wider economic performance, this forecast reflects the global economy’s continued broad-based recovery with moderate growth expected into 2019, according to the World Bank. In 2020, we expect ad growth to bounce back to 4.3%.

Despite uncertainty around the impact of Brexit, the UK market will likely prove resilient. We forecast it to grow by 6.1% this year, a slight decrease on 2018 but still a relatively buoyant outlook. This amounts to £22.2 billion (around US$29.8billion) and is an upward revision from the 4.7% growth predicted in our June 2018 report, reflecting how the digital maturity of the UK ad spend market may insulate it against future geopolitical shock. Other notable markets include China, where ad spend is forecast to grow by 7% in 2019, reaching RMB 682 billion (around US$104 billion) and accounting 17% of global ad spend. And in the US, ad spend is predicted to growby 3% in 2019 to reach US$223.6 billion.

Some markets will experience a small increase in growth this year from 2018. For example, Canada’s ad spend is expected to rise from 3.7% to 5.2% in 2019, reflecting its wider economic growth trajectory supported by strong oil and gas exports. Meanwhile, in India ad spend will increase from 9.6% to 10.6%, strengthened in particular by events such as this year’s Indian general election and coverage of the Cricket World Cup in England & Wales. Japan, too, is forecast to see improved growth at 0.6% this year (up from 0.2% in 2018) due to key events like the G20 Osaka Summit, the Rugby World Cup and national events centred around the ascension of Japan’s new emperor.

However, in 32 out of the 59 markets included in our forecasts, global ad spend growth is expected to decelerate. While global economic growth helps to support continued ad spend growth, the absence of key global sporting events in 2019 is clearly having an impact.

Russia stands out as a market whose ad spend growth is predicted to decline sharply, with 6.9% growth this year from 12% in 2018. Rising taxes, pension reforms and declining consumer demand are leaving their mark—consumer confidence fell to -14 in Q3 2018, its lowest reading since Q2 2017 (according to Russia’s Consumer Confidence Index).

Global Summary

D E N T S U A E G I S N E T W O R K

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Digital by default (nearly)Digital ad spend is forecast to grow by 12% this year, reaching US$254 billion. In 2019, it will constitute more than 41% of global ad spend and in 2020, this will increase to almost 44% as the impact of the digital economy extends its reach (see Figure 2).

In the US, digital ad spend is forecast to overtake TV for the first time this year and will represent 37% of the total share. This represents a major landmark in a market where television has for decades been king. US digital ad spend growth will be at 12.3% in 2019 amounting to US$82.8 billion.

More widely, digital is predicted to have the largest share of ad spend in 26 out of 59 markets analysed this year (up from 21 markets in 2018), with not only the US, but also Czech Republic, Malaysia and Singapore joining this list for the first time this year.

Mobile on the marchWithin digital, Mobile ad spend remains the fastest growing platform and is forecast to grow at 19.2% in 2019. It owes much of its growth to the fast-increasing number of smartphone users, particularly within Asia-Pacific markets where it is estimated that there will be 1.59 billion smartphone users in 2019, up from 1.19 billion in 2016, according to eMarketer. As far as Mobile’s share of ad investment is concerned, it will make up 29% of global ad spend in 2019 and more than 30% of global ad spendin 2020.

In China, Mobile is forecast to account for more than three-quarters of 2019 digital ad spend for the first time and in India, it is expected that the growth of mobile ad spend will accelerate at pace, growing by almost half in 2019. Meanwhile in France, where a strong smartphone user base has already been established, Mobile constituted more than half of digital ad spend in 2018 and still looks to rise on a year-by-year basis.

The comeback kids?The decline of traditional media channels’ share of global ad spend is expected to endure. TV is expected to make up just over one-third of ad spend in 2019, its lowest share since our forecasts began in 2000. TV, newspapers and (to a lesser extent) magazines, radio and Out-Of-Home (OOH) ad spend will all experience a slightly smaller share of global spend this year and in 2020.

In markets like Australia and Germany, ad spend on press media (newspapers and magazines) is in steady decline. For example, in Australia, the 2018 Gold Coast Commonwealth games did not strengthen investment as hoped and ad spend on newspapers and magazines is forecast to decline by -8.6% and -24.0% respectively this year (from -4.5% and -26.0% in 2018).

While traditional media spend is expected to decline by -0.7% this year, there are some signs of recovery on the horizon. OOH is showing the highest growth rates, forecast to reach 4% in 2019 to reach a 6.3% share of total ad spend, encouraged by digital innovation that creates ads using contextual information like references to the region or weather to help resonate with audiences. For example, in April 2018, McDonald’s launched an eye-catching weather-reactive campaign on giant screens around the UK, teaming up with the Meteorological Office to re-imagine a typical menu as weather icons for a 5-day forecast.

Despite its shrinking share of ad spend, TV will see its growth improve from 0.8% in 2018 to 1.6% in 2020 supported by ad innovations, such as Connected and Programmatic TV. Moreover, in recent months we’ve seen digital disruptors like Uber and Dollar Shave Club investing in TV advertising, recognising the potential value of traditional mediums to strengthen their emotional connection with consumers (see our recent white paper New Brand Balance for more about this shift).


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Keeping it socialOnline Video is forecast to grow by one-fifth in 2019 and is the fastest growing category within digital ad spend, putting its growth ahead of Display, Social Media, Paid Search and Classified. Advertisers are strengthening their investment in Online Video as video platforms—like Instagram Stories and Snapchat—continue to boast hundreds of millions of daily active users. As of June 2018, Instagram Stories had 400 million daily active users, according to Statista, and streaming services grow in popularity supported by increased mobile usage and expanding mobile data packages. In July 2018, Spotify announced it had reached 83 million paid Premium subscribers, up from 70 million in January 2018.

In the US, Online Video is predicted to grow by 19.3% this year (compared with 18.5% in the June 2018 report), with YouTube representing 11% of Google’s net US revenues, according to eMarketer. Meanwhile, in the UK, Online Video is predicted to represent more than half of display ad spending by 2020.

Social Media is forecast to grow by 18.4% in 2019. Despite lingering concerns around brand safety and personal data use, the number of social network users continues to rise globally; Statista estimates that there will be 2.77 billion social network users in 2019 up from 2.46 billion in 2017. Understandably, then, advertisers will continue to utilise Social Media as a key platform for engagement with consumers.


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Western Europe Market

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LATEST KEY AD SPEND TRENDS• According to past data from January to August, the growth rate was not

as high as expected. Specialists predict that ad spends in the second half of the year 2018 will rise disproportionately high. The economic prosperity in Austria will then also appear in the spending figures.

• We predict that the year on year growth rate for 2019 will be smaller than expected in the June 2018 report. The reason for this assumption is the slow economic growth of 2019 and also 2020. This trend will also affect the ad spend growth.

THE 2019 AD SPEND FORECASTExperts believe that Economic prosperity will slow down in 2019 and the GDP growth will be smaller than the year before. This will also influence the ad spend growth rate for 2019 with less budget growth for advertising than 2018. We expect that Television and Digital will be the biggest drivers for total market growth. For the digital sub-categories Social Media, Mobile and Video we expect more budget than 2018 but especially US-firms will benefit from this growth.

Global or local events to boost spend in 2019In 2019 there is no big sport event with a major influence on ad spend but European Union Elections will play a role on influencing spendings. Nearly every party will nominate a candidate and promote them across the available media channels. This will increase ad spends in May. In Austria, especially billboards will benefit from the elections.

THE 2018 AD SPEND FORECASTAccording to the past data from January to August, year on year growth will be bigger than predicted in the June 2018 report. Television, Magazines, Radio and Digital media channels all have more spendings, while OOH has less budget (Austrian Parliament election was a big driver in 2017). At the moment Print is approximately at the level of last year, but we believe that these spendings will tip in the minus area later on in the year. Football World Cup had an affect on our market´s ad spend in June which were increasing, especially in TV, Radio and Print, but overall the World Cup didn’t influence the growth rate as much as expected.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)Half-year growth 2018 was lower than expected because one big player (Steinhoff-Gruppe with Kika/Leiner) had troubles and the Deutsche Telekom was waiting if their deal with UPC was legal. Specialists expect for the second half of the year increasing figures because budgets were shifted from first half year to second half year. Because of this predicted growth will be observed.

The economic contextAustria goes through an economic boom with GDP forecast from approximately 3,1%. There will be a growth slowdown in the next two years with 2,1% in 2019 and 1,7% in 2020. Unemployment rate will decline to 5% (-0,5%). Inflation is still above the European average being at approximately 2,2%. So there are no signs that the economy would impact the advertising spendings in a negative way this year. For the next two years the year to year growth will slightly decrease.

AD SPEND PERFORMANCE BY CATEGORY The Category “Home and Garden” shows the biggest year on year loss. The reason for this trend is the economic troubles of the Steinhoff-Group, the second largest spender of this category. Retail is still on the top of the table. Big spenders in this category are the grocery chains such as “Spar” and “Billa”. Services, which includes political parties and governmental departments, is also facing a minus because 2017 was a strong year with disproportionate spendings due to the Austrian parliament election.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OFAD SPENDSustainability is very important for consumer and the year to year growth is still rising. This will have an impact on advertising for biological food and brands like “Zurück zum Ursprung” or “Ja natürlich”.Consumers are increasingly interested in health issues therefore FMCG companies develop new products for different consumer types with variable needs. To communicate these variations of products they have to increase their ad spendings. This trend drives the budgets in the category “Cosmetics & Pharma” as seen in the table below.Consumers like to personalize and individualize their products. This means new opportunities for marketers to gain new clients. This trend will force the growth of digital spendings.

AUSTRIA: ‘Economic prosperity to slow down in 2019 influencing ad spend’


Year on year % growth at current prices

2018 2019f 2020f

Austria 2,7% (2,1%) 1,2% (1,5%) 1,1%

OVERVIEW OF THE TOTAL ADVERTISING MARKET

Top 10 Categories 2018

2018 Gross Local Currency Million

2018 vs. 2017YOY%

Retail 726 1%

Services 591 -4%

Media 414 4%

Home and Garden 383 -12%

Tourism 301 -1%

Cosmetics & Pharma 284 6%

Automotive 272 1%

Food 260 0%

Finance 254 -5%

IT/Office/Communication 172 10%

Previous forecasts in brackets from June 2018

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’MORE BUDGET ALLOCATED TO OOH EXPECTED IN 2019’

BY MEDIA.The 5 biggest by media ad spend trends in 2019

a.Print spendings (newspaper and magazines) will be less in 2019. We expect that the European Union election will help this category to reduce the decline. Without the Election in May we think there would be a bigger drop. Professional journals and magazines are showing a minus compared to last year and we expect these budgets in total for the year 2019 to be lessas well.

b.We expect Television to continue to be one of the biggest driver for total market growth in 2019. The biggest private TV contributor, the ProSieben.Sat.1Puls4 GmbH, is very successful with its diversification of the different TV stations. Although the public broadcaster ORF lost the national football league to Pay TV, they score with formula one, successful TV formats and high quality politics broadcasts.

c. OOH will also benefit from the European Union Election in May 2019, especially Billboard which is an important channel for the political parties. We are expecting the biggest growth rate in this section for Digital-Out-of-Home. These two factors will positively influence the ad spends for 2019. In comparison to this year, we estimate more budget for OOH in 2019.

d.2019 Radio will face declining ad spends. The years before Radio continuously achieved a budget rise at a lower level but this trend will stop next year. Radio will not benefit from the European Union Election in May 2019. “Ö3”-Radio is still the biggest player in the Austrian radio market, controlling nearly half of the total spends. And the supermarket chains such as “Spar” and “Billa” will continue to be the top spenders in thismedia channel.

e.In comparison to the global market, the share of online spendings in Austria is quite low. We expect that Digital along with its sub-categories will account for the largest amount of spending growth in 2019. The biggest drivers are Social Media, Mobile and Video but especially US-firms will benefit from this growth. In Austria we can´t book advertising for Subscription based Video on Demand (Netflix, Amazon Prime) or Broadcaster Video on Demand. Programmatic buying will grow disproportionately high in Austria.


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Austria Data Tables

DENTSU AEGIS NETWORK

MEDIA Y-O-Y % GROWTH AT CURRENT PRICES

2018 2019f 2020f

Television 3,2 7,6 6,2

Newspapers -0,8 -2,0 -2,0

Magazines 2,1 -5,3 -2,1

Radio 3,6 -1,5 -1,4

Cinema -9,9 5,6 -2,4

OOH -2,2 1,0 -2,4

Total Digital 8,8 5,2 4,0


2018 2019f 2020f

Total Digital* 8,8 5,2 4,0

Display (Banners) 5,4 2,6 1,0

Online Video 20,3 15,6 13,5

Social Media 27,9 10,3 8,1

Paid Search 4,6 2,2 1,6

Other incl. Classified 3,6 3,8 2,6

Mobile^ 34,5 35,9 22,6

ProgrammaticSpend^ 50,1 43,5 28,1

MEDIA % SHARE OF TOTAL ADVERTISING SPEND

2018 2019f 2020f


Newspapers 26,8 26,9 25,1

Magazines 19,0 17,8 17,2

Radio 5,5 5,4 5,3

Cinema 0,3 0,3 0,3

OOH 5,9 5,9 5,7


MEDIA % SHARE OF TOTAL DIGITAL SPEND

2018 2019f 2020f





Paid Search 28,3 27,5 26,9


Mobile^ 6,1 7,8 9,2


*Includes Mobile/Tablet and Desktop, ^Subset of Total Digital Spend

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LATEST KEY AD SPEND TRENDS• Overall downturn vs June 2018, particularly remarkable in Newspapers &

Magazines, not compensated for by other traditional media, and subject to the impact of the digital evolution not officially communicated.

• FMCG and Car advertisers keep reducing their expenditures; unusual high number of media pitches where media volumes are under pressure of procurement, impacting the overall market expenditures. The absence of a clear Digital view and effective results does negatively influence the level of investments.

THE 2019 AD SPEND FORECASTOn a like for like basis to 2018, a small upside is forecasted in 2019. The uncertainty around Brexit is negatively impacting the estimates and the 2019 local elections might also have an impact.

Global or local events to boost spend in 2019No sporting event expected. Brexit, EU and Belgian elections might impact the investments, but not necessarily positively.

THE 2018 AD SPEND FORECASTOn an annual basis, the 2018 Football World Cup has not boosted the expenditures despite the strong performance of the Belgium team. It has impacted positively the Q2 expenditures, but it was more a re-allocation of budget in this period than an overall increase, as confirmed by the fullyear forecasts.

FMCG and Car advertisers are reducing their expenditures, and the unusually high number of media pitches (where media volumes are under pressure of procurement) are negatively impacting the overallmarket expenditures.

The economic context.The overall economic situation remains stable: a GDP increase of 1.5%, the inflation remains at 2% due to the oil price increase, the unemployment rate is stabilized at 6.7% and the level of exports is slightly down.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OFAD SPENDThe inflation is due to the electricity (+8.7%) and oil price (+20%) increases. Food products also increase by 2.6%, while leisure, household and IT appliances are down by 5%.

BELGIUM: ‘Small upside is forecasted in 2019’



2018 2019f 2020f

Belgium -11,2% (-9,6%) 1,0% (2,3%) 1,3%

OVERVIEW OF THE TOTAL ADVERTISING MARKETTop 10 Categories


2018 vs. 2017YOY%

Culture, Tourism, Leisure, Sports 1002 -1,2%

Retail 638 -2,2%

Food 473 +7,4%

Services 399 -0,4%

Transport 372 -4,8%

Beauty-Hygiene 256 +6,2%

Telecom 177 -1,0%

House&OfficeEquipment 175 -4,8%

Health – Well-being 108 +6,8%

House&OfficeMaintenance 100 +4,3%


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‘RADIO REMAINS A STABLE MEDIUM EVOLVING POSITIVELY’


TelevisionTelevision stays the biggest media in Belgium, with a share between 40 and 47% depending of whether the digital media is in scope or not. 2019 will be a year without Football championship, which will normalize the audiences in June-July. In 2018, the Belgian market opened to advertising on TF1 (French channel), of which we will have to evaluate the further impact in 2019 (decreasing overflow, potential reshuffling of positions for the major sales houses in the South). Addressable TV was launched end of 2017 and very slowly evolved in 2018. However, still only 1,6% of all TV-campaigns were addressable. The offer should expand in 2019, which will enable us to evaluate if it’s all hype or a real trend. All TV sales houses continue to invest in online video, based on their premium content. Next step is to put data to use at its full potential.

NewspapersPrint media has been declining for a long time, but still holds a large part of total investment in the market with a share of 27,4 %. Dailies & Magazines are both impacted.

Radio Radio is a stable medium evolving positively in terms of media investments. It’s the 3rd main medium in Belgium. The measurement methodology of radio was updated in 2018, with a better measurement of digital listening. Sales houses are expanding their online audio offer in order to answer to the offer of Spotify, Deezer or other players.

OOHThe traditional OOH marketplace remains stable. Main OOH media owners (Clear Channel & JCDecaux) rationalized their traditional OOH inventory by focusing on better qualitative locations instead of quantity. Both actors continue to extend their 6sheet ‘proximity’ offer by enabling the buyer to cover with greater accuracy certain points of interests (POI) and/or points of sales (POS) and/or specific target. The traditional OOH ad spends are suffering due to several factors: an investment shift in digital media, an under-investment of FMCG and Car brands, a more fragmented offer, an insecure political climate (Brexit), an insecurity climate in Europe (terrorist attacks) and a current lack of accountability in OOH.

OOH stays stable with a share of 8%.On the other hand, digital OOH ad spends are growing thanks to the launch of several new digital networks in new environments and with suppliers investing in new digital screens as well as digitizing traditional formats. For brands these new sites provide a number of opportunities in terms of content and creativity. New technologies can offer brands the possibility of supplying their consumers with increasingly creative and personalized – and therefore relevant – content at the right place, the right moment and the right OOH context.


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Belgium Data Tables



2018 2019f 2020f

Television 4,9% 2,8% 2,9%

Newspapers -9,8% -1,9% -0,7%

Magazines -4,4% -2,3% -2,4%

Radio 0,3% 0,3% 0,3%

Cinema 0% 0% 0%

OOH 2,1% 1,2% 2,1%

Total Digital NA NA NA


2018 2019f 2020f

Television 47,6% 48,4% 49,2%

Newspapers 20,6% 20,0% 19,6%

Magazines 6,8% 6,6% 6,4%

Radio 15,3% 15,2% 15,1%

Cinema 0,8% 0,8% 0,8%

OOH 8,9% 8,9% 9,0%

Total Digital NA NA NA


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THE 2019 AD SPEND FORECASTThe total ad spending for 2018 is expected to increase by 1.6%. We have no numbers on the 2019 forecast but we expect a small increase of 1-2.0%. It is predominantly the digital trends that will drive this development.

Global or local events to boost spend in 2019Sporting: VM in European Handball in Denmark (January)

Political: General Election (by 17 June 2019 at the latest)

THE 2018 AD SPEND FORECASTThe Danish advertising market is expected to increase by 1,6% this year according to The Institute for Advertising and Media Statistics (IRM). The forecast is expected to be slightly higher in 2019. The entire market is estimated to amount to almost 14 billion this year. The growth is primarily in digital media, with a two-digit increase in Search, Social Media and Online Video. Traditional media such as OOH and Radio are expected to show a slight increase in 2018.

The economic contextThere is a favourable economic climate (boom) in Denmark and consumers are willing to spend a lot of money on goods and services – countless records are being set when it comes to the amount of shopping, both offline and online.

AD SPEND PERFORMANCE BY CATEGORY Increase in Total Digital in share of total advertising spend (36% in 2018, 37% in 2019, 40% in 2020)• Decline in Display Banners (37% in 2018, 22% in 2019, 20% in 2020)• Increase in Social Media (15% in 2018, 20% in 2019, 22% in 2020), Paid

Search (9% in 2018, 10% in 2019, 10% in 2020) and Programmatic Spend (39% in 2018, 48% in 2019, 48% in 2020)

Slight decline in Television (41% in 2018, 40% in 2019, 39% in 2020) and Newspapers and Television (7% in 2018, 6% in 2019, 5% in 2020)

Slight increase in Cinema (3% in 2018, 4% in 2019, 4% in 2020) and OOH (5% in 2018, 6% in 2019, 6% in 2020)

Stagnation in Magazines (3% in 2018, 2019, 2020) and Radio (5% in 2018, 2019, 2020)

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OFAD SPENDConsumers are increasingly using digital media that offers targeted communication, and mobile, which offers information on-the-go that can help navigate, coordinate chores and provide entertainment in one’s everyday life.

DENMARK: ‘Digital trends predominantly driving development’



2018 2019f 2020f

Denmark 1,6% (1,1%) 1,7% (1,7%) 2,0%



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‘PROGRAMMATIC SOLUTION FOR ADDRESSABLE FLOW-TV EXPECTED IN 2019’

BY MEDIAThe 5 biggest by media ad spend trends in 2019

a. Programmatic Buying Programmatic is still a popular tool in digital advertising powered by data availability. Programmatic buying was expected to represent more than 70% of the total display advertising in 2017 and this development is continuing into 2018. Within programmatic and digital advertising there is a lot of discussion around ad viewability, the technology behind it, the optimization of viewability and whether it can be used as a way to measure quality/success. It has become a hot topic ever since a report showed that 54% of display ads were not being seen, despite advertisers paying for them. Since high ROI is correlated with improved ad viewability, it is in the best interest to improve the visibility of ads.

e. DOOHWe expect more spend on DOOH. Through dynamic DOOH advertisers are able to buy campaigns automatically in (programmatic) real time. This means that campaign distribution is based on data, which ensures that we communicate to the right people at the right time with the right message. For example, we can now activate a campaign during e.g. certain weather conditions.

f. Proximity OOH BuyingThrough proximity buying, we can now do more specific OOH buying in terms of where the audience is located and at what time. Furthermore, we can also specify real-time content which we think is most likely to obtain a response from the audience.

b. Declining traditional TV ads So far, consumers’ time spent on watching TV has decreased by 1% in 2018, so the decline has stopped (momentarily?). The decline in TV can partly be explained by the fact that consumers are moving their attention to digital (streaming) platforms. Also, when watching television consumers are “second screening’ as they place attention on content on their smartphones, laptops and/or tablets while they are watching TV. This means that it is no longer the various television programs or ads that compete for media users' attention. Thus, TV ad spending is expected to further decrease.

c. Addressable TVAddressable TV is now on the agenda enabling advertisers to buy and distribute ad-server controlled and real-time delivered TV ads. Therefore advertisers can move beyond large-scale traditional TV ad buys and instead focus on relevance and impact. Web-TV from broadcasters has become addressable, and the next step is to create addressable flow-TV. However, it might take some years before they can really manage this task. Addressable flow-TV is sold as digital video in 2018 and we expect a programmatic solution in 2019.

d. More Mobile The mobile platform has experienced an increase in daily coverage from 19% in the first quarter of 2017 to 37% in the first quarter of 2018. Thus, mobile is the platform that has increased its coverage the most among Danish Internet users during this period.


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Denmark Data Tables



2018 2019f 2020f

Television -1% -1% -3%

Newspapers -5% -3% -3%

Magazines -2% -5% -6%

Radio 4% 6% 5%

Cinema -10% 10% 4%

OOH 3% 4% 4%

Total Digital 7% 6% 6%


2018 2019f 2020f

Total Digital* 7% 6% 6%

Display (Banners) -2% -5% -7%

Online Video 18% 25% 20%

Social Media 20% 20% 20%

Paid Search 15% 20% 15%

Other incl. Classified 5% 2% 0%

Mobile^ 30% 40% 50%

ProgrammaticSpend^ 65% 50% 40%


2018 2019f 2020f

Television 41% 40% 39%

Newspapers 7% 6% 5%

Magazines 3% 3% 3%

Radio 5% 5% 5%

Cinema 3% 4% 4%

OOH 5% 5% 6%



2018 2019f 2020f

Total Digital*

Display (Banners) 37% 22% 20%

Online Video



Other incl. Classified

Mobile^



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LATEST KEY AD SPEND TRENDS• 2018 ad spend growth has been slower than we predicted and an

unusually warm summer slowed media consumption during the months of June and July.

• Healthy economic situation in Finland has not impacted advertisers’ media budgets yet, but we still expect ad spend to grow in the coming years.• Digital ad spend growth is still on a very good level but the decline of print

media continues.

THE 2019 AD SPEND FORECASTThe ad spend growth forecast for 2019 is 1,1%, which means the total ad spend market will reach 1.189 million euros at the end of the year. Digital ad spend growth and the slowing down of the decline of print media are expected to be the drivers of growth. About a third of the Finnish ad spend is still in Print media, but it remains just a fraction of the size it was 10 years ago.

Global or local events to boost spend in 2019Parliamentary elections in the beginning of 2019 will boost ad spend at the beginning of the year.

THE 2018 AD SPEND FORECASTThese global events have not had a significant effect on ad spend, especially in the case of the FIFA Wold Cup as this was mostly broadcasted on the government owned non-commercial channel YLE.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The original prediction for 2018 was slightly higher than our current one as we expected the positive economic growth to have more of an impact on ad spend budgets. We still predict marginal growth in the coming years based on the solid growth of digital media.

The economic context.2018 is the third year of economic growth in a row and unemployment levels are at their lowest since 2011. The growth is expected to slow down next year due to declining foreign demand and tightening of financial conditions. While more people have found work in recent years, due to the aging population structure the actual working population is shrinking, which limits the potential growth in coming years. (Bank of Finland & IMF)

AD SPEND PERFORMANCE BY CATEGORY Finance sector has increased ad spend by 26% in the period January to September in 2018. Other increases have been groceries at 7,9%, recruitment at 6,1% and Oil and energy companies at 5,8%.

Cosmetics sector ad spend has declined by 13,5%, retail by 6,6%, medicine by 4,3% and auto industry by 2,2%.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDBy far the largest trend which has been going on for almost a decade is the shift from Print media to Digital in Finland. Print has traditionally had a very strong share of the media market. Even though it has declined over the years, over 30% of the ad spend remains in Print, but it has come down from over 50% in the beginning of the 21st century. The question around print is when will the decline stop, or even slow down. Digital took over in 2017 as the largest media type and is definitely the biggest driver of growth in the market.

TV Market is also disrupted by the popularity of VOD subscription models especially in the younger audiences, which results in more ad spend flowing towards Digital as that is where you can reach the younger audiences. Finland’s population structure is quite old and the older target audiences still spend many hours per day watching TV.

FINLAND: ‘Slowly returning to growth’



2018 2019f 2020f

Finland 0,3% (0,9%) 1,1% (0,6%) 0,9%



19

‘DIGITAL GROWTH DRIVEN BY ONLINE VIDEO TO LEAD MARKET GROWTH’


TVTV market has declined marginally in the past few years and we expect this trend to continue due to the rising popularity of subscription based content models (Netflix, HBO Nordic etc.).

Internet usage and MobileDaily usage of internet on mobile is at 66% currently for the whole population while 91% use the internet daily on any device (CCS 2018). Katsomo and Ruutu say over 50% of their watching comes via mobile devices, while Facebook reports over 85% of usage is now mobile.

Online VideoOnline video growth has been a significant factor in the digital ad spend growth. Facebook video in particular has risen in popularity and we’re expecting this to continue in coming years. Currently the non-commercial Yle-areena along with commercial VOD-services Katsomo and Ruutu are most popular among adults, whilst Netflix and YouTube are the most popular in the younger audiences (CCS 2018).

AmazonAmazon is bringing their ecommerce business to Finland which is expectedto disrupt the ecommerce market and challenge the current, mostlylocal, players.

Streaming and subscription based VOD servicesOnline streaming based watching is increasing steadily as new CCS 2018 data shows. Compared to 2016 CCS-data 25% more consumers have a subscription to an online video streaming service, and 50% more are using one. Currently 40% of households are subscribed to a streaming service and 36% of the population are actively using one. 8% are planning to buy a subscription within the next year.


20

Finland Data Tables



2018 2019f 2020f

Television -0,5 -1 -2,8

Newspapers -10 -5 -5

Magazines -7 -6 -6

Radio 5,1 2 1

Cinema 1,5 5 4

OOH 10 3,1 0

Total Digital 10 8 8


2018 2019f 2020f

Total Digital* 10 8 8

Display (Banners) 7 9 7,8

Online Video 57,1 15 15


Paid Search 6 4,1 5,3

Other incl. Classified -3,6 5,7 7,2

Mobile^ N/A N/A N/A

ProgrammaticSpend^ 59,4 20 x


2018 2019f 2020f


Newspapers 27,7 26 24,5

Magazines 5,7 5,3 4,9

Radio 5,7 5,7 5,7

Cinema 0,6 0,6 0,6

OOH 5,3 5,4 5,4

Total Digital 34,7 37 39,6


2018 2019f 2020f




Social Media N/A N/A N/A

Paid Search 29,5 28,4 27,7


Mobile^ N/A N/A N/A

ProgrammaticSpend^ 36 40 45


21

LATEST KEY AD SPEND TRENDS• On the 1st semester of 2018, net ad spends results published by IREP

showed an impressive rise of +5,2% vs. 1st semester of 2017. The market weights more than 5,5 billion € (except mailing). This rise is a very good sign for our sector and consolidates our optimistic forecasts for FY 2018 and 2019.

• Digital ad spends shine with a boost of +15,5% in one year, especially thanks to display (+29,9%). TV with +1,6% growth has been carried by sponsoring ad spends (+33,1%).• The effect of the Football World Cup has been profitable for TF1, the

broadcaster, with a rise of +6,5% of its ad spends on Q3 2018, its highest rise since 2010. The other channels, above all M6, have lightly suffered during Summer because of the Football World Cup.

THE 2019 AD SPEND FORECASTIn 2019 the Rugby World Cup in Japan should add to the recovery of economic activity.

Our all-media advertising market should grow by +3,1%, still driven by digital investments with +8,1%, TV media with +0,8% and OOH media up by +2,2%. At the end of the year 2018, our president should review the laws concerning the media calendar e.g. the forbidden sectors in TV such as discounts promoted by retailers and movie trailers, as well as programmatic TV. If legislative changes are decided, our market in 2019 could be positively impacted.

Global or local events to boost spend in 2019Rugby World Cup during Fall 2019, as we said, should boost TV ad spends, because despite the jet lag this event is gaining popularity and audiences in France. For Dentsu France, this event is especially important because one of our major clients, the bank Société Générale, is a sponsor. European elections will take place on the 26th of May 2019 in France, but since it’s a global election it won’t have as much impact as a national election. It will be less followed in the media than presidential elections for instance, thus we don’t foresee it impacting on ad spends during Spring.

THE 2018 AD SPEND FORECASTOlympic Winter Games were well attended and generated good audiences despite the jet lag. On the other hand, it did not constitute a windfall in terms of advertising revenue. The World Cup however has benefited mainly the audiovisual media and of course the Internet due to the short time zone of broadcasting. Digital is still the most invested media and is the motor of the sector, covering 19% of the total ad spends.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)Forecasts for FY 2018 highlight recovery for the sector, with +2,3% growth in one year. This recovery, initiated 3 years ago, is finally becoming real with strong signs of good health. However, this growth is slightly weaker than the economic growth.

The economic contextGDP growth reached +0,4% during Q3, instead of +0,2% during the 2 first quarters. Activity has been boosted thanks to households consumption, which has gained +0,5%. Nevertheless the unemployment rate has increased by +0,5% during Q3 2018 compared to Q2 2018, but economists count on a decrease at the end of the year with 8,9%.

AD SPEND PERFORMANCE BY CATEGORY We forecast a strong increase for automotive ad spends, with +12% in one year leading to 3,5 M€ of gross ad spends. The market is in good shape with continuing increase of sales. Retail should be more flat with a forecast of -0,4% and food sector with -1,8%. The biggest fall should be media information (-9,0%) and culture (-8,8%).

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OFAD SPENDMajor consumer trends in France are related to organic and natural products consumption. Nielsen forecasts a +20% rise for organic products in France in 2018. Even if the trend is not new, this rise proves that there is still a potential for catching new clients.

Digital revolution is still ongoing and we are monitoring activity regarding IA and connected speakers. The equipment in France is still low, with less than 10% of the households being equipped.

FRANCE: ‘Optimistic forecasts for FY 2018 and 2019 consolidated’



2018 2019f 2020f

France 3,6% (2,5%) 3,1% (2,8%) 2,5%




2018 vs. 2017YOY%

Retail 5 642 663 -0,4%

Automotive 3 516 790 +12,0%

Food 2 593 211 -1,8%

Culture & Leisures 2 187 914 -8,8%

Beauty care 2 143 953 +1,1%

Bank & insurance 1 965 243 +0,5%

Tourism 1 670 760 +3,5%

Media information 1 511 554 -9,0%

Services 1 349 141 -2,5%

Telecommunications 1 322 630 -5,4%


22

‘TV AD SPENDS SHOULD BENEFIT FROM RUGBY WORLD CUP’


Digital In 2019, total digital is expected to grow by +8,1% vs 2018 and should reach 41,3% of SOM, equal to the total ad spends of press in 2007. Among digital levers, display should rise by +13,9%, especially because of mobile (+20,7%) and video (+20,5%). Total Video should account for 867 M€ and 17,7% of digital investments. The popular outstream formats and the video instream on the replay platforms will also make it possible to better monetize this lever.

Total display will reach 1 985 M€ in 2019. Paid Search, the first digital lever, will grow by +4,5% with 2 255 M€, accounting for 46,1% of total investments. The growth will mainly be carried by mobile (+10,0%). In 2019, programmatic buying will continue to grow (+24,0%).

b. TelevisionWe count on a growth of +1,3% for TV ad spends at the end of 2018, a growth carried by sponsoring TV. The opening of forbidden sectors (retail discounts, cinema) and the authorization of programmatic buying on TV is a work in progress in France. The lobbying of the TV groups should lead to new legislation, most probably in 2020 but with some progress in 2019. By the end of 2019, ad spends should benefit from Rugby World Cup in Japan, especially if the French team is successful. We expect a +0,8% growth for 2019, with 3 357 M€.

c. Press The fall is still ongoing for this media even if we predict a lower decrease, with -5,0% of net ad spends by the end of 2018 for newspapers and -6,5% for magazines. Newspapers (especially the sports news “L'Equipe”) have benefited from Football World Cup during Summer, but over a short time period. Print titles take advantage of connected speakers by launching applications, such as “Les Echos” or “Vogue” giving voice to written content.

In 2019 ad spends should fall by -4,2% for newspapers and -4,5% for magazines (keeping in mind that the ad spends for press websites are counted within digital). Despite good audiences, especially on digital, the press can not find a virtuous business model that would lead to dynamic progression. The Gravity and Skyline alliances are not managing to reverse this trend for the moment. These alliances between press groups, but also TV and e-commerce sites, have the ambition to share their data and allow agencies to buy in programmatic and real time. The scourge of the press in France is not only the GAFAS and the closing of the kiosks, but its free model. Advertising that finances the non-paying model can no longer finance newspapers alone.

d. RadioRadio will be almost flat, with only +0,2% of growth in 2018 and 2019 as well. Classical radio ad spends remain steady and is still sold at a very low price, weakening the media. Nevertheless, digital audio (podcasts, webradio…) is a great opportunity for the channels and has had impressive success in France. Thus, it opens new advertising possibilities for brands in a privileged universe. Regarding radio measurement, a new methodology –based on pagers measuring all radio listening of the panelists, coupled with the declarative measure – will be implemented in September 2019.

e. OOH We expect 2018 to be a good year for OOH thanks to the Football World Cup, with a forecast growth of +2,4% by the end of the year. This is also due to the natural progression following a presidential elections year (SOM at 10,5% and 1 208 M€). Displayce, a digital platform, expects a +78% increase in DOOH advertising expenditures (end of 2017 to 2019), which will contribute to growth for the whole media. For 2019, we forecast a rise of +2,2% carried by DOOH ad spends.


23

France Data Tables



2018 2019f 2020f



Magazines -6,5 -4,5 -4,0

Radio 0,2 0,2 0,5

Cinema 2,1 3,0 3,9

OOH 2,4 2,2 2,4



2018 2019f 2020f







Mobile^ 18,7 15,0 11,2



2018 2019f 2020f




Radio 6,1 5,9 5,8

Cinema 0,8 0,8 0,9

OOH 10,5 10,4 10,4



2018 2019f 2020f





Paid Search 47,7 46,1 45,0


Mobile^ 52,0 55,0 57,0



24

LATEST KEY AD SPEND TRENDS• Despite a stable economy during 2018 the political national and

international climate dampens the previous slightly positive outlook significantly -> advertisers act much more cautiously than in theprevious year.

• Classical media investments in particular declining more than expected, but the development of most digital media channels is also slowing down. Data protection and brand safety issues have left a clear markon investments.• The forecast for the next two years had to be adjusted downwards as well

since relevant economic and political factors don’t allow toomuch optimism.

THE 2019 AD SPEND FORECASTThe forecast for next year had to be adjusted due to several risk factors such as increasing tensions between EU and the US, but also within the EU itself – upcoming Brexit, refugee disagreement, possible punitive tariff and a growing anti-EU attitude in several countries. Moreover, big media players such as Facebook struggle with data protection regulations.

Nevertheless, most online channels will keep on growing to the disadvantage of classical media.

Global or local events to boost spend in 2019There will be no large local sports or political event in 2019 that is expected to boost the German ad market.

THE 2018 AD SPEND FORECASTWhile the big sports events and the US mid-term elections did not have a huge effect on advertising expenditures in 2018 the regional elections in Bavaria and Hesse caused some uproar. Withering support of mainstream political parties (in favour of more right/left-wing ones) means a weakened government – which is one of the risk factors for the economy and advertisers.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The following factors can all be seen as having a negative impact on the development of ad spends – rather unpredictable as to its extent: Tense situation EU-US (e.g. threatened tariffs); political shift to the right and anti-EU sentiments in Europe; tense political climate in Germany after 2 regional elections in Autumn; “diesel-scandal” with no clear legal situation yet; very long and hot summer – leading not only to reduced harvest, but also to extremely low tides which effect the transport options for produce and oil, and leads to higher prices; expected rise of minimum wages (higher costs for industries). In the media market ad channels had to deal with sinking reaches and on-going shifts from classical to digital. At the same time video inventory is lessening and big players have to deal with brand safety and data protection regulations. All this provides enough reason for advertisers to play it safe and be rather hesitant with ad investments.

The economic contextEven against the backdrop of a stable economy in the first 3 quarters of 2018 and low unemployment figures, the factors described in question 4 have led to more economic instability than expected by the government and IMF. Both have recently reduced their economic forecasts for 2018. International trade conflicts will slow down growth in the export country Germany.

AD SPEND PERFORMANCE BY CATEGORYMost of the top categories in the German ad market stay stable or are even expected to show a slight growth overall in 2018 compared to the year before. However, lots of other categories such as consumer electronics, IT, tourism, telecommunication and energy will clearly invest less in advertising than in the year before. (Note that the ranking is based on gross advertising expenditures by Nielsen. Net ad spends for segments are not available in Germany).

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDThe German media and entertainment market is still thriving, Germans still spend time and money on media products – preferably on audio/video. Watching TV (95%), listening to radio (90%) or music (85%) and the Internet (78%) are the main leisure time activities*.TV is still the most used video channel, but 25% of online time is spent with video content, paid VoD is growing rapidly**.

Audio is gaining momentum, pushed by growing access possibilities via voice control/smart speakers.The smart phone is a permanent companion with an average use of more than 4h per day, mostly for gaming, music and messaging.***

GERMANY: ‘Significant decline in expectations’



2018 2019f 2020f

Germany 1.0% (2.6%) 0.5% (2.9%) 0.5%


Top 10 Categories 2018 (gross)


2018 vs. 2017YOY%

Retail 5.039 € 0,4%

Media 4.864 € 0,2%

Services 3.614 € 3,5%

Automotive 2.393 € 0,5%

Body Care 2.288 € -1,0%

Food 2.268 € 2,5%

Health & Pharmaceuticals 1.806 € 2,1%

Home and Gardening 1.531 € 2,8%

Finance 1.345 € 9,0%

Beverages 1.307 € 1,5%


*Source: BAT, Freizeit-Monitor 2018, at least once a week**Source: Kantar TNS Convergence Monitor 2018***gfu Studie 2018

25

‘DIGITALISATION OF MEDIA GOES ON’

BY MEDIATHE 5 BIGGEST BY MEDIA AD SPEND TRENDS IN 2019

TV: If you can’t beat them, join themThe threatening spread of SVOD in Germany and its challenging of traditional linear TV has become obvious. Yet due to still fairly solid usage figures and the relative scarcity of brand-safe online video-inventory, good old broadcasting-TV continues to bind a dominant share of the ad investments on the home screen – partly because of the two SVOD leaders Netflix and Amazon Prime’s reluctance to enter the advertising market. This gives German TV houses some time to develop their online (free/pay) and connected-TV portfolios.In an effort to reach out for TV budgets, Google and Facebook are working with the TV measurement joint-industry-committee AGF. Despite the long delay, the market is still urging for comprehensive TV data, a widely accepted “currency” that includes linear TV, online video, mobile video and advertising.

b. Mobile: Strong but still teethingThe growth of mobile in digital advertisement is unchallenged. The pocket-hub continues to show double-digit progression rates due to its unrivalled relevance for m-Commerce and emotional communication through video and social media. Stories, Virtual- and Augmented-Reality are setting new best practices for story-telling.

This relevance also has its dark sides though: ad fraud peaks and there are political frictions regarding the lagging enhancement of the German infrastructure with 5G.

c. Programmatic: Growingly widespread and complexProgrammatic has been the dominant buying mode for display advertising for a couple of years, mostly driven by mobile and video lately, the process is eventually being established for audio and DOOH. The last years have seen a rise of new deal forms like header bidding and SSPs growingly resorting to first price auctions, which might lead to higher CPMs. Even if (according to IAB Europe) private market places are the most used programmatic mechanism, by reinforcing safety and transparency issues these developments will contribute to more complexity and sustain the trend to integrate the ad tech supply chain (“in-housing”).

d. Audio: Listening is the new readingTechnical developments such as voice assistants and smart speakers push the usage of audio as a media channel and advertising vehicle. Voice search is the next big thing and voice assistants will change story telling.

Moreover, one of the biggest radio sales houses RMS has launched the 1st audio DMP and is therefore able to reach cord-cutters and adblockers with audio advertising. They invest in technical progress such as a joint booking platform and automation possibilities which will ease and accelerate bookings and support further programmatic approaches.

e. OOH: The wind of change continues to blowWhile recent years provided the medium with double digit growth and a clear tailwind in its transformation, it is proving rather robust in a flat advertising market.OOH continues to invest in its positioning to provide advertisers with the right response to the social trends of urbanization, increasing mobility and digitization for marketing and media planning. Technology, data and infrastructure continue to seamlessly come together and enable a new era of efficiency and effectiveness for advertisers.


26

Germany Data Tables



2018 2019f 2020f

Television -1.3 -1.2 -1.2

Newspapers -4.3 -5.5 -6.6

Magazines -8.0 -7.6 -7.9

Radio 1.0 1.1 1.1

Cinema -9.0 -4.0 -4.9

OOH -5.0 -3.0 -2.2

Total Digital 9.0 6.5 6.1


2018 2019f 2020f

Total Digital* 9.0 6.5 6.1

Display (Banners) -7.0 -5.2 -5.4

Online Video 9.5 7.0 4.9

Social Media 9.8 9.3 8.5

Paid Search 2.0 2.0 2.0

Other incl. Classified n.a. n.a. n.a.

Mobile 50.0 41.0 31.3

ProgrammaticSpend^ 41.6 20.6 15.1


2018 2019f 2020f

Television 31.5 30.9 30.4

Newspapers 11.8 11.1 10.3

Magazines 9.8 9.0 8.2

Radio 5.3 5.3 5.3

Cinema 0.4 0.4 0.4

OOH 4.1 4.0 3.9



2018 2019f 2020f


Display (Banners) 15.6 13.9 12.4



Paid Search 53.4 51.2 49.1

Other incl. Classified n.a. n.a. n.a.

Mobile 11.2 14.9 18.4



27

LATEST KEY AD SPEND TRENDS• No real event / change has been monitored since the earlier report.

• In terms of legal framework, the Terrestrial DTV licences process conclusion and the changes in the TV Levy, together with the 2018 change in Media Law, have created a new wave of turbulence in the market.• The market growth is mainly driven by inflation pressure that increases

the cost of CPP for the advertisers. This is a trend that is expected to continue in 2019.

THE 2019 AD SPEND FORECAST 2019 is expected to be another year of sluggish growth since the macroeconomic situation is still uncertain, unemployment rate remains in high ratio and no changes in disposal income are expected.

The positive –slightly positive – climate is driven by TV CPP inflation (cost of TV remains low compared to European ratios), energy sector growth and the slow recovery in Automotive industry spend.

Global or local events to boost spend in 20192019 is a year of regional, European and National elections. Currently the expectation is that all three will occur in Q2 thus any negative impact on the economy /ad spend is expected to be minimal. Still the national elections timing and result remains a high risk factor.

THE 2018 AD SPEND FORECASTThe 2018 Football World Cup has brought in a 1,5-2% incremental spend in the market during Q2-Q3 but this is not a sustainable trend.

OTT TV formats are starting to present penetration in the Greek Market but it is too early to measure the impact. TV remains the leading media in terms of ad spend but Video On line is gaining momentum although non-measured. OOH maintains growing momentum.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)No significant changes to the ad spend forecasts. The Football World Cup had a slightly better performance than expected in TV and Display spend. Otherwise the overall situation in 2018 will remain in the forecasted area.

The economic contextSince late August, Greece is formally out of the strict Financial Supervision of EU institutions with improved surplus that is mainly driven by Public Sector investment cuts and increased taxes. Organic real economy growth is still very low and Foreign Investments boost is not evident. Unemployment ratio, though improved, is still very high thus being the major risk on future predictions, directly corresponding to the disposable income and the GDP growth.

GREECE: ‘Struggling to return to growth’



2018 2019f 2020f

Greece 4.5% (4.5%) 4,5% (4,2%) 4,0%



28

‘OOH EXPECTED TO CONTINUE ON AN UPWARDS PATH’


a.In TV double digit inflation pressure is driving advertising expenditure growth.MEGA Channel: The leading TV Channel for almost a decade in terms of Advertising spend after a severe turbulence in the last 2 years (2016 and 2017) has ceased broadcasting. There has been a new entry in the TV landscape, Epsilon TV changed management and started it’s ambitious programme on October 24th. A new Media law voted in April 2018, together with the reduction of TV tax from 20% to 5% and the conclusion of the National Digital Terrestrial TV licenses, is expected to further boost TV Cost Inflation.

b.GDPR enactment might slow down E-commerce and Performance related spending in the short term, while the industry will be in the “getting compliant” phase.

c.In 2018 OOH is expected to continue the up-ad spend path, powered by the upsurge of mobile OOH formats and digital formats integration.

d.Radio and Print media will remain in the role of the follower as a tactical media vehicle.

Newspapers and Magazines will continue to shrink while a sluggish growth in radio will primarily come from regional Radio stations.


29

Greece Data Tables



2018 2019f 2020f



Magazines -7,3 -2,6 -2,7

Radio 5,0 4,8 3,0

Cinema NA NA NA

OOH 9,3 6,9 6,4



2018 2019f 2020f



Online Video NA NA NA

Social Media NA NA NA

Paid Search NA NA NA

Other incl. Classified NA NA NA

Mobile^ NA NA NA

ProgrammaticSpend^ NA NA NA


2018 2019f 2020f




Radio 7,3 7,3 7,3

Cinema NA NA NA

OOH 5,8 5,9 6,0



2018 2019f 2020f


Display (Banners) 100 100 100

Online Video NA NA NA


Paid Search NA NA NA


Mobile^ NA NA NA



30

LATEST KEY AD SPEND TRENDS• Strong performance across the market in Q3 means an upwards revised

forecast for the year. Moving from +0.6% in Q2 to our current position of +2.7%.

• TV, while still down YoY (-2.5%), is showing a significant improvement on the last forecast (-9%). Digital and OOH are still the only media that are showing growth, Digital is currently showing strong growth at +12% with OOH at +2%.• Newspaper, Magazine and Radio suppliers are having a turbulent year with

the majority of suppliers seeing decline YoY.

THE 2019 AD SPEND FORECASTOur forecasted position for 2019 is 4.4% growth (€38mil).

Rugby World Cup is the biggest sporting event in 2019, this, coupled with further Digital growth – predominately paid search, social media and video –will drive the 2019 position.

Global or local events to boost spend in 2019Yes, the Rugby World Cup in Japan is likely to see an ad spend boost in the Irish media industry. Rugby is on the up in Ireland with the national team performing well and currently ranked no.2 in the world. Expectations are high and brands are latching on to the hype and likely to spend a lot in the build up.

THE 2018 AD SPEND FORECASTWinter Olympics and US elections have minimal impact on Irish media –World Cup definitely had a positive impact on the market with TV seeing a boost in ad revenue. Without the World Cup our forecast would be down a couple of %.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)Stronger ad revenue than expected around the World Cup has impacted our 2018 forecast – with Ireland not qualifying there wasn’t much expectation around it but as it drew closer brands began to latch on to it and piggyback on the hype in the UK. Due to this increased expenditure we’ve also revised our 2019 position, with Ireland not only involved, but in contention to win the Rugby World Cup we envisage strong ad spend around the event.

The economic context• Economy rebounds strongly in 2013-17 period. GDP growth of 5.1% in

2016, 6.5% in 2017. Domestic economy has recovered strongly, led by rebound in investment and retail spending. Strong jobs growth. Unemployment rate fell from 16% in early 2012 to near 6% by end of 2017.

AD SPEND PERFORMANCE BY CATEGORYDrink, Govt Social & Political and Finance were the categories with the biggest YonY increase (+20.54%, +18.74% and 13.45% respectively).Motors is down significantly for another quarter (-14.49%).

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDRetail sales values grew by 3.9% in the third quarter of the year compared to the same period in 2017, giving rise to positivity as retailers approach the crucial Christmas period. With wage growth running at 3% and increases in consumer disposable income of 4.4%, retailers feel they are not getting their fair share of that uplift with greater levels of spend now going towards other sectors of the economy including the hospitality industries.The report showed that the long hot summer was a major boost for convenience stores but there was evidence that the extra spend across the summer led to some belt tightening in September itself. Some evidence of premium products and treats over indexing in the sales recovery, a

bellwether for the stronger economy.

IRELAND: ‘Slight recovery after strong Q3’



2018 2019 2020

Ireland 2.7% (0.6%) 4.4% (2.9%) 5.7%




2018 vs. 2017YOY%

Retail 164,341,798 0.17

Entertainment & The Media 70,683,512 -3.77

Household Services 69,698,365 -8.17

Finance 67,434,848 13.45

Govt,social,politicalOrganis 49,172,487 18.74

Motors 46,931,959 -14.49

Travel & Transport 43,724,154 -2.47

Food 43,693,028 0.91

Drink 42,874,322 20.54

Cosmetics & Toiletries 26,818,780 -7.72


31

‘DIGITAL NOW REPRESENTS CIRCA 44% SHARE OF SPEND’


a.The Drink category saw the largest increase YoY, the World Cup and incredible summer weather was behind the increased spend across Q3. Govt, social and Political are up 19% YoY. This was bolstered by the recent Irish presidential election and referendum.

b.Dept of Finance Trade with UK equates to 35% of Irish GDP. As a key trading partner the UK takes 43% of Irish indigenous firm exports, and the expected negative impact of Brexit on the UK economy will have a knock-on effect in Ireland. Sterling has fallen sharply on Brexit concerns, which hits exports to UK and impacts Irish firms competing with UK exports to Ireland and elsewhere.

c.The Digital Share of spend now represents circa 44% share of spend V’s 21% in 2012, furthermore in the same period Display spend jumped from being majority Desktop to now being 58% Mobile in 2018.

d.The impact of the big tech companies GAFA (Google, Apple, Facebook and Amazon) is impacting growth of the agency digital spend % with some clients spending directly with the tech giants. This is further hindered by the fact both Google and Facebook have large operations based in Dublin.

e.• Strong performance across the market in Q3 means an upwards revised

forecast for the year. Moving from +0.6% in Q2 to our current position of +2.7%. Digital and OOH are the only media showing growth, TV while down YoY is looking slightly better than previous forecast at -2.5%. Newspaper, Magazine and Radio suppliers are having a turbulent year with the majority of suppliers seeing decline YoY.


32

Ireland Data Tables



2018 2019f 2020f

Television -2.5 2.0 4.0

Newspapers -11.3 -5.9 9.6

Magazines -9.6 -7.5 0.0

Radio -1.2 0.0 3.8

Cinema -6.6 0.0 0.0

OOH 2.0 2.8 -3.5



2018 2019f 2020f





Paid Search 16.9 20.4 11.1

Other incl. Classified 8.1 -9.5 10.5

Mobile^ 16.0 13.7 8.2

ProgrammaticSpend^


2018 2019f 2020f




Radio 9.7 9.3 9.1

Cinema 0.7 0.6 0.6

OOH 9.8 9.6 8.8



2018 2019f 2020f





Paid Search 37.2 40.7 41.9

Other incl. Classified 5.5 4.5 4.6

Mobile^ 58.0 60.0 60.0

ProgrammaticSpend^


33

LATEST KEY AD SPEND TRENDS• Better performance of the ad revenue driven by Digital growth. TV

remains under expectations despite the positive revenue of the Football World Cup, although the Italian National Team did not participate.

• Slight contraction on 2019 forecast, mainly due to the economic dynamics of the country. 2020 prediction is confirmed.

THE 2019 AD SPEND FORECASTWe expect a 2019 market with growth of +0,8% vs 2018.Television will maintain its leadership with a SoM over 50% followed by Digital, whose share will continuously grow (28,2%) in spite of press that is expected to lose 1 share point overall.

Other media will consolidate their position. Radio and OOH will contribute to the positive market trend, even with restrained growths.

Global or local events to boost spend in 2019In 2019, no significant events that might have an impact on Italy’s ad revenue are planned. The next European Elections might affect the fragile Italian political situation.

THE 2018 AD SPEND FORECASTPositive performances of the Football Wold Cup revenue. The event, fully broadcasted on free television, has exceeded 70 mio in TV revenue. On the whole, the vendor (Mediaset) declares a sales volume of 90mio on its media (TV, radio and digital).

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)• In the Italian market the Cambridge Analytica and Facebook scandals had

no impact on the digital ad revenue, the OTT continuous growth is pulling the medium; because of this situation we have increased 2018 expected performances.

• In this context TV is slightly suffering; forecast at a +0,8% compared to a previous +1%.• On the one hand, the revenue of the World Cup has produced a 70mio

income compared to the 55/60mio forecasted, on the other hand Television’s 1st half closed under expectations.• Another negative index that will influence autumn revenue is the different

assets of the football rights: DAZN, a new Digital player, has bought the exclusive rights to some matches of the Serie A (3 out of 10 per day) and the whole Serie B championship and this will affect negatively the TV revenue.

The economic contextIn these last months, the Italian economic context is particularly complex.The recent elections did not produce a majority, therefore the recent government is the result of post-electoral agreements with two different electoral programmes. This leads to expensive consequences in the unstable economic context. Due to this scenario, the country has recently been downgraded by rating agencies.

AD SPEND PERFORMANCE BY CATEGORYAMONG THE 2018 CATEGORIES, 4 OF THEM STAND OUT: Automotive (+4,1%) thanks to the development of the Electric/Hybrid technology and the recent dispositions in terms of environment and vehicles circulation. Retail (+5,4%) thanks to the e-commerce boost. Finance/Insurance (+4,6%) with the recovery of the “reinsurance” insurance branch and the new Mastercard payback and contactless.Culture/Leisure(+20,0%) strong growth caused by food delivery and betting. In June 2019 this last branch (betting) will suffer a communication arrest.2 are suffering:Telco (-4,9%) with a contraction of the fixed/mobile telephone market. Moreover, the entrance of Iliad did not contribute to a market strengthen as the historic brands do not communicate their low cost offers.Clothing (-5,1%) and Personal Objects are branches whose favouritemedium is press and they highlight a revenue contraction that is notbalanced by other media.

ITALY: ‘TV performs under expectations despite World Cup revenue’



2018 2019f 2020f

Italy 1,6% (1,4%) 0,8% (1,1%) 1,6%




2018 vs. 2017YOY%

FOOD 970 -1,4%

AUTOMOTIVE 895 4,1%

RETAIL 476 5,4%

TELCO 450 -4,9%

PHARMACEUTICALS 419 -2,0%

FINANCE/INSURANCE 354 4,6%

CLOTHING 349 -5,1%

MEDIA/PUBLISHING 348 0,0%

PERSONAL CARE 346 2,8%

BEVERAGES/ALCOHOLICS 339 2,2%


34

‘ALMOST A THIRD OF AD REVENUE FLOWING INTO DIGITAL’


Press In 2019 the press trend is expected to continue its decrease (-7,2%) due to the changes in the balance of power with Digital. Every month 40 mio italians decide to read press on paper and/or digital formats. The last reading survey shows a progressive decrease in every group (newspapers, weeklies and monthlies) with a contraction also for circulation data.

RadioIn the last years, radio has substantially remained flat in terms of audience. In the 1st semester 2018, radio attracted 34 mio listeners per day, with 80% of them being super loyal to the medium. From a fruition point of view, dynamics are in evolution. Listening out of home is increasing through: mobile (web radios, brand extensions of the reference FM stations), car radio and streaming, the new model that (like podcasts) offers a complete listening personalisation. 2019 revenue is expected to grow (+2,5%) involving both National and Commercial radio.

TVIn 2019 Television will maintain its ad market leadership (50,7%), but in terms of trends the lack of sports events will cause a contraction (-0,7%). Mediaset the broadcaster of the Football World Cup will show a stronger contraction (-3,7%).Even if the medium is still in good health, it will have to face an audience contraction caused by the new frontier of the Addressable and “fluid TV”, that by now is a consolidated reality. The number of people that habitually watch streaming content or download television content on their own devices is growing and this is making investors to move the budgets towards digital categories such as video.

DigitalAlmost a third of the ad revenue in Italy (in 2019: 28,2% that means 2,16 billion euros) flows into digital, where Over The Top (Google & Facebook) hold 70% and are the major driver of the whole growth of the category (2019 forecast: +6,7%). Search will follow the growth of total Digital, reaching +6,5% vs. 2018.

In 2019 (like in previous years), publishers and investors will take advantage of all the opportunities of digital communication such as video and especially mobile advertising. Advertising growth on smartphone/tablet will be +16% reaching a value of 1.039mio euros. The request for digital content on digital platforms is always higher, despite the fact that by now the most relevant such as Amazon Prime, Netflix and Dazn do not include advertising content. In 2019, video will grow by +14,6% reaching 680mio euros, representing 31,5% of the total Digital expenditure. This quota is expected to increase because at the moment the annual TV ad revenue trend is restrained.


35

Italy Data Tables



2018 2019f 2020f

Television 0,8% -0,7% 0,8%

Newspapers -6,0% -6,5% -7,0%

Magazines -8,3% -8,0% -8,0%

Radio 4,0% 2,5% 1,0%

Cinema 2,0% 1,0% 0,0%

OOH 1,9% 1,4% 0,5%

Total Digital 6,9% 6,7% 6,5%


2018 2019f 2020f

Total Digital* 6,9% 6,7% 6,5%

Display (Banners) -2,0% -2,6% -2,8%

Display Performance 5,2% 4,0% 3,4%

Online Video 15,0% 14,6% 14,0%

Paid Search 6,8% 6,5% 6,0%

Mobile^ 19,9% 16,0% 13,4%

Social Media 9,8% 10,6% 6,5%

ProgrammaticSpend^ 30,5% 25,7% 22,1%


2018 2019f 2020f

Television 51,5% 50,7% 50,3%

Newspapers 6,0% 5,5% 5,1%

Magazines 4,9% 4,4% 4,0%

Radio 6,0% 6,1% 6,0%

Cinema 0,3% 0,3% 0,3%

OOH 4,7% 4,7% 4,7%

Total Digital 26,7% 28,2% 29,6%



2018 2019f 2020f

Total Digital* 100,0% 100,0% 100,0%

Display (Banners) 20,0% 18,2% 16,6%

Display Performance 15,0% 14,6% 14,2%

Online Video 29,3% 31,5% 33,7%

Paid Search 35,7% 35,7% 35,5%

Mobile^ 44,3% 48,2% 51,3%

Social Media 16,4% 17,0% 17,0%


36

LATEST KEY AD SPEND TRENDS• The growth was not as optimistic as forecasted previously for 2017,

however the spend has spread out into 2018 and 2019 improvingtheir outlook.

• The main reason was the lack of critical mass towards the final months of 2018 which did not perform as strongly as expected.• The impact of eradicating the agency commission by the large public

broadcaster STER has yet to be determined.

THE 2019 AD SPEND FORECASTWe continue to expect growth, a slightly more upward trend was common across specialists polled.

Global or local events to boost spend in 2019No, there are elections for the European Parliament, but these do not influence the ad spend in NL.

THE 2018 AD SPEND FORECASTAs is common in our market, the effects are 0 or close to zero. Orange team did not qualify for the World Cup finals and the Winter Olympics are not a spend booster, therefore this time was no exception either.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)We would have to wait for further figures to go on, but the general trend in the market is optimistic. We are all waiting for the full effects of the skipping of the agency commission in 2019 by more large parties, now that it has been deleted by STER (public broadcaster).

The economic contextThe economic outlook is still bright, but the first sign of slowdown and overheating is in place. The new Dutch cabinet presented their first budget with large investment portfolio aimed at health care, defence/safety, and education. It is paired with some savings and reform on the labour market. Threats are the mounting trade wars, the chances of a hard Brexit (which would hurt the Dutch economy), international terrorism (Dutch security agencies foiled a direct and imminent attack).

AD SPEND PERFORMANCE BY CATEGORYThe spend will be driven by Retail, FMCG & Transport, we also expect major impact from Government and Telco services. The economy will also boost spend in the Tourism sector.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OFAD SPENDAs consumers become more digital, this will boost the digital acceptance and spend considerably across the older age brackets and less adaptive groups.

NETHERLANDS: ‘Improved Outlook’




Category Spend 2017/2018

Retail 1.567 +2,3%

Food & stimulants 868 +1,1%

Food & catering, Tourism & recreation

870 +3,1%

Transport 620 +5,5%

Media 620 0

Finance 481 +1%

Personal care 478 0

Government 430 +6%

Telco 477 +6%

Other products & services

243 0


2018 2019f 2020f

Netherlands 1.9% (0.7%) 2.0% (1.6%) 2.1%

37

‘STER INTRODUCES NEW BUYING MODEL’


a. Mobile & social firstIt is obvious to see that Digital (average 8,8% growth from 2017), and mobile are stellar. Especially mobile +% each year from 2016 is exploding. The launching of the Mobile stack helps clients to make the right choice in deployment. It shares the position with Social Media, also growing a staggering 24,5%/year.

b.TV turns into AVAlthough modestly in decline (-2,5, 2017-2020) it is still second in volume and ROI. Linear viewing is declining with audiences shifting away to VOD, Online paid streaming like Netflix and Videoland are making it harder to sift through clutter. High reach STER has introduced a new buying model, shedding the majority of buying TA’s & ditching the agency commission (15%). This will lead to a better offer to small and medium clients, but will be less advantageous for large clients since it will be the end of volume contracts. It will be interesting to see the reaction of other publishers like RTL & SBS, for now it seems that they are following.

c. Surge of online, decline of desktopSimilar to point A, the growth across online has been impressive the last few years. With 11% growth, it is by far the largest across the board, more than 3 fold the nearest rival, niche cinema (av: 3,5%). When looking at volume media types it is more than 5 times its nearest rival (OOH). Within online it is mobile that shines alongside social media spend. For next year we predict that 50% of buys will be programmatic, in 2020 this will be 56% illustrating the rapid acceptance by advertisers & agencies alike. Overall we advise clients to quickly include RTB in their media diet to make use of this window of opportunity.

d. Print declines continueWe’ll let the figures speak for themselves: past 5 years -13%/year average decline for dailies. For 2017-2020 it is still -7%. For magazines the figures are -9,5 & -5,8% average/year. The end is not in sight however, as we do see more branded content cooperation and the second half of the year looks slightly more promising. Special interest (Luxury, finance, BTB) predict index 100, an performance in itself.

e. OOH moves to digitalThe trend in OOH is digital, with the concession of The Hague up for bidding in 2018, the expectation is that this will be fully digitised. This opens up the possibility for RTB and the first cases have been encouraging. Also the strong tie in with Mobile offers chances for both agency as well as advertiser. Rotterdam has been won by JCD, further enhancing their large urban offer.


38

Netherlands Data Tables

D E N T S U A E G I S N E T W O R K *Includes Mobile/Tablet and Desktop, ^Subset of Total Digital Spend


2018 2019f 2020f

Television -0,3 -1,6 -2.1

Newspapers -9,6 -6,2 -4.7

Magazines -7,2 -7,4 -3.8

Radio -0,9 -0,9 -0.9

Cinema 0.0 12.5 0.0

OOH 0.5 1.1 1.6

Total Digital 7,8 7.1 6.3


2018 2019f 2020f

Total Digital* 7,8 7,1 6.3

Display (Banners) -13,4 -2,1 -1.3

Online Video 20,1 13,3 15.2

Social Media 19,5 12,8 8.8

Paid Search 8,8 6,5 5.6

Other incl. Classified 5,6 5,3 4.7

Mobile^ 28,1 14,5 17.9

ProgrammaticSpend^ 39,3 15,3 29.1


2018 2019f 2020f

Television 24,0 23,2 22.2

Newspapers 10,1 9,3 8.6

Magazines 6,4 5,8 5.4

Radio 5,6 5,4 5.3

Cinema 0,2 0,2 0.2

OOH 4,6 4,6 4.5

Total Digital 49,1 51,6 53.7


2018 2019f 2020f




Social Media 17,4 18,3

Paid Search 56.6 56.9 56.8

Other incl. Classified 16.2 16,2 16.0

Mobile^ 48,0 52,1 57.8

ProgrammaticSpend^ 22,8 24,6 29.8

39

LATEST KEY AD SPEND TRENDS• Linear TV airtime was in short supply in 2017, driving the prices upwards

in 2018. This led to a much larger drop in demand than anticipated, and TV billings declined more than expected in 2018.

• Radio and OOH also declined. Radio due to turbulence after the transition to digital radio (DAB), while OOH merely had a “correctional year” after record high growth in 2017.

• Digital media is expected to grow further, and for the first time in 2018 became more than half of all investments.

THE 2019 AD SPEND FORECASTThe general economic climate is fairly solid which provides the foundations for slightly increased ad spend in 2019. It is expected that most advertisers will move on after a GDPR driven digital "cool down period" in mid 2018. However, despite increasing marketing budgets, more and more investments find their way into own channels, ambient media or other data/tech investments.

Global or local events to boost spend in 2019There are no major events driving investment, but local elections in September 2019 may have some positive impact.

THE 2018 AD SPEND FORECASTThe slightly positive growth trend from the start of 2018 has continued in the second half of the year and market indications going forward are also solid. This is very much driven by digital, while linear TV has had a somewhat surprisingly weak development throughout the year, despite major global sports event etc.At the same time the structural shift from traditional display digital media to search and social media continues, leading to substantial growth in these channels also in 2018.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)Our revised forecasts for 2018 and 2019 have marginally decreased. Market players still indicate a strong commitment to advertising, but the general economic and ad spend trends have shown a little bit more uncertainty, and GDPR has also had a cooling-off effect.

The economic contextThe cyclical downturn that followed the fall in oil prices four years ago has come to an end, and the economy is in a cyclical upturn. Economic growth is above its historical trend and is projected to increase further next year.

The labour market is improving, and unemployment has come down across the entire country. Employment is increasing markedly. The share of the working age population in employment is increasing, after several years of decline.

AD SPEND PERFORMANCE BY CATEGORYThe retail players in Norway have been well known as heavy users of TV, local newspapers and unaddressed DM for many years. In more recent years they have started investing more in the digital area, but it differs a lot depending on the type of retail. The growing popularity of electric cars, which are often in short supply, have led to a decrease in spending from the automotive industry.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDDespite falling ratings, major parts of the population still spend substantial amounts of time in front of TV/video screens. The online video inventory is rapidly increasing, both in quality and quantity. Combined with high inflation on linear TV, many advertisers have reduced their TV spend leading to a better balanced marketplace. This also has an impact on better adaptation of creatives to digital (shorter) formats.There is also an increased focus on sustainability and environmental issues. The Economist wrote a few years ago: "It is hard to overstate the extent to which greenery has penetrated official thinking in Norway. Successive governments have taken all the obvious steps. There are high taxes on petrol and cars.” This way of thinking is also expanding into consumer goods, food waste and use of plastic and disposable items.

NORWAY: ‘Moderate growth driven by Digital’



2018f 2019f 2020f

Norway 1.1% (2.6%) 2.0% (2.5%) 1.7%


Top 10 Categories 2018f

2018f Gross Local Currency Million

2018f vs. 2017YOY%

Groceries 5 717 2 %

Consumer Electronics/Telecoms 3 898 0 %

Information/Services 3 243 4 %

Automotive 2 395 -2 %

Furniture/Home/Interior 1 873 1 %

DIY 1 743 0 %

Travel/Hotels 1 452 3 %

Entertainment 1 308 -4 %

Clothing/Fashion 1 036 -5 %

Sports/Leisure 975 -8 %


40

‘TRADITIONAL TV HAS STARTED TO DECLINE’


TVThe TV market in Norway has experienced big shifts in the last 2-3 years. Even though there is still high viewing, some target groups have declined their viewing by almost 30%. This is especially the case for the youngest target groups, but even some female targets view far less than the total population. TV reached it’s highest spending of all time in 2017, before the decline started in 2018.

On the back of the sold-out situations in 2017, all the TV stations took their precautions and introduced substantial rate card increases in 2018 in order to cope with excess demand. The market responded by pulling out investments, and despite even less viewers the stations have not been sold out yet. This may lead to lower rate card increases in the coming year(s).

DigitalDigital media will still be even more important to most businesses. Having increased by double digit numbers for several years, there is still room for further growth, but the spending is also shifting away from banner ads and increasingly over to search and social media. There will also be a transition to more data driven and targeted advertising (programmatic).Social media is one of the major drivers of digital spend, shifting from traditional direct buying. However social spend is hard to measure, but unofficial numbers indicate 15-25% growth in 2018 – on top of previous years’ strong growth.

At the same time there is more and more focus on viewability, brand safety and data (GDPR) compliance. We expect to see more private deals/market places in the coming year(s). More money will also be put into own channels and disappear from the traditional reports.

Online VideoOne of the fastest growing media groups, both in 2018 and 2019, is expected to be Online Video. With traditional TV in short supply there is huge potential, but so far “long format” inventory has been limited. Still, the spending and growth tend to be bigger than reported due to the fact that some online video spending is hidden within other media groups (display & social).All TV media owners, as well as more traditional website media, are now developing their offers in this area; quickly picking up speed and closing in on the underdog TV player NENT Group, which has led the area for a couple of years.

OOHAnother growth winner in 2017 was OOH media. Despite a minor set back in 2018 they are expected to do well also in the coming year(s). They are enjoying increased budgets due to the declining ability of TV to quickly build net reach, but at the same time they are also developing their products to be increasingly digital, which opens up lots of possibilities in use of data and creatives. The first true programmatic OOH campaigns are expected to take place in 2019.In practice, the Norwegian OOH market is a duopoly and divided between the two global players JCDecaux and Clear Channel. The latter has recently tightened their presence in capitol Oslo, while on a countrywide basis it is more evenly split.OOH remains strong as a true ‘mass media’. Combined with further digital innovation we think they will also gain market shares in the coming years.

NewspapersOne cannot say something about the Norwegian media market without also mentioning newspapers, and in particular the local ones. Newspapers have until a few years ago been the largest media group in Norway, and even though they have lost more than 50% of their advertising revenue since 2007, they have during the same period nearly doubled the income from online advertising (including online newspapers).2018 became a turning point for the local newspapers as their combined (digital & print) subscriber base increased for the first time in several years. They are developing new digital products while milking the old print cow for all it’s worth, and apparently that is still quite a lot.


41

Norway Data Tables



2018a 2019f 2020f

Television -2.0 % 0.0 % -1.0 %

Newspapers -11.0 % -10.0 % -10.0 %

Magazines -17.5 % -12.0 % -10.0 %

Radio -8.0 % +2.0 % +3.0 %

Cinema +15.0 % +12.0 % +10.0 %

OOH -2.0 % +5.0 % +7.0 %

Total Digital +8.0 % +6.0 % +5.0 %


2018a 2019f 2020f

Total Digital* +8,0 % +6,0 % +5,0 %

Display (Banners) -1,0 % - +1,0 %

Online Video +30,0 % +26,0 % +24,0 %

Social Media n/a n/a n/a

Paid Search +13,0 % +11,0 % +10,0 %


+14,3 % +4,9 % -0,8 %

Mobile^ +17,0 % n/a n/a

ProgrammaticSpend^

+9,6 % +10,3 % +14,6 %


2018a 2019f 2020f

Television 21.4 % 21.0 % 20.4 %

Newspapers 13.1 % 11.6 % 10.3 %

Magazines 2.7 % 2.3 % 2.1 %

Radio 3.6 % 3.6 % 3.7 %

Cinema 1.1 % 1.2 % 1.3 %

OOH 4.0 % 4.2 % 4.4 %

Total Digital 54.0 % 56.1 % 57.9 %


2018a 2019f 2020f

Total Digital* 100,0 % 100,0 % 100,0 %

Display (Banners) 39,4 % 37,1 % 35,7 %

Online Video 5,1 % 6,0 % 7,1 %


Paid Search 32,2 % 33,7 % 35,3 %


23,4 % 23,1 % 21,8 %

Mobile^ +17,0 % n/a n/a

ProgrammaticSpend^

12,4 % 13,0 % 14,1 %

*Includes Mobile/Tablet and Desktop. ^Subset of Total Digital Spend

42

LATEST KEY AD SPEND TRENDS• No significant changes were made compared to the last June report. The

previous prediction of 3,5% growth now stands at 3,4% since TV was below vs. 2017 for the 3rd Quarter. Despite the slowdown in the 3rd

Quarter we believe the market will recover in the last one.

THE 2019 AD SPEND FORECASTFor 2019 we estimate that the market will reach around 500M€, exactly the same amount we had in 2011. As expected after a long period of recession in 2014 we started recovering and for 2019 we expect to be at that level. This is still far away from the maximum value we achieved in 2007 (720M€), but is recovery nonetheless. Economical stability, consumer confidence and a strong Europe after Brexit will be essential to keep expenditure growing.

Global or local events to boost spend in 2019The Portuguese will be called to vote in two elections. In May for the European Parliament and in Sept/Oct for the Portuguese Government. It is expected that there will be some “friendly” measures from the government during 2019. It is crucial to reinforce political stability in order to sustain consumer confidence and push private consumption which directly affectsthe ad market evolution.

THE 2018 AD SPEND FORECASTThe first 2Q of the year performed well with expenditure above 2017 in all media except Press. Press is declining each year with Internet/Digital getting the biggest increases. 3rd Quarter 2018 performed below vs. 2017.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)This year we had an “extended summer” as temperatures where higher than expected for October. Some brands/advertisers postponed or extended their campaigns due to this abnormal phenomena. We expect 4th Q of the year will be in line with previous years, ending 2018 slightly below the previous forecasts. Football World Cup also changed the shift and amount of expenditure in Q2, with brands supporting the National team making strong campaigns during that period/event. A seasonal shift in ad investment rather than an actual budget growth was the consequence.

The economic contextEconomic growth indicators point towards a positive trend, all evaluations

from the EU and ECB point towards an improvement in the short term, butambitious reforms are essential in the medium term. GDP is growing, theunemployment rate is decreasing, family consumption is starting to recoverand some sectors such as Real Estate and Automotive (long term familyacquisitions) are showing signs of a positive evolution. Portugal is under

the supervision of the EU and depending on the deficit goals we have toachieve, Macro economic decisions will be adopted.

AD SPEND PERFORMANCE BY CATEGORY Retail remains the biggest sector with an ad spend of 54,5, but with a slight decrease of 1% over 2017. Automotive, Cosmetics/Beauty/Personal Care, Telecoms/Communic., Finance/Insurance/Banks remain stable, with just slight increments/decrements.

Pharmacy/Drugs/Remedies expect to be lower 2,9% vs previous year. Other FMCG like Food, Beverage/Alcoholics, House Care are increasing (9,7%, 14,2% and 9,9%) as a result of a more consumer confidence and Economic recovery.Tourism/Culture and Leisure is also increasing 3,6% and could be one of the future bets for our economy, but also part of the investment in this sector is done outside in order to bring Tourists to our country.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDConsumer trends are related to the economy situation and financial stability. As described in 4a) the economic context we are facing is a positive scenario. Long term acquisitions like Households and Automotive are now showing a recovery. Travel inside/outside the country is also another consumer habit for a considerable part of the population. All the above is changing the profile of ad spend and allowing some categories to recover vs previous years.

PORTUGAL: ‘Media market facing a recovery’



2018 2019f 2020f

Portugal 3,4% (3,5%) 2,7% (2,7%) 2,9%




2018 vs. 2017YOY%

Retail 54,5 -0,6%

Automotive 51,3 +1,5%

Pharmacy/ Drugs/ Remedies 50,7 -2,9%

Cosmetics/ Beauty/ Personal Care 49,9 +0,1%

Food 42,7 +9,7%

Tourism/ Culture/ Leisure 35,1 +3.6%

Telecom/ Communications 32,5 -1,4%

Finance/ Insurance/ Banks 27,3 +0,6%

Beverage/ Alcoholics 24,3 +14,2%

House Care 18,6 +9,9%


43

‘PROGRAMMATIC – OVERWHELMING POSITIVES IN OPTIMIZATION AND DRIVING COST EFFICIENCIES’


a. TVTV still leads advertising expenditures in Portugal. Over the years TV’s share of total ad spend has slightly declined, representing 54% in 2017. We expect this figure to be 52% in 2018. In the near future this trend will be even more marked since the shift of TV investment to digital continues. We are also seeing a shift from “traditional” free to air TV channels to pay TV, and a shift from a traditional 30” Spot to more integrated brand content. Brand content is not yet measured in terms of ad expenditure.

b. DigitalDigital is clearly the 2nd media in Portugal, representing 22% in 2018 (great part of the investments made on Google and Facebook are not collected and published. If we consider our estimations on that figures, we probably can say that the weight of digital will be something around 35%).

Over the years Digital spend has increased and “stolen” advertising expenditure from Press (Newspapers and Magazines). The pre-roll and joint reach TV + Video analysis is also a step that advertisers already integrated into their plans.

Display represents the largest slice of total digital ad expenditure. Online Video is becoming the most natural choice for advertisers already doing 30” TV spots, with TV + Online Video PreRoll. Media publishers are improving their inventory as all want to play a major role in this area.

Mobile is becoming first screen usage for many targets, and content/advertising is being delivered, adapting messages, formats and creative solutions in order to drive high CTRs and conversion rates.

On Social Media, Facebook remains the “player” when using or planning Social Media, whether it be through Facebook ads, using newsfeeds effectively, or in tracking lead generation right through from start to finish. Utilizing mobile more effectively should be the next thing on both major players’ radars.

Prioritizing driving reach on Facebook is a trend. Driven by the fact we are small and with a high usage of Facebook it is easy to achieve high target reach with a low cost.

Portugal is a mature market regarding Paid Search. Advertisers use it according to their goals. Search will grow in line with digital. Mobile search will continue to rise faster than Desktop.

On Programmatic, all agencies have been focusing efforts on improving their in-house programmatic offerings, driving strong optimization and efficiencies to advertisers.

Branded Content and Native advertising begin to be seen as a way for brands to communicate their benefits in a more editorial environment. This could be relevant as a way of capturing extra budget from the brands.

c. OOHDespite the lack of audience data in our market, OOH is the 3rd most popular media in Portugal after TV and Digital and shows a continuous growing trend. Digital OOH is trying to get space in the market with some suppliers offering new inventory but not very representative in the overall OOH

market.

d. RadioDifferent formats and a more integrated approach to brand communication, allows Radio to sustain a slice of the pie. Brands are using radio Dj’s animators, specially on “prime time” (morning daily broadcast shows) to interact, promote, or using their voices to brand communication. From simple spots to more integrated presence of the Brand inside programs. Radio is receiving digital support through the usage of Instagram official accounts, YouTube channels, and Facebook.


44

Portugal Data Tables



2018 2019f 2020f

Television 1% 1% 1%

Newspapers -16% -10% -10%

Magazines -22% -10% -10%

Radio 0% 2% 2%

Cinema 11% 1% 1%

OOH 8% 3% 3%



2018 2019f 2020f




Social Media n.a n.a n.a

Paid Search n.a n.a n.a


Mobile^ 11% -1% -1%

ProgrammaticSpend^ n.a n.a n.a


2018 2019f 2020f


Newspapers 3% 2% 2%

Magazines 3% 2% 2%

Radio 7% 7% 7%

Cinema 0,4% 0,4% 0.4%

OOH 14% 14% 14%



2018 2019f 2020f





Paid Search n.a n.a n.a


Mobile^ 9% 8% 7%



45

LATEST KEY AD SPEND TRENDS• Although Q1 figures were negative, in Q2 and Q3 the market has achieved

positive growth (-0,6%, 3,4%, 2.0%) that has led to a slightly higher 2018 situation than forecast.

• Political instability and uncertain economy growth expectations make for a moderate market growth forecast.

THE 2019 AD SPEND FORECAST2019 forecast is maintained at 1.2% growth, as economy expectations have not changed (2.3 GDP growth).

Global or local events to boost spend in 2019Regional and local elections will take place, with slight impact on OOH and Print mainly. Potential general elections would also benefit these media.

THE 2018 AD SPEND FORECASTFootball World Cup had an estimated impact of 0.2 growth points over total year (approx. 5% for the month), as aired in private channels with a special ad offering.

Other events such as Winter Olympics will have no incremental effect over total market.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)2019 expectations for advertising market are maintained, no relevant circumstances have varied the forecasts.

The economic contextSpanish economy is stable with 2.6 GDP growth forecast by government (in Oct’18), just revised downwards 1 decimal point. Tourism and also internal consumption are main economy drivers with good results and slow down expected in 2019.

AD SPEND PERFORMANCE BY CATEGORY Automotive remains the biggest sector with an ad spend increase, but growing under car registrations (+10% Jan-Oct’18 vs ya) and so car advertisers are still cautious regarding the economy and return on investment. Tax increase for diesel-fueled cars is expected in early 2019 and some 2018 registrations are happening in advance of this situation.

Finance and Tourism are the biggest growing categories (around 8%), while FMCG categories are declining (especially Beauty & Hygiene and Food), despite household increase in consumption.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDHousehold consumption growth has slowed down (still positive, 2.5% 2018 vs 2017) and combined with prices inflation (2%) and savings rate having the lowest figure (12.5%) since 2007, this means that consumption expectations are moderate for the next years.

SPAIN: ‘Moderate growth in the next years’



2018 2019f 2020f

Spain 1.8% (1.5%) 1.2% (1.2%) 0.8%



2018 Net estimatedLocal Currency

Million

2018 vs. 2017YOY%

Automotive 521 5,5%

Retail 478 2,5%

Finance 412 8,0%

Public & Private Services 343 -5,1%

Culture 329 4,5%

Beauty & Hygiene 315 -3,2%

Food 311 -4,1%

Telecomms 263 6,5%

Transport, Travel And Tourism 206 8,5%

Drinks 202 5,3%


46

‘DIGITAL WILL OVERTAKE TV IN 2020’


a. TV (37.8% Share)Commercial offer concentrated in 2 main groups (Mediaset and A3 Advertising), that makes 85% market volume (GRPS), with planning and buying methods based on cost/GRP for standard targets (Housewives and Adults 16+ mainly).High clutter in free-to-air channels is moving advertisers towards pay TV channels. Also, pay TV platform penetration has increased up to 36% of households.Important TV consumption reduction up to 45 years is affecting campaign %reach and GRP delivery. This is stimulating expenditure towards online video, which is capable of balancing reach loss.2018 is expected to have negative growth for TV (-1.8%), the firsttime that TV declines whilst the total market is growing (+1.8%). Thisdecline is expected to continue in the next years, in contrast to themoderate market growth driven by digital.

b. DIGITAL (33% share)Second biggest media in Spain, with growth of 10.5% excepted for 2018.Online penetration is very high (78% daily), 69% of time via mobile (31% desktop).

Online video is the highest growing segment within digital, with most agencies and advertisers planning with an audiovisual approach (TV and online video).Social media penetration is very high in Spain, with Facebook being the most extended and Instagram having grown by 31% into second place (Twitter is stable in 3rd position). Social media ad spend is estimated to grow 13.2% in 2018.

In 2019, Digital and TV will tie with around a 36% share each. 2020 isexpected to be the year when Digital media takes over and achievesmarket leadership.

c. NEWSPAPERS (10% share)Expected to continue decline as circulation remains on downward trajectory. Consumer advocacy capacity due to print credibility maintains advertising demand.Overall consumption is stable due to digital consumption increase, balancing delivery across age breaks.

National titles suffering more than regional with the circulation loss, and consumption shift towards digital media not fully monetized by media owners.Main publishers are investing and preparing data offering in order to improve their digital business performance.

d. RADIO (8.6% share)Competitive costs, flexibility and content integration actions maintains demand, with 2.8% growth in 2018 but a slight decrease in 2019 and 2020 is forecasted. National groups have concentrated market share in the last years, to the detriment of smaller local stations. High saturation in peak time (early morning) is driving price increases intop stations.Radio consumption maintains stable and the digital offer is growing (77% of the population listens to music through web/apps).

e. OUT OF HOME (5.9%)Two main operators (JCDecaux and Clear Channel). Digital Signage gaining relevance but only represents around 9% over OOH market.

Programmatic offering of DOOH is expected to be developed in the market early 2019.


47

Spain Data Tables



2018 2019f 2020f



Magazines -6.5 -6.7 -7.2

Radio 3.2 -1.0 -1.1

Cinema 4.5 4.1 2.3

OOH 1.3 -0.2 -1.7



2018 2019f 2020f







Mobile^ 21.8 11.2 11.8



2018 2019f 2020f




Radio 8.6 8.4 8.3

Cinema 0.6 0.6 0.7

OOH 5.9 5.9 5.7



2018 2019f 2020f





Paid Search 52.0 51.4 51.2


Mobile^ 70.8 72.0 75.0



48

LATEST KEY AD SPEND TRENDS • The Swedish media market is still very strong and forecasted to grow in

2018 by 6,4% vs 2017 in net value. This builds on a strong general economic climate in the country and a number of industries driving growth. The winners in the media market are as before digital media, but also OOH, TV and Radio are showing strong development. Print media arein decline.

• It is extremely challenging to plan and book TV campaigns in this market and we have seen an exceptional inflation in the TV market in the last years, which we envision will continue. We are experiencing a highinflation in TV during 2018 due to continuing increases in rate card, butmostly from significant changes in sales policy. • OOH has had an exceptional growth in the last 3 years and is now

experiencing being sold out in many periods and in the most attractive formats. This is due to the transformation into digital OOH and aided by a troublesome TV market, where advertisers are not able to invest as they want. This is expected to cause further inflation pressure in this channel. This will lead to an increase on pricing due to strong demand, and will make it difficult for us to negotiate when the rate of sold out placements is very high.

THE 2019 AD SPEND FORECASTThe total ad spend is forecasted to grow by 4,5% in 2019 which is a further reduction in growth from the two previous years. The expectation is that the extreme growth within digital continues to pan out and 2019 does not have any major events that affect the media market. We can also expect a continued decline in newspaper and in print in general.

Global or local events to boost spend in 2019As opposed to 2018, there are minimal contributions from political and sports events but the market continues to be supported by a solid economy.

THE 2018 AD SPEND FORECASTIRM has made an upward revision of the Swedish ad spend forecast for 2018. Development during the second quarter exceeded expectations driven by sports events, though display growth decelerated, in part due to implementation of the GDPR. Ad spend development is expected to show continued strong growth in the third quarter due to national, regional and local elections before slowing down somewhat during the last quarter ofthe year.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS (JUNE 2018)The revised forecast for 2018 shows a higher expected growth in the media market compared to the last report, with estimated growth of 6,4% and the expectation is that this trend will hold for the full year. In total the market is forecasted to have a slightly lower growth for the full year than in 2017.

The economic contextThe Swedish economy is growing strongly in 2018 and shows a positive first quarter in terms of GDP growth YOY. For the first time in several years the forecasts for the global economy has been revised for the better and especially in Europe economic growth has stabilized. Since Sweden is a small market and very dependent on foreign trade, this development is very important and we are watching closely the recent effect of tariffs and trade inhibiting policies in the global economy. The improved development in Europe results in net export becoming increasingly important as an economic engine.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OFAD SPENDThe shift from print media to digital channels are evident in Sweden – paid search, online video and social spends are driving this development. The extremely sold out TV market has also likely pushed investment into online video and into digital generally, but also into broad reach media like out-of-home which is at an all-time high in this market. Print investments are in continued decline. This reflects media pricing development in these media channels.

SWEDEN: ‘Continued strong growth expected in Q3 before slowing down during last quarter’



2018 2019f 2020f

Sweden 6,4% (5,3%) 4,5% (1,7%) 0,4%




2018 vs. 2017YOY%

Retail 17 413 119 3%

Financial 9 039 249 9%

Organisations/Information 4 447 105 1%

Food & Beverage 4 189 229 1%

Travel 3 656 145 3%

Automotive 3 892 261 10%

Media & Education 3 917 756 10%

Data & Telecommunications 3 110 783 2%

Healthcare 2 427 256 15%

Hygiene products 1 791 345 1%


49

‘OOH BECOMES THE REMAINING HIGH REACH MEDIA CHANNEL’


TV.The TV market is experiencing a continued high level of being sold out, having difficulty in delivering enough ratings to advertisers and an upward push on pricing due to strong demand. Broadcasters have made significant changes to 2018 sales policy, more than just ‘standard’ inflation, reduction in the target audiences that may be negotiated and restriction on which channels may be purchased for specific audiences. Rate card prices will increase significantly in 2019 and it can be up to 12-18% increase depending on channel and target audiences. Sweden is a TV market where it is practically impossible to buy ratings without a yearly committed volume agreement and with limited flexibility. The main channel TV4 is strengthening its position as the one commercial channel which holds a strong audience and reach development, while the smaller channels are losing viewers to online video and subscription services. We expect this trend will likely continue into the next year - where we have a scheduled licensing of the online betting industry which will both add demand of TV ratings in the market. The total market for TV is growing slightly this year (5,2% is the forecast for 2018), mainly due to stable demand and increased inflation on TV pricing, but the long term expectation is that the TV market will decline as viewers move from linear TV.

Radio.The Swedish radio market is in a similar position as the TV market, as the two main national networks Bauer and NENT (former MTG) have a very high degree of being sold out during large parts of the year. All current commercial FM radio licenses in Sweden expired on the 31st July 2018. The design of the new licenses intends to create an improved landscape for commercial radio through optimisation of frequencies which should lead to improved competition with Swedish Public radio (SR) and listeners being taken from public radio. 3 new national and 35 new local/regional licenses have been issued. The new licenses are valid for 8 years from 1st August 2018 and have been awarded to the highest bidders in an auction. For advertisers this means an easier market if you want national reach with a cleaner network structure.

Print. Sweden has traditionally been a dominant print market with strong local newspapers, but like the global trend the print market in Sweden has been in a slow but steady decline, both in terms of readership and advertising market. The magazine market has also lost in readership but the decline is expected to slow as many publishing houses are developing commercial products such as branded content and influencer marketing on top of traditional advertising. The once strong evening press has seen an extreme decline in the last years and this trend only continues.

OOHOut-of-home media is experiencing an all time high growth taking the last 3 years into account. This is partly due to investment into digitalisation of OOH sites and establishing new digital inventory. This is also a factor of a messy TV market where advertisers have to live with high inflation, under deliveries and lower reach per TRP effect as viewers leave this media channel. Suddenly OOH is THE remaining high reach media channel for many advertisers, which also does not have problems with ad avoidance, brand safety or ad fraud related issues. This year we are clearly seeing the effect of OOH’s relatively strengthened position in that many weeks are heavily sold out and advertisers need to plan and commit budgets far ahead of time. We expect this will be reflected in inflation increases in 2018 and 2019. The estimated inflation for OOH in 2019 is 9%.

DigitalDigital media now stands for the largest part of the media market (58,6% in the forecast for 2018) and also still has one of the highest growth rate. As IRM has redefined how online segments are defined, it is difficult to exactly follow the long term development of different areas within digital, but it is apparent that Search, Social and Video are the main drivers, while desktop display advertising is flat or in decline. Search stands for more than half of all digital advertising. The long term expectation is that data driven programmatic display and video will keep the momentum for digital advertising, but we expect some backlash from the introduction of GDPR in the short term, until media owners, data suppliers and technology platforms have settled ways of working in this new framework.


50

Sweden Data Tables



2018 2019f 2020f

Television 5.2 -0.4 -4.5

Newspapers -9.4 -9.6 -32.7

Magazines -10.2 -10.3 -6.5

Radio 9.8 9.0 0.2

Cinema 3.4 2.2 2.2

OOH 12.1 5.0 6.1



2018 2019f 2020f


Display (Banners) 0.1 -1.2 1.6



Paid Search 14.0 12.2 10.6

Other incl. Classified -4.1 -5.7 -10.3

Mobile^ 27.9 16.5 18.2

ProgrammaticSpend^ n/a n/a n/a


2018 2019f 2020f




Radio 2.9 3.1 3.0

Cinema 0.5 0.5 0.5

OOH 5.4 5.4 5.8



2018 2019f 2020f





Paid Search 53.0 54.2 55.7


Mobile^ 43.8 46.5 51.1



51

LATEST KEY AD SPEND TRENDS• A new more accurate data fundament for doing gross-net-gap estimations

for different media channels has been used and applied 10 years backwards to the data contained in the report. The ad spend figures therefore differ largely from the previous report and are not directly comparable. • Figures for ad spend in Search show a huge growth rate of 215% for

2017. This growth rate of course isn’t organic, but was derived from a new measurement methodology by Media Focus, the main provider of ad spend data in Switzerland (published in “Media Focus Online Semester Report 2017-2”)

THE 2019 AD SPEND FORECASTWe expect the Swiss advertising market to continue to grow by 7.1% in 2019. As in the previous year, this growth will be mainly driven by digital ad spend in various categories which outweighs the losses in traditional media categories like print and radio.

We also expect growth in ad spend for Cinema and OOH as the past years showed positive effects mainly due to ad product innovations and a dynamic market environment within both sectors (competitor structure,Digital OOH). OOH and print ad spend will further profit from national parliament elections in October 2019.

Global or local events to boost spend in 2019In 2019 national parliament elections will take place in Switzerland. Main media categories for political campaigns are print and OOH media. Therefore, these categories should directly profit from the correspondingmedia campaigns. Average additional ad spend in political campaigns fornational election years amounted to CHF 20 Mio in the past 8 years.

THE 2018 AD SPEND FORECASTWhile sport related product categories tend on average to have higher ad spending in event-heavy years, this tendency isn’t present for 2018. This might be due to other underlying effects.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)• Before doing the 2018 July report, we chose a new data fundament for

doing gross-net-gap estimations for different media channels, that we believe to be more accurate than the one we previously used. We applied this new process 10 years backwards to the data contained in the report. The ad spend figures of the current report therefore largely differ from the previous report and are not directly comparable.

The economic contextThe Expert Group of the SECO – State Secretariat for Economic Affairs does forecasts for Swiss economic development on a quarterly basis. “The Expert Group is significantly raising its forecast for GDP growth in 2018 from 2.4% to 2.9%. The favorable international economic development is stimulating foreign trade, and companies are investing heavily. The forecast for GDP growth in 2019 remains unchanged at robust 2.0%. However, the negative risks significantly outweigh the positives and threaten the global outlook.”

AD SPEND PERFORMANCE BY CATEGORYYTD August 2018 most major advertising categories show a slight decrease. Only finance and events had a strong year so far. On the other side campaigns and service industry show the strongest decrease in spending.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDEvents and campaigns are the categories with the strongest win and respective losses. Both categories show strong fluctuations in general, as they are subject to strong seasonality. Campaigns ad spend often depends on the controversy around individual political votings that take place 4 times a year. Advertising for sport events has improved due to a generally positive environment around the Winter Olympics and Soccer World Championships.

SWITZERLAND: ‘OOH and Print boost from national parliament elections’



2018 2019f 2020f

Switzerland 5.8% (3.0%) 7.1% (2.6%) 6.7%




2018 vs. 2017YOY%

Food 524 -1.2%

Retail 450 -3.9%

Automobile 382 -3.9%

Finance 374 +2.3%

Campaigns 346 -10.9%

Tourism & Gastronomy 301 -4.0%

Events 267 +5.8%

Cosmetics & Body Care 261 -4.3%

Fashion & Sport 247 +0.2%

Services 241 -5.7%

52

‘SWISS VIDEO ADVERTISING MARKET SHOWING STRONG DYNAMICS’


a. SearchAd spend figures for search in the Media Focus Online Semester Report show an extremely high growth rate of 215% for 2017. This growth rate of course isn’t organic, but was derived from a new measurement methodology by Media Focus, that covers a larger share or the actual search ad spend in Switzerland. Therefore we expect growth rates for search to continue at a more moderate level for 2018 and 2019.

b. TVThe fragmentation of the Swiss TV market seems to have slowed down in 2018. We therefore expect a regressive growth trend for the coming years as less longtail offers enter the market. This general trend is overlayed with the event-heavy years 2018 & 2020. While we already expected stronger TV ad spend for 2018 due to Olympic Games and the Soccer Championships, this positive influence has been outweighed by a general downward trend that predominantly affected the public TV stations of SRG in 2017 (https://werbestatistik.ch/de/downloads/publikation-2018-1/summary.pdf-1).

c. OOHThe OOH market in Switzerland stays very dynamic. Through the acquisition by Tamedia Neo Advertising, a OOH provider that traditionally had a strong inventory in the French-speaking part of Switzerland, started to contest the duopoly of Clear Channel and APG also in the German part of Switzerland. Furthermore, the digital OOH networks of all providers are continually being expanded, resulting in a bigger inventory and larger ad spend. We expect this trend to continue, but with slightly decreasing growth rates overall. Furthermore, we expect a higher level of OOH spending in 2019, as national parliament elections are going to take place that year.

d. Programmatic AdvertisingProgrammatic advertising in Switzerland has been heavily impacted by the ad-fraud and ad-quality debate of the last years. While originally the programmatic dogma stated that the advertising environment was mostly secondary to reaching the right person, clients and agencies developed a stronger conscience for the quality of delivered ad impressions. This process has also been driven by 3rd party technology providers, that provided more transparency about ad-delivery.In the case of programmatic, this process resulted in ad spend being shifted from open exchanges to private deals, improving control of ad environments by advertisers. While this reduced the immediate amount of relevant programmatic ad inventory, the improved level of quality ensures that client trust into programmatic advertising remains intact and share of online advertising is continually rising.

e. Video AdvertisingWhile the Swiss video advertising market hasn’t yet arrived at the same spend levels as in other markets, it still shows strong dynamics. The efforts of YouTube and the big social media platforms to enhance attention and time of engagement for their video content show relevant effects. New advertising formats cater to the situation of consumption on mobile devices and advertisers begin to deliver an awareness towards the necessity of custom video creatives for online video campaigns. This results in high growth rates for online video spend, that we expect to continue in the future. In case of programmatic video, demand actually exceeds supply. Providers still receive very good prices on IO orders, leading to a shortage in actual programmatic video inventory.


https://werbestatistik.ch/de/downloads/publikation-2018-1/summary.pdf-1

53

Switzerland Data Tables



2018 2019f 2020f


Newspapers -13.4 -5.6 -6.1

Magazines -5.3 -2.9 -3.4

Radio 1.4 -3.2 -1.9

Cinema 9.3 8.4 7.6

OOH 10.1 5.4 4.5



2018 2019f 2020f





Paid Search 21.0 18.3 16.7


Mobile^ 19.6 17.3 15.0



2018 2019f 2020f




Radio 2.9 2.6 2.4

Cinema 0.6 0.7 0.7

OOH 9.2 9.1 8.9



2018 2019f 2020f





Paid Search 67.5 69.3 70.8


Mobile^ 55.0 56.1 56.9



54

LATEST KEY AD SPEND TRENDS• Digital forecasts have increased pushing overall forecasts up.

• TV growth forecasts have been reduced slightly. This is due to a declining Q4 as some key advertisers show reluctance to invest amidst wider economic uncertainty. • Cinema forecasts have also declined slightly following a flat Q3

performance.

THE 2019 AD SPEND FORECAST• Healthy growth in 2019 is again driven by double-digit growth in Digital

(incl PPC) – which at that point is expected to represent 64% of all spend.

• The TV market is now expected to remain flat in 2019. This is based on continued uncertainty prevailing in the wider economy as a result of Brexit filtering down to the TV market in H1. This will be exacerbated by the absence of a major football tournament across the summer. Marginal growth is expected to return in H2 with the Rugby World Cup starting in Q3 and the expectation of some kind of recovery in Q4 – coming from a low base- as a result of greater certainty around Britain’s exit fromthe EU.

THE 2018 AD SPEND FORECAST• The UK market had a really good H1 with a strong Q1 & then Q2 ending

much better than expected with increased investment around the world cup.• H2 is not expected to end the year as well for traditional media types like

TV, Radio & Cinema but Digital had a strong Q3 which is expected to continue into Q4, boosting overall spends.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)• 2018 forecasts have increased showing even healthier growth than

expected earlier in the year. This growth is predominantly driven by a good Q1, higher investment into the period around the World Cup (Q2) and revisions to Digital.• Significant upward revisions to Digital forecasts since the beginning of the

year has boosted overall forecasts given that it represents just over 60% of all media. Advertiser anxiety regarding the impact of Brexit and the General Data Protection Regulation (GDPR) have eased with these concerns having had far less effect than was predicted, pushing 2018 & 2019 forecasts up.

UK: ‘Healthy 2019 growth driven by Digital’



2018 2019f 2020f

UK 6.5% (4.2%) 6.1% (4.7%) 7.1%

OVERVIEW OF THE TOTAL ADVERTISING MARKETTop 10 Categories 2018 2018 Gross Local

Currency Million2018 vs. 2017

YOY%

Entertainment & Leisure 2,441 8.3%

Food 2,268 24.2%

Finance 2,076 11.4%

Cosmetics & Personal Care 1,391 8.5%

Motors 1,372 4.7%

Retail 1,371 0.2%

Telecoms 1,269 -2.0%

Travel & Transport 1,176 -4.2%

Household Equipment & Diy 1,108 13.7%

Govt Social Political Organisations 774 0.7%


55

‘COMPANIES TO FOCUS ON VOICE RATHER THAN SCREENS IN COMING YEARS’


a.Traditional broadcasters have found huge business value in partnering with the big internet players, e.g. by doing co-productions with Amazon, distributing back content via Netflix and offering live-streaming via YouTube and Facebook. These types of partnerships are expected to continue and increase in 2019.

b.Developments in voice search and control are increasing with some sources predicting half of all searches will be voice-based by 2020. Forward-thinking companies will be focusing more on voice than screen over the next couple of years.

c. There has been a resurgence for contextual and premium content solutions which is giving hope to premium publishers, helped in part by GDPR.

d. The Ozone project – a digital advertising & audience platform was created in 2018 by the Guardian Group, News UK, the Telegraph and Reach.This new platform will offer fantastic opportunities for both Newsbrands and advertisers as the project aims to offer advertisers, through a unified sales team, access to a combined digital audience of 42.5 million in Britain.

This collaboration will only strengthen the digital offering of those involved and make them a credible threat in this highly competitive landscape.

e.In 2018 Global (Britain's biggest Radio group) acquired Exterion Media, Primesight & OOH plus giving them around a 34% market share in OOH –on par with market leader JC Decaux. Global's scale and reputation of innovation will likely serve to further accelerate investment in the digitalisation of the medium and continue to place OOH as a solid and long-term investment opportunity.


56

UK Data Tables



2018 2019f 2020f

Television 0.2 -0.4 2.0


Magazines -11.0 -11.0 -8.0

Radio 5.0 2.0 2.0

Cinema 2.0 1.7 1.5

OOH 2.0 1.0 1.0



2018 2019f 2020f






Mobile^ 19.3 18.0 12.2



2018 2019f 2020f




Radio 3.3 3.2 3.0

Cinema 1.4 1.3 1.3

OOH 5.6 5.3 5.0



2018 2019f 2020f




Paid Search 44.2 43.4 42.3


Mobile^ 68.6 73.0 73.8



57

Central & Eastern Europe Market

58

LATEST KEY AD SPEND TRENDS• High inflation and scarce inventory in TV and digital result in almost

doubling the YoY percentage growth 2018 forecast.

• Traditional media continues the trend of transferring their most interesting TV content into interactive online platforms to meet the growing digital demand, especially for mobile, boosting the ad expenditures and contributing to the almost doubled YoY growth.• The forecasted overall inflation in TV is now 13% with 2% additional

growth from FIFA World Cup advertisers activities.

THE 2019 AD SPEND FORECASTTotal ad spend forecast for 2019 is forecasted to reach 6.9% growth yoy. It is most likely to be affected by political rather than any sport events. Media inflation and current political stability will keep ad expenditure growth on a stable track.

426 million BGN are to be spent in ads during 2019. The forecasted inflation for 2019 is expected to reach 10% mainly driven by TV and digital scarcity of inventory in both media.

Global or local events to boost spend in 2019Political elections – both local and European ones – will keep the demand for inventory high and boost ad spend in 2019 further.The year is very intense with regards to political campaigns. On the one hand, in 2019 municipal elections in Bulgaria will take place. These elections will take place in all the regions in Bulgaria given that the goal is selecting office-holders (mayors and councilors) in local governments. Therefore, regional and national media will both be used for conveying the candidates’ messages. On the other hand, European elections will also take place in the same year and will amplify the local and national media demand for inventory and keep the inflation trend growing further.

The year does not have an as intense sports curriculum as 2018 but there will still be sports events of public interest, e.g. UEFA Euro 2020 qualifications that start in March 2019 and will continue till march 2020.

THE 2018 AD SPEND FORECAST Spending on media in Bulgaria is shifting from traditional to digital at a fast pace with inflation in TV and digital growing rapidly and yoy growth reaching new local heights. The FIFA 2018 World Cup has increased the TV ad spend with an additional 2%, boosting the inflation in TV to reach 13%.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)Demand for more inventory in TV and digital, coupled with the high advertising activities during the FIFA World Cup, have significantly impacted the yoy growth of local ad spend.The high advertisement activity during and around the World Cup, in addition to the scarce inventory in both TV and digital, resulted in nearly 4pp higher investments than the previous June Ad Spend Report forecast. The higher 2018 inflation forecast is expected to have an impact on the ad inflation in 2019, increasing the total ad market with 6.9% compared to 6.0% forecasted in June.

The economic contextEconomy growth and reduced unemployment rate influence the increase in household consumption: The Bulgarian economy has grown with 3.4% in Q2 2018. Still, this is the lowest growth rate since 2015. The major reason for the economic growth is the household consumption increase (1.8% for Q2 2018 and 4.7% FY 2018). However, inflation is growing by 3.4% majorly driven by the utility and rental costs which will reduce consumption at a certain point in time. The labor market situation is positive, given that the unemployment rate has reduced to 5.5%. This is considered to be the population’s economic activity peak.

AD SPEND PERFORMANCE BY CATEGORYRetail proceeds to outperform the other categories in terms of YoY growth for a second consecutive year and is forecast to enter the ad spend Top 3 in 2018, overtaking Cosmetics. Pharmaceuticals and Foods will remain the top

advertising industries in the Bulgarian market, but with slower growth YoY. Though remaining in the Top 3, the Foods industry is expected to shrink more than two times its growth trend in 2018. A significant downward trend in terms of YoY growth is estimated for the Automotive and Household Chemistry, while the Telecom industry is expected to recover and perform with a two-digit growth trend in 2018 as compared to 2% growth in 2017 vs. 2016.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDThe shift from desktop to mobile is driving changes in the ad spend profile, with video content outperforming in terms of efficiency. Video ads now account for over one forth of the overall ad spend investments in display and is continually growing. It is forecast to rise by nearly 21% YoY for both 2018 and 2019. The rapid shift from desktop to mobile is driving the mobile ad spend at a fast pace, nearly reaching display with expected growth of over 42% YoY for 2018. By 2020 it is estimated to outperform display ad investments, reaching 64 million BGN ad spend.

BULGARIA: ‘Media market to end 2018 at new heights driven by increasing inflation’



2018 2019f 2020f

Bulgaria 9.1%(5.4%) 6.9%(6.0%) 7.3%




2018 vs. 2017YOY%

Pharmaceuticals 311,492,410 18%

Foods 208,344,595 5%

Retail Outlets 237,937,497 22%

Cosmetics 204,873,701 10%

Drinks 160,017,132 6%

Telecommunication 144,715,708 12%

Hobby. Fashion. Sport 96,999,456 16%

Financial Services 80,696,584 3%

Household Chemistry 56,411,760 1%

Motoring 53,001,068 2%


59

‘ROBUST GROWTH OF DIGITAL-MOBILE TO REACH OVER 50% OF TOTAL DIGITAL AD SPEND AND GET STEADILY AHEAD OF DESKTOP BY 2020’


a. TV to secure its place as top ad spend medium amid rising inflation The 2018 TV media inflation is estimated to reach 13% by the end of the year. The YoY advertising expenditure growth in 2018 is forecast to reach 9.1%. The TV growth is expected to drop more than two times in 2019 to 4.6%. The slowing down trend of TV advertising investments growth is expected to continue in 2020, when a 4.4% rise is expected.

b. Digital is closing the gap more aggressively with the market reaching new heights through mobility and personalizationThe Bulgarian advertising market is steadily heading towards digital with significant relocation of resources toward online media within the media mix. This is additionally accelerated by the new media policies introduced by the major local TV media groups that had strengthened their digital proposition aiming to increase the ad expenditures in their online channels throughout different techniques. The shift from “traditional media” towards digital is forecast to grow steadily in the next three years, reaching nearly 1/3 of total ad expenditures. Technology solutions, especially mobile and programmatic, have already established themselves as the major drivers. Despite the steady growth YoY digital is not expected to outperform TV in the next 3 years.

c. Programmatic showing robust growth in 2018Programmatic Display is forecast to bite over 21% of the share of Total Display spend by the end of the year and continue its steady growth, reaching over 30% by 2020. The growth YoY will gradually increase after the main burst in 2017 and will remain at double digits in 2019 as well. This is mainly due to the recent activities of the major local publishers which are already investing in technological solutions that are allowing them to automate the sale of their inventory.

d. Digital Mobile has the highest growth YoYDigital Mobile shows the highest expected growth rate YoY with estimates to increase to 42.1% until the end of 2018, and remain on steady growth until 2020. This is mainly due to the major shift in consumer behavior from desktop to mobile and more importantly - the successful adoption of mobile solutions by the major digital media players locally. This reflects enhancement of their overall ad policies towards mobile. By 2020 mobile will outperform desktop ad spends and have over 50% share from the total digital ad investments.

e. Slow down in social media ad investments growth YoY due to Cambridge Analytica scandalSocial Media is expected to slow down its growth YoY, reaching 15.5% for 2018 due to GDPR implementation and e-privacy regulations as of May 2018. Local advertisers are not likely to spurn FB but indicate caution in their investment interests and are likely to wait and see how the threat of regulation develops. E-privacy regulation is forecast to further accelerate this trend. The expectations are that the investment in social media in 2018 will keep a healthy level compared to 2017 – around 17 mln. BGN. In the next years the growth in social media is expected to stabilize and start to gradually increase, reaching nearly 20% YoY growth by 2020.


60

Bulgaria Data Tables



2018 2019f 2020f



Magazines -6.0 -14.9 0.0

Radio 3.7 1.0 2.5

Cinema N/A N/A N/A

OOH 1.5 3.0 0.2



2018 2019f 2020f





Paid Search 15.4 16.3 18.3


Mobile^ 42.1 31,7 35.8



2018 2019f 2020f




Radio 4.9 4.7 4.5

Cinema N/A N/A N/A

OOH 11.7 11.2 10.5



2018 2019f 2020f

Total Digital* 100.0 100.0 100.0




Paid Search 24.1 23.1 22.6


Mobile^ 42.7 46.1 51.9



61

LATEST KEY AD SPEND TRENDS• Further concentration on the Print market. Bauer Media sold their

activities in Czech Republic to MaFra, publishing house owned by thePrime Minister Mr. Babis. This acquisition will make MaFra the biggest publishing house in Czech Republic.

• Czech economy in good shape. Increase in TV investments for third year in a row, leading to strong inflation trends in TV.

THE 2019 AD SPEND FORECASTWe expect that the total increase in 2019 will be 8,8% and will be drivenmainly by Digital and partially by TV media. There will be no major sports or other events.

Global or local events to boost spend in 2019The only political event scheduled for 2019 is the European parliament election in May. We expect no boost in spend related to this or to any sport events in 2019.

THE 2018 AD SPEND FORECASTThe Presidential election was held in January, Regional and senate elections are due to happen in autumn 2018. As in previous years this had only a minor influence on total ad spends; a significant part of political campaigns are carried out on non-monitored online media. The Winter Olympics and Footbal World Cup 2018 also had a non-measurable influence on the total ad-market.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)There are no changes to the ad spend forecast.

AD SPEND PERFORMANCE BY CATEGORYNearly all categories have risen in gross prices. Retail represents the biggest one from a long term perspective and shows stable growth over the last years; it is the most dynamic category in 2019. Food&Beverages, Consumer electronics, Cosmetics and Telecom categories grow by 5-7%, reflecting an increase in living standards. The only decreasing category is Automotive.

CZECH REPUBLIC: ‘Strong inflation trends’



2018 2019f 2020f

Czech Republic 5,7% (5,7%) 8,8% (8,8%) 10,5%



2018 vs. 2017YOY%

Retail 16 445 13%

Food 8 017 5%

Media/Entertainment/Publishing 7 252 0%

Finance 7 043 5%

Cosmetics 6 884 5%

Tourism/culture/leisure 5 944 0%

Automotive 5 831 -6%

Pharma 5 723 6%

Beverages 5 188 6%

Telecom 2 879 7%


62

‘MAFRA BUYS BAUER MEDIA CREATING BIGGEST PUBLISHING HOUSE IN CZECH REPUBLIC’


TVStrong inflation trends. Nova Group +12%, Prima Group +10%.YOY change in broadcasted GRPs for Jan-Sep is +4%, and it is expected to increase until the end of the year.Consumption of TV is not changing.

Duopoly of Nova Group and Prima Group will stay unchanged in 2019.New TV channels have been unsuccessful.

b.MaFra bought Bauer Media and created the biggest publishing house in Czech Republic.

c. Through TV + Radio (Prima Group + Radio) packages, Media Club is pushingan increase in share of investments to the radio stations represented by them. Cooperation between Czexch Radio Center and Media Bohemia willcontinue in 2019.

d.Bigmedia gave up fighting against the goverment about a new lawprohibiting billboard signs along the highways and started to dismount their signs.Unclear situation as to who will be selling CLV in the underground in Pragueafter the contract between Prague and EuroAWK expires.

Popularity and usage of digital signs is increasing.

e.One of the biggest e-commerce players, Mall.cz, has started its own TV –Mall TV.


63

Czech Republic Data Tables



2018 2019f 2020f

Television 3% 3% 3%

Newspapers 0% -2% -2%

Magazines 0% -3% -2%

Radio -1% -3% 0%

Cinema 0% 0% 0%

OOH 0% 2% 2%



2018 2019f 2020f


Display (Banners) -10% -8% -8%





Mobile^ 109% 42% 38%



2018 2019f 2020f


Newspapers 6% 5% 4%

Magazines 8% 7% 6%

Radio 5% 4% 4%

Cinema 0% 0% 0%

OOH 6% 6% 5%



2018 2019f 2020f







Mobile^ 39% 48% 57%



64

LATEST KEY AD SPEND TRENDS• TV is still considered the most powerful media reaching 90% of the

Estonian population, but live reach is decreasing, and TSV (Time Shifted Viewing) is growing. TV market is not growing, some channels have lost viewers significantly, approximately 10% increase in GRP/sec prices for 2019 is expected. • Investment growth for International online channels Facebook & Google

will continue, Instagram is the latest most popular social media channel. The TOP social media channels for younger audiences are Instagram,Snapchat and, for russian speaking audiences, Odnoklassniki.

• Out-of-home (OOH) has benefited from significant technological innovations in recent years. Digital displays across all formats have transformed the medium. OOH is expected to grow because of digital formats, 25% of total OOH is digital.

THE 2019 AD SPEND FORECASTThe 2019 advertising market will grow by 4,3%, one of the reasons beingstable economic growth (+ 3,3% GDP) and also spend from major political events (Estonian Parliament Election & Euro parliament Elections). Total ad spending will be appr 120 m EUR in net spend.

Global or local events to boost spend in 2019Estonian Parliament Election and Europe Parliament Elections will bein 2019.

THE 2018 AD SPEND FORECASTWinter Olympic Games in PyeongChang had a positive effect on the Eesti Meedia budget for an additional 2,5% turnover in the 1st quarter. Estonian Parliament Elections will be in March 2019, the first campaigns have already started for OOH, TV and online in October 2018.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The revised forecast for 2018 shows a slightly higher predicted growth for the media market compared to the previous report. This is due to a very good first half of the year and the expectation was that this trend will hold for the full year.

The economic contextAccording to the last estimation from the ministry of Finance, the Estoniaeconomy will grow by 3.5% in 2018. This growth is driven mainly by household consumption and investment activity by firms and government institutions. Further increase is expected in 2019, 3,3%.

AD SPEND PERFORMANCE BY CATEGORYRetailThis sector is very competitive. Most active are Coop 17%, Rimi 17%, Maxima 15% and Selver 14%. Top three most used media are TV 58%, online 14% and OOH 9%. In the retail sector AMB and Eesti Meedia have a similar share: 47% and 43% respectively.

Alcoholic beveragesIn 2018 in the alcoholic beverages sector the most used media is TV 69%,then Online 19%, followed by Newspapers 6%. The TV group shares are asfollows: Eesti Meedia with 62%, then AMB with 25% and BMA with 10%. In this sector there are two main advertisers. The most active advertiser with 38% SOS is Saku Õlletehas, then A.Le Coq with 30%. The rest of themarket is divided between little players like MV Eesti 9%, Alder Eesti 5% and Heineken 4%.

TelecommunicationThree most active advertisers are Telia 25%, Elisa 15% and Tele2 9%. The three top used media are: TV 67%, Online 20% and OOH 6%. Here AMB has the highest share: 57% and Eesti Meedia follows with 35%.

AutomotiveToyota with 12% has the highest SOS, then follows Nissan with 11% and Auto 100 with 7%. Auto 100 sells well known brands like Bentley, Porsche and Škoda. The most used media are TV with 42%, Online with 21% and Newspapers with 14%. In this sector Eesti Meedia and AMB have similar shares, 47% and 43%.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDOnline shopping is increasing. It is more and more convenient for people: faster deliveries, easier return policies, free shippings, etc. Big local online shopping channels (kaup24.ee and hansapost.ee) use TV and Online, whereas others use only Online.

The younger target group focus is more on Online and less on TV. 15-25 TG use less YouTube and more Instagram, Snapchat and Odnoklassniki.Some local newspapers offer the opportunity to read fresh news Online even before the news has been published in print. This offer is only for readers who already order the newspaper in print.

ESTONIA: ‘Stable growth this year and next’



2018 2019f 2020f

Estonia 3,6% (5,5%) 4,3% (5,5%) 3,7%




2018 vs. 2017YOY%

Food & Beverages 110 5%

Retail 61 0%

Pharmaceuticals 50 13%

Telecoms 46 -10%

Finance & Insurance 42 -5%

Personal and HH Care 36 -8%

Automotive 32 5%

Luxury & Facion 18 -7%

Consumer Electronics 15 15%

Alcoholic Beverages 8 -7%


65

‘OOH BENEFITS FROM SIGNIFICANT TECHNOLOGICAL INNOVATIONS’


a. Digital – main driver of advertising market growthDigital media continues to be important to most businesses. Digital numbers have increased remarkably over the last several years, but there is still room for further growth. The spending is also shifting away from banner ads and increasingly towards search and social media. We forecast digital (and its sub-categories) to have the largest amount of spending growth in 2018. Mobile has a lot more potential for growth than Desktop. Although Display and Paid Search will not grow as strongly as Social media and Online Video, growth in every digital sub-category is expected. Social media is one of the major drivers of digital spend, shifting from traditional to direct buying. However, social spending is hard to measure and we have no official data. At the same time there is more and more focus on visibility, brand safety and premium placements. New GDPR (General Data Protection Regulation) regulations have been implemented as of May 2018; this new mandatory regulation has forced clients who use personal data to change their internal systems and procedures of collecting this data; the process has turned out to be a difficult one and has come with important costs. GDPR enactment may slow down ecommerce and Performance related spending in the short term while the industry adjusts during the “getting compliant” phase.

b. TV and online VideoThe TV market is still having difficulties with TV ratings being lower than expected due to lost viewers and the competitive market. This is leading to approximately 10% GRP/sec price increases for both big Media groups (AMB & Eesti Meedia).For 2018 and 2019 one of the fastest growing media is Online video in local TV groups. Even though there is growth in local media, quite a big amount of VOD investments are still going to YouTube.

The biggest TV Group, AMB, has developed their new offer in this area; they recently launched a new VOD platform TV Play.

c. DOOH is expected to boost the growth of OOH in upcoming yearsOut-of-home (OOH) has benefited from significant technological innovationsin recent years. Digital displays across all formats have transformed the medium. OOH is forecast to grow by 10% in 2018 and 12,9% in 2019. For brands, these new displays provide a number of opportunities in terms of content and creativity. The leading OOH company JCDecaux launched a very successful new digital package „Digi Tallinn“.

c. Print declines continue, but Daily Newspapers are relatively stablePrint media share has declined for a long time, but still holds a large part of total investment in the market with a share of 14,1%. Daily newspapers are quite stable due to the strong local big media groups Eesti Meedia and Ekspress Group, who are investing greatly in daily newspapers. Magazines are showing a decline compared to last years spendings.

e. Radio will remain in the role of follower as tactical media vehiclesCompetitive costs, flexibility and content integration actions maintaindemand for Radio, with growth both in 2018 and 2019. Prices have increased compared to the previous year and the different media owners offer an enriched bouquet of radio stations. The biggest radio group, Sky Radio Group, will continue to have the most budget, controlling nearly half of the total spending.


66

Estonia Data Tables



2018 2019f 2020f

Television 0% 5.0% 2.0%

Newspapers 1% -2.1% -5.0%

Magazines -2% -6.9% -3.0%

Radio 9% 5.0% 5.0%

Cinema n/a n/a n/a

OOH 10% 12.9% 8.0%

Total Digital 4.0% 4.0% 4.0%


2018 2019f 2020f

Total Digital* 4.0% 4.0% 4.0%

Display (Banners) 4.0% 4.0% 4.0%

Online Video 5.0% 5.0% 5.0%

Social Media 5.0% 5.0% 5.0%

Paid Search 4.0% 4.0% 4.0%

Other incl. Classified n/a n/a n/a

Mobile^ 10.0% 10.0% 8.0%



2018 2019f 2020f

Television 22.0% 22.2% 22.6%

Newspapers 14.1% 13.3% 12.1%

Magazines 3.7% 3.3% 3.1%

Radio 9.7% 9.7% 9.8%

Cinema n/a n/a n/a

OOH 14.2% 15.4% 16.1%

Total Digital 36.3% 36.2% 36.3%


2018 2019f 2020f




Social Media 14.8% 14.9% 15.0%

Paid Search 14.8% 14.8% 14.7

Other incl. Classified n/a n/a n/a

Mobile^ 13.0% 13.9% 14.3%



67

LATEST KEY AD SPEND TRENDS

• In spite of positive trends in macroeconomic variables, long term planning of consumption or media expenditure is still difficult due to incalculable macroeconomic policy and the government’s continuously growing interest in the media market.

• Three submarkets can be observed in the Hungarian advertising market:

1. Politics-driven marketDue to the state’s growing interest, there is a higher and higher market share connected to the government in direct or indirect ways. Media expenditures by the Prime Minister’s Office (incl. state-owned companies) are very important drivers behind the market growth (e.g. 12% of total TV expenditures comes from this submarket according to MEME) and this is an almost exclusive market only for a limited number of media owners and agencies.

2. Direct advertisersSimilar to the politics-related media investments, share of direct orders are also improving. Only some media types are influenced by non-proxy deals such as listings or press. Effects of political acts are important drivers behind direct investments, for instance the 15% fixed agency fee pushed many advertisers to having agreements with media types where they felt that special knowledge was less important e.g. radio or press. SoHo companies also prefer direct deals in the digital market because of similar reasons. This submarket also performs well where professional media agencies are less involved.

3. Free trade or Agency MarketThe situation of media agencies is more difficult as their markets are stagnating or have a more modest improvement compared to the above two. The increase could come from specific fields where their investments into professional staff, data and software are required such as programmatic. Quality focused clients still prefer the expertise of agencies.

THE 2018 AD SPEND FORECAST

Although the market increased nicely, the growth rate is different for agencies and the rest of the market. Internet is the main driver of the growth where all digital media types are improving. For offline media, TV still owns almost a quarter of total media investments however, similar to other classic media types, investments are slightly decreasing in the long term where minor corrections can only compensate this slope for a small while. Expenditure trends were compensated for in all media types in 2017, with political influence playing an important role as well as economic trends.

Many macroeconomic indicators show positive trends, such as solid consistent GDP growth since 2013 and both Nielsen and Ipsos reporting record high consumer confidence in 2018. However, trends of the Hungarian media market will not necessarily follow international trends or even the changes in the attention of the audience. Conditions of the Hungarian advertising industry have worsened due to various political acts and further limitations may arise. The government is influencing the media market in several ways:

As a direct advertiser: by doubling its investment in 2017 vs last year, the Prime Minister’s Office is one of the biggest advertisers in Hungary. Other state institutions and state-owned companies are also important media investors and, together with the government-friendly companies, could influence the total market seriously, likely accounting for about one-fourth/one-third of the market.

As a regulator: after many changes to media laws, further regulations could be expected that further limit free trade. Previous regulations such as the fixed agency fee have reallocated many expenditures into the direct market and influenced the share between channels.

As a media owner: businessmen connected to the government party have dramatically increased their share of every media type recently. By having interests in many media types the government can also influence the media market, both in content and inventory.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)

It is difficult to make any forecasts due to the government’s non-conventional macroeconomic policy and direct influence into the media market. The market sometimes acts as a roller coaster, first going downhill for several media types after the interference of the state which they then try to compensate for through regulations and redirecting expenditures. Additionally, many media owners are not forced to cooperate with agencies or independent advertisers below them as they can sell a high share of their inventory to the government and their alliance easily.

AD SPEND PERFORMANCE BY CATEGORY

State institutions and development, Social organizations

Close to a 30% increase is expected for 2018 according to the continuously growing role of politics in both categories. Besides the aforementioned government and institutions acting as advertisers, political parties and organizations from all sides were also active during the campaigning for the parliamentary election. OOH is the main battlefield for them, with a significantly higher focus on TV and relatively lower digital share compared to the total market.

Medicinal products (OTC)

The OTC market gained the highest share of media expenditure for 4 years in a row. Range of OTC brands such as Algoflex, Magne B6, Normaflore, etc. advertise with a strong TV focus.

Trading firms

Hypermarkets, electronics retailers and online stores kept their high shares of the total media expenditures.

Entertainment and sporting events

Similar to the Budapest-based FINA Budapest 2017 event a year ago, in 2018 the FIFA World Cup was one of the main drivers of this category. However, many other cultural products also have significant investments such as concerts, festivals and movies. Furthermore, gambling is also an important part of this category.

HUNGARY: ‘Solid growth but still an unpredictable future’


Year on year % growth at net-net prices

2018 2019f 2020f

Hungary 12.4% (4.9%) 4.1% (2.3%) 4.9%


Top 10 Categories 2018 2018 Net-net LocalCurrency Million

2018 vs. 2017YOY%

Medicinal Products 19 154 1.02

Trading Firms 17 940 1.01

State Institutions And Development 12 880 1.19

Entertainments And Sporting Events 12 520 0.95

Cars, Vehicles 9 418 1.19

Mass Media 9 100 1.09

Banking 6 901 0.88

Social Organisations 4 039 1.68

Mobile Telecommunication 3 823 0.78

Catering 3 623 1.04


68

‘DIGITAL FURTHER STRENGTHENS ITS LEADING POSITION’


DisplayDisplay remains strong with the highest share of total digital media but its internal structure is changing due to the rise of programmatic, increase of premium inventory and video formats. Dynamic gain of mobile also forms the profile of display. Importance of international giants such as Google (GDN) and Facebook are also increasing, but this could be changed due to the strengthened Hungarian programmatic market. As a sign of this, local media owners are more open to cooperating with agency trading desks such as Amnet.

OOHAlthough appearing stable with heavy growth in both 2017 and 2018, OOH's future is questionable as billboard – and other large formats - could disappear completely in 2020 due to the new act passed in June. Smaller inner-city sites such as city light posters could remain, however the currently offline touchpoint is still waiting for its renewal with new digital-based solutions. According to a new law modification, entered in January 2018, local municipality can impose tax on the advertisement carrier. As media owners are unable to pay this themselves, they charge this tax to the advertiser – which has increased media prices.

TVHungarians still spend many hours in front of their television (242 minutes a day for the total population in January-September 2018 – Nielsen Audience Measurement). However, in spite of the wide range of choice it is harder to reach certain target groups, especially youngsters. Time shifted viewing is not yet a breakthrough but many leading TV channels have realized the threat that online video content poses and are launching their own stream sites such as RTL Most.

VideoBesides the clear dominance of YouTube, local stream sites are emerging. Online video offers considerable alternatives alongside or sometimes even instead of TV. Many big media houses have established their own stream sites and distribute video content previously broadcasted by TV channels, which could be the surviving model for classic media brands such as Tv2.

PrintThere is a shrinking in readership, content and circulation numbers. Besides this the government’s intent to restructure has also not had a good influence on the press market. Now the state is trying to turn the decreasing incomes around by ordering a massive amount of sites in newspapers and magazines – part of them also owned by the government and its halo. Due to this the print market improved for 2017 and further rise continued for newspapers, while magazines are stagnating in the present year.

RadioRadio is a real rollercoaster market because of the changes in political relationships. Today government-friendly businessmen own all the important radio channels and networks next to the state-owned public service channels. Therefore, we foresee a correction and even a 10%+ growth in the radio market for 2018. Classic radio is losing its audience among younger age groups: according to CCS 2017, about half of 15-24 year olds never listen to the radio. Online radio has a considerable audience but not a typical alternative for youngsters since radio has to compete with many other ways of listening to music such as YouTube, streams like Spotify, etc.


69

Hungary Data Tables



2018 2019f 2020f


Newspapers 10.3 2.0 -4.0

Magazines -0.3 0.0 -4.0

Radio 10.5 1.0 -1.1

Cinema 12.1 1.0 -1.0

OOH 24.6 2.0 0.0



2018 2019f 2020f




Social Media - - -

Paid Search 18.8 11.8 16.4


Mobile^ 29.7 15.4 21.0



2018 2019f 2020f




Radio 5.5 5.3 5.0

Cinema 1.0 0.9 0.9

OOH 11.8 11.6 11.0



2018 2019f 2020f




Social Media - - -

Paid Search 40.8 42.4 44.5


Mobile^ 32.8 35.3 38.5



70

LATEST KEY AD SPEND TRENDS • In October 2018 new legislature was approved regarding restrictions to

advertising of the consumer loan category, targeted at limiting reckless borrowing from fast-loan companies. The changes will have a significant impact on the advertising investments of the finance category (2nd largest in 2017) and non-banking loans specifically (~70% of the Finance category).

• The effect of advertising cuts to the non-banking loan category will be most felt by Radio & OOH advertising providers, as well as TV.• However in terms of TV advertising the loss of advertising investments by

the large advertisers of this category should soon be replaced by others, since in recent years the demand for the top TV channels has been higher than supply in terms of available inventory.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)• In October 2018 new legislature was approved regarding advertising of

the whole consumer loan category. The legislation was targeted mostly at fast-loan companies, but it will have an effect on most of the loan providers. Transitional period has been set and the new restrictions will come into effect only on the 1st of July 2019. However the drop in advertising investments for this category to some degree is likely to become apparent even sooner, since the new changes might put some smaller companies out of business entirely. After the transition period the advertising drop might be significant even among the remaining largest players.

• The non-banking loan category has been one of the largest and also the fastest growing categories in terms of advertising investments for quite a while, therefore these changes will have a significant impact on the whole advertising market in Latvia. In 2017 the non-banking loan category share

was ~6,3% of the whole advertising market in Latvia, in 2018 it is estimated that its share would grow to 6,9%, but due to the aforementioned legislature changes in 2019 it might drop to ~4,6% or even less. • That is the reason why the total advertising market growth for 2019 has

been revised down to +2,6% instead of the previously estimated +4,7%.

Global or local events to boost spend in 2019There will be elections for the European Parliament, however the effect on the advertising market is expected to be lower when compared to the Parliament elections that took place in October 2018 and the Municipality elections in 2017.

THE 2018 AD SPEND FORECAST• Currently the advertising market is performing as expected.

• Usually the impact of such large scale sporting events as the Football World Cup or the Olympics on the Latvian advertising market is relatively insignificant. The same goes for the US presidential elections.Events that usually have greater impact on the advertising market in Latvia are elections. The next elections are for the European Parliament and will take place in 2019.

The economic contextSince 2014 there has been a constant growth of nominal GDP at a rate of approximately 3% and the growth of advertising investments has managed to match it or even outpace it.For the period of 2017-2020 another significant factor comes into effect –the next wave of European Structural Funds will kick in. This will have a major effect on the Economics of Latvia.Consequently the Ministry of Finance is more optimistic about this period –nominal GDP growth was predicted to reach +5,2% for 2018, with the average monthly wage growth being +5,0% in 2018, outpacing the inflation that is expected to reach 2,0%.All these events will likely increase the domestic consumption levels which should have a positive effect on advertiser confidence in increasing advertising budget levels as well.

AD SPEND PERFORMANCE BY CATEGORYRetailThere are huge changes expected in the shopping center competitive environment by 2020 – significant expansion of two of the largest shopping centers, as well as a newly built shopping center Akropole, that would be the largest by retail space in Latvia. In combination with the negative demographic tendencies this will lead to approximately a +28% increase of GLA (Gross Leasing Area in m2) per capita. Such changes are very likely to intensify the competitive environment between the shopping centers and should have a positive effect on the advertising investments in the Retail category.Another factor that has been driving the category growth for the last couple of years has been the competition between the two largest grocery and convenience retail chains –Rimi & Maxima. In 2017 one of their largest competitors in Riga “Prisma” left the Latvian market and Maxima managed to take its place in all the shopping centers where it was present. This move has significantly changed the balance of power between Rimi & Maxima in Riga.Also, Lidl has announced that it plans to enter the Latvian market in the nearest future – this change will definitely boost the advertising investments in the category, however currently there is no clear timeline as to when this might happen.

LATVIA: ‘Unpredictable changes to significantly reduce advertising of 2nd largest category –non-banking loans’




2018 vs. 2017YOY%

Retail 30,0 mEUR +7%

Finance 28,4 mEUR +8%

Remedies 20,0 mEUR +10%

Internet 18,7 mEUR +18%

Mobile Communication 13,7 mEUR +14%

Cars 12,2 mEUR +19%

Concerts, Festivals, Shows 12,0 mEUR +9%

Sweets 7,7 mEUR -1%

Household Hygiene 7,5 mEUR -2%

Alcoholic Beverages 6,5 mEUR +/-0%


2018 2019f 2020f

Latvia 5,7% (5,7%) 2,6% (4,7%) 4,8%



71

‘RADIO HIT HARDEST BY DECREASE IN NON-BANKING LOAN AD INVESTMENTS’


All Media Baltics (AMB) Sales house continues aggressive price increase policyIn an unprecedented deal for Latvia in 2017/2018, providence equity (Bite) bought the entire MTG Baltics business creating a new TV group – Allmedia Baltics.This deal in itself includes even more risks than that of 2012 when MTG bought LNT. Consequently it is under strict supervision by the Competition Council. One of the pre-requisites by the Competition Council for this deal to be allowed was a completely transparent & non-discriminatory advertising sales policy. In theory it was supposed to mean completely abandoning historical buying conditions for all clients and applying one publicly available Rate Card.However, due to the fact that these events occurred at the very end of 2017, when most advertisers had already finished budgeting for next year and such a move would mean that for some clients in some channels the inflation could reach +300% and more (base price + all the new indexes), the Competition Council agreed to soften the transition period of 2018 by limiting the weighted base price (new indexes should still be applied) of all AMB channels’ (TV3 & LNT can no longer be freely bought separately) inflation to +25%.But starting from 2019 there will be no more exceptions to the official ratecard.

DOOH is strengthening its presence in the advertising landscape of LatviaIn a relatively short period of time two local OOH providers have managed to create a relatively equal network of DOOH Walls & Billboards – Visual Media & Actual City Media (ACM). However, there has been no response from the top global players – Clear Channel or JCDecaux.

JCDecaux have already established a DOOH large format network in Tallinn & the results have been relatively good. Unfortunately there have been no announcements about JCDecaux’s plans to do the same in Riga. However, taking into account the buying and selling power of JCDecaux and the large format positions that are already sold by them, the Digitization might be done in a relatively short period of time once started.Clear Channel has chosen a different path – it is developing a network of small digital stands in the largest shopping centers that can be bought at least partly programmatically.The DOOH trend will clearly be the main shift in the existing OOH landscape for the upcoming years.

The growth rate of Online video remains high due to constantly growing TV spot advertising prices Constantly increasing prices of regular TV advertising for the past couple of years has narrowed the gap between TV and Online video. Although online video is still significantly more expensive, more and more advertisers are implementing it in their routine media plans. As a result, online video has grown significantly from ~1,7mEUR in 2015 to estimated ~5,9mEUR in 2018. This trend is likely to continue in 2019 as well, when online video is expected to reach ~7,8mEUR in advertising investments.

The effect of an advertising investment decrease for non-banking loans will hit Radio harder than other media Radio has been widely used among non-banking loan providers therefore the effect of the decrease of their advertising investments will be felt most among radio stations. The total advertising investments for 2019 have been revised down by -2,7% if compared to the previous estimations.

International Online is growing significantly faster compared to Local OnlineFor the last couple of years, growth of local online advertising investments has been slower than that of global platforms. The share of online investments in international platforms is increasing significantly faster due to the abundance of different advertising opportunities and large potential.Online video is the only sub-category where local platforms are growing at a similar pace to international.


72

Latvia Data Tables



2018 2019f 2020f

Television 2,2% -0,1% 1,5%

Newspapers -5% -7,1% -7%

Magazines -10% -5,1% -5%

Radio 0,9% -2,7% 0%

Cinema 0% 0% 0%

OOH 6% 2,2% 5%

Total Digital 13,7% 10,9% 12,7%


2018 2019f 2020f

Total Digital* 13,7% 10,9% 12,7%

Display (Banners) 6,7% 3,5% 5%

Online Video 25% 27,3% 25%


Paid Search 23% 21,4% 25%

Other incl. Classified N/A N/A N/A

Mobile^ N/A N/A N/A



2018 2019f 2020f


Newspapers 4% 3% 3%

Magazines 5% 5% 4%

Radio 11% 11% 10%

Cinema 1% 1% 1%

OOH 10% 10% 10%



2018 2019f 2020f



Online Video 21,6% 24,8% 27,5%


Paid Search 12,6% 13,8% 15,3%

Other incl. Classified N/A N/A N/A

Mobile^ N/A N/A N/A



73

LATEST KEY AD SPEND TRENDS• According to the Research Institute Report 2017, advertising investments

in digital have increased less than the market experts forecasted and so the market grew less than expected.

• It is confirmed that the magazines ad market has dropped down by 13,5% while newspapers have decreased less drastically with minus 6,6%.

• 2019 investments will be higher than the initial forecast because the advertising of political elections (President, Euro parliament & municipal council) will provide additional money for the ad market.

THE 2019 AD SPEND FORECAST2019 advertising market will grow by 4,3% which will be driven by stable economic growth (+ 2,7% GDP).

Global or local events to boost spend in 2019Major political events (President, Euro parliament & municipal council elections) will boost ad growth from 2,8% up to 4,3%.

THE 2018 AD SPEND FORECASTThe advertising market growth slowed down in Q1 (+6% gross budgets vs +19% 2017 Q1 vs 2016 Q1) due to an alcohol advertising ban which came into force as of 2018 January. In 2018 other quarters’ ad growth will not achieve last year’s level but will be in the range of 5-9%.

The Winter Olympics were broadcasted via TV3 & TV6 channels (AMB TV group). Advertisers had 4,3% February TV spending in Winter Olympics TV sport programs. Winter sports are not very popular in Lithuania because there is not enough snow in the country and so sportsmen do not win the medals or achieve high positions.

The Football World Cup will be broadcasted on LRT state channel which allows only sponsors’ advertising and so this event will not boost the advertising spends by as much as if it were possible to run also regular ad spots in the football matches. Football is the 2nd sport by popularity in Lithuania (Basketball match audiences are 60-70% higher vs football). Estimated TV spend growth due to the World Cup in June-July is 5-6%.Due to these Global exclusive sport events in 2018, the Lithuanian ad market will additionally increase by 1,5-2%.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The forecast update was influenced by the Research Institute Report 2017 which states that advertising investments in digital have increased less than the market experts forecasted. Therefore the market grew less than expected.

The economic contextThe economy ended 2017 on a strong note: GDP rose 3.9% year-on year in Q4, a notable acceleration from the previous quarter. This momentum seems to have carried over to the first quarter of 2018, with leading indicators signaling robust economic activity. Moderating inflationary pressures and solid labor market conditions spurred retail sales in January, while industrial production continued to expand at the beginning of 2018, and export growth was also buoyant. Meanwhile, on 2 March, S&P Global Ratings raised its long- and short-term foreign and local currency sovereign credit ratings for Lithuania to “A/A-1”, with a stable outlook, from “A-/A-2”. The upgrade reflected the economy’s robust development over the past years, and healthy prospects in the near term.

AD SPEND PERFORMANCE BY CATEGORYHalf of TOP10 categories (Retail in general, sweets, confectionary, medical services, gambling, governmental institutions) will increase their advertising intensity while financial institutions, telecommunication and household hygiene will suffer from advertising budget cuts. Remedies and mobile communication (2nd, 3rd place among TOP10) ad investments will be stable in 2018 compared to 2017.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OFAD SPENDAd spend growth in "Sweets,confectionery” (+29%) & Gambling (+24%) categories are affected by positive consumer trends (Sweets +12%, Gambling +40% according to TNS Atlas survey 2018 vs 2017). In general, consumers’ shopping habits are changing: people prefering to visit a store (vs order by internet) has dropped down from 43% (2016) to 28% (2018) and people tend to go shopping in small stores instead of shopping malls (change from 26% up to 31%). Buyers are less loyal to international brands (shrinking from 47% 2016 down to 43% 2018) and less price sensitive (43% 2018 vs 47% 2016 ) due to economic growth.Other category trends are influenced by internal factors like new brand launches or brands cancelling their advertising activity, marketing investments cut for TOP brands or the leader brand’s aggressive advertising strategy.

LITHUANIA: ‘Slower ad market development due to alcohol ad ban from 2018’



2018 2019f 2020f

Lithuania 3.9% (4.2%) 4.3% (2.8%) 3.6%




2018 vs. 2017YOY%

Retail in general 158,4 16%

Remedies 57,2 3%

Mobile communication 44,0 -3%

Sweets, confectionery 36,3 29%

Medical service, institutions 36,2 21%

Telecommunication 35,9 -6%

Financial institutions, services 30,7 -15%

Gambling 29,8 24%

Governmental institutions 19,3 43%

Household hygiene 18,5 -17%

Previous forecasts in brackets from January 2018

74

‘TRADITIONAL TV REMAINS THE BIGGEST AUDIO-VISUAL FORMAT CHANNEL DESPITE HIGH INVESTMENTS IN DIGITAL ’

BY MEDIAThe 5 biggest by media ad spend trends in 2019.

a. DigitalDigital media is the biggest media (3rd year in a row) in terms of revenue from advertising. Until 2020 it is expected to take more than 40% of all ad spends. Desktop ad spend is 65% but is declining quickly by 2-3% points each year. Mobile online video and mobile social will grow at high speed by 23% & 18% in 2018 vs 2017. Despite advertisers increasing budgets on global networks (Google, Facebook, YouTube, Instagram, etc.), the local players are reporting the positive turnovers.

b. TVAlthough online video is growing fast, traditional TV remains the biggest audio-visual format channel (TV market 5,7 times bigger vs online video ). Due to the alcohol ad ban (>3% of TV incomes) from 2018, both TV groups started to compete for every additional budget which influenced the slight increase in discounts. So far MTG group budget share remains the same 50% as in the previous year while MG group has increased it up to 45,4% (+1% point gain from BMA TV group which owns Russian channels).

c. RadioIn spring 2017, TNS Kantar started to use a new radio metering methodology. It‘s a DAR (Day-After Recall) method which is more accurate. This news has helped to boost radio budgets by 10% in 2017, but in 2018 the growth will be limited (~3%). M-1 group has a stable gross share of 49% in 2017 & 2018 while 2nd Tango group has lost 0,9% point share (currently 38,5%) because „Žinių/News“ and „PHR“ (young audience) radio stations have budget growth % above the market average.

d. Print – newspapers, magazinesIn 2018 the magazines and newspapers market will shrink like in 2017, with newspapers suffering a 6,8% income drop while magazines only 2,7%. In January 2018 three of the biggest publishing groups „Media bites“, „Savaite“ & „Lietuvos rytas“ have established the association „National print“ which will popularize the print and seek for better penetration of quality print in regions.

e. OOHIn 2018 this sector started more aggressive sales in order to compensate the loss of alcohol budgets. So far they have succeeded significantly (10-50%) in increasing the budgets for movies, mobile communications, medical institutions, sports, and leisure categories. Therefore this year OOH providers might achieve the same incomes as in 2017.


75

Lithuania Data Tables



2018 2019f

Television 2,0 2,5

Newspapers -6,8 -6,0

Magazines -2,7 -3,0

Radio 3,0 3,5

Cinema 7,0 6,0

OOH 1,0 3,0

Total Digital 8,8 8,5


2018 2019f

Total Digital* 8,8 8,5

Display (Banners) 9,5 8,0

Online Video 7,0 9,0


Paid Search 5,0 5,0

Other incl. Classified 8,5 3,0

Mobile^ 15,4 17,8

ProgrammaticSpend^ 13,2 12,7


2018 2019f

Television 33,3 32,7

Newspapers 5,2 4,7

Magazines 6,1 5,7

Radio 6,6 6,5

Cinema 0,8 0,8

OOH 7,2 7,2

Total Digital 40,9 42,5


2018 2019f

Total Digital* 100 100

Display (Banners) 54,1 53,9

Online Video 14,5 14,6


Paid Search 13,4 13,0

Other incl. Classified 2,8 2,6

Mobile^ 35,0 38,0

ProgrammaticSpend^ 52,0 54,0


76

LATEST KEY AD SPEND TRENDS After first quarter, ad spend started to grow significantly. Sunday’s ban on trading was imposed in March 2018, since then media spend started to grow rapidly driven by retailers’ campaigns (i.e. after three quarters, the most active advertiser in the category, LIDL, increased its spend by 21% YoY, and the total retail category grew by 16% in rate card terms).

THE 2019 AD SPEND FORECASTThe GDP growth (estimated at 5% in 2018) will slow down in the beginning of 2019 (the growth is driven by consumption, not by investments).

Media spend will keep increasing, but the growth will be driven mainly by media inflation, not high demand in goods and services.Growth in Digital media has slowed down. Traditional media are losing their audiences. Advertisers will spend more on tactics that guarantee effective campaigns (in term of quality and reach), like programmatic based on advanced analytics.

The main question is what part of the growing media budgets will be taken away from media houses and spent directly.

Global or local events to boost spend in 2019⎽Elections to the European Parliament (Spring)⎽Polish Parliamentary Elections (Autumn)

⎽World Handball Championship (Winter)⎽Word Athletics Championship (Autumn)

Political events will trigger stronger demand on media than sport events related to disciplines that are less popular than the mainstream (in Poland –football). Estimated impact amounts to around 1%.

THE 2018 AD SPEND FORECASTThe advertising market is performing surprisingly well in 2018. Although the unexpected growth is driven by media inflation, not an overall increase in media budgets related to growing demand in goods and services.The optimistic outlook may be misleading- media budgets are growing, but the budgets spent through media houses are dropping concurrently. Market estimations assume that 20% and 80% budgets (traditional media and digital respectively) are spent by advertisers directly. This tendency is extremely challenging for agencies’ digital businesses. The biggest media owners facilitate the process by sharing new services targeted at direct clients (i.e. FB and its attribution measurement).

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)Media supply is limited which results in growing prices and, consequently, media budgets.Media owners are rigid in negotiations – even if growing prices hold some (especially smaller) advertisers back from spending money on media, supply generated by other market players is large enough to cover the gap.

The economic contextMedia spend is driven by the economy situation, which is in very good condition: Moody’s kept its ranking unchanged, placing Poland at A2 with a stable outlook. GDP will grow by more than 5% in 2018, the unemployment rate remains below 4% (still, predictions for 2019 are that GDP will lose its momentum), but positive triggers originating from governmental subsidies seem to have failed to stimulate investments. Fines that can be imposed on the Polish government by the European Union will certainly have a negative impact on the Polish economy. At the moment it’s difficult to judge how strong the negative impact could be. On top of that the tightened ban on shopping Sundays in 2019 (one instead of two shopping Sundays in 2019) will inevitably impact on the growth potential.

AD SPEND PERFORMANCE BY CATEGORYSunday’s trading ban drove total market spend, Retail became the market leader. OTC took second place. The growth in the Financial category’s media budgets stands out driven by banks and offers targeted to individual customers.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDThe current index of consumer confidence remains high in 2018, in June it grew by 1,3 percentage points YoY (Central Statistical Office); the positive attitude resulted from optimistic evaluation of the country’s economic situation. Consumers expect also further improvement in their household economic situation, which may drive demand and have a positive impact on advertisers’ media budgets.

POLAND: ‘Continued prosperity holds its momentum’



2018 2019f 2020f

Poland 6,5% (3,0%) 5,0% (3,3%) 5,3%




2018 vs. 2017YOY%

Retail 9 001 14%

Pharmac. Prod., Medicine 7 958 4%

Food 5 222 10%

Telecoms 4 430 4%

Hygiene & beauty 3 598 3%

Automotive 3 586 7%

Financial 3 171 17%

Media 2 752 -17%

Bev. & Alco 2 154 12%

Leisure 2 123 7%


77

‘DIMINISHING VIEWERSHIP AND LACK OF ALTERNATIVES WITH COMPARABLE REACH AND IMPACT RESULTING IN MEDIA INFLATION’


a.TV and Video: The market is split between the top four channels and wide portfolio of niche channels. In the top group, public channels are still losing audience. Diminishing viewership and lack of alternatives comparable in terms of reach and impact result in substantial media inflation (TV owners are less prone to negotiate). Viewers keep shifting to online video services (both global and local suppliers – Netflix, Showmax); the shift means that a substantial part of the potential audience is vanishing, payable video services do not serve ads. All these changes result in growing inflation (campaigns on the main TV channels can be bought mainly from a price list, niche channels still sell packages but they’re unable to deliver on market needs).

b.Digital: new GDPR regulations launched in May 2018 did affect market development in Q2, mainly in mailing campaigns, but now this seems to be compensated for.Video formats win the battle and media owners adapt their offer to follow the trend (like FB introducing Watch service).

According to market estimates, Google collects around 60% of total Digital spend (both Search and other services) in Poland.Standard, well known solutions like static display formats are losing, advertisers keep increasing budgets spent on more advanced and effective tactics (Programmatic and Programmatic based on advanced analytics –DMP, lookalike modelling). Advanced analytics, both attribution measurement and quality based solutions (viewability, fraud detection) gainpopularity, though they are not a standard yet.Content marketing, influencer marketing, martech platforms are being adopted by advertisers slowly, and it is very unlikely that any of them will become the new mainstream solution in the near future.

c. Radio: Prosperity in the media market had a positive impact on the radio’s media budgets (estimated growth in media spend on the radio advertisement says about 5% growth).Radio landscape in Poland could change in 2019, the Polish government aims to buy one of the top radio stations – Radio Zet (EUROZET Group, currently owned by Czech Media Invest, CMI).

d.OOH does not profit from the Polish media market development. Even innovative formats (interactive) do not change the situation. The market leaders (AMS, Ströer, Clear Channel) announced a change in sales policy –in 2019 OOH campaigns will be priced on the base of both: types/numbers of chosen billboards and results of audience measurement. Most likely the change will be followed by a noticeable increase in real OOH campaign costs.

e.Print: all print media owners noticed a substantial drop in media spend after the first half of 2018 (Agora –8%, Edipress –3,3%, Marquard Media –22% YoY). Titles portfolio is continuously being reduced.


78

Poland Data Tables



2018 2019f 2020f



Magazines - 0,5 -0,5 -

Radio 5,0 2,0 2,0

Cinema - - -

OOH 0,9 1,0 1,0



2018 2019f 2020f






Other incl. Classified -1,6 -1,5 -0,5

Mobile^ 92,1 61,7 42,2

ProgrammaticSpend^ N/A N/A N/A


2018 2019f 2020f




Radio 8,4 8,1 7,9

Cinema 1,3 1,3 1,2

OOH 5,5 5,3 5,1



2018 2019f 2020f





Paid Search 32,6 31,5 30,4


Mobile^ 24,0 31,2 35,7

ProgrammaticSpend^ N/A N/A N/A


79

LATEST KEY AD SPEND TRENDS• In Q2 and Q3 2018, the socio-political environment in Romania has been

rather hectic and eventful, with lots of street demonstrations against the governing party. The news stations, unfortunately, took sides in covering the events and ended up by being considered, by the general public, as politically-skewed.

• In this context, there were advertisers that decided to withdraw its communication budgets and stop advertising on all news channels, lest it should be associated, in the public opinion, with one political party or the other, depending on what side each of those news broadcasters favored. As far as 2019 is concerned, the client will maintain the same TV consumption behavior of not communicating on any news TV station. • The TV sold-out situation places the media owners in an advantageous

position, enabling them to maximize their returns on the existing inventory. In a sold-out situation, the clients with high CPPs benefit from airing priority vs the others. Moreover, suppliers introduce extra-charges for premium intervals and programs, thus managing to increase the general price level. However, the Ro market is still a very cheap one, compared to Western European countries. Trading is still performed in the classical way (no Programmatic buying, yet).

THE 2019 AD SPEND FORECASTAlthough Digital and Mobile are following the global ascending trend, the consumption of TV continues to be strong and stable in Romania. TV maintains the broadest reach and captures the highest share of advertising,driving revenue growth through cost inflation.

In terms of programming acquisition, the big surprise of 2018 is Exatlon on Kanal D, which achieved very good audiences and has placed the channel on a strong ascending trend, as well as the new PRO TV acquirement from DAN -> NINJA WARRIOR ROMANIA. Also, this year, National Television broadcasted the FIFA World Cup from Russia which bought higher audiences for public television.

Global or local events to boost spend in 2019Public television, TVR 1 which broadcasted the FIFA World Cup from Russia, had an important audience growth during football transmissions, with number of viewers rising by 3 times during the whole day and more than 5 times during Prime Time.

THE 2018 AD SPEND FORECASTIn 2018 the media market will continue its up-trend, and is expected to grow by 7% vs. 2017. Television is expected to grow by 9.7%, Online by 16% and Print is the only medium expected to decrease.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)For 2019 and 2020, even though we forecasted an approximate 15% TV price inflation, this will translate to a lower market growth, mainly due to the drop in TV ratings -> clutter/ sold-out, as a result of the socio-political environment and peoples’ shift in media consumption behavior.

The economic contextThe Romanian GDP expanded 4.1% year-on-year in the second quarter of 2018, in line with second estimates and slightly above a 4% growth in the March quarter. The economic growth was driven by a 5.4% rise in private consumption (from 5.9% in Q1). The agricultural sector output rose by 7% year on year in Q2, while gross fixed capital formation increased 10.9%. The industrial sector grew by 4.2% for the year, while construction was up by 0.9%.

AD SPEND PERFORMANCE BY CATEGORYThe 2018 main categories are similar to previous years, with “Pharma” in first position, closely followed by “Cosmetics & Toiletries” and “Food”.We expect that all categories will grow slightly, except for “Cosmetics & Toiletries”, “HH Care” and “Finance”. Due to a lack of monitoring data on Social media, Search, etc., with some budgets having moved from classical digital banners to these media (especially FB), some categories should have a higher growth.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDIn terms of TV viewing, this year the average consumption of daily minutes decreased by 4% on the main buying target group, April and August being the month with the most important fall -> more than 20 minutes less viewed.Romanians ranked in second position in the top European countries in terms of time spent on online, with an average of 18.6 hours per week.

ROMANIA: ‘Dynamic market with unstable socio-political situation’



2018 2019f 2020f

Romania 7% (7%) 6.5% (9.1%) 6.8%



2018 Gross Local Currency (RON)

Million

2018 vs. 2017YOY%

Pharmaceutical/ health 12,130 12%

Cosmetics & toiletries 7,126 -5%

Food 6,898 2%

Drink 5,086 0%

Retail 4,582 5%

Household care 3,511 -7%

Telecomms 2,245 1%

Finance 1,742 -6%

Motors, vehicles 1,165 0%

Orders 784 3%


80

‘PROGRAMMATIC IS EVOLVING AS PUBLISHERS MOVE AWAY FROM BIDDING IN OPEN AUCTION’


a. TVIt's a very price-sensitive and cluttered market (sold-out almost the entire year). The direct consequence of this situation is that at the time of annual deals negotiations, all advertisers press for low prices and throughout the year they revert to new and creative (and obviously more expensive) ways of ensuring they are airing, and standing-out from the crowd with, premium placements/programs & intervals, special projects, brand integration into content, etc. All this premium exposure has a direct impact on increasing costs. For 2019, we expect a higher inflation due to 3 main reasons: 1) TV stations' investments in premium content/ formats; 2) there will be presidential elections in Ro next year; 3) ratings' decrease (leading to high clutter/sold-out situation).

b. DigitalProgrammatic is evolving and publishers want to move more inventory into preferred deals and programmatic guaranteed deals and move away from bidding in an open auction. Brand safety and viewability are new KPIsin programmatic.More companies are using ad-tech and are creating new audiences on verticals. There are more suppliers that offer special profiled and specialized audiences (like: Grocery Shoppers, Household Shoppers, White collars) mixed with Geo-targeting options.

c. MobileFor most Online channels, mobile has become the overwhelming leader (between 60% to 90% of volumes) in Paid Search, Paid Social, Display& Video.

Paid search CPC has faced a slow but steady rise across most verticals. Video is the main growth driver as more and more advertisers understand the need to adapt their TVC to the new way of consuming media. The consumer is using their mobile devices more and more to consume media and this change brings more specific tactics from advertisers e.g. building more vertical videos to takeover the maximum space of the mobile screen, creating subtitles for video as they are often watched with the sound off. Influencers campaigns (vloggers especially) are capturing the advertisers attention and vloggers are starting to be used outside the digital space (for OOH campaigns for example).Snapchat have almost 1mil users from Romania and starts to be of interest for Romanian advertisement.

Wetransfer wallpaper is almost always sold-out and changes their sales policy almost each quarter, increasing the price. This is due to the advertisers’ need to be sure their ads are seen.

d. OOHThe first OOH audience study is not yet available, the work is in progress. We expect to have the first data starting end of Q1 2019.

The General Council of Bucharest City Hall adopted two decisions in August with a significant impact on the advertising industry (a draft decision regarding local regulation of the placement and authorization of advertising and the draft decision on the establishment of the Municipal Advertising Company and the allocation of the public service regarding the organization advertising to this new company).

e. RadioRadio audience proves to be quite stable from one year to another, as people tend to show a strong loyalty to their Radio consumption routine. The main Radio networks continue to be flexible and open to special projects and creative contests. Radio driven campaigns continue to engage listeners in social media. PR and marketing activities, events and concerts partnerships represent the main triggers for advertising investments.


81

Romania Data Tables



2018 2019f 2020f

Television 9.7 5.5 5


Magazines -15 -10 -10

Radio 5 5 5

Cinema 3 5 5

OOH 6.6 5 5

Total Digital 10.3 15 15


2018 2019f 2020f

Total Digital* 10.3 15 15

Display (Banners) -3.2 -3.9 -3



Paid Search 37.8 39.6 35

Other incl. Classified n.a. n.a n.a

Mobile^ 25 20 27.8



2018 2019f 2020f

Television 58 57 56

Newspapers 3 2 2

Magazines 4 3 3

Radio 4 4 4

Cinema 1 1 1

OOH 5 5 5

Total Digital 25 27 29


2018 2019f 2020f





Paid Search 15.1 18.4 21.7

Other incl. Classified n.a n.a n.a

Mobile^ 4.4 4.6 5.2



82

LATEST KEY AD SPEND TRENDS• We are expecting the advertising market growth rates to slow down in

2019 due to economic downturn in the country.

• Digital ad spending beat TV: the market share of the Internet for the first time exceeded the share of TV (42% vs. 41%) as of the end of the first half of 2018.• TV advertising market growth is decelerating due to TV viewing decline

and decrease in inflation rate. The Internet is becoming the main growth driver of the Russian advertising market.

THE 2019 AD SPEND FORECASTWe are expecting the market to grow by 6-7% in 2019 compared to 2018. The growth slowdown is associated with economic downturn, decrease in real income, and non-media marketing activities spread. The Internet is becoming the main growth driver. The share of other media is declining.

Global or local events to boost spend in 2019? E.g. sporting or politicalNo big events which could possibly boost the market are expected in 2019.

THE 2018 AD SPEND FORECASTIn 2018 the growth drivers have been the two main media - TV and the Internet. The total share of TV and the Internet has now reached 83%. The TV growth drivers have been high inflation and persistent strong demand from advertisers, including new categories for TV - Internet services and online stores (which have been actively increasing their TV budgets in

2018). The main share of Internet advertising (more than 80%) is performance, this media continues brisk growth, and the Internet segment growth is facilitated by the increase of online video advertising. Hosting the FIFA World Cup 2018 has stimulated the market growth and added about 1-2% to the annual increment.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The advertising market growth forecast for 2019 has been lowered from 8.5% to 6.9%. Russia is suffering an economic downturn. In the next year advertisers will be facing further economic decline and consumer incomes decrease: real household income, which had been rising since January 2018, again demonstrated a decline in August and September. This will lead to a decrease in consumer confidence and purchasing power of citizens. Meanwhile, the advertising market is approaching the maximum potential for promo pressure growth. This year the volume of sales via promotions has risen from 59% to 64%. In some categories it has reached 80%. Recently advertisers tend to prefer sales promotion to advertising activity. All this leads to a slowdown of the advertising market growth.

The economic contextIn the first half of 2018, Russia's GDP grew by 1.6%. The biggest contributors to the GDP growth were the manufacturing industries, wholesale and retail trade, major construction projects, as well as the World Cup 2018. However, after the economic recovery began, in 2019 the growth is expected to slow down. This will be facilitated by the recent increase in VAT up to 20%, the state pension age increase, a slowdown in the salary growth and the economic sanctions imposed on Russia. The most difficult will be the first quarter of 2019, when Russia’s economy will be passing the lowest point of growth.

AD SPEND PERFORMANCE BY CATEGORYThe most fast-paced category is “Internet service” (25-30% annual growth). This category may enter the Top 5 major product categories for Russia’s advertising market as early as next year. “Retail” and “Pharmaceuticals” remain the biggest categories. Meanwhile “Pharma”, which had been at the top for the last several years, was beaten by “Retail” in 2018 as growth due to the increase in online trade budgets meant that it came out on top. The most shrinking category is “Beauty” – almost all advertisers cut their budgets in this category.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDRecently mobile internet usage in Russia has been growing actively, encouraged by audiences shifting to smartphones (+15% smartphone users in 2018). Online trade is rapidly growing and a lot of new online shops are emerging, leading to growth of this category in ad spend. Cars, which had been actively recovering after the crisis, show zero growth. A slowdown in consumer activity has impacted the decreasing ad spends in FMCG categories.

RUSSIA: ‘Market growth slowing down’



2018 2019f 2020f

Russia 12.0% (11.7%) 6.9% (8.5%) 6.7%


Top 10 Categories 2018 2018 Gross Rub Million 2018 vs. 2017

YOY%

Retail 10% 50 960

Medicines 2% 48 472

Food products 5% 27 740

Cars 0.2% 19 290

Financial services 8% 18 808

Beauty -19% 17 215

Internet services 26% 16 625

Realty -16% 15 144

Communication services 12% 14 551

Soft drinks -6% 14 418


83

‘DIGITAL AD SPEND OVERTAKES TV’


a. TV growth is slowing down During the last several years TV has been one of the main growth drivers of the advertising market, generally due to the high inflation rate (annual growth was about 10-12%). In 2018 the TV advertising growth was also encouraged by hosting the FIFA World Cup. Advertising market experts restrain from making forecasts about TV advertising market growth for 2019, but it’s likely to slow down significantly. Over the last year, traditional TV viewing has been demonstrating a considerable decline because the audience is shifting to other devices. In Russia, since August 2018, the Law (increase of advertising time up to 12 minutes per hour, while the total duration of advertising remains the same — 216 minutes per day) has come into effect which will allow channels to increase their inventory. However, TV channels claimed that with a rise in inventory inflation would decline significantly, which would lead to a slowdown in TV ad spend growth.

b. Online video continues growing at a brisk paceUnlike traditional TV, online video continues increasing actively, mostly due to viewing on mobile devices. Among all media segments, online video demonstrates the most active growth (25% in 2018, 20-23% in 2019). Factors of the online video development are audience growth, especially on mobile devices; measurement advancement; increasing interest of advertisers provided by creation of new advertising products (mobile, out-stream, social networks); inventory growth (including high-quality TV content).

c. Number of mobile internet users is still growingThe key trend in media consumption remains the brisk growth of mobile internet. This segment will continue growing actively over the next several years, especially in older age groups.

d. Digital OOH developmentRapid growth in the number of DOOH surfaces - in one year the number of digital advertising surfaces in Russia increased by 68%. The segment of large-format media facades showed the most powerful growth: 75 in 2018, - three times more than in 2017.

e. Development of digital audio advertisingAs for the end of 2017, Russia’s online audio advertising market volume has reached 155 mln rubbles accounting for less than 1% of traditional FM-radio advertising. The audio advertising market is expected to increase threefold in 2018 and by 6,1 bln rubbles in 2021, including advancement in social networks. Experts name mobile devices penetration and radio listening on smartphones among the growth drivers. In terms of audience streaming music services, the number of online radio listeners is steadily increasing. This now occupies a dominant position.


84

Russia Data Tables



2018 2019f 2020f


Newspapers -12.1 -12.1 -7.3

Magazines -8.4 -8.4 -3.4

Radio 4.0 0.0 0.0

Cinema 0.0 0.0 0.0

OOH 2.0 0.0 0.0



2018 2019f 2020f





Paid Search 20.0 15.0 13.0


Mobile^ 33.7 24.1 23.1



2018 2019f 2020f




Radio 3.8 3.5 3.3

Cinema 0.8 0.7 0.7

OOH 8.4 7.8 7.3



2018 2019f 2020f





Paid Search 79.7 80.4 80.9


Mobile^ 41.9 45.6 50.0



85

LATEST KEY AD SPEND TRENDS • Stronger ad spend growth than expected thanks to TV & digital.

• Digital has higher growth rate for next years based on this year’s performance.• TV showing slightly lower media share in favour of digital.

THE 2019 AD SPEND FORECASTWe expect media spend in television will increase by 6% mainly thanks to announced inflation as TV inventory is constantly sold out. The highest growth rate will continue to be in the world of digital (+13%) where online video and programmatic will be the key drivers. Radio and print are expected to decrease their share of investments and OOH will be stable, mainly thanks to the Presidential elections and expected strong campaigning on OOH panels.

Global or local events to boost spend in 2019Presidential elections in spring 2019 will influence mainly OOH advertising but will also have a big impact on the digital environment (risk of video inventory problems for local video providers).

THE 2018 AD SPEND FORECAST2018 media investments in Slovakia are growing versus 2017, but this is not thanks to any special event (there was no important event influencing Slovakia this year), but rather due to good health of business, media inflation and economy growth.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)We are forecasting higher digital spend and stronger digital growth based on this year’s performances and intelligence (digital ad spend is not officially monitored in Slovakia).

The economic contextEconomy in Slovakia is performing really well at the moment. GDP is in faster growth than was predicted and also unemployment is at a record low. All this helps growing business and supports the advertising market.

AD SPEND PERFORMANCE BY CATEGORY?Retail is still the leading category in media investments. Pharma business and Medicaments jumped into second position and left Banks in 3rd position. All top 10 segments are experiencing double digit growth.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDTV is still the most consumed media channel, but shows a decreasing trend (especially in the younger target audience). On the other hand, average time consuming online channels is growing fast and is expected to match TV consumption in the upcoming 5 years.

SLOVAKIA: ‘Spring Presidential elections to affect OOH and digital environment’



2018 2019f 2020f

Slovakia 6,7% (5,3%) 5,7% (3,5%) 5,5%



2018 vs. 2017YOY%

Retail 234,8 +45%

Medicaments 219,0 +65%

Banks 205,2 +35%

Telco services 135,0 +65%

Automotive 124,4 +25%

Cofectionery 84,9 +50%

Consumer Electronics 52,9 +35%

Non-alcoholic drinks 52,0 +40%

Detergents 49,6 +50%

Computers 44,8 +20%


86

‘PROGRAMMATIC AND ONLINE VIDEO ARE KEY GROWTH DRIVERS’


a.The TV situation is still very complicated in Slovakia. The market is dominated by two strong TV commercial groups and as the demand for TV space still exceeds available free TV space on their channels, there is double digit inflation announced every year to reflect this situation. Even so, in 2018 TV space is almost constantly sold out, especially in prime time slots. We therefore forecast this trend of high YoY TV inflation will continue into the next years and TV spend will continue to grow. Share of TV spend is not expected to be lower than 50% until 2020.

b.The fastest growing category within the online ad expenditures is programmatic buying. Behind the current growth compared to the previous period, is the very active work of slovak media vendors. Many of these have already implemented SSPs in order to be able to better monetize inventory, but it is not just about the implementation of SSPs. We can see the crucial development in willingness to sell out different sorts of rich media formats, e.g. desktop format: branding; mobile ad: interscroller, throughprivate deals.

c. Online video (both desktop and mobile video) is still one of the fastest growing digital formats in Slovakia due to demand from local advertisers. Growth of online video is also driven by growing mobile penetration (approx. 40% of all impressions) and mobile consumption of video content, mostly within social networks such as Facebook and Instagram stories. However the biggest part of video ad spend goes towards Google/YouTube. Local media suppliers are also aware of the power of online video. They are putting a lot of effort and investments towards creating and producingrelevant content in order to amplify local video inventory and secure local ad expenditures as well. One of the biggest local video suppliers took the initiative to create the local video platform, Valetin. Valetin allows for theplanning and buying of online video under one roof across the most relevant media vendors offering video inventory.

d.Another growing category is Paid search, mostly thanks to its advanced set up features and options. Behind the growth of classifieds is the power of local media vendors. The portfolio of its services in this kind of segment is still growing and expanding. Last but not least we can see the positive growing trend of native ads due to the development of native ad platforms, many supportive activities (e.g. Native ads Festival, native ads playbook, etc.) and of course the growing cooperation with brand ambassadorsand influencers.


87

Slovakia Data Tables



2018 2019f 2020f


Newspapers -3,6% 0,0% -3,7%

Magazines -5,0% -5,3% 0,0%

Radio 0,0% -8,3% -9,1%

Cinema 0,0% 25,0% 0,0%

OOH 3,4% 0,0% 0,0%

Total Digital 13,1% 12,5% 14,7%


2018 2019f 2020f

Total Digital* 13,1% 12,5% 14,7%

Display (Banners) 1,3% 4,3% -2,9%

Online Video 42,1% 33,3% 43,3%

Social Media 20,7% 22,7% 30,2%

Paid Search 25,0% 12,9% 25,0%

Other incl. Classified 16,7% 17,1% 15,9%

Mobile^ 60,4% 22,7% 29,3%



2018 2019f 2020f

Television 50,9% 51,2% 50,5%


Magazines 6,1% 5,5% 5,2%

Radio 3,9% 3,4% 2,9%

Cinema 0,3% 0,3% 0,3%

OOH 9,7% 9,1% 8,7%

Total Digital 24,8% 26,4% 28,7%


2018 2019f 2020f



Online Video 17,5% 20,8% 26,0%

Social Media 23,5% 25,6% 29,1%

Paid Search 22,1% 22,2% 24,2%

Other incl. Classified 9,1% 9,5% 9,6%

Mobile^ 39,0% 42,5% 47,9%



88

LATEST KEY AD SPEND TRENDSAdvanced 2019 Presidential elections happened in June 2018. Q2 -2018 as a pre-election period passed with advertisers feeling unsettled and hesitant. Post-election weeks were also stagnant as political discussions continued. In the second half of August, the sudden value loss started in Turkish lira with record low levels, both against the USD and the EURO. Starting from September, Turkey faces a period of economic recession which is still ongoing.During the days after devaluation of the local currency, other macro economic indicators started to worsen. This situation caused cancellation of campaigns, decline in ad spends or sudden budget cuts for most of the advertisers. Even flagship sectors like Automobile and Real Estate & Construction have almost stopped their budgets entirely for weeks.

Local currency value loss resulted in a noticeable drop in the Consumer and Producers Price Index. The consumer confidence index has fallen to 2008-2009 global crisis levels, after a long period of stability. To overcome this, both state and private brands have launched discount or promo campaigns in many sectors.

THE 2019 AD SPEND FORECASTWorsening macro economic charts, financial difficulties (both states and private sector) and exchange rate shocks were obvious in the second half of 2018. Even though most of the sudden effects have been normalized by the sector, expecting a rapid recovery for 2019 in the market seems unrealistic. 2019 forecasts are indicating that the recession that started in the second half of 2018 will steadily continue during the year 2019. It is expected that promo and discount campaigns will be a key theme for many of the sectors.

Global or local events to boost spend in 2019• 2019 Turkey Local Elections to take place in March. It is unclear in advance

whether elections will support or pressure the ad market, but due to the saving policy of state and financial conditions of the private sector, it is hard to believe elections will have a positive effect on the ad market compared to previous elections. • As a big move, Amazon Turkey has launched in Q4 2018, but any major

effects of Amazons market entry on e-commerce and retail sectors are expected to happen in 2019.

THE 2018 AD SPEND FORECAST A significant number of advertisers have reduced or minimized their marketing & media investments as of the second half of 2018, under effects of the Presidential & parliamentary elections and the economic recession beginning in August. Some specific sectors like discount markets & some fashion retailers are investing in discount & promotion campaigns. Most of the key industries like Automotive, Finance and Real Estate & Construction have diminished ad spends dramatically.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)2018 and 2019 forecasts have been revised downwards due to the ongoing macro economical conditions of the country.

The economic contextOngoing fluctuation in exchange rates, declining economical growth and worsening consumer confidence have had effects on both the state and private sector for the second half of 2018. These recession effects are expected to continue for the entirety of 2019, with sharp decreases in household consumption, declining growth in key sectors like Real Estate, Constructions, Automobile or Finance expected. Consumer confidence index is in decline and reached 2008 global recession levels. Double digit consumer inflation approaching 25%, short term debts in the private sector, higher interest rates both for private and company credits by banks, and an increasing unemployment rate are key issues faced by Turkey’s economy. These indicators also show that there may not be fast recovery of the market. 2019 can therefore be considered as a period of convalescence.

AD SPEND PERFORMANCE BY CATEGORY?Digital is leading the growth, especially with rising demand for OLV, social media formats, programmatic and Google search.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDAs core dynamics of digital transformation, increasing penetration of mobile internet and smart phones are standing at the axis of media mix decisions in Turkey. Mobile and fast internet have penetrated the majority of the population by 2018. Since Turkey has higher scores for social media real users and mobile app usage rates globally, mobile device formats and new offers of local & global social media platforms are favourable. Online video demand is another major trend, covering rich types of video content from local TV to social media video offers. TV is also transforming as Turkish consumers demand TV content from both catch up sites and new local on demand platforms. This is bringing a new approach to the market as OLV attribution is getting more valuable for advertisers. Online music platforms and radio applications are heavily consumed by younger consumers. Developing digital mobile access alternatives to radio content is also supporting advertisers’ radio demand with cross touchpoint solutions. On the other hand, traditional press (both daily papers and weeklies) are under pressure from digital /social media news and contents which are very damaging to traditional press.

TURKEY: ‘Devalued Turkish lira and increasing inflation leading to recession’



2018 2019f 2020f

Turkey -5.0% (0.0%) 0.0% (3.1%) 3.0%




2018 vs. 2017YOY%

Food 540 -4%

Retail 480 -4%

Communication 407 -4%

Finance 403 -6%Construction & Decoration 398 -7%

Personal Care 327 -5%

Automotive 273 -6%

Tourism 246 -6%

Drinks 239 -4%Furniture & Home Textile 202 -6%


89

‘HIGH REACH CAPABLE TRADITIONAL TV, TRENDING ONLINE VIDEO OFFERSAND EXPANDING SOCIAL MEDIA OCCASIONS ARE SUSTAINING MEDIA MARKETINVESTMENTS IN 2018 AND BEYOND’

BY MEDIA

The 5 biggest by media ad spend trends in 2019

a. Online video

OLV drives growth for digital ad spends in the Turkish market, as investments increased 50% in 2017. YouTube is the most preferable video platform in Turkey, covering local varieties of contents like music, TV serials, and influencers reaching a large portion of different consumer groups. Twitch is on the rise as interest in streamers and famous gamers increases, many of them reaching more than 250K followers. Local video streaming platforms Puhu Tv and Blu TV launched their original local productions while current favorite TV shows and serials movies are also offered on their library. TV channels invest in their own websites with access to full episodes, resulting in high traffic. Facebook introduced FB Watch and IG TV as its video platforms along with conventional video posts with targeting and engagement options.

Among all those video platforms, mobile devices are clearly dominant in terms of usage rates & traffic due to the high smartphone penetration and high speed 4.5G coverage in all regions of Turkey.

b. Social media

Soon after the launch of GDPR, recent data breach instances on giant social media platforms increased the level of anxiety over use of personal data. From the users perspective, there has not been a significant usage rate drop in these platforms in Turkey. However, brands are now even more cautious not to get involved in any activity against the legal rights surrounding the use and/or processing of personal data which might effect usage stats of certain targeting options rather than the whole platform.

Despite the increased concerns, Facebook and Instagram still dominate the local paid social ecosystem with their solid reach and various ad formats. Twitter still struggles to compete with Facebook, and is far behind in terms of ad spend and number of advertisers. Snapchat and LinkedIn are still too niche for the mainstream advertisers.

Video remains to be the key format pushed by all media owners. It is becoming more engaging and action-linked which makes it not only a brand channel, but also a good fit for performance heavy e-com brands. Twitter also highlights the power of their video formats, positioning themselves as the key channel for any sports and gaming related local content and carrying low risk of fraud and brand safety.

c. Search

The overall paid search investment continues its steady growth year over year with more advanced targeting and bidding options now. The market is absolutely dominated by Google Search, with the closest competitor Yandex only fluctuating around 3-5% of search volume. Google search still plays a very significant role, especially for performance marketers. Omnichannel strategies are being developed recently by increasing number of retailers. Turkish media agencies should become increasingly accurate at proving the real attribution of paid search on offline purchase decisions. There is also an increased adaptation to shopping campaigns among retailers, as the campaign type grows more profitable with new ways of improvement for higher return of advertising spend.

d. Programmatic advertising

Programmatic ad investments continued to grow in the first half of the year as more advertisers have switched from direct buying to programmatic and inventories of medium to low volume publishers have become accessible to demand side platforms with the help of sale houses' Network Partner Management (NPM) program. In addition to this continuous trend of adopting programmatic solutions, publishers have started to offer an increasing diversity of ad formats and data segments to advertisers and agencies, which is also among the main factors that make programmatic more appealing to all parties.

Despite this positive atmosphere in the market, a deceleration in growth is expected in the second half of the year due to the latest financial fluctuations in Turkey. Also, the discussions over transparency, brand safety and ad fraud issues echo among the parties in Turkey. While brand safety and ad fraud are a concern for most brands, transparency between supply chain intermediaries are rarely stated as a threat.

e. Television

TV keeps its leading share as the key medium with instant reach building property with efficient costs. During 2018 TV content continued to be refreshed with strong local content to reach various target audiences. Expected positive growth was recorded in the first half of 2018 but due to economical uncertainties, frequent major TV advertisers have minimized TV demand during the summer and autumn of 2018. For major local advertisers and FMCG brands media mixes, this portion of TV remains sustainable.

A new measurement initiative for online TV content by Kantarmedia is expected to start in the first quarter of 2019. This measurement expansion can provide supportive rationales for advertisers who are looking for an integrated screen planning approach and contribution of extended TV contents.


90


2018 2019f 2020f

Television -3,5 0,5 3,9


Magazines -31 -18 -9

Radio -5 4,7 3

Cinema -10 5,3 7,6

OOH -1,2 0,5 8,4


Turkey Data Tables



2018 2019f 2020f







Mobile^ 6,5 7,6 5,9



2018 2019f 2020f

Television 52 52 53

Newspapers 10 8 7


Radio 2,8 3 3

Cinema 1,1 1,2 1,2

OOH 6,1 6,1 6,4

Total Digital 27,5 29 29


2018 2019f 2020f

Total Digital* 27,5 29 29


Online Video 11,3 12 12,8


Paid Search 41,8 41,6 41,5


Mobile^ 70 72 73



91

North America Market

92

LATEST KEY AD SPEND TRENDS• VAM (Video Audience Measurement) and Numeris announced cross

platform audience measurement testing to be released Spring 2019. VAM will provide a holistic, audited and transparent view of audience behaviour across linear and digital platforms which will inform and structure future ad spending across these platforms.

• Consumer privacy and data security are still front and center but the expected fall out of the GDPR launch has not had as significant impact on Canada as it might have on other markets due to already rigorous legislation in this area in Canada. • Existing issues around brand safety and ad fraud are still very much

apparent as advertisers are going to greater lengths to protect themselves and are increasingly willing to allocate media budgets to 3rd party verification platforms. • Facebook continues to be impacted by events earlier this year and is now

seeing zero quarter-over-quarter user growth (daily active users). While immediate impact to ad spend might be limited, this is a trend we are monitoring along with the rest of the world.

• Recreational marijuana was legalised on October 17, 2018. Cannabis companies are ramping up advertising efforts as health Canada warns them of promoting marijuana. In these early stages, we anticipate companies will take a lot of advertising risks and ask for forgiveness later. This is a category poised for growth.

THE 2019 AD SPEND FORECASTThe total Canadian ad spend forecast for 2019 is estimated at $13.4 billion local currency. While Linear TV continues to lead in penetration and share of consumption, advertisers are looking to incorporate OTT video offerings and Programmatic TV to future proof video strategies.

Global or local events to boost spend in 2019The Canadian government continues to maintain the rule that simultaneous substitution will not happen in the Superbowl, resulting in the viewing of US commercials in Canadian homes over Canadian messages. In other sports, hopes are much more positive, with strong performances of Canadian teams in the NBA and NHL driving playoff hopes, and the resulting high viewership of Canadian team in these league playoff rounds. Leading into a Federal election in October 2019, campaign spending has already started to enter the market, and will continue to build as we get closer to the election date.

THE 2018 AD SPEND FORECASTThe advertising market in Canada is currently performing well with a projection to reach $14.6 billion (local currency) within 2018. Q1 saw a modest decline due to the weakened interest in high profile properties such as Olympics, Superbowl and Awards programming. For a second year the Superbowl aired in non-simulcast (CRTC regulations) contributing to decreased advertising spend. The major sporting events in 2018 impacted the cadence that advertisers introduce their budgets to the marketplace, however incumbencies stood through the Winter Olympics and the World Cup with no impact to ad spend.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The delayed availability of 2017 actuals drive the revisions in forecasts for both 2018 and 2019 – once actualized, it became prudent to revisit all ensuing years to ensure that trends/values are reflected correctly. Market source for spend data has changed – previously measured under Nielsen AdExpenditure, now Numerator, and a different methodology and representation has required an adjustment in the base used for current and future forecasts. In addition, Television’s outlook is more positive with stronger measurement investment and anticipated strength of live sports programming as major leagues move towards playoff play.

The economic contextThe Canadian economy is expected to have a solid growth of 2.2% in 2018. The economy should continue operating near potential next year, although growth is expected to moderate as higher borrowing costs eat into

household-spending gains. However, a rock-solid external sector, bolstered by the USMCA, as well as stronger oil and gas exports see growth at 2.0% in 2019.

AD SPEND PERFORMANCE BY CATEGORYWe expect ad spend within the top 10 highest spending advertisers to decline with the largest decrease coming from Automotive. We project three categories poised for significant increases including Financial, Telecommunications and Electronics.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDLarge brands are investing in personalizing the conversation and we are witnessing the age of conversations with devices. Additionally, these brands are putting more of an emphasis on developing content, looking to create social-worthy moments and experiences. Another consumer trend witnessed is the major digital developments in Canada’s e-commerce space driven by the grocery/food category.

CANADA: ‘OTT and Programmatic TV offerings to future proof video strategies’



2018 2019f 2020f

Canada 3.7% (1.1%) 5.2% (5.1%) 5.1%





2018 vs. 2017YOY%

Retail 885 1.0%

Automotive 692 (2.5%)

Financial Services 549 11%

Entertainment 408 1%

Food & Beverages 379 (4%)

Restaurants 349 (5%)

Drug Products 261 (1%)

Travel & Transportation 260 0%

Local Automotive Dealers 253 (2.5%)

Telecommunications 248 7%

93

‘BILL S-228 MINIMIZING “UNHEALTHY” FOOD ADS TO KIDS LIKELY TO PASS THIS YEAR’


a.• Television is following the trend with the rest of the media landscape,

putting smarter targeting and measurement at the core as to how it evolves. As part of this trend, audience based automated buying platform (aka programmatic TV) will finalize beta testing and be poised to roll out publicly in early 2019. Television ad spending is projected to slightly increase in the next three years with the expected establishment of Connected and Programmatic TV. • The success of Netflix and Amazon opening up to ad supported models is

yet to be seen, but if this scales it will expedite the projected growth in TV ad spend.

b.Bill S-228 has been carried to minimize “unhealthy” food advertising to kids and will likely pass in 2019, which will place an incredible amount of restrictions on media spend for CPG clients. This would affect all marketing including TV/digital/OOH advertising, packaging, use of characters, celebrities, sponsorship, product design, product placement and even word of mouth.

c. Sports Sponsorship spend is on the rise. There’s been a steady increase in sponsorship investment with brand awareness as the top objective. The rise in popularity of sports sponsorships is mainly due to accessibility, PVR proof and real time viewing. In Canada, sports streamer Dazn came onto the market last year, while Bell Media’s CTV has continuously added more football to its conventional broadcast schedule and the rising popularity of soccer in the country along with the establishment of new professional teams have all provided increased accessibility.

d.• Depending on the advertising regulations surrounding the legalization of

recreational marijuana, as we enter into 2019, Cannabis companies could become a top category contender. A large amount of advertising spend is at stake as cannabis companies jostle for position in this recreational market.

e.As the Digital OOH landscape continues to mature in Canada, advanced targeting and analytics powered by mobile audience data and programmatic buying is transforming this medium, driving growth in ad spend.


94

Canada Data Tables



2018 2019f 2020f

Television 3.0% 1.0% 1.0%

Newspapers -19.4% 1.3% 0.7%

Magazines -6.3% 1.2% 0.8%

Radio 10.1% 0.0% 0.0%

Cinema N/A N/A N/A

OOH 5.8% 9.7% 7.5%



2018 2019f 2020f



Online Video 41.0% 22.1% 9.5%


Paid Search 7.5% 10.1% 12.0%

Other incl. Classified 0.0% -0.9% -0.9%

Mobile^ 38.5% 24.3% 13.7%

ProgrammaticSpend^ 18.1% 27.1% 22.6%


2018 2019f 2020f

Television 25.1% 24.1% 23.1%

Newspapers 11.8% 11.4% 10.9%

Magazines 3.0% 2.9% 2.7%

Radio 5.6% 5.3% 5.1%

Cinema N/A N/A N/A

OOH 6.0% 6.2% 6.3%

Total Digital 48.6% 50.2% 51.8%


2018 2019f 2020f

Total Digital* 100.0% 100.0% 100.0%


Online Video 20.9% 22.6% 22.1%


Paid Search 47.8% 46.5% 46.5%

Other incl. Classified 2.5% 2.2% 1.9%

Mobile^ 63.7% 69.9% 71.0%



95

LATEST KEY AD SPEND TRENDS• TV remains relatively flat (+1.2% in 2018), in terms of revenue. Although advertisers

continue to believe in the power of TV, they have concerns about audience ratings putting pressure on the price of ads. With more networks experimenting with TV attribution solutions to directly attribute TV campaign exposure to advertiser business outcomes, such as sales lift, in-store visitation lift and brand lift.

• Local TV has overall remained static, with an influx of money in a few categories in the latter half of 2018; due to mid-term elections and gaming deregulation.

• Digital continues to grow (+13.5%) and change at a fast rate. The importance of brand safety and customer privacy stay at the forefront, with ongoing issues facing both members of the duopoly, Facebook and Google. Mobile fuels growth as consumers continue to increase time spent on devices. Video ad spend is healthy across both advertising and subscriptions. Both segments are facing positive disruption as new platforms enter the mix. These include ad-driven social media channels and subscription-based providers that deliver live TV bundles overthe internet.

THE 2019 AD SPEND FORECAST• With no major events, such as elections or Olympics, effecting US ad spend in 2019,

Linear TV will remain relatively static.• Digital ad spend continues to thrive (+13.5), being powered by mobile and video.

Traditional marketers focus more on integrating digital marketing strategies, utilizing the omnichannel approach to reach consumers and optimize engagement and conversions.

• Out Of Home sees growth (+2.5% vs +2.2% in June 2018) due to an increase in Digital OOH ads, that have the ability to create a more personalized experience based on location.

• Print continues to decline (-8.2% in 2018) as most news outlets move their focus to digital, where consumers are able to receive news updates in real time.

THE 2018 AD SPEND FORECAST• Digital Video continues to grow (+25.3% vs +25% in June 2018), with almost a

quarter of all Video ad spending going to YouTube. Although Mobile viewership remains popular, over half of all Digital Video ad spending will go PCs and connected TVs. Showing that viewers still enjoy watching long-form video content on alarger screen.

• The 18/19 TV Upfront continued to show the strength of traditional TV (+1.2% in 2018); with both Upfront spend up +3-5% vs. 2017/18, and CPM increasing +8-10%. Spending was driven by disruptor brands like Google and Amazon, as well as DTC brands like Peloton and UnTuckit, while legacy categories like CPG, Pharma, and Auto were flat to slightly up.

• Local TV has seen a spike in spend due to the upcoming mid-term elections and heated political environment, pushing spend over $3.5B. The mid-term elections have been getting a lot of attention, and not just in swing states. Spending in California has been more active than expected with many proposals on the ballot. Candidate spending in New York, Pennsylvania, and Illinois have also been higher than expected.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)• Although Network TV is holding flat, it is facing internal and external challenges and

uncertainties caused by leadership shakeups. 2018 has been a tumultuous year for the biggest broadcast networks as they experience top rank leadership exits and reshuffling due to pending mergers (Disney and FOX), scandals (CBS) and losing top talents to big tech competitors (Netflix, Amazon). All these changes pose questions on Networks’ content strategy, sales strategy and long term corporate stability.

• A surge in Search ad spending (11.5% vs +11.4% in June 2018) has been seen in the second half of 2018. Search’s growth is mainly attributable to Google, who’s search ad revenues over performed during the first half of 2018, increasing the investment in mobile search advertising.

The economic contextThe GDP has increased at a 4.2% rate, which is up from the 3.2% reported in the first half of 2018. This has been the fastest growing rate we have seen since the third quarter of 2014. Additionally, the September 2018 Consumer Confidence Index (CCI) jumped to 138.4 from the 134.7 reported in August, which shows a high level of confidence . The unemployment rate also hit an all time low, dipping below 4%. Household wealth is also at a record high ($100.8 trillion) as the value of stocks, bonds, and homes keep climbing, but consumer optimism is starting to wobble as inflation increases.

AD SPEND PERFORMANCE BY CATEGORYAutomotiveThe market forecast remains relatively flat now through 2020. The US Auto Industry remains the largest advertising sector in 2018. Although the primary medium for automotive campaigns, TV, has seen a decline (-3% in 2018), digital has benefited as the industry moves towards cross-platform spending. Dealers are also funneling more than two-thirds of their digital budgets into mobile in 2018.

CPG (Packaged Foods, Beverages, Toiletries, etc.)Digital Ad Spend for CPG products continues to rise (+19%) as traditional ad budgets decline. Although budgets are down, TV continues to be a safe and effective medium when looking to reach the masses. CPG companies are experiencing significant business disruption from the increasing amount of ecommerce, especially in the grocery space. Social Media has become imperative, especially influencers, since consumers are more likely to purchase a product from someone that they trust.

RetailThe retail category continues to evolve due to new competitors entering the marketplace, varied interaction points with brands, the demand for a seamless shopping experience, and the fight to garner consumer attention. As consumers evolve, so does how they make purchases. Instagram and Facebook have adapted to this by adding buy buttons on their platforms. TV is still important for brand awareness, with some retailers focusing even more spend into the traditional medium, while others are finding more value in digital and the power of search.

Pharma & HealthcareAlthough overall ad spend in the Pharma & Healthcare industry is relatively flat (+3%), direct-to-consumer ad spending is rising due to consumers changing how they manage their health. While the majority of brands still consider TV a safe space to guarantee reach, many brands are recognizing the value of digital. Social Media has begun to be recognized as a way to reach real physicians and engage directly with patients.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPEND• The subscription VOD/OTT (67mins per day) landscape is becoming crowded, with

over 200+ subscription Video-On Demand/Over-the-Top services in the marketplace. OTT households continue to grow and have become mainstream with almost 60 mm households now using OTT in the US.

• Given the increasingly shortened attention span and unprecedented access and choice, traditional advertisers are innovating and re-inventing the TV (235mins per day) experience to catch viewer’s attention. TV networks have embraced ad innovation such as short video ads like 6-second creatives and reduced ad loads (e.g., FOX, NBCU and Turner).

• Voice search is on the rise, with almost one third of all Google searches being from “personal assistant” devices. Voice search differs from desktop or mobile search, where one sees hundreds of search results; when a question is asked through a device it will only provide one to ten results at most. If one’s website is one of them, the completion rate can potentially be much higher; making SEO strategy for voice search essential.

• With millennial spending differing vastly from the traditional model of both the Baby-Boomers and Gen X, advertisers are forced to build a relationship with the consumer via less traditional media outlets. Many brands have started using the power of social media influencers to sell their products, and Instagram’s new

USA: ‘As Digital continues to grow, traditional media focuses on integrating Digital marketing strategies’



2018 2019f 2020f

USA 3.4% (3.4%) 3.0% (3.1%) 3.6%


96

‘MERGERS CAUSING CONCERN OVER MEDIA OWNERSHIP BECOMING MORE CONCENTRATED’


a. Shift From Traditional TV to VOD & OTT Services.TV networks are racing to directly reach consumers via Direct-To-Consumer OTT offerings. As the video ecosystem becomes more fragmented with unprecedented access via a myriad of content sources, devices, and platforms, more TV networks are going direct to consumers. Bypassing distribution intermediaries offsets rating declines, creates new revenue streams, and forges direct relationship with consumers. Multichannel Video Programming Distributors (MVPD) viewership has experienced an upward growth, demonstrating the value and appeal of both live programming and on-demand viewing amidst the ongoing cord-cutting trend. In addition, ad-supported OTT (AVOD) viewing has shown the strongest viewing growth according to leading OTT service providers and platforms.

b. Brand Safety & Privacy Issues Faced By The DuopolyRecent issues with advertising next to controversial videos on YouTube and information sharing by Facebook, has brought the subject of brand safety and privacy to the forefront. After a report that over 300 companies advertised on YouTube channels promoting white nationalists, Nazi, pedophilia, and North Korean propaganda, Google has promised to work on guaranteeing brand-safety. Google Preferred has become the recommended approach for brands on YouTube, where there is zero tolerance for non-brand safe activity; however, there is a significant premium for this inventory. With ongoing privacy and data-sharing issues, Facebook users have changed the way that they interact with the platform within the last year. Reportedly over half of active users adjusting their privacy settings in the last year and over a quarter of users saying they have deleted the Facebook app from their device. Yet, reports indicated that Facebook has maintained data-sharing partnerships with mobile device manufacturers obtaining data about a user's Facebook friends, even if those friends privacy settings are set to deny information sharing with third parties.

c. The Effect Of Major MergersMedia mergers have become more prevalent, which has people concerned about the adverse effects that could be caused by media ownership becoming more concentrated. The impact that the Disney/Fox merger, which has been approved by

the Department Of Justice, will have on the film industry is significant, largely affecting Marvel Studios. Disney will be releasing all of Fox’s movies that are completed or in production at the time of acquisition under their name, and it is unclear whether Disney will maintain the Fox movie brand and continue to produce new films under it following the acquisition. There have yet to be reports on how this merger will effect TV. AT&T and Time Warner are still working towards the government approving their merger. With the chief concern being whether Time Warner’s bargaining power over pay-TV distributers would increase by merging with AT&T, meaning if other providers do not agree to pay higher fees for access to Time Warner channels they may face black outs of networks such as CNN,TNT,& TBS.

d. Amazon, The E-Commerce PowerhouseThe biggest change in the Retail Category has been the growth of E-Commerce, especially Amazon, which has 49% share of the category. Amazon can contribute a large portion of its growth to the company’s priority to “make smarter recommendations” for customers while driving new brand awareness and discovery. Companies such as e-Bay continue to take a hit, losing market share for the second year in a row, due to their inability to gain more sellers, as well as sellers that differ from Amazon. Walmart, the fourth largest digital retailer, puts more focus on their online grocery service by introducing delivery to more than 100 metro areas by the start of 2019. Although Amazon recently acquired Whole Foods, their prices cannot compete with Walmart’s, finally giving the traditional retailer an edge.

e. Audio Consolidation & RebuildingAs the media marketplace continues to grow and change, Radio has had to rebuild and consolidate to keep up. Pandora, who has suffered against competitor Spotify, has been purchased by SiriusXM; making SiriusXM the largest Audio entertainment company in the world. Other more traditional radio companies, Cumulus and iHeart, fight to maintain business as usual amid bankruptcy. While, US Traffic Network closes its doors as Entercom takes ownership of all CBS Stations. During the collapse and rebuilding of FM/AM Radio, digital audio standout Spotify has differentiated itself by being first to market with family plans, offline listening, and integrations with other services like Hulu and effective social sharing tools. Samsung also announced a partnership with Spotify for their Galaxy Home devices, making Spotify the “go-to music provider” and will be fully integrated with Samsung’s voice assistant, Bixby.


97

USA Data Tables



2018 2019f 2020f


Newspapers -10.4 -10.5 -10.2

Magazines -6.0 -7.6 -5.8

Radio 1.0 0.0 0.3

Cinema 5.0 6.5 4.9

OOH 2.7 2.5 2.5



2018 2019f 2020f







Mobile^ 27.2 18.6 15.7



2018 2019f 2020f




Radio 9.0 8.8 8.5

Cinema 0.6 0.6 0.6

OOH 3.8 3.8 3.8



2018 2019f 2020f





Paid Search 42.3 42.2 42.2


Mobile^ 67.2 71.5 74.8



98

Asia Pacific Market

99

LATEST KEY AD SPEND TRENDS• In 2018, some key drivers contributed to the increase in advertising

revenue, e.g. The Commonwealth Games lifted the Metropolitan TV sector by +15% in April, the highest level in 8 years. Also, there was a considerable increase in growth in advertising spend across major political parties, due to pre-election spending in the lead up to the Australian Federal election.

• Among the top sectors, Travel/Accommodation and Communication grew +18.5% and +16.9% respectively during 2018 and reported the largest increases in spending. Retail still continues to capture the largest volumes of spend, increasing +3% during 2018 to $1.2 bn.• The decline in house prices during 2018 has impacted household

consumption which will lead to reduced consumer discretionary spending, especially for higher priced items.

THE 2019 AD SPEND FORECASTThe ad spend market in Australia is expected to grow +2.4% to AUD$16.2 billion in 2019. Growth will be driven by the upcoming state elections (NSW) and Federal election during January – April 2019 and part of Q2 2019. The Financial sector may also contribute to the upward spend in 2019, due to the four major banks being under investigation by the Royal Commission, which uncovered misconduct and wrongdoing among the major banks. In order to win customers trust, banks will increase their marketing activity to promote changes and best business practice.

Global or Local events to boost spend in 2019Political activity will play an important role in the Australian advertising market, with two elections in the first half of 2019. The NSW state election and the Federal election is expected to increase advertising revenue from Political parties and interest bodies such as trade unions.

THE 2018 AD SPEND FORECAST • The market in 2018 benefited from The Commonwealth Games in April,

which helped to increase advertising spend on Television, lifting the Metropolitan TV sector, reaching all-time highs for the month of April compared to previous years.

• There has also been an increase in advertising spend by Government and trade unions in the lead up to the upcoming elections. Government has increased its ad expenditure by +14% to $160M for the Jan-Aug 2018 period, likewise the volume in ad spend by the Political sector has increased, with more than $14M being allocated during 2018.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The previous forecast in the June 2018 report was for an increase of +2.8% and +2.4% for 2018 and 2019 respectively. The market for Jan-Aug 2018 has shown healthy signs of growth, with spend through Media Agencies increasing by 4.8% to $4.6bn. Major media owners/networks reported growth in advertising revenue for the first six months of 2018. Advertising expenditure from the Commonwealth Games, Government and Political have been above expected levels.

The Australian ad market growth in 2018 +3.7% to $15.9 billion and a forecast +2.4% to $16.2 billion in 2019.

The economic contextThe Australian economic growth has picked up pace, growing by +3.4% YOY for the 12 months to June 2018. The June quarter GDP increased by 0.9% against the previous quarter and the household sector, which has been struggling under low wage gains, was the main key growth driver during this period. Overall the Australian economy is performing well, nevertheless, there have been some economic challenges, such as low wage growth, the decline in house prices and modest gains in retail sales.


Retail: Advertising revenue in Retail is expected to increase by +2.8% to $2.0 billion in 2018, even though the sector has encountered modest growth in sales. Advertisers in this category have maintained an upward trend in ad spend and the volume of ad spend in this category will increase due to the retail peak during the Christmas 2018 period.

Travel & Accommodation: The sector is expected to increase by +18.5% to $953 million. The category has increased at a strong pace during 2018, adding an extra $90m YTD 2018. The market has also benefited from the depreciation of the AUD against the USD, which will help to boost the tourism sector.

Motor Vehicles: Automotive is forecast to decrease by 4.2% to $914 million. It has been affected by negative sales growth during 2018, with new vehicle sales down by 0.3%.

AUSTRALIA: ‘Growth in ad spend narrowly based with Government election related spending the main driver’



2018 2019f 2020f

Australia 3.7% (2.8%) 2.4% (2.4%) 2.6%




2018 vs. 2017YOY%

Retail $2,039 2.8%

Travel/Accommodation $953 18.5%

Motor Vehicles $914 -4.2%

Finance $598 5.2%

Real Estate $597 -7.3%

Entertainment & Leisure $551 -10.1%

Communications $543 16.9%

Insurance $349 2.7%

Services $335 -4.3%

Food $329 -0.8%


100

Finance: The Finance sector has been under pressure by the Banking Royal Commission investigation, where it found misconduct among the four major banks in Australia. In order to gain costumers trust the sector has increased their marketing activity to promote changes in their business practices. The Finance sector is forecast to increase +5.2% to $598 million in 2018.

Real Estate: The Real Estate sector is expected to decrease by 7.3% to $597m, due to falling house prices and rising mortgage interest rates which will add more pressure to the sector.

Entertainment & Leisure: Household disposable income is still weak and Australians have record levels of household debt. The sector is likely to go through low levels of ad spend and to decrease by 10% in 2018 to $551 million.

Communications: The Communication sector is forecast to grow by +16.9% in 2018 to $543 million, fuelled by strong competition among Telecommunication companies. There have been new mergers and acquisitions within the category, and more Telco operators acquiring sporting codes, which will help to boost more advertising dollars across the sector.

Insurance: The Insurance sector is expected to increase +2.7% in 2018 to $349 million. It had a good performance in 2018 and YTD is up 2.1% against 2017, where it previously reported a decline of -7.5% in 2017 for thesame period.

Services: The Service sector is forecast to decrease by 4.3% to 335 million in 2018. It is sitting below 2017 ad spend levels.

Food: After reaching its highest peak of spend in Q3 2018, the Food sector entered a downward trend. Historically the ad spend in the Food industry tends to decrease in Q4. It is expected to decline -0.8% in 2018 to $329 million.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPEND Digital media consumption continues to be strong among Australians, with people spending more time watching Online Video per week, up 34% or 53 minutes more. Digital Video content has been a key driver of advertising expenditure, reaching a $1.0 billion dollar market cap for the first time in 2017 and increased to record levels of ad spend in 2018. This upward trend in spend in Digital Video is the result of more premium content being available. Netflix disrupted TV and Online Video market and its growth has continued since it entered this market, with over 9.8 million Australians now having a subscription. Major Telco companies are now competing with TV networks for sporting rights, therefore, elevating the prices of the sporting deals. One example is Optus, securing the English Premier League rights for $63 million a year. A major strategy among Telco companies is to transition from being an internet or mobile provider only, to offering content and entertainment to customers.


101

‘ONLINE VIDEO TO REACH A A$2 BILLION MARKET VALUE IN 2019’


DigitalDigital continues to drive advertising revenue growth and digital media is expected to increase by +7.3% in 2018, representing 50% share of the total media spend. Since 2010, Digital media has reported double-digit growth, however, 2017 was the first year where Digital had a single-digit growth of +7%, indicating a flattening and maturing of the steep growth curve of recent years. This has also been exacerbated by trust issues such as privacy and brand safety and with the launch of the GDPR data regulation. Governance around data has put more pressure on social media/digital platforms adding a layer of regulations to advertisers and marketers. Digital is expected to grow by +6.6% in 2019 to $8.5 billion. Google and Facebook account for 60% of the Digital ad spend through Media Agencies. Among the local media groups, Newscorp has a 6% share followed by the two main TV networks in Australia, (Seven and Nine) which have a 8% combined share of revenue.

Online VideoSpend in Online Video has been expanding over the last few years and now has a 15% share of total Digital spend, reaching the $1bn mark for the first time in 2017. This upward trend will continue over the next few years with an estimated 19% and 24% share in 2018 and 2019 respectively. Online Video is expected to reach a $2bn market valueby 2019. Australians are spending more and more hours a week watching Online Videos than previous years, with 31% of the population being heavy video content consumers. 20% of the population watch more than 7 videos on YouTube per week, followed by Facebook and Snapchat with 16% and 10% respectively. Online Video ad spend across Media Agencies continues to increase with Google and Facebook having 41% share of the ad spend, followed by Nine Network and Newscorp with 5.7% share respectively. These top four networks retain 51% budget allocation in Online Video.

MobileMobile ad spend has grown rapidly to become an important pillar in the Digital ad spend market. Mobile is expected to increase by 35% to a total advertising market value of $4.bn in 2018, representing 52% of total Digital spend. The upward trend will continue in 2019, where Mobile expenditure will be greater than Desktop. Mobile is expected to have the largest advertising share compared to Desktop, with 62%. The Mobile market is forecast to grow by 28% in 2019 to $5.3 billion.Premium content will be a key driver in the growth of Mobile ad spend in the next following years, as mobile providers have entered the bid race for sport content. The rollout of the 5G network will be important in the growth on Mobile content but it will take at least 2 or 3 years for the 5G network to be fully implemented in Australia.

TVMarket conditions have been difficult for the last few years; the major TV networks have encountered a decline in audiences across key demographics and the entrance of SVOD players such as Netflix has exacerbated the downward trend of linear TV. 2018 was the year where Nine Network and Fairfax entered into a $4 billion merger, the first time a TV network and Newspaper company have combined their business operations. This has let the door open for other mergers and acquisitions across the TV sector for 2019 onwards. Key events have increased ad spend levels in the TV sector, which has benefited from events such as the Commonwealth Games and Political activities. The TV market has reported negative growth -2.8% and -2.0% in the last two years, 2016 and 2017 respectively. The above events will help to reduce the downward trend and will put the TV market in positive territory for 2018 and 2019.

Television advertising revenue is expected to increase 0.5% in 2018 and 0.1% in 2019.Spend in Television will be strong for the first six months of 2019, due to pre-election spend from the NSW election and Federal election.

OOHThe OOH market is showing a two speed Out of Home economy – Long term vs Short term. The long-term market is driven by annual commitments, with products such as large format static. There are more advertisers locking in commitments over a 12 month period. This is driven by supply and demand as the media owners have limited supply, which is a direct result from transforming a significant amount of inventory to Digital OOH Inventory. As an example, over a 12 month period, a Large Format “static site” the media operator only has 13 opportunities to sell said site to an advertiser. This has become a competitive land grab for key advertising categories i.e. Tech & Telco/Handsets, Automotive Brands, and movie distributors. JCD & Adshelcontinue to make more DOOH inventory available via their digitization strategies. Currently, there are 3 major tenders that are up over the next 12 months – Sydney City, Brisbane City Council, and Perth CBD. As an example, the recently won Yarra Tram contract in Melbourne last year already has 150 digital sites, compared to the previous tender owner of 100. This is will continue to grow and this will see circa 50%+ of their revenue driven by digital and static rate pressure on key locations.2018 has seen some key events in Australia dictating solid growth –Commonwealth Games, Royal Commission – Banking & Finance, Elections (Local) 2018 has seen continued fragmentation from TV, Print and Radio with audiences declining and stagnating. Couple this in with the increased opportunities for advertisers to engage with Out of Home to deliver their brand message in all parts of the funnel, has seen continued growth.As we move into 2019 we have a RWC, a Federal Election, Local NSW state election and LAM will be a big focus especially in the key seats where voting margins are minimal. OOH is expected to increase by 12.7% in 2018 to $1.0 billion and 7.6% in 2019 to $1.2 billion.


102

Australia Data Tables



2018 2019f 2020f

Television 0.5 0.1 -0.9

Newspapers -4.5 -8.6 -10.3

Magazines -26.0 -24.0 -19.9

Radio 2.3 1.2 1.2

Cinema 5.2 4.3 4.9

OOH 12.7 7.6 8.9



2018 2019f 2020f






Other incl.Classified 8.3 9.9 3.3

Mobile^ 35.0 27.6 18.9



2018 2019f 2020f




Radio 7.4 7.3 7.2

Cinema 0.9 0.9 0.9

OOH 6.8 7.2 7.6



2018 2019f 2020f

Total Digital* 100.0 100.0 100.0




Paid Search 44.0 43.4 42.9

Other incl.Classified 19.2 19.8 19.3

Mobile^ 51.9 62.1 69.7



103

LATEST KEY AD SPEND TRENDS• Total Ad spend growth for Jan-Sep 2018 was +7.4% driven by Digital and

OOH (digital).

• As yet the bilateral tariffs have not significantly influenced Ad Spend in China, which is fueled by domestic consumption not exports. Consumer confidence was resilient in Q2 China’s Consumer Confidence Index (CCI), shrank to 113 points, a decrease of two points from the previous quarter. Q4 is generally a high spending season for Christmas and New Year and increasingly influential is Double 11 and Double 12 for eCommerce. We would expect advertisers will continue to spend in Q4. • Therefore the overall growth for 2018 is slightly adjusted up from +6.5%

to 7.8%.

THE 2019 AD SPEND FORECASTAd spend will continue to grow, but at a reduced rate compared to 2018. Digital and Digital OOH will continue to be the driving forces in 2019. Growth also coming from lower tier markets. Overall growth for 2019 is projected to be 7.0%.

Global or local events to boost spend in 2019There are no global/local events in 2019 expected to affect media spend.

THE 2018 AD SPEND FORECAST Advertising has been moving alongside consumers in response to their increased disposable income, consumption habits, media behaviour. In the first 3 quarters, Digital and OOH (digital) was up by +15.8% and +14.2% respectively. Whereas TV was down by 6.9%. On TV, the 2018 World Cup and Winter Olympics did not have a big impact on advertising, as CCTV (China Central TV) was the sole TV broadcaster and only a few websites had a broadcast agreement with CCTV and could telecast the event.

The economic contextThe US and China bilateral tariffs have not yet had a significant affect on China so far, as China has shifted from an export-driven economy to a consumer society. Consumption accounted for 78% of China's GDP growth during the first three quarters in 2018, an increase of 14 percentage points over the same period in 2017, official data shows. China's GDP growth registered at 6.7 percent year-on-year in the first three quarters of 2018 according to the National Bureau of Statistics. We believe that advertisers will keep spending for the festive seasons in Q4, i.e. Christmas and New Year, Double 11 and Double 12 for eCommerce.

AD SPEND PERFORMANCE BY CATEGORYThe Top 10 categories reflect well the current consumption trends in China. Out of the top 10 categories, 6 have growth ranging from 12.7% to 59.6%, 4 were fast-moving consumer goods i.e. Drinks, Food, Alcoholic Beverages, Personal Care, and 1 was Retail. These 5 accounted for 33% of total category spend.

Pharmaceuticals was the top spending category with a 11.6% share of total category spend. Webservices (online shopping, life service, etc) was significantly up y-o-y 52.7% and ranked#3. Digital and OOH (mainly digital OOH) accounted for 59% and 31% of its spend respectively. Automotive was up by 13% which was attributed to the increasing car ownership. Further momentum can be expected in 2019 with the impact of government backed tax reductions for cars with plans to reduce tax to just 5% for cars with engines smaller than 1.6 litres. Entertainment (movies, theme parks, events, CDs, DVDs, etc) was dramatically up by 59.6%. Real Estate was down by -35% which might be attributed to government’s measures on cooling down the property market.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDNational residents per-capita disposable income stood at 21,035 yuan ($3,000), a nominal growth of +8.8% year-on-year, or an actual increase of +6.6% after deducting price factors, which kept the same pace as that of GDP growth.

In the first three quarters, Chinese residents' per capita consumption stood at 14,281 yuan, a nominal increase of +8.5% or an actual increase of +6.3% percent year-on-year. Rural residents saw a faster growth in per

capita consumption expenditure than urban residents, with a growth of +12% to 8,538 yuan. China's consumer goods market continues to expand in the first 9 months. Mobile phones and technology products increased +10.7% year-on-year as consumers upgraded. Sales of cosmetics increased by +12% with premium ranges seeing the strongest growth.Online shopping users and online Retail continues to grow, attributed to a broader access of mobile internet. In the first three quarters, online retail sales increased by 23.8% in East China's Zhejiang province and 22.4% in the Fujian province.Fueled by the continued expansion of the middle classes, upgrading will continue, and the overall consumer market is expected to maintain asteady growth.

CHINA: ‘Digital and Digital OOH will continue to drive growth in 2019’



2018 2019f 2020f

China 7.8% (6.5%) 7.0% (6.0%) 6.4%



Top 10 Categories 2018 Jan- Sep

2018 Jan- Sep Gross Local Currency Million

2018 Jan- Sep vs. 2017

YOY%

Pharmaceuticals 125,193 -15.6%

Drinks 97,587 19.9%

Webservices 93,959 52.7%

Food 83,603 18.0%

Automotive 77,201 12.7%

Retail 68,598 28.3%

Personal Care 52,467 -28.4%

Alcoholic Beverages 50,966 -4.5%

Entertainment 37,315 59.6%

Real Estate 34,935 -34.9%

104

‘GENERATION “Z” ACCELERATES THE DIGITAL ADVANCEMENT IN CHINA’


DigitalThe “Z” Generation became adults in 2017/2018 and their consumption habits have greatly impacted the mainstream. The young adults in lower tier cities have also formed their own unique consumption needs and habits. All these fundamental behavioral changes have driven the speedy growth of the digital market in China.

Through machine learning and new technologies, more predictive modelling and analytics are available for the accurate estimate of click-through and exposure. The trends of performance-based advertising started in 2017 when artificial intelligence technology was used to help companies continuously optimize bidding rules and processes for accurate delivery and anti-fraud. Advertisers have gradually moved from CPC or CPM to truly targeted and effective delivery.

The range and depth of product choices on eCommerce sites are abundant and keep attracting consumers to buy online as well as attract advertisers to invest in eCommerce.

Over 60% of China’s digital market is now shared by the top 4 players (BATZ). “ByteDance”(including Toutiao, Douyin, Xigua…etc) has been growing dramatically over the last 2 years and is a new digital giant after TENCENT, ALI and BAIDU.

Eco-system by Tencent and Ali are continually expanding, both offering connected and extensive digital solutions from marketing to business efficiency. Tencent: Wechat eco-system is further upgraded by Mini program effect. The new retail business model is now compatible and will be more popular within the wechat environment. “Official account + mini program” is the new power partnership and completes the consumer journey from trigger, sales to membership. And up to 2018 June, it has accumulated over 20 million wechat official accounts and 6million mini programs.

China is more mobile than ever. Mobile marketing is continuously growing and is expected to account for 76% of the total digital market in 2019. Diversifying is in further progress. Categories from Mobile commerce, travel, camera & picture are developing greatly, while in video, music, news & reading, these categories are facing unprecedented competition.

Native ads (including feeds, content syndication, advertorial…etc.) are more popular today in terms of high relevance with brands and in terms of a good response from audiences and are forecasted to account for 60% of the total market over the next 5 years.

Investment on Search will keep declining, due to both the impact from new native formats, and also the behaviour change from Search platform to vertical search (eg: ec and social).

Growth of online gaming is forecasted to slow down in 2019. Overall China gaming (e-sports) market will face an adjustment year. Example: The Flying shooter’s game has over 300 million players and 600% growth rate in 2018, expectations are it will continue to be popular in 2019 but with much slower growth. Other categories (Strategy, Elimination…etc) expect a decline. WeChat mini games and ‘family friendly’ formats will be popular next year in line with government policy changes.

TVSmart TVs have become more popular as the price is dropping. The content of online TV / OTT is getting more abundant and paid viewing habits are further accepted by audience. As a result TV audience ratings are decreasing and advertisers will shift budget to Online TV (OTV) and product placement.

TV spends will continue to focus on CCTV and prime satellite TV channels. Provincial and local TV stations will suffer. 2019 is the 70th anniversary of the founding of the People's Republic and the government will regulate TV content which will may further affect TV viewership.


105

‘SMARTER TECH IN OOH’

OOHThe OOH market will continue to develop steadily. Several big media vendors are consolidating to expand OOH advertising resources in their pools and more new digital OOH media are expected to break in the market.

OOH media will be transformed into the digital OOH media in order to counteract government policies for regulating the OOH advertising environment. With basic urban construction development, more cities will build, expand or renovate public transportation services e.g. Metro, airports and high-speed railways. As coverage and quality of OOH advertising is greatly getting better, advertisers will keep spending on OOH, however the investment threshold will also be higher than before.

Smarter tech in OOH will see a shift to delivering precision targeting at scale and the use of telecom data will enable greater tracking of reach and effectiveness of OOH campaigns. Ongoing optimization means advertisers will be able to set different strategies for precise locations depending on real and measurable consumer insights.

RADIORadio will maintain its performance as car ownership continues to increase year on year.

NEWSPAPERS AND MAGAZINESNewspapers and Magazines are still declining but at a reduced rate.

Business co-operation mode of newspapers are generally traditional and mainly focused on advertising sales in their newspapers, lack of interaction with clients and readers.

After years of integrating their content with digital resources, some publications have accumulated rich expertise in creating a serious of offline branded events to attract advertisers for sponsorship. Some have deployed AR & VR technologies to enhance consumers’ experience.


106

China Data Tables



2018 2019f 2020f


Newspapers -28.0 -25.0 -20.0

Magazines -9.0 -9.0 -9.0

Radio 1.0 0.4 0.4

Cinema na na na

OOH 14.0 10.0 8.0



2018 2019f 2020f




eCommerce 22.1 19.3 16.5



Mobile^ 25.0 20.0 18.0



2018 2019f 2020f




Radio 2.1 2.0 1.9

Cinema na na na

OOH 9.4 9.7 9.8



2018 2019f 2020f




eCommerce 38.2 40.5 42.9

Paid Search 23.3 21.4 19.5


Mobile^ 71.5 76.2 81.8



107

LATEST KEY AD SPEND TRENDS• Digital ad spend represented a 41.2% share of total ad spend in 2018 and

grew faster than expected at +17.9%, revised up from +12% forecast in the June 2018 report. It is essential to capture relevant data to provide informed insights to develop a customised omni-channel strategy.

• Video ad spend growth in 2018, +37.8%, driven by Mobile Video which is fueling the fast-paced growth of streaming. Short videos and personalized content distributed programmatically is the trend.• Content will still be the king as people demand more reputable content to

advertise (37% of internet users block ads on any device each month). It is important to provide relevant, engaging and informative content which is customised based on data-driven insights, i.e. data driven dynamic messages.

THE 2019 AD SPEND FORECASTA drop of -0.2% is forecasted for 2019, a slight downward revision from 0% previously forecast, reflecting a deceleration in economic growth due to the slowdown in China. The US-China trade war and rising interest rates will weigh on private consumption. The latest forecast for 2019 real GDP growth is 2.6%, which is down 0.4 percentage points from the previous update and 0.1 percentage points from the October 2018 forecast.

Global or local events to boost spend in 2019There are no global or local events expected to boost spend in 2019.

THE 2018 AD SPEND FORECASTAlthough Retail sales showed positive growth in Q1 2018 (+14.4%) and Q2 2018 (+12.4%), it slowed down in the third quarter (+6.5%) and continued weakening in Q4. Moderate growth for the ad market in 2018 of +0.3%, unchanged from the previous prediction in the June 2018 report.

The FIFA World Cup provided a modest boost to ad spend in 2018, without the World Cup Event the ad market would be flat.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The 2018 forecast remains at a moderate growth of +0.3%. With weaker demand from mainland China, the US-China trade war, rising interest rates and the strengthening of the HKD, Hong Kong’s economic growth is forecasted to slowdown from +3.1% in 2018 to +2.6% in 2019. The ad market environment is expected to be weakened with a slight decline of +0.2% expected.

The economic contextEconomic growth decelerated to 2.9% in real terms in Q3 2018, after growing 4.6% and 3.5% in Q1 2018 and Q2 2018. Real GDP is forecasted to growth at 3.1% in 2018. Retail sales momentum slowed markedly, with the value of retail sales declining in Q3 after robust growth in Q1 and Q2. Growth is expected to decelerate in 2019 with the escalation of the US-China trade war, rising interest rates and the slowdown in mainland China.

AD SPEND PERFORMANCE BY CATEGORYBanking & Investment Services remains the top spending category with estimated growth of 6% in 2018. A strong boost coming from credit cards with keen competition from rewards such as Asia Miles, cash rebates etc. Also electronic payments such as Pay & Paid Payment Platform by Hang Seng. Beverages seeing flat growth with a spending drop in Milk Powder for Adults and Infants.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPEND• Digital remains the key media consumed (94%) with time spent getting

longer, reaching almost 5 hours per day (from 265 minutes to286 minutes.)

• Active Social media users (66%) and active mobile social users (58%) are growing at 9% and 11% respectively. 12.7million unique mobile users, representing 175% of the population (with an average of 1.75 mobile phones per user).

• 81% watch online videos at least once a week, 59% on a daily basis. The average length of a video ad consumed on the Mobile is 25-seconds. The preference is for consumption of short online videos via the mobile (35%) and desktop (24%).• 2018 e-commerce revenue forecasted at US$4.4million with 2019 forecast

growth at 11%. TV (34%), Search Engine (34%), WOM (33%), Online (33%) and recommendation on a social network (25%) are the top 5 platforms for brands/products. Search Engine (45%), Social networks (41%), Product/Brand Sites (32%), Price Comparison sites (29%) and Consumer Review (28%) are the top 5 platforms that are used to search for more information on brands/products. Hence, brands are selling their products via the marketplace (63%), brand sites (27%) and Socialmedia (24%).

HONG KONG: ‘Gloomy ad market’



2018 2019f 2020f

Hong Kong 0.3% (0.3%) -0.2% (0%) -0.2%




2018 vs. 2017YOY%

Banking & investment Services 1,913 6%

Pharmaceutical & Healthcare 1,512 6.5%

Cosmetics & Skincare 960 3%

Travel & Tourism Services 949 -12%

Toiletries & Household 863 -10%

Beverages 787 0%

Entertainment 687 -10%

Property & Real Estate 619 -10%

Retail 606 3%

Food 546 -15%


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‘ONLINE VIDEO IS FORECAST TO HAVE THE HIGHEST GROWTH’


a.Total Digital ad spend is forecast to grow by +16.3% in 2019, an upward revision from +12.9% growth forecast in the June 2018 report. It is the only medium with high positive growth reaching a 48% share of spend. It is expected to have similar momentum moving into 2020. Key growth drivers are Online Video, Mobile, Social and Programmatic.Online Video ad spend is forecast to have the highest growth at 30% in 2019, mainly driven by the growth of Mobile Video (40% to 50%). Both YouTube and Facebook remain the core online video drivers recording a rapid increase across desktop and mobile video, where ‘Viu’ has a high growth in mobile video too.

b.A negative growth of TV is predicted at 3% in 2019. TVB Jade remains the dominant channel with estimate share of spend at 60% while the ad spend of Cable TV is forecasted to decline by 20%. Pharmaceuticals and Banking remain the major TV spenders with reported YTD growth of 12% and 14% in TV, followed by Toiletries & Household and Beverages with a drop in TV of (-9% and -3% respectively).

c. Total OOH spend is forecast to drop by 10% in 2019. MTR remains the core OOH channel estimated to account for 45% of spend. Key categories reporting YTD growth in spend were Pharmaceuticals (+27%) and Banking & Finance (+17%).

d.The spend in Newspapers is forecasted to continue to decline across categories at 25% in 2019, a downward revision from -20% previously forecast. Pharmaceuticals, Property and Travel & Tourism will continue to overtake Banking & Finance as the key spending categories.

e.The continuous decline in Magazine ad spend is observed across categories. Its ad spend growth is forecasted to decline by 35% in 2019. Ad spend share in 2015 was 10.6%, we expect it will decrease to 2.1% in 2019 and to 1.2% by 2020.


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Hong Kong Data Tables



2018 2019f 2020f

Television 3.1% -3.0% -6.5%

Newspapers -20.0% -25.0% -30.0%

Magazines -30.0% -35.0% -40.0%

Radio 2.5% 2.0% 0.0%

Cinema NA NA NA

OOH -10.0% -10.0% -15.0%

Total Digital 17.9% 16.3% 15.3%


2018 2019f 2020f

Total Digital* 17.9% 16.3% 15.3%


Online Video 37.8% 30.0% 26.0%


Paid Search 8.5% 6.5% 6.2%


Mobile^ 39.9% 27.8% 23.5%



2018 2019f 2020f

Television 22.8% 22.2% 20.8%

Newspapers 14.9% 11.2% 7.9%

Magazines 3.2% 2.1% 1.2%

Radio 3.5% 3.6% 3.6%

Cinema NA NA NA

OOH 14.4% 13.0% 11.1%

Total Digital 41.2% 48.0% 55.4%


2018 2019f 2020f



Online Video 29.9% 33.4% 36.5%


Paid Search 35.1% 32.2% 29.6%


Mobile^ 50.7% 55.8% 59.7%



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LATEST KEY AD SPEND TRENDSNatural calamities in Kerala & other parts of southern and eastern coasts wiped away the festivities around Onam. It was so devastating that many industries were impacted. And the festivals following the months have been on a lower scale. Many advertisers stayed away from media around this time. The southern Indian state’s GDP growth is expected to fall to 6.5-7.0 from the expected 7.6% for the financial year 2019. (Source: rating agency Care Ratings Aug 2018)

Automobile, Rubber, IT reported huge losses but there is still hope from the Tourism industry for Q4 2018.

Despite competition, Indian eCommerce has slowed down due to revised guidelines for FDI & GST. These factors have led to the decline in consumer spending. Surging fuel prices have also impacted the GDP growth in India. The Auto industry got hit directly.

Festivals did not see much retail ads as expected. Radio volumes were hit in the same way as Print. There was not much traction from tier 2 towns which were expected to drive the growth. Only the leading known ecommerce players and retailers were spending.

Indian Rupee has been at an all time low. A strengthening of the U.S. dollar is causing the rupee to depreciate as the cost of India's hefty, dollar-denominated oil imports rise.

While economic trends in India will weaken Modi as a candidate, the absence of a unified opposition indicates that he will remain the favorite in the 2019 general elections.Overall advertiser as well as consumer sentiments are low. Slower growth than anticipated at a pace of 9.6% instead of a 10.5% for 2018.

THE 2019 AD SPEND FORECAST2019 should be a better year with positive ad spend growth of c.+10.6%. The double digit growth is anticipated on the back of Elections at the Centre and in the major states of India, World Cup Cricket in India. This year we saw consolidation of the entire BCCI Cricket event including Digital and Broadcasting rights into One National and International Television network (Star/Fox) which led to lot of disruption in the way IPL was bought. In 2019 all BCCI matches in India shall also be covered by this network, hence we expect an increase in pricing and also an increase in inventory through expansion across HD and Regional sports Channels which would lead to an increase in rates and would further lead to an increase in ad revenue. Also this network is merging with the Disney network next year so lot of interesting times are ahead.

• Global or local events to boost spend in 2019 • Lok Sabha election & Sports events like the ICC World Cup, IPL will surely

increase the spends in 2019 during Jan–June. Pro kabaddi league & ISL , Cricket & Maharashtra state election events are the major events in July –December.

THE 2018 AD SPEND FORECASTThe Football World Cup broadcaster Sony Network, which has managed to bring more than 40 advertisers on television, was estimated to have closed at INR.200 crore in advertising revenue. There were some state elections in the 1H of the year which boosted ad revenues. However, the festive did not take off as expected.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The falling rupee, increasing fuel price and some natural calamities hit 2018 in H2. Also forecasts are that Global recession may come in 2019. Blue chip companies in India are already facing falling share prices from mid of

2018. Foreign investors are shifting their investments to other countries. India is the world's third-largest consumer of oil and imports nearly 80 percent of its crude. And since oil is a key input across various sectors of the economy, rising crude prices will put upward pressure on inflation. Indeed, the latest inflation figures of 5 percent in June point to afive-month high.

The economic contextThe World Bank has projected economic growth to accelerate to 7.3% in 2018-19 and 7.5% in 2019-20. India is expected to become the worlds 5th largest economy in 2019. While the Government is focused on taking Digital to the next level with new initiatives in the areas of Digital infrastructure, digital empowerment, on demand Govt. services. At the same time it is important to focus on increasing overall consumer confidence and awareness, enabling a smoother transition to the new policies and reforms. Due to international tension crude oil prices are at a peak. Forecasts clearly show advertising spends are being scaled down and many sectors are facing huge pressures.


INDIA: ‘Better growth in 2019 anticipated’



2018 2019f 2020f

India 9.6% (10.5%) 10.6% (11.1%) 11.6%





2018 vs. 2017YOY%

FMCG 186,725 14%

Retail 35,201 11%

E-Commerce 55,438 3%

Media & Entertainment 30,628 3%

Telecom 35,775 -4%

Consumer Durables 37,004 -5%

Auto 54,245 -6%

BFSI 32,772 -17%

Others 150,990 34%

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FMCG Fast moving consumer goods (FMCG) is the 4th largest sector in the Indian economy. There are three main segments in the sector – Food and Beverages which account for 19% of the sector, Healthcare which accounts for 31% and Household and Personal Care which accounts for theremaining 50%.

The FMCG sector has grown from US$ 31.6 billion in 2011 to US$ 52.75 billion in 2017-18. The sector is further expected to grow at a Compound Annual Growth Rate (CAGR) of 27.86 per cent to reach US$ 103.7 billion by 2020. The sector witnessed growth of 11 per cent in value terms between April – June 2018, supported by rate cuts due to the Goods and Services Tax along with better consumer off-take.

Growing awareness, easier access, and changing lifestyles are the key growth drivers for the consumer market. The focus on agriculture, MSMEs, education, healthcare, infrastructure and employment under the Union Budget 2018-19 is expected to directly impact the FMCG sector. These initiatives are expected to increase the disposable income in the hands of the common people, especially in the rural areas, which will be beneficial for the sector.

AutomotiveCurrently, the automotive sector contributes more than 7% to India’s GDP. The Automotive Mission Plan 2016–26 sets an aspiration to increase the contribution to 12%. A number of economic trends could help in meeting this target. Rapid urbanization means the country will have over 500 million people living in cities by 2030—1.5 times the current US population. Rising incomes will also play a role, as roughly 60 million households could enter the consuming class (defined as households with incomes greater than $8,000 per annum) by 2025. At the same time, more people will join the workforce. Participation could reach 67 percent in 2020, as more women and youth enter the job market, raising the demand for mobility.

The Auto sector has been using Digital efficiently. They shall exhibit more dependency on Digital platforms in the coming times. From online classifieds to buying a car online are some of the natural shifts that would be seen on a large scale. Traditionally they spend a lot on Print, OOH followed by Television and Digital. On OOH, spends for Auto in 2018 were slightly higher than last year. The growth in ad spends has also been due to the fierce competition and pricing. Tier 2 and Tier 3 towns are driving the volumes. Rising investments of the Government on metros and local commuting aids would start impacting the auto industry. They have started focusing on the Tier 2,3 cities and smaller markets. Electric Bikes and eco friendly automotive are the next trends expected in India. While these have seen soft launches at the moment, with the Government's subsidy and support, E-Bikes, E-Cars and eco friendly automobiles will grow rapidly.

E Commerce2018 has seen a come back of big billion sales and revival of some of the dormant ecommerce players. Leaders have been up and active during festivals with multiple offers. More and more Indians are adopting for digital and cashless payments.

The Indian e-commerce industry has been on an upward growth trajectory and is expected to surpass the US to become the second largest e-commerce market in the world by 2034. The e-commerce market is expected to reach US$ 64 billion by 2020 and US$ 200 billion by 2026 from US$ 38.5 billion as of 2017. With growing internet penetration, internet users in India are expected to increase from 481 million as of December 2017 to 829 million by 2021.Rising internet penetration is expected to lead to growth in ecommerce.India’s internet economy is expected to double from US$125 billion as of April 2017 to US$ 250 billion by 2020, majorly backed by ecommerce.

TelecommunicationsIndia is currently the 2nd largest telecommunication market and has the 3rd highest number of internet users in the world. India’s telephone subscriber base expanded at a CAGR of 19.22 per cent, reaching 1,194.58 million during FY07–17. Tele-density (defined as the number of telephone connections for every 100 individuals) in India, increased from 17.9 per cent in FY07 to 92.92 per cent in FY18Reliance Jio: It expanded its user base multiple times and penetrated the data usage among the lower strata and smaller towns. Advertising on Telecom has been steady for the top players. Data has been driving ad spends further. Smartphone penetration (with cheaper smartphones available) has also played a key role.

The Indian telecom sector revenue grew at a CAGR of 7.31 per cent from US$ 19.6 billion in FY06 to US$ 42.6 billion in FY17. During the first half of FY18, gross revenues of telecom sector in India reached US$ 20.4 billion. Revenues from the telecom equipment are expected to grow to US$ 26.38 billion by 2020.

Telecom has always been very high on OOH and it continues to be. Television and big properties including sports where they are associated.

On-demand entertainment services led by audio and video content are at the cusp of an inflection point in India. Though the traction towards both on-demand download and streaming has just started. A very promisingsupply side ecosystem is evolving for streaming with multiple players

launching their digital streaming platforms. The advent of OTT players, bothdomestic and international, is providing consumers with multiple choicesaround content consumption. To an extent there are OTT players in Regional languages who have become extremely popular with pure original content.

India is seeing a shift in consumer’s attitude from content ownership to having easy access to a vast library at any time and any place. Telecom plays a vital role in giving them the access and with smooth downloads. This sector hence is only slated to grow even in the next few years!


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Consumer DurablesIndian appliance and consumer electronics (ACE) market reached INR 2.05 trillion (US$ 31.48 billion) in 2017. It is expected to increase at a 9 per cent CAGR to reach INR 3.15 trillion (US$ 48.37 billion) in 2022. India is one of the largest growing electronics market in the world. Indian electronics market is expected to grow at 41 per cent CAGR between 2017-20 to reach US$ 400 billion.

Demand growth is likely to accelerate with rising disposable incomes and easy access to credit. Increasing electrification of rural areas and the wide use of online sales would also aid growth in demand. The rise in the working age population also to stimulate demand. A huge untapped market. As of 2016, only 29% of households in India own a refrigerator, 11% own a washing machine and 6% own a computer or a laptop. Emerging rural areas have a great potential for appliances like microwaves and refrigerators.

Ecommerce platforms have started selling the Consumer durables in a big way. However, the advertising on durables is mainly around the festive season and Print media used for product brief and Local dealer contact details. TV has also been heavy again only around the festive season.

RetailRising income and demand for quality products to boost consumer expenditure. Total consumption expenditure is expected to reach nearly US$3600 billion by 2020 from US$1,595 billion in 2016. Indian Retail one of the fastest growing markets in the world due to the economic growth. India is the world’s fifth largest global destination in the Retail space. The Retail market in India is projected to grow from US$672 billion in 2017 to US$1.1 trillion in 2020. India’s modern retail to double in size over the next three years. The modern retail market in India is expected to grow from US$70.45 billion in 2016 to US$111.25 billion in 2019. Metro consumers have started shifting to online grocery as well, bringing down footfalls further.

Revenue generated from online retail is projected to grow to US$ 60 billion by 2020. Retail industry both bricks and mortar as well as online together is expected to grow to US$1.3 trillion by 2020. The advertising is mainly around the festive season and Print media. TV has also been heavy again around the festive season.

Innovations in terms of payment gateways and loyalty cards, promo-offers have been pushed by retailers. Ad spends on OOH will remain similar to last year. The ecommerce space has been most active in recent times. Paytmthe revolutionizing mobile wallet, also has a thriving online market. The category is driven by discounts, loyalty points and promo offers, festive and specific occasions.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OFAD SPENDFrom products to fashion to stories, going back to the roots is trending and there is a definite pride associated with it. Today products are charging higher prices for the 'Made in India' tag. The rise of local language YouTube channels, for state sports teams, regional food brands are examples. Brands need to make hyperlocal moves, find local opportunities and capitalize on them rather than Global strategies.

Super Multitasking with extremely low attention - Indian’s are one of the biggest multitaskers in the world today – we talk while driving, respond to emails while eating dinner with family, track cricket scores in a strategic discussion, catch a few minutes of our favorite Netflix show on the go. The language of communication today are Emoji's, GIF’s, audio & videos, written word is losing its importance. Brands can increase their reach to this new consuming class by talking in their language on their mediums & create huge opportunities.

Brands need to be more than products, they need to create experiences with products & services, experiences that create a social value more than just simple consumption. One message fits all is no longer relevant.

Retailing is moving to ecommerce more. Changing purchase patterns: The shift in purchase behaviour towards online buying, dominated by mobile phones, has been very evident over the last few years. Preferences are now clearly extending beyond the original product categories of electronics and fashion to include food and grocery as well as local origin products.

Evolving desire for service: Consumers are now seeking a clutter and trouble-free experience, enabled by technology and better quality sales people.

Switch to health and wellness-driven choices: There is a marked consumer shift towards products and services that are perceived to be relatively healthy and less harmful or enhance people’s sense of physical and mental wellness and the environment.

Rise of convenience: Cash-rich and time-starved consumers are seeking a new dimension in ‘convenience by knowledge’ to help them navigate to the right products and services that are relevant for them.

Growing social networks: The concept of ‘crowd clout’ is gaining significance as consumers realize that their collective networks are enabling them to demand improved products and services from companies.


113

‘PROGRAMMATIC BUYING ON THE RISE’


a. TelevisionIndia is the second largest subscription television market in the Asia Pacific Region in terms of the number of subscribers. India will be one of a few countries to register a consistent growth up to 2020 in terms of television advertising. TV is the biggest segment (circa 40% share) in India in terms of ad revenue.

Technology innovations, rising disposable income, government initiatives to push digitization, etc. will act as catalysts for continuing this growth. With a wide reach of ~75%, the TV segment in India signifies scope for tremendous growth and expansion. Low ARPU of ~USD 3 per month makes TV one of the most affordable and preferable forms of entertainment in India.

India has a TV penetration of 64% currently, with 181million TV households. The average daily time spent watching TV (by individuals) is c.220 minutes. This provides an opportunity for ample space, for good content on TV for its viewers. Though at a saturation level in some states with an expected average annual decline in subscription, cable television will continue to dominate the market over satellite television up to 2020. Also, digitization has resulted in tremendous growth in the number of television channels which is now over 800. Television penetration in India is currently at 64% which signifies scope for tremendous growth and expansion.

Channel owners, broadcasters, distributors and other media companies around the world have always shown significant interest in the Indian television industry. However, until recently, the limits on foreign direct investment in certain segments limited the interest of such global players. The government has now relaxed these limits and has allowed 100% FDI in all the segments of the television industry except up linking of news and current affairs channels.

Apart from the traditional Over-the-Top (OTT) players in the market, major broadcasters in the country have also invested in this segment and launched their own OTT platforms. Telecommunication networks’ investments in cheap data plans and Wi-Fi packages are one reason for the rise in Online Video consumption in India.

b. Print Print, unlike in the developed world, continued to grow, with vernacular outpacing the growth of English language publications. The robust growth of the Indian Print media with respect to most other countries is to a large extent driven by the growth in Hindi-speaking North India. Like in the past years, Hindi print media and the northern region again registered the highest growth in the country. Hindi-speaking areas have a higher population growth rate and their literacy rates have begun to pick up only in the last two decades. So, these areas are witnessing significantly higher growth compared to the South where the population is not growing as fast and literacy levels have already reached high levels as early as the 1990s.

Hindi publications registered highest annual growth followed by Telugu, Kannada, Tamil and Malayalam. So, Hindi newspapers not only enjoy larger circulation, but are also growing at a faster rate. The Indian Paper Industry accounts for about 2.6% of the world’s paper production.

Factors for this growth are likely to be organic growth from various Print loyalists like Auto, Durables, Education and Mobile handsets, Ecommerce and Government ads. English, Regional high end and tech savvy newsreaders are also shifting to the new age, Digital News apps, with increasing smart phone penetration. Also the cost of imported newsprint has gone up so all the print owners are trying their best to increase their ad prices.

c. DigitalThe rise of visual storytelling in the form of video and infographics. The wearable tech trend will continue. Messaging app will become the next community management platform for brands. Commerce advertising stands to be the biggest beneficiary. Programmatic buying is on the rise. Viewability and Audibility is on the rise. Clients are ready to spend on tech solutions like Ad-fraudulent and Brand Safety. Brands are unable to track conversations which happen outside the regular social media platform and the size of dark social media is double that of the standard social media platform. Mukesh Ambani’s 4G mobile network Reliance Jio Infocomm Ltd has played an important part in democratizing data usage, also forcing other operators to cut down rates. The entry of low-cost Chinese smartphones like Lenovo, Xiaomi, Vivo and OPPO into the market has also enabled more Indians to log on to the Internet.

It’s also about content. The entry of OTT platforms and the rise of YouTube stars have meant improved content for a previously under-served youth and millennial population. Jio has opened up inventory buys, opening up a host of options for Mobile advertising. This would also enable the marketers to advertise to the BIMARU states and the tier 2 towns with feature phones as well as other forms of advertising. Social advertising will see further growth, considering smartphones are doubling in penetration and the access is increasing from the smaller towns and the rural areas.

⎽Online Video growth which started with You Tube videos, has now picked up across all OTT platforms like Hotstar, Sony Liv, Voot, Zee 5 etc. Facebook has also started taking videos with different edit sizes opening up a plethora of options on video. Local language OTT platforms which do not belong to any big media house, like Hoi Choi in Bengal has also become very popular.

⎽Both Social and Online Video will see growth for the next 5 years in our country as we are still evolving as Internet, Mobile, Cloud audience.

Globally consumers will spend an average of 67 minutes a day watching Online Videos this year, up from 56 minutes in 2017. The time spent watching videos online is expected to go up to 84 minutes a day for the average person by 2020.


114

d. OOHWe expect OOH to establish a growth of about 8-8.5% by the end of the year 2018,taking the total OOH advertising market close to about Rs.3,500 Cr. Some significant ripples were felt due to fuel price increases, automobile spends going down. As was expected BFSI, e-commerce, M-wallet apps, Telecom service provider (driven largely by JIO), and mobile handsets made their presence felt and were significantly aggressive in the OOH market. The Idea and Vodafone merger saw some new campaigns. Transit and ambient saw a positive lift on the back of Airport (supported largely by tourism), Malls and Metro media advertising.

The outlook for 2018 last quarter seems further positive, as the latter part of the year might see a significant push from DAVP and Government led advertising with an eye on the general elections slated for the first half of 2019.

e. RadioRadio had been growing as the tier 2- tier 3 towns had been showing positive

growth. However, the impact of various Govt. policies, like the increase in fuel prices, RERA has completely upturned the situation. Contributing to the initial growth in the yearwere the Mobile wallet, mobile services and Ecommerce players. But those are now heavy on TV and Print. The Phase III auctions, were quite weak and those markets have not really taken off as anticipated. Retail and Realty, categories which used to spend a lot on the medium have been sluggish and slow due to the Government reforms.


115

India Data Tables



2018 2019f 2020f



Magazines -2.1 -1.7 -1.0

Radio 3.9 5.0 5.1

Cinema 14.2 14.3 14.3

OOH 8.1 8.3 7.5



2018 2019f 2020f





Paid Search 25.9 24.3 23.2


Mobile^ 46.1 49.1 49.7



2018 2019f 2020f




Radio 3.9 3.7 3.5

Cinema 2.1 2.1 2.2

OOH 5.7 5.6 5.4



2018 2019f 2020f





Paid Search 24.8 23.3 21.7


Mobile^ 47.2 53.3 60.4



116

LATEST KEY AD SPEND TRENDS• Overall in 2018, ad spend increased by +2.2% due to events such as the

World Cup, ASIAN Games and Regional Elections.

• TV and Digital are the main media with the most allocated ad spend with growth of +2% and +18% respectively.• Print ad spend is still suffering due to the continuing decline in readership.

Other media (e.g. Radio, OOH and Cinema) seeing growth similar to GDP growth (5.1%).

THE 2019 AD SPEND FORECASTThe forthcoming general election (legislative and president) on April 2019 has the potential to create positive growth. The ad market in Indonesia is forecast to grow by +3.7% in 2019, higher than the 2018 growth rate of +2.2%. The higher growth in ad spend forecast in 2019 is boosted by categories ‘corporate/public services’ (especially general election related advertisement and political organisation). They will allocate more money on TV, Print and Digital.

Global or local events to boost spend in 2019The big local event is the general election for legislative and president.

THE 2018 AD SPEND FORECASTThe World Cup and ASIAN Games affected the categories (Toiletries, Beverage and Food) positively with more spend in Q2-Q3/2018 expanding ad spend by 9-10%, but there were declines in Q1 and Q4.

TV in Q3/2018 showed a decline of 4-5% Y-o-Y vs. Q3/2017. Overall for 2018, TV has showed +2% growth after going down by 4.3% in 2017.

Newspapers benefited marginally from the World Cup, ASIAN Games and regional elections. Thus limiting Print Y-o-Y decline to a maximum of 9% vs. a 12% decline in 2017. Magazines kept declining due to more than one-third of titles ceasing publication.

Digital due to privacy issues, elections, brand safety and viewabilityconcerns showed a lower than average growth for 2018 vs. the 20-30% growth in previous years. Google, YouTube, Facebook and Instagram hold about 50% of total digital ad spend.

Radio and Cinema has grown in line with GDP growth by c.5%. While OOH increased by more than +10% in 2018 due to big sporting events and regional elections.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)No significant changes to the 2019 ad spend forecasts compared to the previous prediction. Main factors/assumptions the same (big events,macro economics).

The economic contextConsidering the current global economic situation, GDP growth will be slightly lower than what the government set out in their budget in 2018 (5.4% p.a.). Growing consumer confidence in Q3/2018 has been a positive sign and source of optimism that the Indonesia economy is going to get better in the next year. Strong fundamental economics (e.g. lower inflation) and a successful general election will drive a higher economic growth in 2019. It will encourage advertisers to keep investing and allocating ad spend on a moderate level (+/-3-4% p.a).

AD SPEND PERFORMANCE BY CATEGORYThe Top 10 categories cover 86% of all ad spend in TV and Print. FMCG Categories (Food & Beverages, Personal Care, Corporate/Public Services, and Pharma) still rank amongst the highest, cumulating in more than 60% share. They are followed by E-commerce and Homecare, each recording 6% and 4% share respectively. Then Cigarette, Automotive, Telco and Media Entertainment follow with the next 3-4% share. Pharma, Corporate/Public Services and E-commerce are predicted to expand their gross adex

significantly by +19%, +22.3% and +29.6% YoY respectively. Personal Care, Media/Entertainment, Home Care, and Food & Beverages increasing at a moderate level 6-9% YoY. Cigarette and Automotive going up by a low level 2-5% YoY. On the other hand, Telecoms is predicted to decline by 20% YoY due to budget efficiencies and slowing demand on calls & sms.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDThe growing digital consumption especially on Mobile drives more allocation of ad spend towards Digital and a re-allocation from Print or other conventional media. Electronic transactions which are continuing to increase also trigger more campaigns on e-commerce and m-commerce in 2019.

INDONESIA: ‘Ad spend growth on positively slow performance’



2018 2019f 2020f

Indonesia 2.2% (4.6%) 3.7% (3.7%) 4.7%


Top 10 Categories 2018 2018 Gross Local Currency Million

2018 vs. 2017YOY%

Food & Beverages 43,089,248 5.5

Personal Care 27,285,061 9.2

Corporate & Public Services 14,630,925 22.3

Pharmaceuticals 12,457,429 19.0

E-commerce/Online Service 9,393,923 29.6

Home Care 6,268,382 5.8

Cigarette 5,574,937 3.5

Automotive 4,830,947 2.3

Telecoms 4,561,858 -19.9

Media & Entertainment 3,904,698 7.5


117

‘DIGITAL DUE TO PRIVACY ISSUES, BRAND SAFETY AND VIEWABILITYCONCERNS SHOWED A LOWER THAN AVERAGE GROWTH FOR 2018’


TelevisionTV is still dominant, although the total minutes spent on TV is marginally declining with the increasing trend of simultaneous multi-media use especially with Mobile. Overall TV viewing remains the same, with slight declines against certain demographics e.g. Males, Youngs. But high channel viewing fluctuations will continue to impact performance. We have 15 private and public stations, covering more than 80% of the national population and 10 Pay TV providers concentrated in the main cities and urban areas.The private stations and Pay TV channelsThe top private national stations are owned by 5 media group, such as MNC Group, Trans Media, Emtek, Viva Group, and Metro. Regionally there are more than 60 local stations, bringing local and cultural content. However, Nielsen just monitor one-third of them.TV Establishment Survey 2018 done by Nielsen shows that Pay TV population is about 11% of the total population in 11 cities. One-third of them still connect to FTA (or using antenna) to watch channels not covered by provider or watch football match. To get more quality screen and various entertainment, AB segments and sub-urban residents prefer to subscribe to Pay TV or Cable TV. Data from top Pay TV providers indicates that there are 6.5 Million subscribers, mostly concentrated in the main cities in Java and Sumatera. The top providers are Indovision, First Media, Trans Vision, indihome and BiG.More than half of total ad spend is still allocated on TV. It is mainly allocated ad spots during commercials. But there is an increasing trend of utilizing content programme/non-lose spots (e.g. Digital Branding Integration - DBI) to enhance viewability and viewer attention.

NewspapersThe readership and ad spend share for Newspapers continues to show a declining trend to 26% and 21% respectively, due in part to the influence of Digital newspapers. KOMPAS Group & JAWA POS Group still take the lead in terms of total share of ad spend. Top spending categories are Government/Political parties followed by Corporate Campaigns, Real Estate & Apartment and Hotel & Restaurants.

MagazinesMagazine readership continues to drop. Also the number of publications is reducing by 36% so that only 63 titles remain.

DigitalIn 2018, Internet penetration is still predicted to continue to grow to 70% of all the population, of which 90% accessed the internet from their mobile phone. Concurrently ad spend allocated to this medium is also going up significantly by +18%, slightly lower than the last forecast due to privacy issues, elections, brand safety and viewability concerns. Total share reaching higher than Print in 2018 to more than 20%. In addition, advertisers are allocating almost half of their Digital advertising budget to Google/YouTube, Facebook, and Instagram.

The phenomenon of increasing ad spend in Digital is also boosted by the increase in the number of new products/services and start-ups. Because of limited communication budgets, they prefer to utilize the digital ecosystem (Social media, KOL, and online shopping) than TV and Print to promote and expose their products/services and focus on millennial target audiences.Small-medium enterprises (mostly located outside Greater Jakarta) are also more attracted to Digital/Social media and Local TV than local Print. It is one of the factors causing the continuing decline in Print ad spend in particular for Local/Regional Newspapers.

RadioBased on Roy Morgan Single Source Data Q1/2018, Radio is currently listened to by about 16% of the population or the equivalent of approximately 15 million listeners in Urban areas.Some Radio tried to survive and remain relevant through online integration and activation, by offering bundle packages of on-air, Digital and off-air activities. Radio in Jakarta hired a famous DJ for the primetime slot which created additional exposure through Social Media.


118

Indonesia Data Tables



2018 2019f 2020f


Newspapers -8.0 -15.0 -17.0

Magazines -30.0 -30.0 -30.0

Radio 5.0 5.0 5.0

Cinema 5.0 5.0 5.0

OOH 12.0 3.1 5.0



2018 2019f 2020f




Radio 1.5 1.5 1.5

Cinema 0.0 0.0 0.0

OOH 1.7 1.7 1.7



119

LATEST KEY AD SPEND TRENDSThe biggest factor that contributed to the downward revision of Japan's advertising market forecasts is the poor result for the four traditional media during the January-June, 2018 period, the base period for these forecasts. However, Internet advertising expenditures are expected to grow steadily amid a rapid digital transformation. The overall advertising expenditures forecast was revised downward due to an expectation of decreased spending on paper media such as newspaper inserts as part of promotional media.

• Growth was sluggish for the four traditional media, despite major sporting events.TV program ad placement was quite active for events such as the PyeongChang 2018 Olympic Winter Games and the 2018 FIFA World Cup Russia. However, despite steady growth in the Japanese economy, TV spot commercial placement was down. Furthermore, a growing decline was seen for paper media (newspapers and magazines), resulting in an overall downward trend for the four traditional media. These results show an accelerating pace of digital transformation as people change how they interact with media.

• Growth continues in the Internet advertising market. The past several years have seen a rapid rise in a style of media interaction involving behaviour, such as watching videos on smartphones and making use of social media. Advertising expenditures have also gravitated to Internet advertising due to the indispensability of smartphones in many everyday activities such as purchasing and paying for products and services. Internet advertising expenditures are also growing as companies move to provide greater customer convenience in areas such as real estate and automobiles, which involve high prices and difficulty in making purchase decisions. While this has been a year that

has seen the emergence of ad fraud and other issues related to performance-based ads, there has also been a strong push to hedge risks throughout the industry using tools such as PMPs. Against this backdrop, Internet advertising expenditures could outpace TV advertising expenditures in 2019-2020. Internet advertising expenditures will come to account for a larger proportion of the market, and its rate of growth is likely to slow.

• Out-of-home media advertising will remain on a par with last year. Ad spend for newspaper inserts and other paper media is expected to drop. While a consumption tax hike is planned to take effect in October 2019, a reduced tax rate is also being discussed, making us think there might be a minimal last-minute surge in demand. With the Tokyo 2020 Olympic and Paralympic Games, it is likely that event-related promotional activities will be a greater focus than advertising activities. Numerous projects by the state, Tokyo, businesses, and other organizations are expected to pick up steam beginning in 2019 as we draw closer to Tokyo 2020, a national event. Greater activity in communication and marketing activities aimed at the domestic and international markets is likewise expected to occur.

THE 2019 AD SPEND FORECAST• 2019 ad spend is forecast to see a +0.6% year-on-year increase. • The beginning of the new era ushering in the new emperor and new era

title will likely prompt numerous changes to signs and therefore an increase in OOH ad spend. • Communication activities are likely to pick up in response to the G20

Osaka Summit and the Rugby World Cup 2019, a last-minute surge in demand as the October consumption tax hike approaches and the announcement of both reduced tax rate details and economic stimulus measures.

Global or local events to boost spend in 2019• G20 Osaka Summit • Rugby World Cup 2019 in Japan

• Last-minute surge in demand spurred by the consumption tax increase (8% --> 10%)• National events to usher in the new emperor

• Tokyo Motor Show and other events.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)This was the result of advertising expenditures for the four traditional media coming in lower than expected for January-June, 2018, the base period for forecasting. This puts ad spend on track to underperform 2017 results, resulting in an even lower ad spend forecast than previously predicted. Paper media is seeing a high rate of decline, with even newspaper insert advertising in the Promotion domain being affected. The contribution to television advertising expenditures for major sports events was limited. However, the full picture will not be visible until an annual estimate is made in February 2019. Although the rise in Internet advertising expenditures is expected to continue, ad fraud and many other serious issues have compromised people's trust in Internet advertising in Japan. Because of this, more companies are likely to approach Internet advertising investment with caution.

JAPAN: ‘The Digital transformation barrels ahead’



2018 2019f 2020f

Japan 0.2% (1.5%) 0.6% (1.2%) 2.4%



120

The economic context2018 saw a high number of natural disasters such as heavy snowfall and rainfall, typhoons and earthquakes. Despite this, domestic politics remain stable and the economy continues to grow at a gentle pace. This situation is due to a number of positive factors, among them stable job numbers, rising wages, a recovery in consumer spending and an increase in foreign tourists. With respect to corporate activity, although developments such as rising oil prices present concerns, revenues and profits continue to rise alongside strong exports and capital investment. While growth may not have hit double digits, it was stable and very confidence-boosting. Still, there is no denying the influence of the global economy going forward.

Systemic changes in domestic demographics are more conspicuous than in other countries. With the population aging and decline already underway, any economic growth will be extremely gradual. Japanese companies are becoming more focused on overseas investment than domestic, causing earnings structures to change. There is also an undeniable shift taking place from domestic to overseas with respect to advertising and other marketing activities.

AD SPEND PERFORMANCE BY CATEGORYThe figures below show advertising expenditure performance for just the four traditional media, classified by industry.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDAdvertising activities by domestic corporations correlate with consumption trends and demographicsPopulation decline --> Population aging --> Domestic consumption market stagnation --> Domestic advertising activity decline.

• Spending may be weak but a recovery is happening

⎽ - Consumer confidence was 43.4 points in September 2018, a 0.1 pointincrease over August (Cabinet Office statistics)

• Population decline and a rapidly aging population

⎽ - The population dropped by roughly 1 million people compared to 2015.29% will be elderly by 2020 (Ministry of Internal Affairs andCommunications)




2018 vs. 2017YOY%

Information / communications 285,400 98.8%

Cosmetics / Toiletries 274,700 100.7%

Foodstuffs 257,600 92.8%

Transportation / Leisure 194,500 96.7%

Beverages / Cigarettes 183,100 99.0%

Distribution / Retailing 155,200 94.8%

Finance / Insurance 150,800 100.2%

Pharmaceuticals / Medical Supplies 146,300 99.3%

Automobiles / Related Products 142,200 96.8%

Food Services/Other Services 134,800 100.0%

(*Four traditional media only)Expenditure by Industry

121

‘INTERNET AD PLACEMENT CONTINUES TO GROW. TRADITIONAL MEDIA IS ALSO HOLDING ITS OWN’

BY MEDIAThe 5 biggest by media ad spend trends in 2019a.Growth continues for online performance-based ads.

⎽Performance-based ads are enjoying solid growth. YouTube's video-based pre-roll ads are one of the market leaders. Video-based ads provided by other platforms are also on the rise, with continued growth expected.

⎽Media containing content in violation of copyright has garnered attention. In response, ad platform providers have taken measures that include discontinuing ad delivery on offending pirate content websites. Some Internet providers have also restricted access to such sites. To prevent their ads from appearing on highly-illegal sites, advertisers and their advertising agencies are stepping up ad fraud response efforts. And in the interest of controlling where ads appear, some companies are returning to reserved ads or using PMPs.

The advertising industry overall has grown more cautious towards the illegality of certain affiliate ads. Advertising agencies are making a general move away from handling inappropriate affiliate-based advertising products, causing the affiliate ad market to contract.⎽Although it is not reflected in ad spend, the market for ad verification and

other ad technology-related solutions is expected to see further growth.⎽Finance-related ads (for insurance, consumer loans, credit cards, etc.)

continue to see large ad volumes. Amid this trend, the industry is seeing a greater number of housing loan-related ads due to the recent drop in interest rates.

With regard to general consumer goods, ads are increasingly going Digital, with a continued high volume of ads especially for cosmetics/toiletries, with ads for food and drink not far behind.

b.TV advertising lacks momentum overall, despite the solid performance of TV programs.⎽Major sporting events such as the 2018 FIFA World Cup Russia and the

Jakarta Palembang 2018 Asian Games have driven strong growth for TV programme ads. However, spot ad growth has been stagnant due to natural disasters and advertisers' re-examining their advertising plans.

⎽4K broadcasting will begin in December 2018 via satellite.⎽Growth continues for video ads on video streaming services supplied by TV

stations such as TVer (a TV program catch up service app) and AbemaTV(an ad-based free online TV app).

⎽TV ad volume is expanding for industries such as precision equipment, which has recently been a focus of interest for magnifying spectacles, job hunting websites and apps in response to Japan's workforce shortage, and direct-marketing for cosmetics and other products for women.

c. radiko.jp and other Internet-based radio programs are gaining traction.⎽The radio ad market is growing at a good pace. This trend owes largely to

the existence of radiko.jp, which can be listened to on smart speakers, which have gained popularity, or through a smartphone app, as well as over the air.

radiko.jp premium members increase every month. Audio ads on radiko.jp saw a full-scale launch in October 2018, which is likely to result in increased advertising expenditures.

d.The downward trend continues for newspaper, magazine, and other print media ad spend.⎽Decreasing subscribers and unit sales for both newspapers and magazines

contribute to a grim outlook for ad spend on paper media.

⎽For magazine ad spend, no significant change is being seen in the shift toward digital for the fashion and accessories industries — both ad spend leaders in magazines. Digital media offered by existing publishing companies are employing digital ad strategies such as video ads at an increasing rate.


122

e.Strong expectations for dynamic digital out-of-home advertising (DOOH).⎽Japan is now seeing the rise of dynamic DOOH, which involves linking with

outside data and streaming content that changes dynamically from moment to moment. Already out of the experimental testing phase, dynamic DOOH is now spreading throughout Japan's major cities, and there are signs to suggest an imminent full-scale rollout of ad delivery utilizing dynamic DOOH.

⎽Digital signage inside trains is also on the rise, particularly in new train cars. Meanwhile, although demand for hanging ads and above-window ads inside train cars is slowing somewhat, it is still a popular medium for advertisers.


123

Japan Data Tables



2018 2019f 2020f



Magazines -6.6 -4.6 -3.1

Radio 0.5 0.9 2.4

Cinema - - -

OOH -0.5 0.1 2.1



2018 2019f 2020f


Display (Banners) - - -

Online Video 39.6 - -

Social Media - - -

Paid Search - - -

Other incl. Classified - - -

Mobile^ 25.3 - -

ProgrammaticSpend^ - - -


2018 2019f 2020f




Radio 2.0 2.0 2.0

Cinema - - -

OOH 8.1 8.1 8.0



2018 2019f 2020f


Display (Banners) - - -

Online Video 11.2 - -

Social Media - - -

Paid Search - - -

Other incl. Classified - - -

Mobile^ 72.4 - -

ProgrammaticSpend^ - - -


124

LATEST KEY AD SPEND TRENDS• The Central bank raised the GDP forecast for 2018 to 5.5-6.0% while

expecting moderate inflation and revised the rate to 2.0-3.0%.• Advertising spend did not grow as anticipated due to the 14th General

Election.

• Advertisers and consumers optimistic about the market situation hopefully will continue to grow industry ad spend after the FIFA fever.

THE 2018 AD SPEND FORECAST• 2018 was expected to be a high growth year due to the 14th General

Election and World Cup, however Q1 2018 registered -3% growth against Q1 2017. The short campaign period before the election day is the main reason for the lower growth rate. Hence, the growth in 2018 has been revised to -1.0%.• Q2 2018 performed better with the World Cup and Hari Raya festive

advertising.

Global or local events boosting spend in 2018The projection for 2018 ad spend growth would have been around 4% (approx.) without the General Election and the FIFA World Cup.

The economic context• Central bank raised the GDP forecast for 2018 to 5.5-6.0%.

• Overall inflation rate is expected to moderate in 2018 at 2.0-3.0%.• Domestic demand will continue to drive growth supported by favorable

earnings and employment conditions.• With the abolishment of GST, consumer spending will improve across all

categories.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)2018 ad spend growth has been revised downwards from 6.9% to -1.0% due to the unexpected short period for General Election advertising which had earlier been expected to boost ad spend.

THE AD SPEND FORECAST FOR 20192019 ad spend is expected to grow by +3.1%. Since 2019 is not expected to be an eventful year, growth in ad spend is mainly due to the improving economic situation, stable inflation rate and stronger currency rate that is expected to boost advertisers’ confidence.

AD SPEND PERFORMANCE BY CATEGORY• Food & Beverage is expected to grow by 4% in 2018 mainly due to ‘Dairy

Kids Growing Up Milk’, a very competitive category.

• The Retail category ad spend has been on a declining trend for the past 4 years. Y-t-d Apr 2018, growth is showing a double digit decline. Fast Food Centre and Hypermarket categories, the main contributors, showed a total decline of 14%.• The Personal & Household Care segment is projected to grow by +2% in

2018 with the main contributors ‘Hair Shampoo & Conditioner’, ’Baby Toiletries’ and ‘Toothpaste’ categories showing positive growth in Y-t-d 2018.

• Automotive continues to decline further in 2018 (-15%) with 11 out of 14 Automotive categories showing negative growth in YTD 2018.

MALAYSIA: ‘Growth in ad spend due to improving economic situation’ OVERVIEW OF THE TOTAL ADVERTISING MARKET



2018 2019f 2020f

Malaysia -1.0% (6.9%) 3.1% (4.5%) 3.2%



2018 vs. 2017YOY%

Food & beverages 516.0 4%

Retail 454.1 -8%

Personal & household care 264.1 2%

Automotive 149.9 -15%

Pharmaceutical 119.1 -2%

Finance & insurance 117.8 -13%

Telecoms 91.7 -8%

Media & entertainment 74.4 -13%

Consumer electronics 65.9 1%

Luxury & fashion 61.3 5%

Toys & games 22.8 -6%

Alcoholic beverages 17.5 -10%

Note: Above ad spend excludes Pay TV

125

‘OTT SEGMENT IS RISING AS MORE PEOPLE PREFER TO BE IN CONTROL OF MEDIA CONSUMPTION’

BY MEDIAThe 5 biggest by media ad spend trends in 2019Pick up in ad expenditure driven by the FIFA World Cup, improvement in ad expenditure sentiment post the 14th Malaysia General Election. Potential increase in consumer spending due to the abolishment of GST.

Increase in readership and viewership due to the promise of media freedom by the new government, more balanced reporting and increasing news flow in the country. The billboard, television and email campaigns of yesteryear have transformed into in-app messages, chatbots and social memes; and it seems like more channels will be introduced, especially upon the introduction of voice-activated technology.Ephemeral content had a strong association with Snapchat, however early July 2017 onwards Instagram stories is taking over this space rapidly. Malaysians are the most active on Instagram, as the results show usage has gone from 59% to 73% of connected consumers over the past year.Reaching out to micro-influencers instead of your traditional influencers will be a trend to keep an eye on. Micro influencers in comparison have a more modest set of followers and share content that revolves around a specific passion.Many people said 2017 would be the year of Video, but it turned out to also be the year of live video. While the concept may have started out with Meerkat and later Periscope, this year has seen Facebook, Instagram, Twitter and YouTube go live. Live video is appealing because of the authentic nature of it. You don’t have full control over what happens once you go live, and that sort of spontaneity or even uncertainty makes live videos so much more worth watching.

The growth of AI this year has also been seen across industries, whether it’s Amazon’s Alexa or Apple’s Siri. And we can probably expect more of AI integration within the realm of social media in 2018 and beyond.

Digital adex is forecasted to have a growth of +16.1% in 2018 and +10.2% in 2019. Digital platforms are enabling brands to reach out to their consumers in one on one personalized messaging, making their exposures more impactful.The Nielsen Digital Ad Ratings Benchmarks report, which accessed more than 3,000 digital campaigns since its launch in Southeast Asia in 2015, found that in the first half of 2017, more than nine in 10 (93%) digital ad campaigns leveraged Mobile and mobile achieved an on-target reach equal to or higher than digital or desktop benchmarks for all but two reported age benchmarks (Malaysia being one of the key market too).Malaysia (68.7%) and Singapore (64.5%) were ranked the top two for highest viewability rates, compared to 58.9% in Southeast Asia, Hong Kong and Taiwan. Once again, the region performed better than the global viewability rate benchmark of 55.8%. Malaysia’s ranking proves that industry efforts on improving overall viewability in the country has paid off.

IDC study commissioned by Microsoft predicts that approximately 45% of Malaysia’s GDP will be derived from digital products or services by 2021.Digital transformation has increased productivity, profit margins, cost reductions, revenue from new products & services and customer advocacy. These benefits will also improve by at least 20% in three years.

OTT segment is rising as more people prefer to be in control of media consumption. Malaysians spent 3.6 hours on mobile internet where most of the time spent was on video. Boasting 43 million mobile subscriptions, the popularity of VOD has never been higher, riding on the wave of access to anywhere anytime video content. Industry predictions highlight the promise of OTT and VOD, with a surge in consumption and revenue anticipated in the next few years.

126

Malaysia Data Tables



2018 2019f 2020f


Newspapers -13.5 -2.6 -4.2

Magazines -4.0 3.7 -1.6

Radio 1.6 3.9 2.1

Cinema 1.2 2.9 4.0

OOH 5.3 -1.2 4.0



2018 2019f 2020f







Mobile^ 21.5 13.0 15.7



2018 2019f 2020f




Radio 8.7 8.7 8.6

Cinema 2.7 2.7 2.8

OOH 9.3 8.9 9.0



2018 2019f 2020f

Total Digital* 100.0 100.0 100.0




Paid Search 27.5 27.7 27.3


Mobile^ 77.3 79.3 83.4


127

LATEST KEY AD SPEND TRENDS• Digital continues to grow at pace, particularly Google and Facebook

outside agencies. This was reflected in the latest IAB figures and so growth has been revised upwards.

• Newspaper expenditure declines have proven to be further than expected – down 15% YOY in 2017 and forecast to be down 22% in 2018, reflecting the falling demand in the medium. Publishers are further needing to drive revenue online in order to mitigate these declines.• Broadcast Radio has recently started to decline, likely at the expense of

digital audio providers such as Spotify.

THE 2019 AD SPEND FORECAST2019 is forecast to grow at +3.1% in 2019, broadly in line with GDP Growth. The continuing digitisation of OOH and Digital are the main drivers for this growth.

Digital OOH opens up new opportunities for audience buying and ways to incorporate into programmatic buying, while Programmatic Video, Google and FB/Instagram will continue to grow and take share as media time spent increasingly becomes digital. TV should hold its own as pricing is very competitive for reach and brand building and the networks are investing heavily in content and prices continue to rise to offset declines in inventory.

Global or local events to boost spend in 2019The Rugby world cup will be a big driver of revenue in 2018, especially TV and Digital.

THE 2018 AD SPEND FORECASTAdvertising spend with agencies had a strong start to 2018 but has lost significant ground since April with four successive months of decline. The 2017 general election has played a big part in that decline. The rest of the shift is due to the growth being captured by the tech giants andincreasingly directly.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)Annual market expenditure report for 2017 by ASA released at the beginning of May 2018. Previous estimates based on 2016 ASA results with forecasted inflation based on a combination of sources as ASA is the market standard.

Reliable total market data is only available annually and so given the sustained GDP growth figures no material adjustments have been made.

The economic contextThe New Zealand economy has enjoyed a number of years of strong growth and low inflation. GDP is forecast in excess of 2.5% for 2018, above the long term average, while business sentiment remains positive despite a high New Zealand Dollar and low commodity prices. New Zealand continues to be seen as a safe investment haven and ideal test market. The advertising market is following this trend, forecast to be tracking up 2% YOY in 2018.

AD SPEND PERFORMANCE BY CATEGORYCategories driving revenue in Q1 2018 are Telecommunications (+$6.6m, driven by TV & Cinema) and Investment, Finance, Banking (+$6.2m, driven by TV & Radio).Key categories offsetting this are Household Appliances (-$6.2m, with declines driven by TV, Radio, and Newspapers), Automotive (-$6.4m with declines driven by TV, and Newspapers), and Insurance (-$5.4m with declines driven by TV, Radio).

Note: Category figures are all based on AQX data, which is measured in ratecard value and excludes most Digital spending.

NEW ZEALAND: ‘Healthy advertising growth in line with GDP’



2018 2019f 2020f

New Zealand 2.0% (2.6%) 3.1% (3.2%) 4.1%



2018 vs. 2017YOY%

Retail $420.68 2.6%

Leisure, Entertainment $325.59 2.6%

Foodstuffs $308.38 2.6%

Automotive $300.43 2.6%

Government Departments, Services & Community

$214.06 2.6%

Travel $172.31 2.6%

Investment, Finance, Banking

$163.09 2.6%

Pharmaceuticals, Health $161.55 2.6%

Home Improvements $137.47 2.6%

Toiletries/Cosmetics $117.79 2.6%


128

‘PROGRAMMATIC CONTINUES TO GROW AS A PROPORTION OF DIGITAL SPEND’


a.TV is experiencing heavy demand on its inventory in 2018, brought about by the Commonwealth Games as well as other factors – and in response ratecard pricing for Q3 2018 was increased substantially by the networks. In the first half of 2018 the three major TV networks (TVNZ, MediaWorks, and SKY TV) symbolically joined together in backing Think TV, in order to provide a combined story for TV in order to encourage further spend share on the platform/minimize share lost to Digital advertising. This is starting to generate great traction, with TV declining less than 1% year to date 2018 vs. 2017.

b.OOH media has experienced strong growth over the past few years (+19% in 2017 and +24% in 2016). 2018 revenue is forecast to be 7% p.a., with positive growth forecast to continue for a number of years. Media suppliers are investing heavily in Digital sites, allowing for rotation of ads which is multiplying the revenue they can derive from their sites, and also in new audience measurement systems which allow for a robustness to the medium that previously did not exist in the New Zealand market.

c.Online continues to grow rapidly and reach unprecedented highs in terms of ad spend, with 2016 growing at +11% (IAB) and 2017 growing at an estimated +18%. It expected to continue to grow rapidly over the next few years (consistently in excess of 10% p.a.). Amazon does not operate in New Zealand and so Google and Facebook are projected to further dominate the Digital landscape, currently estimated to hold 60%-70% of Digital spend share and projected to contribute 80%-90% of Digital growth. The agency share of the total digital market is less than 50% as the tech giants service the long tail of advertisers directly and win more and more exclusive large advertiser business.

d.Mobile is one of the fastest growing channels but still lags behind US, UK & Australia. Mobile is estimated to have grown by +72% in 2016 and +52.3% in 2017 – following broader media consumption trends seen in the developed world. Global companies such as Facebook, Instagram, Snapchat & YouTube continue to capitalize on this market shift, rolling out new features to allow advertisers to grow their mobile display and video spends. Growth is expected to slow in 2018 as ad loads saturate and social network audiences peak.

e.Programmatic continues to grow as a proportion of Digital spend, currently making up over 40% of total Display spending and predicted to be as high as 60% by 2020.


129

New Zealand Data Tables

D E N T S U A E G I S N E T W O R K *Includes Mobile/Tablet and Desktop, ^Subset of Total Digital Spend


2018 2019f 2020f

Television -1.0% -2.0% -0.8%

Newspapers -15.0% -13.3% -11.5%

Magazines -21.2% -10.3% -13.1%

Radio -2.5% -1.9% -1.9%

Cinema 18.2% 7.7% 7.1%

OOH 7.1% 10.0% 9.1%

Total Digital 13.8% 11.5% 11.3%


2018 2019f 2020f

Total Digital* 13.8% 11.5% 11.3%


Online Video 15.0% 15.0% 15.0%

Social Media 20.0% 20.0% 20.0%

Paid Search 11.2% 6.7% 6.3%


Mobile^ 22.3% 19.7% 19.6%



2018 2019f 2020f

Television 21.3% 20.2% 19.3%

Newspapers 11.4% 9.6% 8.1%

Magazines 5.5% 4.8% 4.0%

Radio 10.2% 9.8% 9.2%

Cinema 0.5% 0.5% 0.5%

OOH 5.7% 6.1% 6.4%

Total Digital 45.4% 49.1% 52.5%


2018 2019f 2020f




Social Media 17.0% 18.3% 19.8%

Paid Search 60.5% 58.8% 57.1%


Mobile^ 12.2% 13.1% 14.0%


130

LATEST KEY AD SPEND TRENDS• Overall Industry spending slowed down and is expected to grow nominally.• TV & Print ad spend is expected to decline by double digits, while Radio

and Digital is expected to grow compared to the previous year. Digital has experienced growth in allocations and is still expected to rise next year.

• The Big 3 advertisers scaled down their spending which caused an overall decline in industry spend. (The big 3 account for 45-50% of industry spend).

THE 2019 AD SPEND FORECAST• The industry is still expected to grow albeit conservatively.• The increase in ad spend will be fueled by the upcoming elections in 2019

– this has been the affect previously when the country held elections.

• While the Big 3 advertisers had a drop in ad spend in 2018 (vs. Jan-Aug 2017), they are still expected to lead and dominate the industry in 2019.• Digital is anticipated to grow as advertisers start shifting budgets to this

channel.• For OOH, ad spend continues to grow in double digits YOY as new

formats/entrants like Digital Apps & Platforms explore OOH opportunities

• i.e. geolocation activation applications.

Global or local events to boost spend in 2019With the coming Senatorial/National elections in 2019, ad spend under the Govt category is expected to increase in 2019. Ad spend also picks up a few months after the electoral winners are announced, and system of government is normalized.

THE 2018 AD SPEND FORECASTAdvertising in general slowed down as fuel price hikes increased the prices of commodities. The Sugar tax exacerbated the situation as big players in the beverage sector scaled down spending as a result.

OOH continues growing as Mobile apps have been exploring using OOH ads (ie. Grab, Akulaku; Beepbeep.ph; Lalamove). Netflix, an active player.

More MRT inventory options are now available. Birth of new digital platforms (DOOH, LCD screen). While FB & YT still rule the digital realm.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)Continuous fuel price hikes in the last 3 quarters of 2018 has not helped alleviate the pressure on the price of basic commodities, these affected the growth of ad spend as consumers started to hold back spending on non-essential items. The Sugar Excise also worsened the ad industry scenario as Beverage Manufacturers scaled down investments.

As a result Industry Spending Jan-Aug 2018 vs. 2017 was flat. Thus the forecasts were re-calibrated to reflect these new realities.

For 2019, the political campaigns on national media will help boost & stimulate spending in the industry.

The economic contextIn 2018 inflation has been increasing month on month. Starting the year with 3.4%, in Sept at 6.7%. Hence, the full year 2018 inflation is expected to breach 5%, amid elevated oil and food prices. 2019 is expected to have 4.5% inflation.

AD SPEND PERFORMANCE BY CATEGORYPersonal & Household Care still leads, although there is a slight drop in spend.Food & Beverage and Pharmaceuticals are still amongst the top 3. The highest increase is for Government at 43%.

The following categories remain as the top spenders/active players in OOH -QSR (Jollibee, McDonald’s), alcoholic beverage (San Miguel), FMCG, Beauty/Wellness (cosmetics)

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDConsumers are heavy Mobile users that is why it is more challenging to capture their attention. Advertisers are finding new ways on how to stand out to capture the attention of consumers – through frequency, size or volume, engagement (via creative executions or linking placements with digital or mobile).

PHILIPPINES: ‘Ad spend fuelled by upcoming general elections in 2019’



2018 2019f 2020f

Philippines 9.5% (13.7%) 10.0% (15.1%) 9.8%




2018 vs. 2017YOY%

Personal & hh care 70,761.87 -1%

Food & beverages 69,666.47 8%

Pharmaceuticals 26,268.01 15%

Corporate & institutional 14,070.55 20%

Telecoms 7,388.22 9%

Government 7,287.22 43%

Alcoholic beverages 6,768.27 21%

Automotive 5,976.74 9%

Media & entertainment 5,689.34 11%

Real estate & construction 3,680.82 15%

131

‘DIGITAL OOH WILL CONTINUE TO FLOURISH’

BY MEDIAThe 5 biggest by media ad spend trends in 2019a. DTT has brought significant changes in TV Viewing, contributing to audience share. With it’s presence, Cable viewership is in decline. Rural now above Urban. This is likely to carry over to 2019.

b.It was only Radio that increased in ad spend Jan-Aug 2018 (+31% vs. 2017), grabbing SOI from TV (-12% vs 2017) and Print (-21% vs 2017). This is foreseen to continue until end of 2018.

c.There was a continuous decline in Newspaper readership, driven by regional Newspapers.

d.For OOH, it is expected that players will continue to find ways of standing out -- explore dynamic or real-time messaging, geo-location targeting, the integration of Mobile with OOH. Digital OOH will continue to flourish, bigger DOOH formats are coming up.

e.Technology will continue to allow access to premium publishers with real-time bidding via Ad Exchange programmatic that could drive lower cost per unit versus direct publisher buys. It will also activate intent signals and TV syncing that will provide a better user experience.

f.Ad spend is expected to increase next year brought by the anticipated national senatorial elections that will utilize all channels during the campaign period.


132

Philippines Data Tables



2018 2019f 2020f


Newspapers -13.3 3.0 0.0

Magazines -28.0 3.0 0.0

Radio 25.4 8.7 5.0

Cinema 10.0 10.0 7.8

OOH 15.0 15.0 13.8



2018 2019f 2020f









2018 2019f 2020f




Radio 30.0 29.6 28.4

Cinema 0.1 0.1 0.1

OOH 8.8 9.2 9.5



2018 2019f 2020f

Total Digital* 100.0 100.0 100.0




Paid Search 16.4 16.4 16.4




133

LATEST KEY AD SPEND TRENDS• Whilst traditional media continues to dominate total ad spend, it has been

trending downwards since 2017 although this is slowing down.

• Digital spend continues to grow at a healthy double digit rate as forecasted previously.

THE 2019 AD SPEND FORECASTWe foresee TV, Press, Magazines and OOH ad spend sliding downwards whilst Digital advertising revenue will continue to surpass traditional media.

Global or local events to boost spend in 2019There are no global or national events taking place in 2019 to affect media spend.

THE 2018 AD SPEND FORECASTSingapore’s economy grew by an estimated 2.6% in the third quarter of 2018, moderating from the 4.1% growth rate in the previous quarter. According to the Monetary Authority of Singapore (MAS) the economy is likely to remain on a steady expansion path this year despite escalating trade frictions between the United States and China. Digital is growing at a rapid pace and has taken centre stage, it is the key driver of growth in the advertising industry.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)Press revenue continues to decline steeply. TV ads are expected to shrink slightly whilst Magazine, Radio and OOH has had marginal growth due to third quarter spending.


SINGAPORE: ‘Digital revenue will continue to surpass traditional media’



2018 2019f 2020f

Singapore -8.5% (-7.2%) -7.5% (-5.9%) -5.6%




2018 vs. 2017YOY%

Entertainment 145 -12%

Govt/soc/med svc/dom h 101 -25%

Media 109 -10%

Retail 85.5 -22%

Automotive 62 -25%

Pharmaceuticals 66 -20%

Education 56.6 -18%

Real estate 54.4 -20%

Banking/investment 36.4 -25%

Travel 38 -20%


134

‘EMPHASIS ON MORE SHORT FORM VIDEO CONTENT’


a. PressDigital revenue is fueling growth significantly, cannibalising traditional press media spend tremendously. Based on SPH financial highlights there was a rebound in their 3Q performance - improving digital revenue however a decline in print revenue.

b. OOHOOH has evolved with newer technologies - the growing digitization of billboards. Creative advertisements and the spike in digital billboards, makes OOH relevant to this day.

c. Online videoOnline Video consumption will continue to grow across Social networks and via Programmatic. Heavy competition across Telecoms to increase their user base will see better data packages that will help drive video consumption. In addition, the launch of new services, both on existing players to counter competition and diversify their businesses, as well as new entrants, will see video services evolving beyond its current format. The response of Brands is to place more emphasis on the distribution of more short form digital video content. This will also drive a change in behaviour amongst consumers. We should see Digital Video growing by double digits by 2020.

d. MobileSocial media platforms are heavily dominated by Mobile.Mobile and in-app advertising is showing rapid growth and technological innovation.

e. ProgrammaticProgrammatic has picked up rapidly in Singapore since 2016. Spends on programmatic have increased by 20%-30% YoY and are expected to grow at the same pace over the next few years. A driving factor has been a strong push and education. A better way of targeting and measurement also plays a big role in Programmatic growth. However, there has been a string of bad press questioning the efficacy and brand safe issues around programmatic triggering some to approach programmatic with more caution.


135

Singapore Data Tables



2018 2019f 2020f

Television -5.9% -6.1% -5.9

Newspapers -26.0% -26.1% -26.0

Magazines -13.0% -13.4% -12.1

Radio -12.0% -11.8% -12.0

Cinema n/a n/a n/a

OOH -15.3% -14.9% -15.6



2018 2019f 2020f



Online Video 23.1% 10.0% 12.0%


Paid Search 13.2% 10.0% 10.0%


Mobile^ 53.1% 18.7% 16.7%



2018 2019f 2020f

Television 30.3% 30.8% 30.7%

Newspapers 21.4% 17.1% 13.4%

Magazines 3.2% 3.0% 2.8%

Radio 7.7% 7.3% 6.8%

Cinema n/a n/a n/a

OOH 9.0% 8.3% 7.4%

Total Digital 28.4% 33.5% 38.8%


2018 2019f 2020f

Total Digital* 100.0% 100.0% 100.0%


Online Video 12.4% 12.5% 12.8%


Paid Search 33.8% 34.1% 34.2%


Mobile^ 69.0% 75.0% 80.0%



136

LATEST KEY AD SPEND TRENDS• First of all, overall TV ratings have demonstrated a despairing decrease in

2018 on both Terr. TV and CATV. Content consumption, which includes both TV and sports content, on mobile devices was notable in 2018. This phenomena has disrupt the media market.

• Terr. TV spending saw a much sharper decrease than the market forecast. Terr. TV SOV in 2017 was 14% of total market. In 2018, Terr. TV SOV is forecasting less than 11%. This trend will initiate flexibility in the Terr. TV market, where negotiation has never been allowed.• Since most media are demonstrating down sizing except Digital,

traditional media vendors such as SBS and CJ ENM have merged digital and OOH media venders. These two media vendors have expanded their media portfolio and are introducing a total media sales kit. For instance, CJ ENM which is the top CATV vendor has merged OOH and Digital Rep in 2018. CJ ENM will introduce a sales kit collaborating CATV, Digital and OOH media in 2019. • Current disruptive media market situation will open a media network

trading opportunity. This media networking will benefit clients. However, this will disadvantage media agencies in delivering cost guarantees in terms of specific media base.

THE 2019 AD SPEND FORECASTThe optimistic market growth forecast of 2.4%, is based on the strong will of the government. Currently, president Moon announced that the government will focus on rejuvenating the economy. Firstly by creating new jobs to encourage major local companies and secondly by strong government funding in mid-size companies and tech based start-up companies. Last but not least, they plan to reduce geographical risk which

is the North Korea threat. The North Korea peace gesture will encourage and drive foreign capital investment to Korea. The South and North Korea relationship could have a huge impact on economic growth and economic rejuvenation.

Global or local events to boost spend in 2019There are no such global or local events in 2019. However, no events have boosted spend since 2016.

THE 2018 AD SPEND FORECASTThe effect of global sporting events on the advertising market is not noticeable. Both the Winter Olympics and the World Cup recorded minus figures on Terr. TV stations. The overall sales rate for the Winter Olympics was 40% and World Cup sales were less than 30% of total advertising spots. Thus three(3) Terr. TV stations recorded minus revenue.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The overall Korea economic growth forecast has not been over 3% for the last five years and the ad market growth has never exceeded the economic growth rate. Thus we are expecting about the same or a little bit lower growth, which is 2.4% ad market growth. North Korea has been showing strong intentions to open their market to the rest of the world and exit from isolation.

Currently, the United States has shown positive action to denuclearization and relieve economic pressure towards North Korea. This is a good sign for the Korean peninsula to rejuvenate economic growth and increase ad spend.

The economic contextSouth Korea economic growth will maintain about 3% increase in 2018. However as mentioned earlier, the current Korean government announced economic recovery as a priority matter.

AD SPEND PERFORMANCE BY CATEGORYFinance & Insurance: New mobile internet banks such as Kakao Bank and mobilization of bank services is driving the increase in this category. Most banks have launched a mobile service application. In addition, mobile direct payments such as Samsung Pay, Naver pay and Kakao Pay are competing in the Finance category. FMCG (Food & beverage includes beer) Food: Ad spend in this category maintains last year’s increasing trend. Substitute and instant food goes up with the increase in single-person households, and the eat & drink alone trend. On the other hand, in the case of beverages and in accordance with the eat & drink alone trend, beer and beverage spending has significantly dropped. This category usually has a heavy TV preference but the budget is tending to shift to digital.

Service (Travel, cultural performance, franchise and etc): This category is very sensitive to the economic situation. 2018 started with deep recession in the market, which caused local travel instead of overseas travel. The travel related advertising such as hotel and airplane ads stopped. Also, the local major airplane company which is Korean Air, has been afflicted with the company owner’s family accused of harassment towards employees and other companies.

Computer & Telecommunications and Mobile games (Application): In this category, the main decrease comes from mobile games and applications. The mobile game and application advertising spend was more than 20% in this category.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDThe most distinguished market trend is the increase in the “Finance/Insurance” category. This is because major mobile application companies have jumped into the banking and insurance industry (please see above “Finance /Insurance” description). The second noticeable trend is “single household increase in Korea”, with the household-related category demonstrating a slight increase while most other categories have shown a decrease. The increasing categories are food, beverage, household electronics and household goods.

SOUTH KOREA: ‘Disruption on TV (CATV) media causing media network formation’



2018 2019f 2020f

South Korea 2.5% (2.5%) 2.4% (2.4%) 2.3%



137

‘GROWTH OF ONLINE VIDEO ACCELERATED BY FASTEST WIRELESS INTERNET’

BY MEDIAThe 5 biggest by media ad spend trends in 2019a.In 2018 Terr. TV stations have not recovered from the 2017 strike. Due to the strike in 2017, Terr. TV billing was 1.45 trillion won which is a 5% decrease compared to the previous year. However, 2018 Terr. TV billing is forecasted at 1.15 trillion won. CJ E&M and JTBC are taking advantage of the Terr. TV decrease. These two channels have shown sharp increases in the beginning of 2018. Also Terr. TV billing has shifted towards digital media, especially to Online video.

b.The growth rate of video ad spending is higher than other media formats. This was driven by global video platforms such as YouTube and Facebook mainly, and local video formats such as SMR. Global video media have about 70% market share in the video ad market. The share of volume of global video media is +3% compare to the previous year. Among mobile DA media lists, Naver mobile is still dominant. But, Inmobi and MAN+ are demonstrating sharp growth since last year. Among PC DA media lists, Naver PC is still dominant. Also, YouTube DA is ranked as no. 5 in PC DA media lists. YouTube DA is rapidly growing compared to last year.

c. The online video market is being led by mobile. The traffic shift from PC to mobile is getting bigger. The growth rate of Online video has been accelerated by fastest wireless internet. The growth is also supported by the key portal sites’ focus on video such as Naver, Daum and Kakao etc. SMR, the online video network providing Korean content, grew more than 180% compare to the same period in 2017. Facebook launched the ‘FACEBOOK PLUS TV’ concept in 2016. This FACEBOOK PLUS TV keeps showing rapid growth Online.

d.AD tech market is expanding their territory along with the rapid growth of mobile ads and media diversification. Korea’s DMP market is growing by NHN entertainment (Using hangame, bugs, ticketlink’s DB), SK Planet (11st street, T map, OK cashbag’s DB), CJ E&M’s mezzomedia (Using media DB connected with Oracle). In addition, the global DSP such as MediaMath and TTD have launched in Korea. Therefore, Sophisticated targeting (e.g.: Audience targeting using customers’ DB) is continuously being evolved by key mobile media players.

e.Media diversity has become a popular trend, which indicates advertisements do not concentrate on any one media, but are spreading out to various media. The proportion of mobile in the digital online ad market is expected to increase, occupying more than half of the total market size. Advertisers have an opportunity to execute advertisements with performance marketing techniques that maximize efficiency by exposing customized ads through accurate data analysis. The rapid growth of the mobile ad market will lead to a full-fledged competition among advertisers.


Top 10 Categories 2018 2018 Gross Local Currency Million

2018 vs. 2017YOY%

Finance /Insurance 1,047,584 3%

Computer & Telecommunication / Game 821,442 -8%

Service 668,599 -6%

Government & Association 571,898 2%

Food 553,101 2%

Household Electronics 510,649 2%

Household goods 477,882 2%

Cosmetic 473,887 -6%

Medicine / Medical 475,084 -5%

Beverage /favourite food 465,997 5%

138

South Korea Data Tables



2018 2019f 2020f



Magazines -3.8 -6.0 -5.0

Radio 2.3 1.0 1.0

Cinema 1.2 3.0 1.0

OOH 1.2 -1.0 0



2018 2019f 2020f






Other incl. Classified 2.1 7.9 -92.3

Mobile^ 11.5 -7.1 7.0

ProgrammaticSpend^ 10.0 -14.2 48.4


2018 2019f 2020f




Radio 2.6 2.6 2.6

Cinema 2.1 2.2 2.1

OOH 7.3 7.0 6.9



2018 2019f 2020f

Total Digital* 100.0 100.0 100.0




Paid Search 43.7 41.2 38.9


Mobile^ 59.8 55.0 55.5



139

LATEST KEY AD SPEND TRENDS• 2019 Taiwan ad market growth has been downgraded from 2.1% to 1.5%

mainly because the transition to 5G technology by telecom companies will be pushed back from 2020 to 2022, which means a cancelation of budgeting originally slated for 2019 to advertise 5G services. The second reason is that of politics: the 2019 East Asian Youth Games will not be held in Taichung as originally planned.

• More and more advertisers are investing into social media, and the bidding mechanism has led to relatively high costs for those who wish to invest in precision ad placement, which is going to boost ad spending.• The 2018 ad market will see significant growth as a result of ads related

to the World Cup and elections. Since the starting bids for agencies handling ad space sales for the MRT and Taoyuan Airport MRT will dramatically rise in 2019, popular OOH ad spots are sure to see price hikes.

THE 2019 AD SPEND FORECASTThe 2019 ad market is expected to see growth of 1.5%, mainly resulting from continued (but slower) growth of digital ads. For traditional media, contraction in TV and radio ad spending will slow down while the OOH market will grow. Momentum for 2019 ad market growth will mainly come as a result of the following-

Impact on National market:1. Taiwan will hold its presidential election in early 2020. This will begin to

affect the ad market beginning in mid-2019 as government agencies advertise their accomplishments/image campaigns and as candidates begin allocating budgeting for ads. Social media is expected to benefit most from this, followed by TV and OOH.

2. Taiwan is strongly pushing non-cash consumption. The Financial

Supervisory Commission has estimated that mobile payment will account for 52% of all payments by 2020, and the Executive Yuan has expressed the hope that the percentage will reach 90% by 2025. The government has proposed reduced/waived taxes to encourage business owners to offer mobile payment. Mobile payment competition is likely to heat up in 2019 and 2020, so those in the business are expected to invest much into related advertising, with TV and social media the focal points of such ads; storefront OOH media will also be a major target for such ads. Based on the scale of Taiwan’s market, there will probably only be three to five companies in this industry left standing in two years.

Impact on Local market:1. The Taichung World Flora Exposition will be held from November 2018 to

April 2019 (half a year). Advertisers began placing related ads in October, and more ads are expected to be placed in early 2019 on social media and OOH.

2. Phase II of the Kaohsiung Circular Light Rail construction is to be completed in late 2018, and operation will begin soon after, which will spur on more OOH advertising for it in 2019.

THE 2018 AD SPEND FORECASTIn terms of international events, the Taiwan ad market only benefitted from the FIFA World Cup, which mainly drove ad growth for MOD, TV, and OOH. The event brought in over 120,000 subscribers for MOD, and TV and OOH growth was also significant.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The 2019 ad growth forecast was downgraded from 2.1% to 1.5% fortwo reasons:

1. Originally, telecom companies were to make the 5G transition in 2020, which meant they would have invested in related phone and service ads in 2019. However, the five major service providers have expressed opposition to this time frame and will delay the transition until 2022. Thus, related ads will not be placed until 2021.

2. Sporting events are a major driving force behind the ad market, but because of politics, the 2019 East Asian Youth Games will not be held in Taichung as originally planned.

The economic contextWith stable economic growth, foreign demand continued to rise in 2018. In contrast, domestic demand has been weak despite good stock market performance and increased employee wages because of pension reforms being implemented, a sustained rise in commodity prices, and low consumer confidence. As for 2019, the DGBAS stated that even though the global trade war is continuing, global economic growth next year is still forecast to reach 3.1%. Thus, the competitiveness of Taiwanese industries and export momentum could continue. However, with Taiwan quitting its developing economy status in the WTO, it may lose some customs tax perks. Domestic demand in 2019 is not expected to see much improvement with rising commodity prices, volatile oil prices, the threat of electricity shortages, and the TAIEX dropping below the 10,000-point mark.

TAIWAN: ‘Strong digital ad growth for 2019; traditional media contraction to soften’



2018 2019f 2020f

Taiwan 1.0% (0.4%) 1.5% (2.1%) 1.3%



140

AD SPEND PERFORMANCE BY CATEGORYThe top ten industries for H1 2018 were the same as those in 2017, though the ranking was different. The top spender was still the pharmaceuticals/beauty industry: with increased spending on ads for intuition and supplements, this category is forecast to see 17.6% y-o-y growth. In at second was the transportation industry: even though ad budgeting for SUVs increased, investment into ads for cars significantly declined, causing an overall ad investment contraction of 4.2%. Still in third place, the real estate industry is seeing a decline for the whole year of 8.9% due to ad budgeting cuts by developers. Still in fourth place, the computer/accessories industry dramatically cut ad investment into software and games/online games, bringing overall ad growth to -11.6%. The “others” category ranked fifth, with growth of 11% because of spending by political parties, candidates, and government agencies for Taiwan’s 9-in-1 elections in November. The services industry fell to sixth place with -12.9% growth because of reduced ad spending by the tourism industry, department stores, hypermarkets, supermarkets, and convenience stores. Spending growth by the food industry remained flat, while that of the culture/sport industry contracted by 5.6% because of less spending by those in the language education business.Ad spending by the top ten industries accounted for 70% of expenditure by all industries, and of those ten, only the pharmaceuticals/beauty industry and “others” category are to see positive y-o-y growth.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OFAD SPENDBased on the special traits of products and the TA, different types of mainstream ads are placed by different media forms. In the past, TV ads were dominated by the auto, cosmetics, and real estate industries, but as the TV audience is aging, health food ads are increasing. Moreover, most TV auto ads are focusing on SUVs, while the cosmetics industry is focusing on placing online ads. For example, before 2015, ads for locally made autos were placed mainly on TV followed by newspapers, while only 15% of budgets were destined for digital (online). But in 2017, TV ads only accounted for 55% of that industry’s investment (down from 64%), while ads placed online accounted for 32% of the total (for growth exceeding 100%). The percentage of online ads is only expected to keep growing.




2018 vs. 2017YOY%

Pharmaceuticals/Beauty 4,780 17.6%

Transportation 2,623 -4.2%

Real Estate 2,492 -8.9%

Computers and Accessories 2,305 -11.6%

Others 2,260 11.0%

Services 1,759 -12.9%

Food 1,674 -0.6%

Culture and Sport 1,440 -5.6%

Beauty Aid/Cosmetics 1,383 -12.7%

Electronic Appliances 1,374 -1.0%

141

“ADVERTISERS WILL PAY MORE TO ENSURE AD PLACEMENT PRECISION.”


a.The amount of time people spend watching TV continues to decline, while both that of watching streaming videos and the number of OTT platform users are on a sustained rise. Since the price of mobile Internet has fallen and bandwidth efficiency is continually rising, along with the popularity of mainland Chinese and Korean dramas, more and more people are turning to OTT platforms. In 2019, TV ad spending is to contract by 4%, and its ad market percentage of 39% in 2018 is expected to drop to 34.9% in 2020.

b.Ad investment into newspapers and magazines continued to decline in 2018; the share of the ad market is expected to decline from 10.8% in 2018 to 8.1% in 2020. In 2018, a number of magazines ended print operations and went completely digital. Newspapers are also working diligently on developing their digital versions and toward diversification. There has been significant growth in ad spending by digital-platform subsidiaries of print-media companies. By incorporating print- and digital-version ad space sales, newspapers and magazines are providing advertisers with more choices.

c. In 2019, digital ad spending is to grow by 10%, and it will account for 43% of total ad spending. More and more advertisers are choosing to place ads on social media, but since Facebook has changed its algorithm (lowering organic reach), besides actively reaching out to cooperate with media owners and Internet celebrities to create digital video content that is both useful and entertaining, advertisers are also paying higher prices to ensure precision ad placement.

d.In order to stop ad fraud and maintain brand safety, advertisers are willing to spend more on third-party verification (like IAS, MOAT, etc.). More and more of these third-party verification companies are using AI to analyze traffic, conversion rates, CTR, and more, allowing for insight into a number of related dimensions and providing real-time early warnings and feedback.

e.With the support of government policy, there was a significant increase in OOH display ad spots in areas belonging to railed public transportation. Moreover, with momentum from the World Cup, OOH display ads were a focus for advertisers this year. Since the starting bids for agencies handling ad space sales for the MRT and Taoyuan Airport MRT will dramatically increase in 2019, popular OOH display ad spots are to rise in price by 20-30%, and advertisers will, as a result, significantly increase spending.


142

Taiwan Data Tables



2018 2019f 2020f


Newspapers -12.0 -10.0 -10.0

Magazines -15.0 -8.0 -8.0

Radio -8.0 -5.0 -3.0

Cinema -10.0 0.0 0.0

OOH 7.0 3.0 5.0



2018 2019f 2020f






Other incl. Classified -- -- --

Mobile^ 18.8 15.9 11.4



2018 2019f 2020f




Radio 3.1 2.9 2.7

Cinema 0.4 0.4 0.4

OOH 7.0 7.1 7.3



2018 2019f 2020f

Total Digital* 100.0 100.0 100.0




Paid Search 28.0 28.1 28.0

Other incl. Classified -- -- --

Mobile^ 72.6 76.5 79.0



143

LATEST KEY AD SPEND TRENDS• Spending in TV slightly increased in Q2 and Q3 due to special events i.e.

World Cup, ASEAN Game, which has impacted the overall spending.

• In Cinema, Nielsen adjusted the ratecard in 2018, resulting in low % growth in 2018.• For Digital, Line TV collaborated with Ch3 and One (top TV channels in

Thailand) to create popular content for its application. Also popularity of Twitter usage is continually increasing.

THE 2019 AD SPEND FORECASTDue to the election that will happen in 2019, the first half of the year should be better, but we will have to wait until after the results. Increased GDP by 4% and presumably no unfavourable factors also leading to this forecast.

Global or local events to boost spend in 2019No global event that could effect the spending in Thailand, the only local event is the election.

THE 2018 AD SPEND FORECASTThe sports events FIFA World Cup and ASEAN Game only slightly impacted the overall market since the FIFA World Cup was broadcast on channels which are not top channels in Thailand.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)• The rise in actual spend in Q2 and Q3 for overall spending.• Spending in digital rose mainly from Line – Line TV has improved the

content and has launched the new platform LAP (Line Ads Platform) that allows advertisers to do self serve advertising for the Line Timeline. Twitter in Thailand has became more popular.

The economic contextThe forecast for GDP growth in 2019 will depend on the election. If it goes well, it should raise to 3.9-5.4%.

AD SPEND PERFORMANCE BY CATEGORY• Major growth in category ‘Media and Marketing’ (Direct Sale) resulted

from the left-over inventory which sold out at a cheaper price to fill in the space. If spend from this category is excluded, the real situation in the market would show a decrease of 4% (Jan-Sep’18 vs Jan-Sep’17). • The 2nd largest growth was Skin-care Preparations which is in the top 5

and has L'OREAL (THAILAND) as their top advertiser, increasing their spend in 2018 by around 11%.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPEND• TV is still the most popular media for all Thais even though time spent on

TV slightly dropped by 7%.• Multi-screen consumption time spent on Digital significantly increased by

84% within 5 years from 2013 to 2018. Moreover, year-on-year time spent in digital rose up 5% in 2018, which led to higher ad spend in digital by about 21%. Digital penetration in rural areas of Thailand did increase up to 50% in 2018, but the most reachable media for rural populations is still TV.• People consume more and more online content which means that

traditional media has significantly dropped, especially for Print media (Newspaper dropped 25% and Magazine dropped 35% YOY since 2016).

THAILAND: ‘Gradual improvement’



2018 2019f 2020f

Thailand 2.5% (1.3%) 0.9% (2.7%) 2.1%

OVERVIEW OF THE TOTAL ADVERTISING MARKET Top 10 Categories 2018


2018 vs. 2017YOY%

Motor vehicles 6,151-1%

Media & marketing 5,97590%

Non alcoholic beverages 5,615 -7%

Communications 5,0397%

Skin-care preparations 4,30619%

Government & community announcement

3,384-16%

Leisure 3,099 -12%Dairy products & dairy substitute prod. 2,850

-15%

Travel & tours 2,3865%

Retail shops/stores 2,321 8%


144

‘3 MEDIA TYPES DOMINATING REST; TV, DIGITAL AND OUT OF HOME’


a. TelevisionStronger OTT content platforms, notably Line TV, YouTube, Mello and Bugaboo which align to consumer behaviour.

b. DigitalBig players – Facebook and Google (represent 57% share) launched new format ads for conversion objectives in particular.

Facebook wins the rights to stream Football Premier League from 2019 to 2022 in Thailand, Cambodia, Laos, and Vietnam.Small and medium brands tend to invest more in Search Marketing.

Twitter’s official representative in Thailand called Media Donuts increased more than 200% by the end of 2018.Line Thailand (3rd player following Facebook and Google, represent 8% share of market) has improved its Line TV content, and launched Line Ad Platform.

c. OOHOOH media as the 3rd top media in Thailand (13% share) will increase due to a 10% increase ratecard adjustment in VGI and Plan-B which represent 40% in Total Out-of-Home.

d. CinemaCinema spending (6.8% share of market) will gradually increase year-on-year by about 3% due to the slow network expansion, approximately 50 cinema houses per year.

e. PrintDeclining state for traditional media, Newspapers and Magazines represent 7% share of market in Thailand and drop year-on-year by around 25-35%. They are expected to continually drop by 40% within 2020.


145

Thailand Data Tables



2018 2019f 2020f

Television 3.4% 0.2% 0.8%

Newspapers -25.0% -28.0% -30.0%

Magazines -35.0% -38.0% -40.0%

Radio 0.0% 0.0% 0.0%

Cinema 5.0% 4.0% 5.0%

OOH 3.0% 3.0% 3.0%

Total Digital 20.7% 15.3% 15.0%


2018 2019f 2020f

Total Digital* 20.7% 15.3% 15.0%


Online Video 26.7% 14.4% 15.0%

Social Media 21.1% 20.1% 19.6%

Paid Search 37.7% 8.0% 4.6%

Other incl. Classified -41.7% -48.0% -23.0%

Mobile^ 26.8% 21.0% 19.2%



2018 2019f 2020f

Television 55.1% 54.7% 54.0%

Newspapers 5.5% 3.9% 2.7%

Magazines 1.2% 0.7% 0.4%

Radio 4.2% 4.2% 4.1%

Cinema 6.8% 7.0% 7.2%

OOH 12.9% 13.2% 13.3%

Total Digital 14.2% 16.2% 18.3%


2018 2019f 2020f



Online Video 32.7% 32.4% 32.4%

Social Media 70.8% 71.9% 72.1%

Paid Search 9.5% 8.9% 8.1%


Mobile^ 73.5% 77.2% 80.0%



146

LATEST KEY AD SPEND TRENDS• Media inflation is lower than expected as quality has improved significantly

on the top 3 TV channels. The 5.4% spending growth is considered as “natural growth” of the market.

• Cable TV (private channels) are in a difficult situation with content since prices have been rising heavily. A few of them have closed in 2018 such as Let’s Viet.

THE 2019 AD SPEND FORECASTIt is estimate that total ad spend in 2019 will be 1,7 bil USD. The main factor behind this growth is still TV spend which is projected at 4.6% without any special sporting or political events.

Global or local events to boost spend in 2019Seagames sport event hosted in Philippines Nov- Dec 2019.

THE 2018 AD SPEND FORECASTThere are 2 key events in 2018: FIFA WORLD CUP 2018 in June and AFF SUZUKI CUP 2018 in November-December.

RATIONALE FOR ANY FORECAST CHANGES TO THE PREVIOUS REPORT (JUNE 2018)The solid and stable economic growth allowed advertisers to be more confident and to spend more on advertising.

The economic contextThe economy continued to grow at a stellar, albeit slightly slower, pace in the first quarter of the year, after expanding at an over 10-year high rate in the previous quarter. GDP growth moderated in year-on-year terms from 7.7% in Q4 2017 to 7.4% in Q1 2018. Vietnam remains among the world’s fastest growing economies thanks to flourishing exports, a deluge of foreign direct investment (FDI) and a thriving tourism sector.

AD SPEND PERFORMANCE BY CATEGORYFood & Drinks remains top of the categories in terms of SOS andgrowth rate.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDImproved living standards enable Vietnamese consumers to spend more on goods that are essential for staying healthy as well as improving personal appearance.Spending on F&B is estimated to increase CAGR 6% during 2018-2022.In addition to higher income that enables consumers to take high-quality foods, there is better awareness of healthy living that drives demand for clean/organic foods.

VIETNAM: ‘Stable economic growth allowing advertisers to be more confident ’



2018 2019f 2020f

Vietnam 5.5% (6.7%) 5.4% (4.2%) 5.1%



2018 vs. 2017

YOY%

Food14,588,956 7%

Hygiene & beauty8,199,117 0%

Drinks7,834,047 29%

Household cleaning3,480,343 -15%

Pharmacy & medicine3,124,889 4%

Telecommunication2,282,684 7%

Distribution1,768,107 34%

Household appliances730,840 -14%

Property553,260 -8%

Audio-visual543,348 65%


147

‘MOBILE ALREADY VIEWED AS PRIMARY ENTERTAINMENT DEVICE’


a.TV, with more than 200 channels, has maintained its growth at 84.3% share of advertising expenditure by medium. Within this, free-to-air channels capture 70% of TV ad spend, while cable and satellite took 30%. Vietnam is experiencing robust economic growth, while TV content and programming are improving TV. Future growth in TV advertising is likely to be nominal at best, as market momentum accrues to online and mobile media.

b.Mobile video consumption trending upwardsAccording to Ericsson, around 70% of consumers now watch TV and video content on a smartphone—twice as many as in 2012. Mobile video consumption will continue to soar while mobile is already viewed as the primary entertainment device. Pay-TV operators need to effectively scale up their online distribution capabilities to deliver content beyond just TV screens.

c.Multi-Media Campaigns There is a gap between how well marketers think they integrate strategies and what consumers see. And we need lots of brand integration cues to improve campaign performance. There might be an answer which fits better across all channels where consistent use of characters or personalities differentiates the best campaign.

d.E-commerce set for strong 2019 The e-commerce market has taken off in Vietnam thanks to booming internet usage and smartphone ownership, along with massive investments from key retail players. However, e-commerce has faced several barriers deterring its sustainable development, including low consumer trust in products and services, and worries over online payment security. In addition, most Vietnamese e-commerce websites provide only basic services, such as information about products and modes of payment. Services such as digital marketing optimization and connecting online with offline sales need to be added.

e.There will likely be an ever greater focus on data-driven ad targeting within digital – as advertisers (increasingly empowered by their recently developed in-house data management platforms, DMPs) apply their data to programmatic buying.


148

Vietnam Data Tables



2018 2019f 2020f


Newspapers -18.0 -32.5 -25.6

Magazines -28.3 46.0 2.4

Radio -6.9 11.7 2.0

Cinema n.a n.a n.a

OOH n.a n.a n.a



2018 2019f 2020f




Radio 1.7 1.8 1.8

Cinema n.a n.a n.a

OOH n.a n.a n.a




2018 2019f 2020f





Paid Search 15.2 10.0 11.0


Mobile^ 50.8 68.2 29.5



2018 2019f 2020f

Total Digital* 100.0 100.0 100.0




Paid Search 11.6 11.5 11.6


Mobile^ 20.0 30.0 35.0


149

Latin America Market

150

LATEST KEY AD SPEND TRENDS• From July to September, there was an economic crisis: the AR $ devalued

45% vs dollar, and inflation will close the year at 50%.

• This meant that advertisers who have budgets in dollars could increase their investments and those that did not, have had to maintain their budgets or in some cases cut them.• Volumes have not increased unlike investments. Demand is still great due

to the need to communicate and therefore media prices have risen.

THE 2019 AD SPEND FORECAST• It is expected that advertising investments in 2019 will grow below

inflation and that there will be uncertainty surrounding any potential changes generated in the political context of the country.

• The economy will decrease 1.6% (according to IMF estimates) and inflation is expected to be around 25%. Much presence of political communication.

Global or local events to boost spend in 20192019 will be a political year, with presidential elections in October. Communication of political parties will grow, and audiovisual media inventories become saturated but this is free because they are spaces ceded by the government to political parties.

THE 2018 AD SPEND FORECASTThe World Cup always generates growth in investments, this year there were many brands that participated after June when the economic crisis decreased. In September the Olympic youth games were organized here in Argentina, and many brands took advantage of this unusual event to communicate strongly, especially brands that had budgets in dollars and were benefiting from the devaluation of the peso.

The economic contextA clearer economic outlook was expected, with an adjustment of the dollar at the beginning of the year, a referential rate of 45%, and the IMF loans to cover bond maturities. However, a new economic crisis with further devaluation of the currency and projected inflation of 50% means that goals have changed and that many companies are cutting budgets.

The Senate is currently discussing the 2019 budget, where the government proposes a 0.5% GDP fall, 1.6% drop in private consumption, and 25% inflation. The reference rates are very high, around 65%, in order to sustain the price of the dollar.

AD SPEND PERFORMANCE BY CATEGORYOf the Top Ten categories, Political did not grow because we came from a year of legislative elections, but all the others did. Retail and Beauty grew less than in other years due to the economic crisis and dollarized products leading them to cut budgets.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDTV consumption continues to be strong in Consumer categories- Beauty, Pharmaceutical and Food concentrate 90% of investment in TV, the rest concentrates between 40 and 50% in TV.The media mix is maintained from one year to the next, Digital grows little by little. Print and OOH continue to lose share and in segments such as Politics and Communications, Radio has lost 3% share.

ARGENTINA: ‘Uncertainty dominates in current economic and political context’



2018 2019f 2020f

Argentina 44,9% (25,5%) 25% (20,1%) 19,4%



2018 vs. 2017YOY%

Retail 19,128 16%

Beauty 17,833 22%

Pharmaceutical 10,324 45%

Food 8,987 35%

Political 6,336 -3%

Telecommunications 6,022 5%

Banks & finances 5,733 18%

Espectaculos 5,375 19%

Cleaning 5,097 30%

Drinks without alcohol 4,694 20%


151

‘PROGRAMMATIC BUYING TO ACCOUNT FOR MORE THAN 50% VS. DIRECT PURCHASE IN 2020’


a. Video-news and live broadcastsThe audiovisual format is seeing a clear increase. The visualization of information through mobile phones, the greater impact of images on text and the options offered by social networks, all encourage the use of live videos. Companies must adopt live broadcasts and use videos in their releases. Facebook already bought the transmission rights of the Copa Libertadores de Fútbol 2019.

b. Marketing automation through AIArtificial intelligence solutions at the enterprise level are increasingly available, and are more widely used in multiple industries. Some examples of marketing automation driven by artificial intelligence include:Client profiles, through which the activity of the client is tracked through multiple channels and networks, which allows for an accurate image of the target audience at all times.

Chatbots, which are a powerful tool for customer engagement, help automate processes such as customer service.Advanced performance tracking for advertising campaigns, which is essential for making adjustments on the fly.

c. Influencers and reputation monitoringInfluencers, as well as brand advocates, have become relevant because they have an impact on the reputation of organizations. Using the most relevant social networks plays a key role as a channel for the dissemination of information, ideas and for the exercise of the influence of some users over others. Integrating specific strategies to identify and communicate with the Influencers has become vital to project a reputation and strengthened brand. Bloggers and YouTubers, as well as improving the traceability of dissemination, content and social media actions, are necessary to analyze reputation.

d. Big Data and ProgrammaticThe amount of information that can be obtained from users continues to grow. The industry quickly learns to interpret and use them in favour of more effective and personalized messages. Companies are already using Big Data to understand the profiles, needs and pulse of their customers on the products or services sold. This allows us to adapt the way in which the company interacts with its customers and how to best serve them. This is why programmatic buying is rapidly growing, and it is estimated that 2017 will end with 20% vs. direct purchase, with a projection for 2020 of more than 50%.

e. MobileGrowth is expected to be close to 50% vs. Desktop for 2017. The main reason is the growing penetration of smartphone use. According to a study by Kantar Ibope in Argentina, 53% of the population that have cell phones use smart phones. This means an increase of 87% from last year and common uses show that while users are watching TV, 61% are also entering social networks in order to be in contact with friends, generate content or be informed. Throughout the day, 37% of smartphone users enter their social networks at least 5 times or more and 49% said that they had bought products or services on the web in the last 3 months.


152

Argentina Data Tables



2018 2019f 2020f

Television 45.2% 25.0% 16.0%

Newspapers 30.3% 15.0% 15.0%

Magazines 29.8% 20.0% 15.0%

Radio 76.4% 15.0% 15.0%

Cinema 14.2% 13.1% 10.9%

OOH 13.7% 15.0% 15.0%

Total Digital 57.1% 38.0% 30.0%


2018 2019f 2020f

Total Digital* 57.1% 38.0% 30.0%

Display (Banners) 66.6% 13.3% -1.2%

Online Video 74.1% 66.8% 57.1%

Social Media 48.8% 54.3% 38.7%

Paid Search 50.8% 45.4% 33.8%

Other incl. Classified 13.4% -31.1% -35.0%

Mobile^ 63.5% 74.2% 53.7%



2018 2019f 2020f

Television 43.6% 43.6% 42.3%

Newspapers 19.1% 17.6% 16.9%

Magazines 1.9% 1.8% 1.7%

Radio 7.6% 7.0% 6.7%

Cinema 0.8% 0.7% 0.6%

OOH 2.7% 2.5% 2.4%

Total Digital 24.4% 26.9% 29.3%


2018 2019f 2020f

Total Digital* 24.4% 26.9% 29.3%


Online Video 19.9% 24.0% 29.0%

Social Media 13.4% 15.0% 16.0%

Paid Search 32.3% 34.0% 35.0%


Mobile^ 44.0% 49.0% 55.0%



153

LATEST KEY AD SPEND TRENDS• With the end of the election, the social-political climate is unstable. The

polarization between voters generates a state of fear and distrust about the results and how it will affect next year's economy and relations abroad.

• In current values, GDP totaled R $ 1,693 trillion. It closed the second quarter of the year with growth of 0.2% in relation to the first quarter.• The data indicates that the slight increase was determined by the services

sector, which had a positive performance of 0.3%, while the agricultural sector showed stability.

THE 2019 AD SPEND FORECAST• With the change of government representatives, the economic results for

advertising are as uncertain as for the rest of the sectors. If positive measures are triggered, the tendency is for consumption to accompany and gain strength.

• The America Cup Games will take place in Brazil. It’s also a major event in Latin America that can drive sponsors to invest.

Global or local events to boost spend in 2019• Despite being held in 2018, the elections will directly affect the country's

economy and politics in 2019. During the presidential race, stock price asset volatility has increased dramatically and is likely to continue until the president begins to actively govern and take economic measures from the government plan. The elected will have difficulty getting their processes approved on both sides since they belong to poles of extreme opposition.

THE 2018 AD SPEND FORECAST• The advertising market has grown 7,1% when compared to the same

period last year. When we focus on the World Cup, among the top 25 investors in Brazil during the first month of the games, three are among the official sponsors of the event: Inbev (Budweiser), Coca-Cola and McDonald's. Regarding media, the highlight goes to Open TV, with 94% of the investment during this period.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)Economic and social uncertainty remains and growth in the industry was predicted by the continued recovery from the crisis of the previous year.

The economic contextA sense of instability holds for the final stretch of the year. The underutilized labor force rate is stable in the second quarter, at 24.6%. Number of unemployed falls to 12.4% when compared to the same period in 2017, a decrease of 0.6%.

The number of employees with a formal contract was stable in relation to the first quarter of this year, as well as the number of self-employed and domestic workers.

AD SPEND PERFORMANCE BY CATEGORYDue to the World Cup, the Beverages category has a significant growth of 15% over the same period last year. With distance from the worst phase of the crisis, Retail grows 16%. Despite the elections, Public Administration falls -11% compared to 2017.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF D SPENDIn combat of the fake news that has emerged in recent years, the search for more real and transparent communication is among the consumer trends.

Digital is growing more and the importance of an experience and content that interests the consumer will continue to be important. The consumer no longer wants to simply be exposed, they want to consume quality.

BRAZIL: ‘A year of decisions’



2018 2019f 2020f

Brazil 7,1% (5,0%) 3,6% (6,5%) 6,2%



2018 vs. 2017YOY%

Retail 25.687.542 10,00%

Consumer Service 18.745.092 21,27%

Finance 12.379.758 14,88%

Personal Care 11.561.230 -9,94%

Pharmaceutical 10.732.411 4,29%

Sports, Leisure, Culture and Tourism 9.073.892 10,86%

Public Administration 7.472.072 -15,95%

Media 7.024.920 11,24%

Automotive 6.643.327 9,03%

Beverages 5.934.131 7,98%

Previous forecasts in brackets 2018

154

‘DOOH NO LONGER NEXT BIG THING’


a. TV still has the leadershipTV still accounts for a large share of advertising investment, despite the -6% decline of market share when compared to the same period last year. Even with this drop, it’s still far from losing the leadership of the Brazilian market with 72% of the investment, showing that we still maintain a very strong off-line culture.

b. Digital grows quickly There is no stopping the digital evolution that has been occurring in recent years. Just between January and September, when compared to the same period last year, there was a growth of 56%. When it comes to formats, Display is still the most relevant, with 54%. New technologies, content on demand and consumption without the need of possession, are all common to the online universe. Artificial intelligence, analytical market analysis, and VR will become part of consumer's everyday life.

c. Print Media continues to decreaseThe print media continues to lose its strength as reported in the June update. Magazines have dropped by -13% of investment when compared to 2017 and Newspapers maintain their value. In total, they currently account for 9% of the total Ad Spend investment, but the highlight still goes to Newspapers with 6% of share of spend.

Magazines maintain their share of market when compared to the same period of 2017, with 3%. Newspapers lose -1% of participation with 6%.

d. OOH evolution in formatsDigital OOH is fast becoming as ubiquitous as static formats, it is no longer the next big thing, it is already happening. What we are starting to see is a more intelligent use of DOOH networks and no longer the copy-and-paste job of a TVC; we are seeing creative being tailored to each environment which research has shown to increase noting and recall, according to the OOH Auditors State of OOH 2018.

Looking at their investment, it is stable and maintains their share of investment when compared to 2017, with 3%.

e. Radio x Digital MusicWhen we observe the penetration of the media in the population since 2013 there was a fall of -11%, going from 71% to 63%. The evolution of digital music platforms and stations with online radio are the most responsible.

Looking at the investment, the medium had a 18% increase when compared to the same period in 2017, and maintained its 4% share of the total Ad Spend.


155

Brazil Data Tables



2018 2019f 2020f


Newspapers -2,6% -0,7% 0,0%

Magazines -13,0% -3,7% 0,0%

Radio 18,3% 8,9% 0,9%

Cinema 0,0% 0,0% 10,0%

OOH -9,6% 6,1% 10,0%

Total Digital 21,1% 14,8% 12,7%


2018 2019f 2020f

Total Digital* 49,1% 34,8% 24,7%


Online Video n.a n.a n.a


Paid Search 42,9% 39,9% 26,2%


Mobile^ n.a n.a n.a



2018 2019f 2020f

Television 71,7% 70,8% 70,6%


Magazines 3,0% 2,8% 2,6%

Radio 4,0% 4,2% 4,0%

Cinema 1,4% 1,3% 1,4%

OOH 3,0% 3,1% 3,2%

Total Digital 10,7% 11,9% 12,6%


2018 2019f 2020f



Online Video n.a n.a n.a


Paid Search 51,4% 53,4% 54,0%


Mobile^ n.a n.a n.a



Increase of coverage data

Increase of coverage data

156

LATEST KEY AD SPEND TRENDS• A better closing for 2018 is forecast, basically driven by Digital which in

the second quarter had a much higher growth than what is normally observed.

• In fact, the total of offline media does not show a major change compared to the previous year; Despite not showing growth, it should be noted that the downward trend observed in recent years could be ending.

THE 2019 AD SPEND FORECASTIt is expected that in 2019 ad spend will grow by 4.3% as it will benefit from the economic recovery expected for this year; In fact, it is estimated that GDP will grow by at least 3.3%, which means returning to growth levels of above 3%, something that has not happened for three years, at a time of very little growth.However, this positive effect of growth could be counteracted by a possible tax reform (2019) that would negatively impact demand and consumption and even impact inflation.

Global or local events to boost spend in 2019• Football America Cup (Brazil, June 2019)• Local elections of mayors and governors (October 2019)

THE 2018 AD SPEND FORECASTIt was expected that events such as the Football World Cup and the presidential elections would have had a greater impact on ad spend, however the observed results show that this was not so. The average growth month, compared to the same month of the previous year, was 1.9% between January and June, but between August and September there were decreases of -3.1% average month (with respect to the same month of the

previous year). Therefore, it seems that the efforts made in the first semester weakened budgets for the second.However, a significant impact was seen in Digital, which grew 61.5% in the second quarter of 2019 compared to the same period of the previous year, when the quarterly growth for Q2 compared to the previous year has historically been around 27%.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The variation observed is due to a higher than expected growth in digital during the second quarter (61.5%) while the first semester had grown by 31.4%, with respect to the same period of the previous year respectively.

This growth can be attributed to, among other things, events such as the Football World Cup, since there was a greater participation of categories associated with football sponsorships or the Colombian National Team.

The economic contextIt was expected that 2018 would mark the beginning of the economic recovery after three years of low growth and, in fact, to date the expectation has been somewhat exceeded: at the beginning of the year it was expected that the GDP would grow just above 2% and now 2.6% is expected, driven by issues such as an unexpected increase in oil prices and an improvement in consumer confidence indexes. It is expected that this growth will be consolidated in 2019, although recently some uncertainties have been generated by a new government project for tax reform.

AD SPEND PERFORMANCE BY CATEGORYThe main category is still Commerce/Tourism although it is estimated that it will not present major changes compared to last year, in fact it is expected to fall by -0.3%.For 2019 Civic Campaigns and Government turn out to be the second most important category, expected to grow 57.5% due to the presidential campaigns.

Telecommunications will grow 12.0% and is the third most important category. Automotive is expected to decrease by 18.1%.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDOn the one hand, an increase in demand is expected given some improvement in the confidence indicators of the consumer (ICC) which in September 2018 reached a value of -0.7%. Although still in negative territory, this is much better than what it was last year (-10.3%). On the other hand, digital media continues to grow in penetration, unlike offline media. According to the General Media Study (EGM) internet is already consumed by 77% of the population (15 main cities).

COLOMBIA: ‘Economic recovery begins to have a positive effect on ad spend’



2018 2019f 2020f

Colombia 3.1% (1.0%) 4.3% (6.2%) 3.9%




2018 vs. 2017YOY%

Commerce, tourism 789,692 -0.3%

Civic and government campaigns 662,416 75.5%

Telecommunications 555,278 12.0%

Cosmetics 465,328 -11.3%

Pharmaceutics 457,913 -13.7%

Food, confectionery 408,403 -4.5%

Services 374,597 0.0%

Drinks 313,860 -14.4%

Financial, insurance 304,653 14.4%

Fun and entertainment 234,635 -7.6%


157

‘DIGITAL LEADS THE GROWTH FOR 2018’


a.Print media shows the greatest decline in advertising investment and the consequential loss of market share.

Part of the decline in investment may be associated with its progressive decrease in audience, which has likely moved to digital versions.

b.Radio has managed to maintain its position in market share; 2018 turned out to be a year in which radio presents an acceptable growth, after a couple of years of low performance.

c. Digital is the medium with the highest growth rate and is approaching second position in market share: it is already close to 15% of SOI and in a couple of years it could be consolidated as the second medium in SOI.

d.In spite of its low SOM, OOH remains in force and a relevant media for different categories and advertisers; in fact, it sustains and improves its SOM.

e.Television is still the medium with the highest SOI, which is still over 50%, but it is estimated that in the next few years it will start to fall below this level.


158

Colombia Data Tables



2018 2019f 2020f


Newspapers -5.6 3.1 -0.5

Magazines -7.9 0.6 -2.1

Radio 5.9 -0.2 1.5

Cinema 0.5 7.4 3.9

OOH 5.4 12.7 6.9



2018 2019f 2020f





Paid Search 37.3 25.0 21.2


Mobile^ 37.3 25.0 21.2



2018 2019f 2020f




Radio 13.8 13.2 12.9

Cinema 0.3 0.3 0.3

OOH 3.3 3.6 3.7



2018 2019f 2020f

Total Digital* 100.0 100.0 100.0




Paid Search 19.4 19.4 19.4


Mobile^ 47.0 47.0 47.0



159

LATEST KEY AD SPEND TRENDS• Political campaigns expected to be on the minds of the Mexican population

during the last weeks of Q2, as the election day came closer (July 01), and the initial weeks of Q3. The first 100 days of the new government (from Dec 01, 2018) will surely hold special attention, mostly ondigital channels.

• TV, the largest medium, addressed much more advertising than the last forecast, despite audiences still falling since the last years. The aforementioned political campaigns and the Olympic Games both contributed to this increase. • OOH and Digital media also had a light uplift, mostly caused by the

political campaigns.

THE 2019 AD SPEND FORECASTTotal ad spend is expected to reach 5.2 billion USD (96.5 billion Mexican pesos). The increase versus 2018 (+6.6%) will be caused by the maintenance of advertising costs by the bigger media players and the America’s Cup taking place next summer. This event will be the most important showcase that brands should consider.

Global or local events to boost spend in 2019The next America’s Cup that will take place this year in Brazil (Jun 14 – Jul 07). It will receive special attention from the Mexican population because of soccer popularity all across the country.

THE 2018 AD SPEND FORECASTInnovation and digitization is dictating the market, for publishers and advertisers as well. Technology is aiding advertisers to deliver an ad in a more effective way and to offer a better experience for consumers or audiences. Even market solutions to measure campaign and media investment performance are being innovated with AI solutions, trends that are shaping a new point of view for measuring advertising.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The most relevant change has been in TV advertising, passing from a decrease to an increase. As previously highlighted, this media channel had an important role during the political campaigns and the Olympics. As a massive medium, it was more suitable to reach big audiences than any of the other ones. Digital and Out of Home saw a light increase too, due to the political campaigns.

The economic contextIt’s important to highlight that unemployment has been falling to minor levels each year for more than 4.5 years, which is a healthy indicator of economic development.

It is also important to have in sight that the Mexican economy is strongly dependent on the US economy and the dollar exchange rate. For almost 3 years, the exchange rate has been more or less frozen. However, experts believe that the dollar will exceed these average levels in 2019.

AD SPEND PERFORMANCE BY CATEGORYIn the case of self-service and retail stores, 39% of the investment is in the top 5 stores: Walmart, Chedraui, Liverpool, Soriana and ComercialMexicana. Walmart is the fastest growing, 2017 vs 2016 (122%).Beers represent on average 75% of the investment in the category of alcoholic beverages. The two main groups, Cerveceria Cuauhtémoc and Grupo Modelo, have a very closed SOI (53% and 47%) respectively.

The category of craft beers still has very little participation, but with an increasing tendency.In the case of soft drinks, Coca Cola and Pepsi are the leaders in the investment of media, with greater use of Television within the media measured by IBOPE.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDAs shown in the table below, TV has lost relevance for audiences and non traditional media is filling this space. Mobile is breaking through all media trends, showing important increases year to year. This is impossible to ignore with the mobile component being present in media plans for most campaigns, even for massive products.

MEXICO: ‘Growth and continuous market change’



2018 2019f 2020f

Mexico 7.9% (4.4%) 6.6% (6.8%) 5.0%




2018 vs. 2017YOY%

Retail stores $19,160 2.6%

Internet $13,513 17.0%

Department stores $10,001 -6.0%

Shampoo $9,055 -14.0%

Multisector $7,467 4.4%

Beer $6,982 -7.3%

Sodas $6,579 -23.3%

Banking $6,434 38.6%

Other industries $5,663 13.5%

Mobile $5,638 -12.8%

Previous forecasts in brackets from June 201895% 94% 92% 90%

44% 48% 56% 60%45% 45% 44% 42%40% 44% 47% 48%

65% 65% 67% 68%

32% 33% 37% 40%

0%

50%

100%

2014 2015 2016 2017

Open TV Paid TV Newpapers Magazines Radio Cinema

53% 57% 58% 60%51%72% 82% 85%

55% 57% 60% 64%

30% 38% 46%58%

34% 37% 40% 44%30% 36% 40% 47%

63% 66% 70% 74%

2014 2015 2016 2017

Display Mobile Search Print Online Online Video Online Radio Social Media

160

‘OPEN TV CONSUMPTION MODIFIED DUE TO GROWTH IN DIGITAL SCREENS’


a. TelevisionTelevisa maintains their cost per rating point. They will perform an analysis of each client regarding category behavior, target and audience with the objective of offering an adhoc plan to each client with traditional spots, product placement and digital.Tv Azteca will have a new scheme for 2019, offering audience guarantee under the model called CPM (Cost per Thousand) with two models of purchase (free and horizontal). The horizontal model will allow for having spots in their 4 channels at the same time.Imagen TV maintains the CPR as the essential way of commercialization.Additionally, Open TV is evolving into digital platforms and Pay TV. The consumption of Open TV has been modified due to the growth inDigital screens.In 2019 Broadcaster Dish will have a new channel on Open TV, with their own programming for a multitarget audience.

Paid TV is increasing their digital platform and they are maximizing their content using the strength of influencers.

b. Print-newspapersThis medium is affected mainly by digital. Advertisers are migrating to digital platforms and so newspaper publishers are adding digital components to reach digital audiences too.

c. MagazinesSimilar to newspapers, advertisers are more likely to choose digital magazine platforms (influencers) instead of print. There are however some advertisers that still consider it as their main point of contact, such as perfumes or luxury products for example.

d. OOHThe new government of Mexico will continue the initiative of regulating this medium in an effort to decrease visual saturation affecting the image of the city.Digital OOH continues to grow. This format is taking big steps in evolving a new way to buy OOH using geolocation and programmatic for the future.

e. RadioThis medium continues with the same business scheme of cost per spot.

f. CinemaCoverage continues to expand based on the increased number of movie theaters - the accelerated growth of construction, specifically of shopping malls, has increased the number of complexes and made movies more accessible to greater numbers of people.

g. DisplayThere has been no change in formats.

h. Audio syncAudio Sync: Digital Sync is increasing in the Mexican market and this year we can connect our radio campaign using audio sync.

i. Programmatic TVProgrammatic TV: Dish, Totalplay & Decidata launched TV programmatic in 2018, and in 2019 we are going to test their new way of buying TV.

j. VR & IA (CHAT BOT / Machine learning)Business Intelligence claim that 8% of internet user of smart speakers have used voice to shop.The second iteration of Snapchat’s Spectacles are projected to include AR functionality.

k. DOOHDOOH: Nowadays only Clear Channel have the technology to sell programmatic audiences on OOH, the benefits of using DOOH is that it allows the changing of ads “in real time”.

l. Brand content • Content continues to grow from 8% to 13 % vs 2018.

• The personalization of content will be leading the strategies based on data generation.• 80% of it led by video content.• Fast content becomes the new ads.

• Messaging apps start as new channel for content distribution this year. • VOD the principal ambition for clients.

• From the client perspective, the ROI is much more efficient.

Notes:There is uncertainty about the new government starting in December 2018. We need to be alert for any factors that could impact media consumption.


161

Mexico Data Tables



2018 2019f 2020f


Newspapers -1.0 0.5 0.3

Magazines -0.6 0.5 0.3

Radio -1.0 0.5 0.3

Cinema -5.6 -2.2 -2.3

OOH 1.4 1.5 1.3



2018 2019f 2020f


Display (Banners) 12.7 -8 4.1

Online Video 42 39.5 16.9


Paid Search 18.4 18.1 12.3


Mobile^ 35.8 25 21


2018 2019f 2020f




Radio 5.9 5.6 5.3

Cinema 0.7 0.6 0.6

OOH 6.0 5.7 5.5



2018 2019f 2020f



Online Video 34 40.5 42.3


Paid Search 31.6 31.9 32


Mobile^ 63.8 68.1 73.6


162

Middle East & North Africa Market

163

LATEST KEY AD SPEND TRENDS• More production of local content, more channels, and lower total ad spend

– Opportunity to explore barter deals and branded content within overall media deals.

• Streaming and OTT will continue to rise as more stations attempt to create their own VOD platforms – Build relationships with early supporters of VOD platforms with joint deals and potential content deals.• Out of home entertainment (Cinema & Event) will rise in KSA – this means

clients should build relationships with KSA’s General entertainment authority & expand the cinema strategy.

THE 2019 AD SPEND FORECAST• The ad spend growth forecast is negative, which means that the spends

will continue to drop in 2019.

• Print is the most affected medium with a 20% drop across markets followed by TV which is 9%. • The fastest growing medium is Online which includes Social/Search

and Mobile.• The growth of online advertising is at a rate of 5% year on year basis.

• Looking at the Middle East and North Africa region, the fall in oil prices since 2014 has had a severe effect on these economies, but the rise in oil prices since last year has given some confidence back to the advertisers. This will help to move from the decline in ad spend in 2019 and start growing ad spend from 2020 onwards.

Global or local events to boost spend in 2019• For next year, one of the biggest events is Copa America (Football). • Soccer has been a popular sport in the region, but Copa is not as popular

as the World Cup or European football leagues.• Usually sporting or political events do not drive the advertising spends.

THE 2018 AD SPEND FORECAST• There is a huge shift in spends from traditional media to digital media.• Overall in the MENA region there is a drop in spends by 9% over 2017.

Also, the big events like the World Cup haven’t increased the spends. The spends in this region are based on oil prices, real estate, and tourism.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)Overall budget cuts or no growth Vs. 2018. The changes in ad spends is mostly from the Print medium, which is dropping at a rate of 20% and more on a YOY basis. TV has also shown a decrease of 10% on average. Digital spend has increased by single digits instead of the usual double digit growth.

The economic contextHigher oil prices and increased production are supporting economic growthEconomic growth among the countries within the Gulf Cooperation Council (GCC) escalated to a one-and-a-half year high, as the sub region strongly benefited from a near 50% year-on-year increase in oil prices.

Introduction of a value added tax (VAT) in Saudi Arabia and the UAE, has affected the drive of private sector’s performance.On the downside, the rise in oil prices has slowed the implementation of much-needed economic reforms in the sub region, and could hit potential growth among GCC countries.

AD SPEND PERFORMANCE BY CATEGORYThere is a drop in spends in a few categories. However, at the same time the Public Sector, Real Estate and Chocolate have shown an increase of double digits for spends in 2018 over 2017.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OFAD SPENDSome of the key trends driving change in the consumer profile:

Alternative Channels – outside the regular traditional retail stores, online stores and mobile apps are making headlines.Digitization – computers and smartphones are key to day-to-day lives and activities.Ecommerce – order online and delivery on the same day.Safety and Trust – search for more safe and healthy advertising.Shopping behaviour – more research done before buying products and so consumers are looking for more informative ads.

MENA Region: ‘Print takes biggest hit, followed by TV’



2018 2019f 2020f

MENA Region - 9% - 8% - 2%




2018 vs. 2017YOY%

Telecommunication 587 -4.5%

E-commerce 569 1.4%

Public sector 435 21.8%

Cars 414 -22.6%

Real estate 357 7.8%

Banking 317 1.3%

Restaurant 316 -15.3%

Chocolate 315 39%

Theater & cinema 296 2.3%

Shampoo 281 -1.3%


https://www.focus-economics.com/countries/saudi-arabia

https://www.focus-economics.com/countries/united-arab-emirates

164

‘DESPITE LACK OF MEASUREMENT, DIGITAL SHOWING GROWTH IN MIDDLE EAST’


a. TVTV has contributed to 60% of the total media spends and forecast for 2019 is 55%. So there is a drop in TV spends and budget has been movingto digital.Focus for 2019 TV will be on reality shows in order to increase the viewership and ratings.More influencers are being used in TV commercial productions (especially in the automobile and fashion industries).

The international news TV stations are focusing more on local and Arab news, the news readers are well known and more local flavored, alsodriving viewership.

b. PrintYear on year spends growth on print has been on the decline.Influencers are promoting brands in the fashion and beauty category.

There are more photo shoots in magazines which helps catch the attentionof readers.Print titles, especially magazines, are being closed down since last year and some titles are moving from print to digital.

c. RadioRadio has been an important medium in ME and has seen a marginal growth in advertising. Due to demand. a new radio station has been launched. Radio is an important medium in the region especially in the morning and evening drive time.

Launch of news programs catering to the older audience.Radio is seen as a promotion medium for most on ground events, which drives the sales of tickets and creates a hype in the market.

d. DigitalDigital spends are not monitored exactly however, digital has shown growth in the Middle East.

Clients focus on content creation, video production, performance andtech suppliers.Increase in Mobile and video spends, forecast at 9% and more in 2019.

YOY spend on Social & influencers marketing has increased to 15% on average in the region – expectation for this to have a single digit growthin 2019.The campaign’s Quality focus is now on high viewability and premium inventory.There is a launch of Music apps in the region, like Spotify and Deezer, which will be more popular among the target audience.


165

MENA Region Data Tables



2018 2019f 2020f

Television 0% 0% 0%

Newspapers 0% 0% 0%

Magazines 0% 0% 0%

Radio 3% 1% 0%

Cinema 3% 2% 2%

OOH 3% 2% 2%



2018 2019f 2020f


Newspapers 2% 1% 1%

Magazines 2% 1% 1%

Radio 3% 4% 5%

Cinema 6% 7% 7%

OOH 13% 14% 14%


166

LATEST KEY AD SPEND TRENDS• Market witnessing major consolidation of concessions for key TV networks,

leading to monopolization and less negotiation flexibility on pricing.

• Direct CPM buys slowly diminish with clients moving towards performance-based platforms and sponsorships/takeovers.• With the growth in client investments on digital media, their strategies are

becoming more conversion-centric.

THE 2019 AD SPEND FORECAST• Increasing client budgets behind YOY inflation, yet we are expecting more

strategic budget allocation to digital and possibly a cut in the high investments towards TV. This is due to the diminishing TV landscape and less premium content varieties.

• Despite this, the TV market spend figures are most likely to increase since clients are being forced to increase budgets on TV for efficiency and impact, due to very high inflation YOY and increasing content pricing behind high production formats.

Global or local events to boost spend in 2019There are no announced critical events so far that will impact advertising spend in 2019.

THE 2018 AD SPEND FORECAST Egypt qualifications to the World Cup has positively driven overall media investment growth, given that clients established new campaign platforms to support the WC over and above their marketing calendars, driving additional budgets and investments. Also, since Ramadan and the World Cup occurred back to back this year, advertisers have increased their investments during Q2/Q3 respectively.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)Overall YOY growth % is the same as previously reported, however some categories have witnessed variations in % growth/drop in spending due to the fact that media activities and investments started earlier in the year 2018 vs. previous years. This is because of the World Cup as commonly most client activities and launches will take place towards Q2.

The economic contextEgypt is expected to pay billions of its foreign debts in 2018 and Inflation was contained towards the end of the year and fell throughout 2018 Q1. The Central Bank of Egypt is committed to bring down the inflation rate by the end of 2018. Growth, in the meantime, is expected to gain momentum in the 2017-2018 fiscal year with a recovery in private consumption and investment as well as in exports. Economic growth is expected to remain robust this fiscal year and next. Increased government investment spending, rising natural gas production, an improved regulatory environment and construction activity related to the building of the new capital city should boost activity.

AD SPEND PERFORMANCE BY CATEGORY• Telecommunications, Real Estate and Banking are the top 3 category

spenders throughout 2018 YTD.

• Telecom, Soft Drinks and Shampoo are witnessing significant spend growth throughout 2018 YTD, other categories also showing spend increase are Chocolates, Public Sector, Electronics and Household Appliances. • Other categories have witnessed a drop in spending such as Medical

Servicing and Holiday Resorts.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDDue to the economic recession that has hit the country in recent years, 71% of Egyptians now say they look for promotions, while 35% of them shop less often, and 17% have reduced the quantities of their grocery shopping (Nielsen Survey 2017). Based on this change in purchasing behavior, advertisers have become more focused on promotional communications.

EGYPT: ‘Communication opportunities created by World Cup, driving more budget into 2018’



2018 2019f 2020f

Egypt 19.8% (19.8%) 9.0% (9.0%) 17.8%



2018 YTD Gross Local Currency

2018 YTD vs. 2017 YTD

YOY%

Telecom 8,404,412,036 261%

Real estate 7,185,814,865 39%

Banking 4,833,898,829 39%

Medical servicing 2,487,544,348 -35%

Holiday resorts 2,479,469,840 -2%

Public sector 2,212,121,695 67%

Soft drink 1,578,117,150 115%

Electronics and household appliances 1,560,169,308 44%

Shampoo 1,487,783,582 105%

Chocolate 1,388,626,647 71%


167

‘ADVERTISERS ADOPTING MOBILE-FIRST THINKING’


a.Less budget being plugged into TV, which is driving more budget into digital. However this trend is not yet obvious looking at the spend figures, given that efficiency on digital requires much lower budget levels vs. TV and hence the actual impact of this trend on TV investments will not be noticeable.

b.Investments in performance-based platforms have exceeded Display ad spends in 2018.

c.Display networks and programmatic have become available on most local websites, leading to a slight drop in direct CPM buys.

d. Facebook penetration is around 93% of Egyptian internet users, becoming a leading platform for digital advertisers.

e.Content has become a focal point for some of the largest Telecom and FMCG advertisers, driving branded generated content.

f.Advertisers have adopted mobile-first thinking, following that mobile drives most of the traffic across the top performance-based and display platforms.


168

Egypt Data Tables



2018 2019f 2020f

Television 24.0% 10.0% 20.0%

Newspapers -30.0% -9.9% -14.6%

Magazines -33.3% 0.0% -25.0%

Radio 32.9% 9.9% 4.5%

Cinema n.a n.a n.a

OOH n.a n.a n.a

Total Digital n.a n.a n.a


2018 2019f 2020f

Television 89.8% 90.6% 92.3%


Magazines 0.2% 0.2% 0.1%

Radio 5.3% 5.3% 4.7%

Cinema n.a n.a n.a

OOH n.a n.a n.a

Total Digital n.a n.a n.a

169

LATEST KEY AD SPEND TRENDS• There has been no significant changes in this market in 2018 to warrant

any correction of the forecast data.

• The political situation remains volatile which affects the economy of the country. We had elections during the month of May however they did not affect the economic crisis in Lebanon.

THE 2019 AD SPEND FORECAST• Ad spend in 2019 should be similar to 2018 granted the economical and

political situations remain the same.• Global or local events to boost spend in 2019

• Nothing in the pipeline.

THE 2018 AD SPEND FORECAST • Our market was not affected by the world events in 2018.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)• No major changes yet and no talks about any evolution.

The economic contextThe economic situation is stable in Lebanon in terms of the local currency versus the USD. However, any political issues could affect the spends in the market.

LEBANON: ‘Political situation remains volatile’



2018 2019f 2020f

Lebanon -0.2% (-0.2%) 4.4% (4.4%) 1.5%




2018 vs. 2017YOY%

Banking 229,926,753.87 18%

Beer 53,234,287.00 6%

Telecommunication 43,434,424.50 83%

Cars 42,294,932.77 4%

Jewelry 35,502,174.40 6%

Shampoo 31,365,289.00 159%

Washing detergent 30,771,691.00 21%

Cheese 29,767,737.48 21%

Furniture 29,014,038.43 24%


170

‘HIGHER PROGRAMMATIC SPEND FORECAST FOR NEAR FUTURE’


Social Media spends are increasing with time, clients are shifting their strategies to Always On paid social by promoting posts on the page to increase continuous engagement.

• Mobile spends are growing at a low pace.• Online video is getting a higher share of spends versus previous years.• Programmatic spends are still at minimal, however we do forecast higher

spends in the near future.

• TV continues to get the largest share of media spends and is the battlefield to any active category.• Radio has witnessed positive growth of 90% from 2005 to date, although

there is a slight declining trend in listenership.

• Some magazines launched their online versions. • Longstanding respected newspapers are adapting to consumer demand

through digital capabilities, as is visible from the cross-media presence of the top 5 newspapers.


171

Lebanon Data Tables



2018 2019f 2020f

Television -1.7% 4.7% 2.9%

Newspapers 0.7% 0.0% -15.4%

Magazines -15.0% -1.0% 0.0%

Radio 6.8% 6.3% 2.9%

Cinema 138.1% 3.3% 6.5%

OOH 1.8% 5.0% 2.0%

Total Digital N/A N/A N/A


2018 2019f 2020f

Television 51.5% 51.7% 52.4%


Magazines 3.8% 3.6% 3.6%

Radio 7.1% 7.2% 7.3%

Cinema 0.7% 0.7% 0.7%

OOH 31.1% 31.3% 31.4%

Total Digital N/A N/A N/A

172

Rest of World

173

LATEST KEY AD SPEND TRENDS• Rapid digitization is seeing the growing convergence of the entertainment and

media industries. As a result, the battle for the consumer’s attention is becoming increasingly evident across various sectors. Furthermore, this is leading to a plethora of media platforms that are creating digital extensions for themselves e.g. Digital OOH, Radio Podcasts, TV streaming services as well as applications as a means to access content.

• Media research is still in a state of flux, with lack of consensus for some data as well as best practice methodologies. Forecasting accurate results and conducting adequate trend analysis is thus an ongoing challenge within the South African landscape. This causes complications for budgeting and auditing. Creative use of data, such as fusion and mining alternative sources e.g. social media trends, will start to gain more traction over the coming years.

• Change in presidency mid February 2018 has resulted in extreme inflation and VAT prices. This has reduced consumer buying power which is expected to change in 2018, with multiple basic consumer goods expected to see zero rated tax. Hopefully this will shift consumer buying power positively.

THE 2019 AD SPEND FORECAST• 2019 is expected to see good growth in advertising spend at 6.6%. There are

a number of reasons for this; by 2019 the new economic policies that are being put in place to encourage growth and investment should be taking effect; positive sentiment will influence budget size and attitude; policies around jobs and education should see the unemployment rate going down slightly. The elections in 2019 will see additional advertising spend both around the elections and starting to build momentum in 2019.

• Potential changes to social media polices on advertising and data mining (i.e. privacy) and changes in legislation around alcohol advertising may impact spend in this area. However, spend share is still relatively low (although growing slowly) in South Africa and will not significantly effect advertising spend as a whole.

Global or local events to boost spend in 2019The South African advertising market is only impacted by very major sporting events (i.e. mostly football World Cup and local elections, and to a lesser degree Rugby & Cricket events). The US election does not have a marked impact on local spend or behaviour. Interest and advertising around events such as the Olympics and World Cup also tends to be limited to specific audiences (i.e. young men) although one can see a general increase in media coverage, which can impact on programming, ratings and behaviour. Due to political instability and low purchase power in 2018 however, the Football World Cup did not sway advertising spend significantly with only 5% growth year on year from Jan – Aug year to date. This is a clear indication that even though there are elections and the Rugby World Cup in 2019, this is not expected to yield significant changes in advertising investment growth overall.

THE 2018 AD SPEND FORECASTThe South African advertising industry was impacted severely by the economy which saw a slow growth trajectory, with declines in spend across TV, Print, Cinema etc. However, growth in digital spend is increasing year on year.There has also been an increase in the number of smaller specialist consulting agencies. The improving economy and more positive outlook will see the market stabilizing, however, media agencies must ensure that they are able to offer a full service, fully integrated and ROI based media solutions.

RATIONALE FOR ANY FORECAST CHANGES COMPARED TO THE PREVIOUS REPORT (JUNE 2018)The extent of the corruption and impact on the economy was unprecedented and the marketers reacted rapidly to the poor outlook by cutting budgets and reducing their risk and exposure to the South African market. Previously AC Nielsen was used to report on digital spend, however this has changed since 2018. PWC is now the source being used to forecast digital spend which has an entire new methodology. Significant increases and year on year growth in the digital reporting are likely to occur.

The economic context2017 was a year of huge uncertainty in South Africa. There was significant corruption among political leaders (i.e. allegations around President Jaco Zuma) and large public entities (i.e. Steinhoff). This had a very negative effect on the economy. S&P Global and Fitch downgraded South Africa’s credit rating to full

junk status, the lowest level since 2000. Business confidence was low, falling to an index of 29 in July 17. This resulted in many international and local companies failing to invest at the expected levels. On the positive side, the

election of Cyril Ramaphosa as President has seen a positive swing in attitude, and economic forecasts are expected to improve even though South Africa is experiencing a technical recession.

AD SPEND PERFORMANCE BY CATEGORYRetail is expected to see 7% growth for the forecasted 2019 period. The Homecare category is forecasted to see the greatest investment at 27% year on year growth in the South African market based on year to date over the past two years. In April 2018 there was an increase in VAT from 14% to 15%. This will have significant impact on consumers. Both retail and FMCG brands will have to reassure consumers, as this is where it is most felt. Positive economic outlook should encourage both sales and competition for larger priced items such as motor vehicles.Tourism also needs to work hard to recover lost ground from 2017. We are also likely to see a growth in Government spending to inform the public on changes in the unstable economic times within the South African landscape.

CONSUMER TRENDS DRIVING CHANGES IN THE PROFILE OF AD SPENDBefore the technical recession, there was inflated reporting of entertainment and media industry predictions. However, with consumer spending on the decline year on year by an average of 0.8% (PWC), there is increasingly a lack of investment in media. Advertisers need to be more savvy in the way they are optimising their media investments or significantly increase their media spends to get valuable exposure.

SOUTH AFRICA: ‘Content, social responsibility and brand safety are key to driving brand messages in South African economy’



2018 2019f 2020f

South Africa -3.8% (2.9%) 6.6% (4%) 6.6%



Top 10 categories 2018 2018 vs. 2017Yoy%

Retail 7%

Financial services 0%

Fmcg - health & beauty 7%Automotive 5%Travel sport and leisure 10%Multimedia 6%Fmcg - beverages 11%Fmcg - food -10%Professional services 1%Government education & health 18%Fmcg – homecare & homeware 27%

174

‘DROP IN TELEVISION AD SPEND FOR FIRST TIME IN SOUTH AFRICANHISTORY’


a.Television remains the largest medium and will continue to grow for the foreseeable future. However, for the first time in South African television history, there was a drop in advertising spend since 1996 (earliest data available). This was a result of the cut or total withdrawal of some major advertisers. Business to business and government had negative growth, spending less in 2017 than 2016. Beverages are expected to see a reduction in spend due to the increase in legislation around alcohol advertising. However, digital spend within these sectors are anticipated to see incremental growth. Automotive, Retail, Financial services, Multimedia and Tourism sectors also cut spend from 2016, although showing only slight growth, not at usual levels.

On the positive side for 2018, television data is becoming more stable and trends will start to emerge, making planning more predictable. On demand television/streaming is growing and the traditional linear way of viewing television/any medium is changing. Second screening is growing rapidly especially amongst the younger millennials which has its own challenges for advertisers, as consumer attention spans are depleting and the demand for content marketing is defining the means of communications going forward.

b.Radio’s popularity fluctuates as it is seen as a more tactical medium by advertisers, however its share of spend continues to grow, particularly in the Government, Retail, FMCG and Travel and Leisure sectors. Radio streaming is growing, particularly among younger audiences and will become increasingly important as data costs come down and WIFI access increases. Radio saw an unusually high increase in advertising spend in 2017. This was partly due to marketers shifting money from television to a medium that is more flexible, has a lower entry point and which tends to perform well on call to action campaigns. Smaller local stations are gaining both listeners and advertising money. Their ability to customize campaigns to suit the marker is an incentive. Radio podcasts and live streaming is also a growing trend amongst the South African consumer.

c. The line between traditional media and digital media is blurred – consumers want more flexibility and freedom in how they consume content.After more than a decade of digital disruption, the African entertainment and media industry has entered a new landscape – one where the media is no longer divided into distinct traditional and digital spheres, according to a report from PwC titled Entertainment and media outlook 2018 – 2022 (South Africa – Nigeria-Kenya). The Outlook forecasts that South Africa’s entertainment and media industry is expected to grow from R129.2 billion in 2017 by 7.6% (to R139 billion) by the end of 2018, at a compound annual growth rate (CAGR) of 6.5%.

d.Social media is becoming the key to a successful marketing campaign, both as a platform and as an information tool. Utilizing social listening, marketers need to be flexible and agile to ensure that strategies align with the opinions and attitudes of the market, while still being sensitive around issues of privacy. This is as relevant in South Africa as in other countries. Consumers want to be treated as individuals and it is important not to let technology get between your brand and your customer. The ‘human’ approach; showing a genuine interest in their opinions is key to keeping a positive brand reputation. Content needs to be relevant and authentic. Local South African content, whether a video on Instagram or a Facebook post, needs to be accessible and current to have greater success in capturing the most endearing consumer. Using social media as a communications tool is ever more important in building an authentic relationship between the brand and consumer, acting as a means to building brand equity.

e.Long and short forms of video content have taken off in South Africa. There was a large growth in live streaming on social media platforms in 2017 and this is growing exponentially in 2018. Video story telling allows a brand to be both relevant and engaging whilst still supplying brand information. Despite the still high cost of data in South Africa, smart phone access proliferates, enabling internet and video access across a broader sector of the South African population. There is a move in South Africa to explore the right to universal access to online information, to declare internet access a basic human right – to give all South Africans basic minimum levels of access to free public Wi-Fi and through it, content. YouTube saw a decline in investment from blue chip clients due to questionable content but internet spend is increasing in share of ad market overall. As is the case globally, brand safety and transparency are key issues in the South African market. Internet access will represent 44% of the market in 2022, with a projected 11 million new unique subscribers by 2022.


175

South Africa Data Tables



2018 2019f 2020f

Television 1% 7% 7%

Newspapers -14% 4% 4%

Magazines 23% 4% 4%

Radio -12% 10% 10%

Cinema -32% 2% 2%

OOH -17% 2% 2%



2018 2019f 2020f







Mobile^ 5% 11% 8%


2018 2019f 2020f


Newspapers 13% 13% 13%

Magazines 6% 6% 6%

Radio 18% 18% 18%

Cinema 1% 1% 1%

OOH 3% 3% 3%



2018 2019f 2020f




Social Media X X X



Mobile^ 33% 34% 34%


176

Appendices

177

Global Market Sizes & Growth Rates


COUNTRY BY COUNTRY MARKET SIZES AND GROWTH RATES

MarketAdspend (US$m) at current prices % Change

2016 2017 2018 2019f 2020f 16 vs 15 17 vs 16 18 vs 17 19f vs 18 20f vs 19f

Austria 3,271 3,400 3,473 3,523 3,569 5.6 4.0 2.1 1.5 1.3Belgium 4,840 5,067 5,081 5,165 5,296 6.4 4.7 0.3 1.7 2.5Denmark 2,161 2,234 2,256 2,306 2,331 3.6 3.4 1.0 2.2 1.1Finland 1,390 1,394 1,399 1,415 1,427 1.1 0.3 0.3 1.1 0.9France 12,853 13,196 13,675 14,097 14,453 1.1 2.7 3.6 3.1 2.5

Germany 18,327 18,712 18,908 19,010 19,111 2.8 2.1 1.0 0.5 0.5Greece 469 490 512 535 557 4.2 4.5 4.5 4.5 4.0Ireland 991 993 1,020 1,065 1,126 3.9 0.2 2.7 4.4 5.7Italy 8,792 8,873 9,019 9,095 9,240 3.5 0.9 1.6 0.8 1.6

Netherlands 4,611 4,691 4,780 4,877 4,982 2.7 1.7 1.9 2.0 2.1Norway 2,130 2,229 2,254 2,300 2,339 -2.0 4.7 1.1 2.0 1.7Portugal 554 573 592 608 626 5.2 3.2 3.4 2.7 2.9Spain 6,382 6,515 6,633 6,713 6,767 6.8 2.1 1.8 1.2 0.8

Sweden 3,662 4,009 4,267 4,461 4,478 9.8 9.5 6.4 4.5 0.4Switzerland 4,170 5,147 5,446 5,831 6,223 2.9 23.4 5.8 7.1 6.7

UK 24,919 26,382 28,109 29,835 31,962 7.1 5.9 6.5 6.1 7.1Western Europe 99,523 103,904 107,423 110,835 114,487 4.4 4.4 3.4 3.2 3.3

Bulgaria 212 222 242 259 278 2.5 4.7 9.1 6.9 7.3Czech Republic 719 762 805 876 968 9.0 6.0 5.7 8.8 10.5

Estonia 128 135 140 146 151 4.4 5.2 3.6 4.3 3.7Hungary 674 761 855 890 933 3.4 12.9 12.4 4.1 4.9Latvia 98 103 108 111 116 5.3 5.7 4.6 2.6 4.8

Lithuania 167 176 182 190 197 17.3 5.0 3.9 4.3 3.6Poland 2,313 2,368 2,521 2,648 2,788 2.7 2.4 6.5 5.0 5.3

Romania 289 322 345 367 392 6.0 11.4 7.0 6.5 6.8Russia 6,935 7,930 8,884 9,492 10,130 12.3 14.3 12.0 6.9 6.7

Slovak Rep 333 346 369 390 412 5.9 4.0 6.7 5.7 5.5Turkey 1,530 1,491 1,417 1,417 1,460 42.9 -2.5 -5.0 0.0 3.0C&EE 13,398 14,616 15,869 16,787 17,827 12.0 9.1 8.6 5.8 6.2

Europe 112,920 118,520 123,292 127,623 132,314 5.2 5.0 4.0 3.5 3.7

178D E N T S U A E G I S N E T W O R K




USA 204,751 210,103 217,150 223,595 231,538 5.0 2.6 3.4 3.0 3.6Canada 8,696 9,175 9,517 10,013 10,523 0.1 5.5 3.7 5.2 5.1

North America 213,446 219,278 226,667 233,608 242,061 4.8 2.7 3.4 3.1 3.6Australia 11,246 11,508 11,938 12,225 12,545 4.5 2.3 3.7 2.4 2.6

China 84,844 90,223 97,229 104,050 110,699 8.8 6.3 7.8 7.0 6.4Hong Kong 2,641 2,433 2,441 2,436 2,431 -12.3 -7.9 0.3 -0.2 -0.2

India 7,652 8,334 9,132 10,096 11,270 49.4 8.9 9.6 10.6 11.6Indonesia 5,240 5,092 5,202 5,393 5,646 6.6 -2.8 2.2 3.7 4.7

Japan 57,216 58,151 58,239 58,615 60,003 1.9 1.6 0.2 0.6 2.4Malaysia 1,307 1,363 1,349 1,391 1,435 4.5 4.3 -1.0 3.1 3.2

New Zealand 1,712 1,793 1,830 1,887 1,964 0.2 4.7 2.0 3.1 4.1Philippines 3,562 4,479 4,906 5,395 5,922 23.4 25.7 9.5 10.0 9.8Singapore 1,918 1,702 1,557 1,440 1,359 20.6 -11.3 -8.5 -7.5 -5.6

South Korea 9,396 9,608 9,849 10,088 10,317 3.2 2.3 2.5 2.4 2.3Taiwan 1,773 1,728 1,744 1,770 1,794 -4.2 -2.6 1.0 1.5 1.3

Thailand 3,443 3,192 3,272 3,302 3,373 -7.8 -7.3 2.5 0.9 2.1Vietnam 1,449 1,509 1,592 1,678 1,763 7.6 4.2 5.5 5.4 5.1

Asia Pacific 193,400 201,115 210,280 219,768 230,521 6.6 4.0 4.6 4.5 4.9Argentina 2,814 3,863 4,869 6,087 7,271 38.4 37.3 26.0 25.0 19.4

Brazil 14,857 15,382 16,481 17,077 18,141 1.4 3.5 7.1 3.6 6.2Colombia 1,704 1,639 1,690 1,763 1,833 -7.3 -3.8 3.1 4.3 3.9Mexico 4,190 4,408 4,755 5,068 5,319 6.2 5.2 7.9 6.6 5.0

Latin America 23,565 25,292 27,795 29,996 32,565 4.9 7.3 9.9 7.9 8.6Bahrain 100 80 68 61 56 2.7 -19.6 -15.2 -10.2 -8.4Egypt 1,744 1,600 1,917 2,090 2,461 -7.6 -8.3 19.8 9.0 17.8Kuwait 374 348 333 314 300 -16.1 -7.0 -4.1 -5.9 -4.2

Lebanon 514 451 450 470 477 -23.5 -12.4 -0.2 4.4 1.5Morocco 753 793 823 823 869 2.3 5.2 3.8 0.0 5.6Oman 129 108 100 86 79 -14.9 -16.0 -7.1 -13.8 -9.1

Pan Arab 4,899 4,028 3,632 3,191 2,933 -0.6 -17.8 -9.8 -12.1 -8.1Qatar 243 202 182 162 150 -17.8 -17.1 -9.9 -10.7 -7.3

Saudi Arabia 839 735 661 596 551 -16.0 -12.4 -10.0 -9.9 -7.6UAE 1,479 1,311 1,225 1,149 1,125 2.8 -11.3 -6.6 -6.2 -2.1

MENA 11,074 9,655 9,391 8,942 9,001 -5.0 -12.8 -2.7 -4.8 0.7Israel 992 1,029 1,060 1,091 1,123 2.5 3.7 3.0 2.9 2.9

South Africa 3,472 3,415 3,286 3,502 3,734 7.5 -1.6 -3.8 6.6 6.6Other 4,464 4,444 4,346 4,593 4,857 6.3 -0.4 -2.2 5.7 5.7

GLOBAL 558,870 578,303 601,772 624,530 651,319 5.3 3.5 4.1 3.8 4.3

179

Television Market Sizes & Growth Rates





Austria 654 696 738 776 824 7.9 6.4 5.9 5.2 6.2Belgium 2,082 2,041 2,141 2,201 2,264 10.9 -2.0 4.9 2.8 2.9Denmark 359 352 352 345 338 2.1 -2.0 0.0 -2.0 -2.0Finland 301 286 284 281 274 -1.1 -5.1 -0.5 -1.0 -2.8France 3,872 3,910 3,962 3,994 4,034 0.4 1.0 1.3 0.8 1.0

Germany 5,991 6,033 5,952 5,878 5,808 3.1 0.7 -1.3 -1.2 -1.2Greece 261 284 303 324 343 6.3 9.1 6.7 6.7 5.9Ireland 262 239 233 238 247 1.9 -8.6 -2.5 2.0 4.0Italy 4,673 4,611 4,647 4,613 4,649 5.2 -1.3 0.8 -0.7 0.8

Netherlands 1,179 1,152 1,148 1,130 1,107 0.4 -2.3 -0.3 -1.6 -2.1Norway 489 493 483 483 478 1.9 0.7 -2.0 0.0 -1.0Portugal 304 308 311 314 318 4.4 1.2 1.2 1.0 1.0Spain 2,525 2,550 2,504 2,457 2,408 5.5 1.0 -1.8 -1.9 -2.0

Sweden 631 643 677 674 644 -1.3 2.0 5.2 -0.4 -4.5Switzerland 911 918 916 934 970 7.6 0.8 -0.1 1.9 3.9

UK 6,022 5,877 5,888 5,865 5,982 4.7 -2.4 0.2 -0.4 2.0Western Europe 30,517 30,392 30,541 30,508 30,688 4.1 -0.4 0.5 -0.1 0.6


Estonia 29 30 31 32 34 -3.0 3.8 1.1 5.0 5.9Hungary 168 195 208 213 224 -1.0 16.3 6.3 2.7 5.0Latvia 40 41 42 42 42 -0.2 3.1 2.2 -0.1 1.5

Lithuania 58 59 61 62 63 5.6 2.7 2.0 2.5 2.0Poland 1,142 1,150 1,233 1,288 1,353 0.6 0.7 7.3 4.5 5.0

Romania 163 182 200 211 221 5.0 12.0 9.7 5.5 5.0Russia 2,876 3,251 3,598 3,715 3,836 10.3 13.0 10.7 3.2 3.3

Slovak Rep 162 175 188 200 208 13.3 8.1 7.5 6.3 4.2Turkey 779 762 736 739 768 51.3 -2.1 -3.5 0.5 3.9C&EE 5,817 6,267 6,737 6,959 7,222 11.1 7.7 7.5 3.3 3.8

Europe 36,334 36,659 37,278 37,467 37,910 5.1 0.9 1.7 0.5 1.2





USA 77,783 78,027 78,934 79,194 79,962 4.0 0.3 1.2 0.3 1.0Canada 2,209 2,316 2,386 2,410 2,434 -9.9 4.8 3.0 1.0 1.0

North America 79,992 80,344 81,321 81,605 82,397 3.6 0.4 1.2 0.3 1.0Australia 2,858 2,801 2,815 2,817 2,792 -2.8 -2.0 0.5 0.1 -0.9

China 29,706 28,072 26,388 25,332 24,826 -3.7 -5.5 -6.0 -4.0 -2.0Hong Kong 608 541 558 541 506 -9.2 -11.0 3.1 -3.0 -6.5

India 3,080 3,329 3,605 3,911 4,252 67.1 8.1 8.3 8.5 8.7Indonesia 2,901 2,774 2,816 2,957 3,105 7.3 -4.3 1.5 5.0 5.0

Japan 17,886 17,724 17,572 17,678 18,062 1.7 -0.9 -0.9 0.6 2.2Malaysia 239 243 234 243 253 3.0 1.4 -3.6 3.6 4.2

New Zealand 388 393 389 381 379 -7.0 1.3 -1.0 -2.0 -0.8Philippines 2,122 2,670 2,734 3,009 3,385 22.9 25.8 2.4 10.0 12.5Singapore 555 502 473 444 418 46.0 -9.5 -5.9 -6.1 -5.9

South Korea 3,419 3,335 3,366 3,397 3,430 -0.1 -2.5 0.9 0.9 1.0Taiwan 751 712 680 653 627 -6.7 -5.2 -4.5 -4.0 -4.0

Thailand 2,056 1,745 1,803 1,807 1,821 -12.3 -15.1 3.4 0.2 0.8Vietnam 1,263 1,281 1,353 1,415 1,481 6.3 1.4 5.6 4.6 4.7

Asia Pacific 67,834 66,122 64,785 64,584 65,334 1.1 -2.5 -2.0 -0.3 1.2Argentina 1,205 1,682 2,105 2,632 3,053 34.3 39.6 25.2 25.0 16.0

Brazil 10,876 10,970 11,812 12,084 12,809 12.8 0.9 7.7 2.3 6.0Colombia 943 874 873 879 887 -7.5 -7.4 -0.1 0.6 1.0Mexico 2,093 2,031 2,070 2,091 2,102 1.0 -3.0 2.0 1.0 0.5

Latin America 15,118 15,556 16,861 17,685 18,851 10.9 2.9 8.4 4.9 6.6Bahrain 5 5 8 8 8 2.0 3.4 60.0 2.0 0.0Egypt 1,496 1,388 1,721 1,893 2,272 -8.0 -7.2 24.0 10.0 20.0Kuwait 38 29 27 24 22 -66.6 -24.3 -6.7 -11.0 -8.0

Lebanon 278 236 232 243 250 -30.0 -15.0 -1.7 4.7 2.9Morocco 214 247 242 242 247 4.3 15.5 -2.0 0.0 2.0Oman 7 7 5 5 4 36.8 7.1 -23.7 -10.0 -10.0

Pan Arab 4,786 3,939 3,564 3,137 2,886 0.1 -17.7 -9.5 -12.0 -8.0Qatar 18 16 17 17 18 -45.3 -16.1 10.0 2.0 2.0

Saudi Arabia 23 25 70 73 74 -37.9 10.6 177.9 5.0 1.0UAE 95 73 57 48 42 45.8 -22.8 -22.6 -15.0 -12.0

MENA 6,959 5,964 5,943 5,690 5,823 -4.2 -14.3 -0.4 -4.3 2.3Israel 367 382 392 403 414 -0.6 4.1 2.6 2.8 2.8

South Africa 1,950 1,815 1,831 1,957 2,090 12.6 -6.9 0.9 6.8 6.8Other 2,317 2,197 2,223 2,360 2,505 10.3 -5.2 1.2 6.1 6.1

GLOBAL 208,553 206,842 208,411 209,391 212,819 3.3 -0.8 0.8 0.5 1.6

181

Newspaper Market Sizes & Growth Rates





Austria 933 942 931 915 897 4.9 0.9 -1.1 -1.7 -2.0Belgium 1,083 1,029 928 910 904 6.1 -4.9 -9.8 -1.9 -0.7Denmark 428 402 362 308 277 -7.5 -6.0 -10.0 -15.0 -10.0Finland 476 431 388 368 350 -4.6 -9.5 -10.0 -5.0 -5.0France 1,049 994 944 904 882 -11.9 -5.3 -5.0 -4.2 -2.5

Germany 2,484 2,339 2,238 2,114 1,975 -4.5 -5.8 -4.3 -5.5 -6.6Greece 50 46 45 44 43 -2.3 -7.9 -1.8 -2.6 -1.4Ireland 162 137 121 114 125 -9.3 -15.4 -11.3 -5.9 9.6Italy 622 573 538 503 468 -6.9 -8.0 -6.0 -6.5 -7.0

Netherlands 587 533 482 452 431 -10.7 -9.1 -9.6 -6.2 -4.7Norway 386 333 296 267 240 -19.0 -13.8 -11.0 -10.0 -10.0Portugal 23 18 16 14 13 -22.3 -18.9 -15.6 -10.0 -10.0Spain 775 712 662 609 564 -6.5 -8.1 -7.0 -8.1 -7.4

Sweden 715 621 563 509 342 -9.1 -13.1 -9.4 -9.6 -32.7Switzerland 854 805 697 658 618 -8.6 -5.7 -13.4 -5.6 -6.1

UK 1,939 1,687 1,552 1,443 1,342 -24.0 -13.0 -8.0 -7.0 -7.0Western Europe 12,566 11,602 10,764 10,133 9,471 -9.1 -7.7 -7.2 -5.9 -6.5

Bulgaria 14 13 12 12 11 -13.6 -5.4 -4.8 -4.5 -3.7Czech Republic 46 45 45 44 43 -5.0 -3.0 0.0 -2.0 -2.0

Estonia 20 20 20 19 18 -4.5 -2.1 -0.9 -2.1 -5.0Hungary 71 77 84 86 83 -14.6 7.7 10.3 2.0 -4.0Latvia 5 4 4 4 3 -8.1 -13.2 -5.0 -7.1 -7.0

Lithuania 11 10 9 9 8 -9.9 -6.6 -6.8 -6.0 -6.0Poland 44 36 35 35 34 -13.1 -20.1 -1.0 -1.0 -1.0

Romania 17 13 11 9 7 -20.0 -20.0 -20.0 -20.0 -15.0Russia 194 168 148 130 120 -10.8 -13.4 -12.1 -12.1 -7.3

Slovak Rep 19 17 16 16 15 -20.0 -12.5 -3.6 0.0 -3.7Turkey 206 189 138 115 103 23.0 -8.5 -27.0 -16.2 -11.0C&EE 647 591 522 478 447 -3.0 -8.7 -11.6 -8.4 -6.5

Europe 13,213 12,192 11,286 10,611 9,918 -8.8 -7.7 -7.4 -6.0 -6.5





USA 20,945 19,060 17,082 15,290 13,733 -9.0 -9.0 -10.4 -10.5 -10.2Canada 1,514 1,394 1,124 1,138 1,146 -11.5 -7.9 -19.4 1.3 0.7

North America 22,459 20,454 18,206 16,428 14,879 -9.2 -8.9 -11.0 -9.8 -9.4Australia 1,234 1,182 1,129 1,032 926 -14.9 -4.1 -4.5 -8.6 -10.3

China 2,710 1,559 1,122 842 673 -33.8 -42.5 -28.0 -25.0 -20.0Hong Kong 583 455 364 273 191 -23.1 -21.9 -20.0 -25.0 -30.0

India 2,484 2,563 2,629 2,692 2,759 37.4 3.2 2.5 2.4 2.5Indonesia 1,342 1,184 1,089 926 769 -4.4 -11.7 -8.0 -15.0 -17.0

Japan 4,942 4,683 4,428 4,358 4,266 -4.4 -5.2 -5.5 -1.6 -2.1Malaysia 497 492 426 415 397 -2.0 -1.0 -13.5 -2.6 -4.2

New Zealand 290 245 208 181 160 -12.0 -15.3 -15.0 -13.3 -11.5Philippines 137 114 99 102 102 -0.4 -16.6 -13.3 3.0 0.0Singapore 604 450 333 246 182 8.9 -25.4 -26.0 -26.1 -26.0

South Korea 1,343 1,284 1,223 1,150 1,069 -2.0 -4.5 -4.7 -6.0 -7.0Taiwan 169 140 123 111 100 -21.0 -17.6 -12.0 -10.0 -10.0

Thailand 306 239 179 129 90 -20.0 -21.8 -25.0 -28.0 -30.0Vietnam 34 25 21 14 10 -10.3 -25.6 -18.0 -32.5 -25.6

Asia Pacific 16,674 14,617 13,374 12,469 11,694 -8.5 -12.3 -8.5 -6.8 -6.2Argentina 653 821 905 1,041 1,197 24.7 25.7 10.3 15.0 15.0

Brazil 1,042 1,059 1,032 1,025 1,025 23.7 1.6 -2.6 -0.7 0.0Colombia 314 291 275 283 282 -14.7 -7.4 -5.6 3.1 -0.5Mexico 242 240 238 239 240 -1.0 -0.5 -1.0 0.5 0.3

Latin America 2,251 2,411 2,450 2,588 2,744 13.7 7.1 1.6 5.6 6.0Bahrain 81 64 51 45 41 2.9 -20.5 -19.9 -12.0 -10.0Egypt 152 130 91 82 70 -5.0 -14.3 -30.0 -9.9 -14.6Kuwait 214 153 121 103 93 -4.7 -28.4 -21.0 -15.0 -10.0

Lebanon 30 26 26 26 22 -30.0 -15.0 0.7 0.0 -15.4Morocco 80 55 52 52 49 8.9 -30.5 -6.0 0.0 -6.0Oman 114 93 87 74 67 -17.6 -18.2 -6.3 -15.0 -10.0

Pan Arab 29 19 14 11 9 -46.1 -34.4 -24.0 -20.0 -20.0Qatar 142 132 113 96 87 -20.7 -6.5 -14.3 -15.0 -10.0

Saudi Arabia 406 319 265 225 202 -32.0 -21.4 -17.0 -15.0 -10.0UAE 420 322 241 181 154 -23.1 -23.5 -25.0 -25.0 -15.0

MENA 1,666 1,313 1,062 896 793 -20.4 -21.2 -19.1 -15.7 -11.5Israel 149 137 134 131 133 -12.6 -8.3 -2.2 -1.9 1.3

South Africa 530 516 442 459 477 -6.2 -2.7 -14.3 3.9 3.9Other 679 652 575 590 610 -7.7 -3.9 -11.8 2.6 3.3

GLOBAL 56,942 51,640 46,953 43,583 40,638 -8.5 -9.3 -9.1 -7.2 -6.8

183

Magazine Market Sizes & Growth Rates





Austria 645 650 636 625 611 1.1 0.8 -2.1 -1.8 -2.1Belgium 336 321 307 300 293 -3.3 -4.3 -4.4 -2.3 -2.4Denmark 155 150 135 115 104 -2.5 -3.0 -10.0 -15.0 -10.0Finland 89 86 80 75 70 -8.9 -4.0 -7.0 -6.0 -6.0France 1,193 1,078 1,008 963 924 -6.9 -9.7 -6.5 -4.5 -4.0

Germany 2,159 2,007 1,847 1,706 1,572 -3.1 -7.0 -8.0 -7.6 -7.9Greece 51 49 45 44 43 -4.4 -4.7 -7.3 -2.6 -2.7Ireland 7 6 6 5 5 0.0 -13.3 -9.6 -7.5 0.0Italy 513 478 438 403 371 -4.2 -6.8 -8.3 -8.0 -8.0

Netherlands 352 328 305 282 271 -7.2 -6.8 -7.2 -7.4 -3.8Norway 82 73 61 53 48 -11.2 -10.9 -17.5 -12.0 -10.0Portugal 24 19 15 14 12 -14.1 -18.4 -21.6 -10.0 -10.0Spain 300 286 267 249 231 -1.2 -4.8 -6.5 -6.7 -7.2

Sweden 183 166 149 133 125 16.7 -9.5 -10.2 -10.3 -6.5Switzerland 592 557 528 513 495 -0.6 -5.8 -5.3 -2.9 -3.4

UK 758 622 553 493 453 -15.2 -18.0 -11.0 -11.0 -8.0Western Europe 7,439 6,878 6,380 5,973 5,629 -4.6 -7.5 -7.2 -6.4 -5.8

Bulgaria 9 6 6 5 5 2.2 -29.6 -6.0 -14.9 0.0Czech Republic 63 61 61 59 58 -3.0 -3.0 0.0 -3.0 -2.0

Estonia 7 5 5 5 5 0.0 -23.2 -2.0 -6.9 -3.0Hungary 67 70 70 70 67 -5.5 4.1 -0.3 0.0 -4.0Latvia 7 6 6 5 5 -19.8 -10.6 -10.0 -5.1 -5.0

Lithuania 13 11 11 11 10 1.8 -13.5 -2.7 -3.0 -4.0Poland 118 106 105 104 104 -7.6 -10.8 -0.5 -0.5 0.0

Romania 17 15 13 11 10 -10.0 -15.0 -15.0 -10.0 -10.0Russia 231 223 204 187 181 1.6 -3.5 -8.4 -8.4 -3.4

Slovak Rep 26 24 23 21 21 -12.0 -9.1 -5.0 -5.3 0.0Turkey 20 17 12 10 9 50.8 -15.8 -31.3 -18.2 -8.9C&EE 579 544 514 488 475 -2.0 -6.0 -5.4 -5.1 -2.7

Europe 8,018 7,422 6,894 6,461 6,104 -4.4 -7.4 -7.1 -6.3 -5.5





USA 20,510 19,280 18,119 16,735 15,765 0.3 -6.0 -6.0 -7.6 -5.8Canada 282 302 283 286 289 -15.3 7.2 -6.3 1.2 0.8

North America 20,792 19,582 18,402 17,021 16,054 0.0 -5.8 -6.0 -7.5 -5.7Australia 278 222 164 125 100 -9.5 -20.1 -26.0 -24.0 -19.9

China 576 409 372 338 308 -20.6 -29.1 -9.0 -9.0 -9.0Hong Kong 187 110 77 50 30 -41.4 -41.1 -30.0 -35.0 -40.0

India 231 238 233 229 226 37.0 3.0 -2.1 -1.7 -1.0Indonesia 83 54 38 26 18 -17.0 -35.2 -30.0 -30.0 -30.0

Japan 2,023 1,841 1,720 1,642 1,591 -9.0 -9.0 -6.6 -4.6 -3.1Malaysia 25 25 24 25 24 1.0 1.0 -4.0 3.7 -1.6

New Zealand 138 128 101 90 78 -5.2 -7.5 -21.2 -10.3 -13.1Philippines 30 20 14 15 15 -16.8 -33.0 -28.0 3.0 0.0Singapore 65 57 50 43 38 13.7 -11.5 -13.0 -13.4 -12.1

South Korea 345 314 302 284 270 -9.3 -9.0 -3.8 -6.0 -5.0Taiwan 104 77 66 60 56 -24.5 -25.6 -15.0 -8.0 -8.0

Thailand 91 61 40 25 15 -31.6 -32.3 -35.0 -38.0 -40.0Vietnam 18 18 13 19 19 -18.4 2.4 -28.3 46.0 2.4

Asia Pacific 4,192 3,574 3,213 2,971 2,789 -12.3 -14.8 -10.1 -7.5 -6.1Argentina 73 81 97 116 133 21.9 10.0 19.8 20.0 15.0

Brazil 567 565 492 474 474 29.1 -0.3 -13.0 -3.7 0.0Colombia 50 46 42 43 42 -21.4 -8.3 -7.9 0.6 -2.1Mexico 174 174 173 174 175 3.1 0.4 -0.6 0.5 0.3

Latin America 864 866 804 806 824 18.1 0.3 -7.2 0.3 2.1Bahrain 11 8 7 6 5 0.7 -24.8 -19.9 -12.0 -10.0Egypt 6 6 4 4 3 -33.6 0.0 -33.3 0.0 -25.0Kuwait 26 17 14 12 11 11.1 -33.4 -21.0 -8.0 -10.0

Lebanon 24 20 17 17 17 -30.0 -15.0 -15.0 -1.0 0.0Morocco 40 37 35 35 32 8.9 -7.6 -6.0 0.0 -6.0Oman 6 4 4 3 3 -0.9 -28.8 -6.3 -10.0 -5.0

Pan Arab 85 70 53 42 38 -11.3 -17.6 -24.0 -20.0 -10.0Qatar 14 7 6 6 5 22.5 -49.6 -14.3 -7.6 -8.0

Saudi Arabia 17 9 8 7 6 -13.9 -44.5 -17.0 -10.0 -10.0UAE 175 118 88 66 56 -7.8 -32.7 -25.0 -25.0 -15.0

MENA 403 297 235 199 178 -7.6 -26.4 -20.8 -15.5 -10.3Israel 30 28 24 22 18 -14.9 -4.3 -14.2 -9.1 -19.1

South Africa 158 154 189 198 206 -6.2 -2.3 22.9 4.4 4.4Other 188 183 214 220 224 -7.7 -2.7 17.1 2.9 2.0

GLOBAL 34,457 31,923 29,762 27,679 26,173 -2.4 -7.4 -6.8 -7.0 -5.4

185

Radio Market Sizes & Growth Rates





Austria 184 187 191 194 198 6.7 1.5 2.1 1.8 1.8Belgium 663 687 689 691 694 8.4 3.6 0.3 0.3 0.3Denmark 56 56 61 63 65 5.8 0.0 10.1 3.0 3.0Finland 73 76 79 81 82 2.9 3.9 5.1 2.0 1.0France 847 826 827 829 833 -1.1 -2.5 0.2 0.2 0.5

Germany 964 988 997 1,008 1,019 3.3 2.4 1.0 1.1 1.1Greece 35 36 37 39 40 3.6 3.4 5.0 4.8 3.0Ireland 101 100 99 99 102 -5.6 -1.2 -1.2 0.0 3.8Italy 493 517 538 552 557 2.1 5.0 4.0 2.5 1.0

Netherlands 268 269 267 264 262 0.0 0.4 -0.9 -0.9 -0.9Norway 89 89 81 83 86 -3.8 -0.2 -8.0 2.0 3.0Portugal 38 40 40 41 42 7.6 5.5 0.0 2.0 2.0Spain 545 554 572 566 560 0.8 1.7 3.2 -1.0 -1.1

Sweden 99 114 125 136 136 14.6 14.6 9.8 9.0 0.2Switzerland 169 157 160 154 152 -1.6 -7.1 1.4 -3.2 -1.9

UK 833 892 936 955 974 4.6 7.0 5.0 2.0 2.0Western Europe 5,457 5,586 5,700 5,757 5,802 2.7 2.4 2.1 1.0 0.8

Bulgaria 11 12 12 12 12 4.8 8.6 3.7 1.0 2.5Czech Republic 39 38 38 37 37 -1.0 -2.0 -1.0 -3.0 0.0

Estonia 11 12 14 14 15 3.0 14.3 9.0 5.0 5.0Hungary 42 42 47 47 47 -8.5 1.5 10.5 1.0 -1.1Latvia 12 12 12 12 12 6.4 0.7 0.9 -2.7 0.0

Lithuania 11 12 12 12 13 4.7 10.1 3.0 3.5 3.0Poland 196 201 211 215 219 2.3 2.3 5.0 2.0 2.0

Romania 13 14 15 15 16 2.0 5.0 5.0 5.0 5.0Russia 313 322 335 335 335 15.6 3.0 4.0 0.0 0.0

Slovak Rep 14 14 14 13 12 0.0 0.0 0.0 -8.3 -9.1Turkey 46 42 40 42 43 118.0 -8.3 -5.0 4.7 3.0C&EE 708 723 750 756 762 10.9 2.0 3.8 0.8 0.8

Europe 6,165 6,308 6,451 6,513 6,564 3.6 2.3 2.3 1.0 0.8





USA 19,554 19,389 19,590 19,593 19,651 1.9 -0.8 1.0 0.0 0.3Canada 454 485 534 534 534 -2.8 6.8 10.1 0.0 0.0

North America 20,008 19,874 20,124 20,127 20,185 1.8 -0.7 1.3 0.0 0.3Australia 862 866 886 896 907 3.4 0.4 2.3 1.2 1.2

China 2,041 2,041 2,061 2,070 2,078 2.1 0.0 1.0 0.4 0.4Hong Kong 82 83 85 87 87 3.7 0.7 2.5 2.0 0.0

India 340 347 360 378 398 54.3 2.0 3.9 5.0 5.1Indonesia 70 73 77 81 85 7.3 5.0 5.0 5.0 5.0

Japan 1,169 1,174 1,179 1,190 1,218 2.5 0.4 0.5 0.9 2.4Malaysia 112 115 117 121 124 4.0 3.0 1.6 3.9 2.1

New Zealand 188 192 188 184 181 0.4 2.2 -2.5 -1.9 -1.9Philippines 854 1,174 1,472 1,599 1,679 34.8 37.4 25.4 8.7 5.0Singapore 159 136 120 106 93 19.4 -14.5 -12.0 -11.8 -12.0

South Korea 278 254 260 263 265 2.5 -8.4 2.3 1.0 1.0Taiwan 69 58 53 51 49 -23.8 -16.4 -8.0 -5.0 -3.0

Thailand 163 139 139 139 139 -7.3 -14.9 0.0 0.0 0.0Vietnam 4 29 27 31 31 29.1 648.2 -6.9 11.7 2.0

Asia Pacific 6,392 6,681 7,025 7,196 7,334 7.6 4.5 5.1 2.4 1.9Argentina 170 240 376 432 497 61.2 41.3 56.4 15.0 15.0

Brazil 448 557 659 718 725 -6.8 24.4 18.3 8.9 0.9Colombia 215 220 233 232 236 -4.9 2.1 5.9 -0.2 1.5Mexico 284 284 281 283 284 -1.0 0.0 -1.0 0.5 0.3

Latin America 1,118 1,302 1,549 1,665 1,741 1.6 16.5 19.0 7.5 4.5Bahrain - - - - - - - - - -Egypt 90 76 101 111 116 -1.9 -15.6 32.9 9.9 4.5Kuwait 12 14 15 16 17 -13.4 13.6 9.6 5.0 2.0

Lebanon 37 30 32 34 35 -20.0 -20.0 6.8 6.3 2.9Morocco 185 194 225 225 261 -6.6 4.6 16.0 0.0 16.0Oman - - - - - - - - - -

Pan Arab - - - - - - - - - -Qatar - - - - - - - - - -

Saudi Arabia 216 170 143 128 122 15.1 -21.4 -16.2 -10.0 -5.0UAE 236 269 294 309 324 23.0 13.8 9.4 5.0 5.0

MENA 777 752 810 823 874 5.0 -3.2 7.6 1.6 6.2Israel 69 59 60 60 61 3.9 -15.1 1.6 0.0 1.6

South Africa 562 651 574 628 688 10.7 15.8 -11.9 9.5 9.5Other 632 710 634 688 749 9.9 12.4 -10.8 8.6 8.8

GLOBAL 35,092 35,628 36,592 37,012 37,448 3.3 1.5 2.7 1.1 1.2

187

Cinema Market Sizes & Growth Rates





Austria 11 11 10 10 10 0.0 3.9 -5.9 1.0 -2.4Belgium 38 36 36 36 36 -14.6 -6.3 0.0 0.0 0.0Denmark 16 16 21 22 22 3.1 0.0 30.0 3.8 3.7Finland 6 8 8 8 9 13.3 31.4 1.5 5.0 4.0France 107 113 115 119 124 9.8 5.6 2.1 3.0 3.9

Germany 87 92 83 80 76 -7.1 4.8 -9.0 -4.0 -4.9Greece - - - - - - - - - -Ireland 7 7 7 7 7 0.0 1.7 -6.6 0.0 0.0Italy 27 27 28 28 28 6.4 2.4 2.0 1.0 0.0

Netherlands 8 10 10 11 11 -9.1 14.3 0.0 12.5 0.0Norway 20 22 25 28 31 16.1 8.6 15.0 12.0 10.0Portugal 2 2 2 2 2 27.5 -8.4 11.4 1.0 1.0Spain 27 40 42 44 45 2.7 49.1 4.5 4.1 2.3

Sweden 17 20 21 22 22 6.4 17.3 3.4 2.2 2.2Switzerland 30 32 35 38 41 -11.5 9.0 9.3 8.4 7.6

UK 372 387 394 401 407 16.0 4.0 2.0 1.7 1.5

Western Europe 775 822 838 855 870 7.0 6.1 1.8 2.1 1.7Bulgaria - - - - - - - - - -

Czech Republic 3 3 3 3 3 0.0 0.0 0.0 0.0 0.0Estonia - - - - - - - - - -Hungary 7 7 8 8 8 2.5 9.9 12.1 1.0 -1.0Latvia 1 1 1 1 1 13.4 11.8 0.0 0.0 0.0


Romania 3 3 3 3 3 2.0 3.0 3.0 5.0 5.0Russia 63 67 67 67 67 -20.5 6.1 0.0 0.0 0.0

Slovak Rep 1 1 1 1 1 0.0 14.3 0.0 25.0 0.0Turkey 17 18 16 17 18 52.9 2.5 -9.6 5.3 7.6C&EE 129 135 134 135 137 -5.5 4.3 -0.5 1.0 1.0

Europe 904 957 972 991 1,007 5.0 5.9 1.5 2.0 1.6





USA 1,213 1,274 1,338 1,425 1,495 5.0 5.0 5.0 6.5 4.9Canada - - - - - - - - - -

North America 1,213 1,274 1,338 1,425 1,495 5.0 5.0 5.0 6.5 4.9Australia 91 97 103 107 112 10.0 7.0 5.2 4.3 4.9

China - - - - - - - - - -Hong Kong - - - - - - - - - -

India 149 164 187 214 245 3.0 10.5 14.2 14.3 14.3Indonesia 1 1 1 1 1 5.0 5.0 5.0 5.0 5.0

Japan - - - - - - - - - -Malaysia 33 37 37 38 40 10.0 10.0 1.2 2.9 4.0

New Zealand 7 8 9 10 10 11.1 10.0 18.2 7.7 7.1Philippines 6 6 7 7 8 10.0 7.0 10.0 10.0 7.8Singapore - - - - - - - - - -

South Korea 206 208 211 217 219 6.2 1.3 1.2 3.0 1.0Taiwan 7 8 7 7 7 -37.7 11.0 -10.0 0.0 0.0

Thailand 169 212 222 231 243 6.1 25.2 5.0 4.0 5.0Vietnam - - - - - - - - - -

Asia Pacific 668 740 783 832 884 4.1 10.8 5.8 6.2 6.3Argentina 32 38 43 49 54 26.7 16.0 14.2 13.1 10.9

Brazil 49 226 226 226 248 21.9 364.8 0.0 0.0 10.0Colombia 4 4 4 5 5 7.0 1.0 0.5 7.4 3.9Mexico 33 33 32 31 30 -1.6 2.4 -5.6 -2.2 -2.3

Latin America 118 301 305 310 337 14.9 155.3 1.1 1.7 8.8Bahrain - - - - - - - - - -Egypt - - - - - - - - - -Kuwait - - - - - - - - - -

Lebanon 2 1 3 3 3 -30.0 -30.0 138.1 3.3 6.5Morocco 18 16 16 16 17 28.0 -7.4 1.0 0.0 1.0Oman 2 4 4 4 4 9.0 63.2 3.1 5.0 5.0

Pan Arab - - - - - - - - - -Qatar - 2 2 2 2 - - 48.4 -8.3 -4.5

Saudi Arabia - - - - - - - - - -UAE 56 52 45 41 39 8.0 -7.5 -13.0 -10.0 -5.0

MENA 78 75 71 66 65 10.5 -3.9 -5.3 -6.3 -2.4Israel 10 11 11 11 11 -11.6 13.5 -5.7 3.2 3.0

South Africa 40 40 27 28 28 0.5 0.4 -31.7 1.7 1.6Other 50 51 38 39 40 -2.1 3.0 -26.0 2.1 2.0

GLOBAL 3,031 3,399 3,506 3,663 3,828 5.2 12.1 3.2 4.5 4.5

189

OOH Market Sizes & Growth Rates





Austria 201 211 207 209 205 3.0 5.0 -1.9 0.7 -1.8Belgium 395 393 401 406 414 0.3 -0.6 2.1 1.2 2.1Denmark 64 66 72 77 80 -1.0 3.0 9.9 5.7 4.2Finland 59 68 75 77 77 2.5 15.1 10.0 3.1 0.0France 1,434 1,404 1,438 1,469 1,505 3.2 -2.1 2.4 2.2 2.4

Germany 753 825 784 760 744 3.9 9.5 -5.0 -3.0 -2.2Greece 26 27 30 32 34 4.8 3.2 9.3 6.9 6.4Ireland 95 98 100 102 99 5.3 2.5 2.0 2.8 -3.5Italy 410 416 424 430 432 -1.5 1.4 1.9 1.4 0.6

Netherlands 215 219 220 223 226 4.6 1.7 0.5 1.1 1.6Norway 80 93 91 96 102 8.7 16.7 -2.0 5.0 7.0Portugal 67 73 80 82 85 8.2 10.1 8.5 3.0 3.0Spain 382 389 394 393 386 -2.0 1.7 1.3 -0.2 -1.7

Sweden 182 206 231 243 258 26.5 13.2 12.1 5.0 6.1Switzerland 439 455 501 528 552 8.2 3.6 10.1 5.4 4.5


Bulgaria 27 28 28 29 29 1.2 1.3 1.5 3.0 0.2Czech Republic 48 48 48 48 49 -5.0 0.0 0.0 2.0 2.0

Estonia 12 18 20 22 24 10.0 48.6 10.0 12.9 8.0Hungary 72 81 101 103 103 -1.8 13.1 24.6 2.0 0.0Latvia 10 10 11 11 12 12.3 5.5 6.0 2.2 5.0


Romania 16 17 18 19 20 3.0 5.4 6.6 5.0 5.0Russia 667 730 744 744 744 6.0 9.4 2.0 0.0 0.0

Slovak Rep 35 35 36 36 36 3.6 0.0 3.4 0.0 0.0Turkey 93 87 86 86 93 34.0 -7.0 -1.2 0.5 8.4C&EE 1,129 1,204 1,244 1,254 1,267 6.0 6.6 3.3 0.8 1.1

Europe 7,467 7,681 7,856 7,961 8,062 4.8 2.9 2.3 1.3 1.3





USA 7,897 8,134 8,352 8,563 8,773 4.0 3.0 2.7 2.5 2.5Canada 442 535 566 622 668 5.2 21.3 5.8 9.7 7.5

North America 8,338 8,669 8,919 9,185 9,442 4.1 4.0 2.9 3.0 2.8Australia 677 724 816 878 957 9.4 6.9 12.7 7.6 8.9

China 7,896 8,014 9,136 10,050 10,854 4.0 1.5 14.0 10.0 8.0Hong Kong 408 391 352 317 269 -4.0 -4.3 -10.0 -10.0 -15.0

India 450 482 521 564 606 16.2 7.1 8.1 8.3 7.5Indonesia 74 81 91 93 98 0.0 10.0 12.0 3.1 5.0

Japan 4,729 4,741 4,719 4,723 4,822 -0.7 0.3 -0.5 0.1 2.1Malaysia 117 120 126 124 129 2.2 1.8 5.3 -1.2 4.0

New Zealand 82 97 104 115 125 24.2 18.6 7.1 10.0 9.1Philippines 313 374 430 495 563 17.1 19.3 15.0 15.0 13.8Singapore 207 165 140 119 100 26.2 -20.1 -15.3 -14.9 -15.6

South Korea 716 707 716 708 708 -1.1 -1.2 1.2 -1.0 0.0Taiwan 122 114 122 125 132 -6.4 -6.9 7.0 3.0 5.0

Thailand 364 410 423 435 448 25.6 12.9 3.0 3.0 3.0Vietnam - - - - - - - - - -

Asia Pacific 16,156 16,421 17,695 18,747 19,813 3.5 1.6 7.8 5.9 5.7Argentina 75 134 152 175 201 10.4 79.2 13.7 15.0 15.0

Brazil 695 544 492 522 574 41.9 -21.7 -9.6 6.1 10.0Colombia 59 53 56 63 67 -6.3 -10.3 5.4 12.7 6.9Mexico 273 279 284 288 292 2.0 2.5 1.4 1.5 1.3

Latin America 1,102 1,011 984 1,048 1,134 24.1 -8.3 -2.7 6.5 8.3Bahrain 3 3 2 2 2 5.0 -15.5 -32.9 -10.0 0.0Egypt - - - - - - - - - -Kuwait 84 135 157 158 158 18.5 60.2 16.3 1.0 0.0

Lebanon 143 138 140 147 150 -4.0 -4.0 1.8 5.0 2.0Morocco 218 244 254 254 264 3.7 12.1 4.0 0.0 4.0Oman - - - - - - - - - -

Pan Arab - - - - - - - - - -Qatar 69 45 43 41 39 9.7 -34.7 -5.5 -5.0 -5.0

Saudi Arabia 177 211 176 162 146 12.6 19.2 -16.5 -8.0 -10.0UAE 496 478 499 504 509 26.4 -3.8 4.5 1.0 1.0

MENA 1,191 1,253 1,271 1,268 1,268 13.8 5.2 1.4 -0.2 0.0Israel 69 76 80 84 86 33.4 8.9 5.6 5.2 1.8

South Africa 131 133 111 113 115 7.7 2.0 -16.6 1.6 1.7Other 200 209 191 197 200 15.4 4.4 -8.6 3.1 1.7

GLOBAL 34,454 35,244 36,915 38,405 39,919 4.8 2.3 4.7 4.0 3.9

191

Digital Market Sizes & Growth Rates





Austria 643 703 760 794 823 9.8 9.5 8.0 4.5 3.7Belgium 244 560 579 621 691 -4.7 129.8 3.4 7.1 11.4Denmark 1,084 1,192 1,252 1,377 1,446 10.6 10.0 5.0 10.0 5.0Finland 386 441 485 524 565 13.4 14.2 10.0 8.0 8.0France 4,350 4,871 5,381 5,819 6,152 7.6 12.0 10.5 8.1 5.7

Germany 5,888 6,429 7,008 7,463 7,918 8.5 9.2 9.0 6.5 6.1Greece 46 48 51 52 54 11.4 3.8 6.2 2.3 2.3Ireland 357 406 454 500 540 16.3 13.7 12.0 10.0 8.0Italy 2,054 2,251 2,406 2,567 2,734 6.9 9.6 6.9 6.7 6.5

Netherlands 2,001 2,180 2,349 2,515 2,675 11.3 8.9 7.8 7.1 6.3Norway 983 1,127 1,217 1,290 1,355 4.6 14.6 8.0 6.0 5.0Portugal 97 111 128 141 155 20.5 14.7 15.0 10.0 10.0Spain 1,828 1,984 2,192 2,396 2,573 22.7 8.5 10.5 9.3 7.4

Sweden 1,834 2,238 2,501 2,744 2,951 21.8 22.0 11.7 9.7 7.6Switzerland 1,176 2,222 2,608 3,006 3,395 10.2 89.0 17.4 15.2 12.9



Estonia 49 49 51 53 55 13.5 0.2 4.0 4.0 4.0Hungary 247 287 337 362 401 22.2 16.4 17.1 7.4 11.0Latvia 24 29 33 36 41 28.7 21.1 13.7 10.9 12.7


Romania 60 78 86 99 114 30.0 29.5 10.3 15.0 15.0Russia 2,590 3,170 3,787 4,314 4,847 20.8 22.4 19.5 13.9 12.4

Slovak Rep 76 81 92 103 118 9.5 6.3 13.1 12.5 14.7Turkey 368 377 390 408 426 34.9 2.4 3.5 4.6 4.4C&EE 4,388 5,154 5,967 6,716 7,516 20.8 17.4 15.8 12.6 11.9

Europe 40,819 47,300 52,556 57,619 62,749 13.6 15.9 11.1 9.6 8.9





USA 56,849 64,939 73,734 82,795 92,158 16.7 14.2 13.5 12.3 11.3Canada 3,795 4,142 4,624 5,022 5,452 14.7 9.1 11.6 8.6 8.5

North America 60,644 69,081 78,358 87,818 97,610 16.5 13.9 13.4 12.1 11.2Australia 5,246 5,616 6,026 6,369 6,751 15.9 7.0 7.3 5.7 6.0

China 41,914 50,129 58,150 65,418 71,960 28.1 19.6 16.0 12.5 10.0Hong Kong 773 852 1,005 1,169 1,348 1.5 10.2 17.9 16.3 15.3

India 919 1,210 1,597 2,108 2,784 66.1 31.7 31.9 32.0 32.1Indonesia 770 924 1,091 1,309 1,571 35.0 20.0 18.0 20.0 20.0

Japan 11,920 13,734 15,904 18,260 20,997 13.0 15.2 15.8 14.8 15.0Malaysia 284 332 386 425 468 20.9 17.0 16.1 10.2 10.0

New Zealand 619 730 831 926 1,031 11.3 17.9 13.8 11.5 11.3Philippines 99 121 150 169 171 25.0 21.6 23.8 12.9 1.3Singapore 329 390 442 482 528 12.1 18.8 13.2 9.2 9.4

South Korea 3,089 3,507 3,771 4,069 4,354 12.7 13.5 7.5 7.9 7.0Taiwan 551 619 694 763 824 19.4 12.5 12.0 10.0 8.0

Thailand 294 385 465 536 616 17.3 30.8 20.7 15.3 15.0Vietnam 130 155 178 200 221 35.5 19.4 15.0 12.2 11.0

Asia Pacific 66,937 78,706 90,687 102,203 113,625 23.1 17.6 15.2 12.7 11.2Argentina 606 868 1,190 1,643 2,136 71.4 43.3 37.1 38.0 30.0

Brazil 1,180 1,460 1,768 2,029 2,287 -56.5 23.7 21.1 14.8 12.7Colombia 117 151 207 259 314 26.6 28.9 37.3 25.0 21.2Mexico 1,092 1,365 1,677 1,962 2,197 25.0 25.1 22.8 17.0 12.0

Latin America 2,995 3,844 4,842 5,893 6,934 -25.8 28.4 26.0 21.7 17.7MENA - - - - - - - - - -Israel 298 336 359 380 400 13.0 12.9 6.9 5.7 5.4

South Africa 101 106 112 120 129 5.0 5.0 5.3 7.5 7.5Other 399 442 471 500 529 10.9 10.9 6.5 6.1 5.9

GLOBAL 171,794 199,374 226,914 254,032 281,447 17.0 16.1 13.8 12.0 10.8

193

TV % Share of Advertising Expenditure


TELEVISION % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f

Austria 22.3 18.9 19.4 19.9 19.6 20.0 20.5 21.2 22.0 23.1Belgium 40.5 40.1 39.4 38.5 41.2 43.0 40.3 42.1 42.6 42.8Denmark 19.9 21.6 18.1 17.2 16.9 16.6 15.8 15.6 15.0 14.5Finland 21.1 21.3 22.8 22.5 22.1 21.7 20.5 20.3 19.9 19.2France 33.0 32.5 32.2 30.3 30.3 30.1 29.6 29.0 28.3 27.9

Germany 40.1 32.1 32.3 32.4 32.6 32.7 32.2 31.5 30.9 30.4Greece 58.3 58.4 57.6 57.8 54.5 55.6 58.0 59.3 60.5 61.6Ireland 28.5 28.7 28.2 27.0 26.9 26.4 24.1 22.9 22.3 22.0Italy 53.6 51.8 52.3 52.8 52.3 53.2 52.0 51.5 50.7 50.3

Netherlands 23.6 25.5 25.6 25.8 26.1 25.6 24.6 24.0 23.2 22.2Norway 21.0 22.2 22.2 21.8 22.1 23.0 22.1 21.4 21.0 20.4Portugal 57.4 57.6 57.6 56.2 55.2 54.8 53.8 52.6 51.7 50.7Spain 40.7 39.2 39.4 41.0 40.1 39.6 39.1 37.8 36.6 35.6

Sweden 22.0 22.5 21.6 21.2 19.2 17.2 16.0 15.9 15.1 14.4Switzerland 24.1 21.6 21.6 21.4 20.9 21.8 17.8 16.8 16.0 15.6

UK 26.7 25.7 24.4 24.6 24.7 24.2 22.3 20.9 19.7 18.7Western Europe 34.3 31.8 31.2 30.9 30.8 30.7 29.3 28.4 27.5 26.8

Bulgaria 56.8 58.3 58.6 56.2 55.5 55.6 54.8 55.0 53.8 52.3Czech Republic 44.6 45.1 41.6 40.4 40.8 39.3 39.3 38.3 36.3 33.8

Estonia 31.6 30.8 31.5 25.4 24.6 22.9 22.6 22.0 22.2 22.6Hungary 30.1 29.7 28.0 27.0 26.0 24.9 25.7 24.3 24.0 24.0Latvia 45.1 45.7 44.3 44.0 42.7 40.4 39.4 38.5 37.5 36.3

Lithuania 47.5 47.3 44.7 41.4 38.5 34.7 33.9 33.3 32.7 32.2Poland 56.9 56.2 50.0 50.9 50.4 49.4 48.5 48.9 48.7 48.5

Romania 61.6 59.0 57.5 55.7 56.7 56.2 56.5 57.9 57.3 56.4Russia 49.7 48.0 47.7 47.1 42.2 41.5 41.0 40.5 39.1 37.9

Slovak Rep 44.6 44.3 45.4 45.0 45.4 48.6 50.5 50.9 51.2 50.5Turkey 56.4 56.4 56.8 48.8 48.1 50.9 51.1 51.9 52.2 52.6C&EE 50.6 49.4 47.6 46.5 43.7 43.4 42.9 42.5 41.5 40.5

Europe 36.2 33.9 33.1 32.7 32.2 32.2 30.9 30.2 29.4 28.7


TELEVISION % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f

USA 40.0 40.2 39.6 39.3 38.4 38.0 37.1 36.4 35.4 34.5Canada 34.4 31.6 30.4 29.4 28.2 25.4 25.2 25.1 24.1 23.1

North America 39.8 39.8 39.2 38.9 37.9 37.5 36.6 35.9 34.9 34.0Australia 31.2 31.1 31.4 30.1 27.3 25.4 24.3 23.6 23.0 22.3

China 53.9 51.8 50.1 45.5 39.6 35.0 31.1 27.1 24.3 22.4Hong Kong 25.7 25.4 24.5 23.5 22.2 23.0 22.2 22.8 22.2 20.8

India 37.2 36.8 36.5 37.2 36.0 40.2 40.0 39.5 38.7 37.7Indonesia 56.6 57.1 56.4 56.5 55.0 55.4 54.5 54.1 54.8 55.0

Japan 43.2 44.2 43.8 43.3 42.4 41.9 40.4 38.6 36.9 35.4Malaysia 18.2 19.3 19.8 20.0 18.6 18.3 17.8 17.3 17.4 17.6

New Zealand 29.8 29.9 29.3 26.8 24.4 22.7 21.9 21.3 20.2 19.3Philippines 56.8 61.9 62.1 60.6 59.8 59.6 59.6 55.7 55.8 57.1Singapore 27.5 25.7 25.6 25.1 23.9 28.9 29.5 30.3 30.8 30.7

South Korea 38.3 37.3 36.2 37.4 37.6 36.4 34.7 34.2 33.7 33.2Taiwan 51.9 52.2 53.9 43.3 43.5 42.4 41.2 39.0 36.9 34.9

Thailand 55.3 57.2 60.0 61.5 62.7 59.7 54.7 55.1 54.7 54.0Vietnam 83.1 83.8 87.3 88.7 88.2 87.2 84.9 85.0 84.3 84.0

Asia Pacific 46.5 46.2 45.7 43.5 40.3 37.9 35.4 32.8 30.9 29.5Argentina 44.0 45.0 43.9 43.1 44.1 42.8 43.5 43.2 43.2 42.0

Brazil 68.0 63.3 63.3 64.5 65.8 73.2 71.3 71.7 70.8 70.6Colombia - 53.9 53.7 53.9 55.5 55.4 53.3 51.7 49.8 48.4Mexico 62.6 61.2 59.4 58.0 52.5 50.0 46.1 43.5 41.3 39.5

Latin America 65.6 61.2 60.6 60.9 60.7 64.2 61.5 60.7 59.0 57.9Bahrain 12.9 17.4 6.0 11.1 5.1 5.0 6.5 12.2 13.8 15.1Egypt 57.6 79.9 81.4 87.6 86.2 85.8 86.8 89.8 90.6 92.3Kuwait 31.4 29.0 28.3 35.7 25.3 10.1 8.2 8.0 7.6 7.3

Lebanon 70.0 52.6 56.1 58.0 59.0 54.0 52.4 51.5 51.7 52.4Morocco 34.3 33.1 29.9 30.3 27.8 28.4 31.1 29.4 29.4 28.4Oman 3.6 3.1 2.5 2.8 3.2 5.1 6.5 5.3 5.6 5.5

Pan Arab 94.8 95.9 96.1 96.3 97.0 97.7 97.8 98.1 98.3 98.4Qatar 4.0 3.9 4.8 13.0 11.4 7.6 7.7 9.4 10.7 11.8

Saudi Arabia 5.8 4.6 4.2 4.3 3.7 2.7 3.4 10.5 12.3 13.4UAE 4.4 4.4 3.9 5.0 4.5 6.4 5.6 4.6 4.2 3.8

MENA 55.3 58.7 57.5 61.6 62.4 62.8 61.8 63.3 63.6 64.7Israel 40.6 41.3 41.9 39.2 38.2 37.0 37.1 37.0 36.9 36.9

South Africa 44.2 45.9 45.7 50.2 53.6 56.2 53.1 55.7 55.9 56.0Other 43.1 44.6 44.9 47.5 50.0 51.9 49.4 51.2 51.4 51.6

GLOBAL 42.3 41.7 41.3 40.6 39.1 38.3 36.7 35.4 34.1 33.1

195

Newspaper % Share of Advertising Expenditure


NEWSPAPER % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f









Romania 10.4 10.6 9.7 9.4 7.7 5.8 4.2 3.1 2.3 1.9Russia 7.8 7.1 5.7 4.9 3.5 2.8 2.1 1.7 1.4 1.2


Europe 20.4 18.2 16.8 15.1 13.5 11.7 10.3 9.2 8.3 7.5


NEWSPAPER % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f

USA 16.5 14.5 13.8 12.8 11.8 10.2 9.1 7.9 6.8 5.9Canada 25.1 23.5 21.8 20.7 19.7 17.4 15.2 11.8 11.4 10.9


China 15.1 12.6 9.9 7.5 5.3 3.2 1.7 1.2 0.8 0.6Hong Kong 32.8 29.5 30.1 25.7 25.2 22.1 18.7 14.9 11.2 7.9

India 40.0 38.9 37.6 37.6 35.3 32.5 30.8 28.8 26.7 24.5Indonesia 35.5 32.9 32.5 30.9 28.6 25.6 23.3 20.9 17.2 13.6

Japan 15.0 14.7 14.2 13.4 12.5 11.6 10.7 9.7 9.1 8.4Malaysia 53.0 50.8 49.4 47.3 40.6 38.0 36.1 31.6 29.8 27.7








Pan Arab 1.6 1.2 1.3 1.3 1.1 0.6 0.5 0.4 0.4 0.3Qatar 74.1 78.0 76.8 52.0 60.3 58.2 65.6 62.4 59.4 57.7

Saudi Arabia 64.6 61.5 60.5 58.9 59.8 48.4 43.4 40.0 37.8 36.8UAE 42.5 41.6 41.4 41.3 38.0 28.4 24.5 19.7 15.7 13.7

MENA 29.5 23.6 23.4 19.8 18.0 15.0 13.6 11.3 10.0 8.8Israel 26.0 24.2 21.0 18.8 17.6 15.0 13.3 12.6 12.0 11.8


GLOBAL 18.5 16.4 15.1 13.6 12.1 10.5 9.2 8.0 7.1 6.3

197

Magazine % Share of Advertising Expenditure


MAGAZINE % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f









Romania 10.6 10.8 9.9 8.5 7.0 6.0 4.6 3.6 3.1 2.6Russia 7.5 6.8 5.5 4.7 3.7 3.3 2.8 2.3 2.0 1.8


Europe 11.7 10.4 9.5 8.6 7.8 7.1 6.3 5.6 5.1 4.6


MAGAZINE % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f

USA 12.2 12.0 11.7 11.1 10.5 10.0 9.2 8.3 7.5 6.8Canada 5.3 4.8 4.6 4.3 3.8 3.2 3.3 3.0 2.9 2.7


China 2.0 1.8 1.5 1.2 0.9 0.7 0.5 0.4 0.3 0.3Hong Kong 15.6 15.3 14.5 12.1 10.6 7.1 4.5 3.2 2.1 1.2

India 4.3 4.1 3.8 3.6 3.3 3.0 2.9 2.5 2.3 2.0Indonesia 3.1 2.7 2.6 2.4 2.0 1.6 1.1 0.7 0.5 0.3

Japan 6.4 6.0 5.8 5.5 5.4 4.7 4.2 3.8 3.4 3.1Malaysia 2.7 2.5 2.1 1.9 2.0 1.9 1.8 1.8 1.8 1.7








Pan Arab 3.5 2.9 2.6 2.4 1.9 1.7 1.7 1.5 1.3 1.3Qatar 1.6 2.0 3.2 3.1 3.9 5.7 3.5 3.3 3.4 3.4

Saudi Arabia 2.2 1.4 1.7 2.1 2.0 2.0 1.3 1.2 1.2 1.2UAE 18.6 17.8 15.7 14.0 13.2 11.9 9.0 7.2 5.8 5.0

MENA 4.6 4.9 4.7 4.0 3.7 3.6 3.1 2.5 2.2 2.0Israel 4.3 4.6 4.0 3.8 3.6 3.0 2.8 2.3 2.0 1.6


GLOBAL 9.3 8.7 8.1 7.4 6.8 6.3 5.7 5.1 4.5 4.1

199

Radio % Share of Advertising Expenditure


RADIO % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f









Romania 4.3 4.6 4.7 4.8 4.8 4.6 4.3 4.2 4.2 4.1Russia 4.5 4.9 5.0 4.9 4.4 4.5 4.1 3.8 3.5 3.3


Europe 6.2 5.9 5.8 5.7 5.5 5.5 5.3 5.2 5.1 5.0


RADIO % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f

USA 10.6 10.3 10.4 10.2 9.8 9.5 9.2 9.0 8.8 8.5Canada 6.0 5.6 5.8 5.5 5.4 5.2 5.3 5.6 5.3 5.1


China 3.0 3.0 2.8 2.7 2.6 2.4 2.3 2.1 2.0 1.9Hong Kong 3.5 3.0 2.9 2.5 2.6 3.1 3.4 3.5 3.6 3.6

India 4.8 4.8 4.9 4.7 4.3 4.4 4.2 3.9 3.7 3.5Indonesia 1.8 1.5 1.5 1.3 1.3 1.3 1.4 1.5 1.5 1.5

Japan 3.1 2.9 2.9 2.8 2.8 2.7 2.7 2.6 2.5 2.4Malaysia 6.7 6.7 6.4 6.0 8.6 8.5 8.4 8.7 8.7 8.6






Latin America 5.0 5.2 5.2 5.0 4.9 4.7 5.1 5.6 5.6 5.3Bahrain - - - - - - - - - -Egypt 4.1 2.1 2.4 2.4 4.9 5.2 4.8 5.3 5.3 4.7Kuwait 1.7 1.3 1.4 2.1 3.2 3.3 4.1 4.6 5.2 5.5

Lebanon 5.4 8.4 7.3 6.7 7.0 7.3 6.6 7.1 7.2 7.3Morocco 17.4 16.5 23.5 24.7 26.9 24.6 24.4 27.3 27.3 30.0Oman - - - - - - - - - -

Pan Arab - - - - - - - - - -Qatar 1.5 2.1 1.9 2.1 3.0 - - - - -

Saudi Arabia 10.5 13.2 14.9 18.3 18.8 25.8 23.1 21.6 21.5 22.1UAE 6.1 8.0 11.8 9.1 13.3 16.0 20.5 24.0 26.9 28.8

MENA 4.1 4.1 5.4 5.2 6.4 7.0 7.8 8.6 9.2 9.7Israel 6.0 6.3 6.5 6.7 6.9 7.0 5.7 5.7 5.5 5.4


GLOBAL 7.2 6.9 6.9 6.8 6.6 6.4 6.3 6.2 6.0 5.8

201

Cinema % Share of Advertising Expenditure


CINEMA % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f


Germany - 0.5 0.5 0.5 0.5 0.5 0.5 0.4 0.4 0.4Greece - - - - - - - - - -Ireland 0.9 1.0 1.0 0.8 0.7 0.7 0.7 0.7 0.6 0.6Italy 0.5 0.5 0.4 0.3 0.3 0.3 0.3 0.3 0.3 0.3




Bulgaria - - - - - - - - - -Czech Republic 0.5 0.5 0.5 0.5 0.5 0.4 0.4 0.4 0.4 0.3

Estonia - - - - - - - - - -Hungary 0.7 0.9 0.8 0.9 1.0 1.0 1.0 1.0 0.9 0.9Latvia 0.5 0.5 0.4 0.6 0.8 0.8 0.9 0.8 0.8 0.8


Romania 0.9 0.9 1.0 1.1 1.0 1.0 0.9 0.9 0.9 0.8Russia 1.6 1.7 1.8 1.5 1.3 0.9 0.8 0.8 0.7 0.7

Slovak Rep 0.2 0.2 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.3

Turkey 1.2 1.1 1.1 1.1 1.0 1.1 1.2 1.1 1.2 1.2C&EE 1.4 1.6 1.4 1.3 1.1 1.0 0.9 0.8 0.8 0.8

Europe 0.7 0.9 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.8


CINEMA % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f

USA 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6 0.6Canada - - - - - - - - - -


China - - - - - - - - - -Hong Kong - - - - - - - - - -

India 3.1 3.1 3.0 3.0 2.8 1.9 2.0 2.1 2.1 2.2Indonesia 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Japan - - - - - - - - - -Malaysia 0.4 0.6 0.6 0.7 2.4 2.5 2.7 2.7 2.7 2.8






Latin America 0.5 0.5 0.5 0.4 0.5 0.5 1.2 1.1 1.0 1.0Bahrain 2.8 0.5 - - - - - - - -Egypt - - - - - - - - - -Kuwait - - - - - - - - - -

Lebanon 0.2 0.3 0.2 0.4 0.4 0.3 0.3 0.7 0.7 0.7Morocco 0.7 0.7 0.9 1.4 1.9 2.3 2.0 2.0 2.0 1.9Oman - - - 1.2 1.3 1.7 3.3 3.7 4.5 5.2

Pan Arab - - - - - - - - - -Qatar - - - - - - 0.8 1.3 1.4 1.4

Saudi Arabia - - - - - - - - - -UAE 1.0 1.4 1.8 3.1 3.6 3.8 4.0 3.7 3.5 3.4

MENA 0.2 0.2 0.3 0.5 0.6 0.7 0.8 0.8 0.7 0.7Israel 1.0 1.2 1.2 1.1 1.2 1.0 1.1 1.0 1.0 1.0


GLOBAL 0.5 0.6 0.5 0.5 0.6 0.6 0.6 0.6 0.6 0.6

203

OOH % Share of Advertising Expenditure


OOH % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f









Romania 5.7 5.4 5.3 5.9 5.7 5.6 5.3 5.3 5.2 5.1Russia 13.0 12.7 12.5 12.0 10.2 9.6 9.2 8.4 7.8 7.3

Slovak Rep 10.1 9.5 9.1 10.8 10.6 10.4 10.0 9.7 9.1 8.7

Turkey 7.4 7.4 7.5 6.6 6.5 6.1 5.8 6.1 6.1 6.4C&EE 10.4 10.4 10.4 10.0 8.9 8.4 8.2 7.8 7.5 7.1

Europe 7.3 7.0 6.9 6.8 6.6 6.6 6.5 6.4 6.2 6.1


OOH % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f

USA 3.9 3.9 3.9 3.9 3.9 3.9 3.9 3.8 3.8 3.8Canada 5.2 4.7 4.9 4.8 4.8 5.1 5.8 6.0 6.2 6.3


China 11.0 11.3 10.4 10.2 9.7 9.3 8.9 9.4 9.7 9.8Hong Kong 16.2 17.4 15.5 14.5 14.1 15.5 16.1 14.4 13.0 11.1

India 7.5 7.6 7.8 7.3 7.6 5.9 5.8 5.7 5.6 5.4Indonesia 2.9 2.7 2.7 1.9 1.5 1.4 1.6 1.7 1.7 1.7

Japan 12.0 11.7 11.7 11.6 11.5 11.1 10.8 10.4 9.9 9.5Malaysia 10.1 9.0 9.2 9.6 9.2 9.0 8.8 9.3 8.9 9.0



Thailand 8.9 9.1 8.8 8.5 7.8 10.6 12.9 12.9 13.2 13.3Vietnam - - - - - - - - - -



Latin America 4.2 3.7 3.9 4.0 4.0 4.7 4.0 3.5 3.5 3.5Bahrain 1.2 1.3 2.4 3.1 3.1 3.2 3.4 2.7 2.7 2.9Egypt - - - - - - - - - -Kuwait 2.4 7.0 5.2 7.4 15.9 22.5 38.7 47.0 50.5 52.7

Lebanon 13.0 21.2 22.8 21.7 22.2 27.8 30.5 31.1 31.3 31.4Morocco 25.4 27.0 25.3 26.5 28.5 28.9 30.8 30.8 30.8 30.4Oman - - - - - - - - - -

Pan Arab - - - - - - - - - -Qatar 18.8 13.9 13.3 29.8 21.3 28.5 22.4 23.5 25.0 25.7

Saudi Arabia 17.0 19.3 18.7 16.4 15.8 21.1 28.8 26.7 27.2 26.5UAE 27.5 26.7 25.4 27.5 27.3 33.6 36.4 40.8 43.9 45.3

MENA 6.3 8.5 8.7 8.9 9.0 10.8 13.0 13.5 14.2 14.1Israel 4.9 4.9 4.9 5.3 5.4 7.0 7.4 7.5 7.7 7.6


GLOBAL 6.6 6.7 6.6 6.5 6.4 6.3 6.2 6.3 6.3 6.2

205

Digital % Share of Advertising Expenditure


DIGITAL % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f


Germany - 23.9 26.0 28.5 30.5 32.1 34.4 37.1 39.3 41.4Greece 4.2 5.8 7.5 8.1 9.3 9.9 9.8 10.0 9.8 9.6Ireland 17.1 21.5 25.4 29.9 32.2 36.0 40.9 44.6 46.9 47.9Italy 12.7 16.4 19.3 21.3 22.6 23.4 25.4 26.7 28.2 29.6







Romania 6.4 8.7 12.0 14.6 17.0 20.9 24.3 25.0 27.0 29.1Russia 15.9 18.9 22.0 24.9 34.7 37.4 40.0 42.6 45.4 47.8


Europe 17.5 23.7 27.0 30.4 33.5 36.1 39.9 42.6 45.1 47.4


DIGITAL % SHARE

2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f

USA 16.3 18.5 20.1 22.0 25.0 27.8 30.9 34.0 37.0 39.8Canada 24.0 29.8 32.5 35.3 38.1 43.6 45.1 48.6 50.2 51.8


China 14.9 19.6 25.3 32.8 42.0 49.4 55.6 59.8 62.9 65.0Hong Kong 6.2 9.5 12.5 21.6 25.3 29.3 35.0 41.2 48.0 55.4

India 3.0 4.7 6.4 6.6 10.8 12.0 14.5 17.5 20.9 24.7Indonesia - 3.0 4.3 7.0 11.6 14.7 18.2 21.0 24.3 27.8

Japan 20.2 20.4 21.6 23.3 25.5 27.9 31.3 34.9 38.2 41.2Malaysia 8.9 11.1 12.5 14.5 18.8 21.7 24.4 28.6 30.6 32.6


South Korea 22.6 24.8 27.8 29.0 30.1 32.9 36.5 38.3 40.3 42.2Taiwan - - - 21.2 24.9 31.1 35.9 39.8 43.1 46.0




Latin America 5.7 11.7 14.0 15.8 18.0 12.7 15.2 17.4 19.6 21.3MENA - - - - - - - - - -Israel 17.1 17.5 20.5 25.0 27.2 30.0 32.7 33.9 34.8 35.6


GLOBAL 15.6 19.0 21.5 24.6 28.4 31.6 35.3 38.5 41.4 43.8

207

Exchange Rates


AVERAGE YEAR TO DATE AGAINST US$Austria EUR 0.8404 Belgium EUR 0.8404 Denmark DKK 6.2623 Finland EUR 0.8404 France EUR 0.8404 Germany EUR 0.8404 Greece EUR 0.8404 Ireland EUR 0.8404 Italy EUR 0.8404 Netherlands EUR 0.8404 Norway NOK 8.0518 Portugal EUR 0.8404 Spain EUR 0.8404 Sweden SEK 8.6180 Switzerland CHF 0.9743 UK GBP 0.7429 Bulgaria BGN 1.6438 Czech Republic CZK 21.5153 Estonia EUR 0.8404 Hungary HUF 267.4627 Latvia EUR 0.8404 Lithuania EUR 0.8404 Poland PLN 3.5753 Romania RON 3.9110 Russia RUB 61.8492 Slovak Republic EUR 0.8404 Turkey TRY 4.7213 USA USD 1.0000 Canada CAD 1.2886 Australia AUD 1.3286 China CNY 6.5558 Hong Kong HKD 7.8398 India INR 67.7609 Indonesia IDR 14,155.5929 Japan JPY 109.8989 Malaysia MYR 4.0040 New Zealand NZD 1.4397 Philippines PHP 52.6343 Singapore SGD 1.3437 South Korea KRW 1,095.1189 Taiwan TWD 29.9980 Thailand THB 32.1995 Vietnam VND 22,955.2040 Argentina ARS 26.0957 Brazil BRL 3.6099 Colombia COP 2,905.0536 Mexico MXN 19.0304 Egypt USD 1.0000 Israel ILS 3.5627 Kuwait USD 1.0000 Lebanon USD 1.0000 Morocco MAD 9.3608 Saudi Arabia USD 1.0000 South Africa ZAR 13.0339 UAE USD 1.0000

208

Part of Dentsu Inc., Dentsu Aegis Network is made up of ten global network brands - Carat, Dentsu, Dentsu X, iProspect, Isobar, mcgarrybowen, Merkle, MKTG, Posterscope and Vizeum and supported by its specialist/multi-market brands. Dentsu Aegis Network is Innovating the Way Brands Are Built for its clients through its best-in-class expertise and capabilities in media, digital and creative communications services. Offering a distinctive and innovative range of products and services, Dentsu Aegis Network is headquartered in London and operates in 145 countries worldwide with more than 45,000 dedicated specialists. www.dentsuaegisnetwork.com

About Dentsu Aegis Network


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Price: £495

For any additional information on this report, please contact:

Caitlin Tuvesson, Dentsu Aegis Network,+44 (0) 203 535 9974, [email protected]

Lin Liu, Dentsu Aegis Network,+44 (0) 207 550 3451, [email protected]

20 Triton Street, Regents Place, London,NW1 3BF, United Kingdom

DAN Global Ad Spend 2019 MASTER FINAL 010219

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